Kogan penalised $350,000 over tax time promotion

Online retailer Kogan has been penalised $350,000 after temporarily jacking up the prices of Macbooks and smartphones while offering a 10 percent off coupon code at the checkout.

Image credit: ACCC

The Federal Court found in July this year that Kogan had made “false or misleading representations” about the tax-time sales promotion in breach of Australian consumer law.

The promotion ran for four days in June 2018 and offered a code that customers could use “to reduce prices by 10 percent at checkout, when Kogan had increased the prices of 621 products immediately before the promotion.”

“In most cases, the prices of these products had been increased by at least 10 percent,” the Australian Competition and Consumer Commission (ACCC), which filed the case, said in a statement.

“Kogan then decreased those prices soon after the promotion ended, many back to their pre-promotion prices.”

ACCC chair Rod Sims said Kogan marketed the offer via email and SMS to large lists of customers.

“In many cases, consumers who used the promotional code to purchase these products paid the same as, or more than, they would have paid before or after the promotion,” Sims said.

Sims said the decision and penalty sent “a strong signal to businesses like Kogan, which regularly conduct online sales promotions, that they must not entice consumers to purchase products with a  promise of discounts that are not genuine.”

The court ordered Kogan to pay the ACCC’s costs of the proceedings.