The Federal Court has ordered home goods chain The Good Guys to pay $13.5 million in penalties for misleading advertising.
The court action by competition watchdog the ACCC relates to StoreCash promotions, and for failing to provide store credit to more than 20,000 eligible consumers.
The proceedings related to 116 promotions run by The Good Guys between July 2019 and August 2023 in which it offered customers store credit (also called StoreCash in some promotions) if they spent a minimum amount, purchased a specific brand or product, or used a particular payment method. The amount of credit varied between $10 and $1,000, depending on the promotion.
The Good Guys admitted that its advertisements for the store credit promotions did not disclose, or adequately disclose, the expiry period of the store credit which, for the majority of promotions, was as short as 7 or 10 days, or, in most cases, that customers would only receive a store credit if they remained opted in to The Good Guys’ marketing communications.
“We took this court action because we were concerned that The Good Guys had failed to adequately disclose some really key conditions attached to these store credit promotions,” ACCC chair Gina Cass-Gottlieb said.
“The chance to earn store credit may have encouraged some consumers to make a purchase at The Good Guys they otherwise may not have made or to choose this retailer over others. We were concerned some of those consumers may not have done so had they been aware of all the conditions.”
“When advertising promotional offers, all businesses must clearly disclose any key terms and conditions or limitations to avoid misleading consumers. Businesses that fail to do so could potentially face court proceedings and large penalties.”
The Good Guys also admitted that it failed to provide about 21,500 consumers with store credit within the time frame it had specified.
“Businesses that use promotional programs to attract consumers and differentiate themselves from their competitors must ensure they provide any gifts or rebates to eligible consumers in the time period they said they would,” Cass-Gottlieb said.
As well as the $13.5 million in penalties, the court ordered The Good Guys to provide redress to certain consumers.
The Good Guys has already remediated consumers who did not receive their store credit due to not meeting the condition requiring them to remain opted in to marketing material, and the 21,500 consumers who did not receive their credit within the specified time.
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