Coles Broke Own Pricing Rules in Down Down Case, Court Hears

Coles admitted in Federal Court it broke its own pricing guardrails on at least two products as part of the Down Down promotional campaign now at the centre of a landmark consumer protection case.

"We allege that each of Woolworths and Coles breached the Australian Consumer Law by making misleading claims about discounts, when the discounts were, in fact, illusory," ACCC Chair Gina Cass-Gottlieb said when launching the case in September 2024.

The admission came during closing submissions in the Australian Competition and Consumer Commission's case against both Coles and Woolworths, alleging the supermarkets misled consumers with illusory discounts on 511 products over 15-20 months.

Coles downplayed the breach during the trial, telling the court it was due to mistakes and errors. The products in question were Arnott's Shapes biscuits and Nature's Gift dog food.

The Race to the Bottom

Court documents reveal what a judge described as a race to the bottom between Coles and Woolworths over what could be the shortest period possible to establish a higher price before a discount could be applied.

"Many consumers rely on discounts to help their grocery budgets stretch further, during this time of cost of living pressures," Cass-Gottlieb told reporters when the case launched. "It is critical that Australian consumers are able to rely on the accuracy of pricing and discount claims."

The ACCC alleges both supermarkets offered certain products at a regular price for at least 180 days. They then increased the price of the product by at least 15 per cent for a relatively short period of time, and subsequently placed it onto their Prices Dropped or Down Down program.

"We also allege that in many cases both Woolworths and Coles had already planned to later place the products on a 'Prices Dropped' or 'Down Down' promotion before the price spike, and implemented the temporary price spike for the purpose of establishing a higher 'was' price," Cass-Gottlieb said.

The Oreo Example

In the case of Oreo Family Pack Original 370g at Woolworths, the product was sold at $3.50 on a pre-existing Prices Dropped promotion for at least 696 days from January 2021 until November 2022.

On 28 November 2022, the price was increased to $5.00 for a period of 22 days. On 20 December 2022, the product was placed on a Prices Dropped promotion showing a was price of $5.00 and a new Prices Dropped price of $4.50.

The Prices Dropped price of $4.50 was 29 per cent higher than the product's previous regular price of $3.50.

The ACCC alleges Woolworths had planned the temporary price spike to establish a new higher was price for the subsequent promotion. Woolworths had decided on or around 18 November 2022 to take the product off Prices Dropped, increase the price, and then put the product back on to Prices Dropped three weeks later.

"The ACCC alleges the display of the Prices Dropped and Down Down tickets was misleading, as the price of the products was in fact higher than or the same as the regular price at which the supermarket had previously offered the products for sale."

Strepsils and the Seven-Day Window

Coles' tactics followed a similar pattern. Strepsils Throat Lozenges Honey and Lemon 16 pack was sold at $5.50 on a pre-existing Down Down promotion for at least 649 days from January 2021 until October 2022, including one seven-day short-term special.

On 12 October 2022, the price was increased to $7.50 for 34 days. On 16 November 2022, the product was placed on a Down Down promotion at $6.00, with tickets showing a was price of $7.50.

The Down Down price of $6.00 was 9 per cent higher than the product's previous regular price of $5.50.

For a family buying these products weekly, the impact adds up. If you were buying Oreos and Strepsils regularly and thought you were getting a discount, you were actually paying more than you had been months earlier, sometimes 29 per cent more.

Scale of the Alleged Conduct

The ACCC alleges Woolworths made false or misleading representations to consumers about the prices of 266 products during the period between September 2021 and May 2023.

Products affected include Arnott's Tim Tams biscuits, Dolmio sauces, Doritos salsa, Energizer batteries, Friskies cat food, Kellogg's cereal, President butter, Listerine mouthwash, Moccona coffee capsules, Mother energy drinks, Nicorette patches, Ocean Blue smoked salmon, Oreo cookies, Palmolive dishwashing liquid, Raid insect spray, Sprite soft drink, Stayfree pads, Twisties, Uncle Tobys muesli bars, and Vicks VapoDrops.

For Coles, the ACCC alleges the supermarket made false or misleading representations to consumers about the prices of 245 products during the period between February 2022 and May 2023.

Those products include Arnott's Shapes biscuits, Band-Aids, Bega cheese, Cadbury chocolates, Coca Cola soft drink, Colgate toothpaste, Danone yoghurt, Dettol multi-purpose wipes, Fab laundry liquid, Karicare formula, Kellogg's snack bars, Kleenex tissues, Libra tampons, Lurpak butter, Maggi two-minute noodles, Nature's Gift dog food, Nescafe instant coffee, Palmolive shampoo, Rexona deodorant, Sakata rice crackers, Sanitarium Weet-Bix cereal, Strepsils lozenges, Sunrice rice, Tena pads, Viva paper towels, Whiskas cat food, and Zafarelli pasta.

What Happens Next

The ACCC estimates that Woolworths and Coles sold tens of millions of the affected products and made substantial revenue from those sales.

Together, Coles and Woolworths control almost two-thirds of the Australian supermarket sector. When you have that much market power, pricing practices affect almost everyone who buys groceries in Australia.

The ACCC is seeking declarations, penalties, costs and other orders. It is also seeking community service orders that Woolworths and Coles must each fund a registered charity to deliver meals to Australians in need, in addition to their pre-existing charitable meal delivery programs.

"We allege these misleading claims about illusory discounts diminished the ability of consumers to make informed choices about what products to buy, and where," Cass-Gottlieb said.

The Federal Court established an online file for public access to court documents in view of the public interest in the matter. Documents from the proceeding are being added to the online file in accordance with a protocol laid down by the Court, with the most recent update as of 18 March 2026.