Coles “Down Down” Ruling Sparks Fresh Scrutiny of Australian Supermarket Pricing

Australia’s Federal Court has ruled that Coles Group’s supermarket division misled shoppers through deceptive “Down Down” discount promotions, adding pressure on major grocery chains over pricing transparency and consumer protection practices.

The court found that Coles Supermarkets Australia made false or misleading representations on 13 out of 14 promotional tickets reviewed in a case brought by the Australian Competition and Consumer Commission (ACCC). Following the decision, Coles Group (ASX: COL) shares fell more than 3%, dropping to AUD 20.49 during Thursday trading and marking the company’s lowest share price in two months.

According to the ACCC, Coles temporarily increased prices on 245 products by at least 15% before placing them into its well-known “Down Down” campaign. Regulators argued that many of the advertised discounts were not genuine because the promoted prices were equal to or higher than the products’ earlier regular prices.

ACCC Chair Gina Cass-Gottlieb said the ruling confirmed that Coles breached Australian Consumer Law. She noted that misleading discount promotions can make it difficult for consumers to identify real savings while purchasing everyday essentials.

Products named in the proceedings included popular household brands such as Coca-Cola soft drinks, Cadbury chocolates, Colgate toothpaste, and Weet-Bix cereal. The ACCC originally launched legal action in September 2024, focusing on promotional campaigns run between February 2022 and May 2023.

Coles, which operates more than 840 supermarkets across Australia, introduced the “Down Down” strategy in 2010 as a major price-cutting campaign designed to attract budget-conscious shoppers.

The Federal Court will determine financial penalties and additional orders at a later date. Meanwhile, separate ACCC proceedings against rival supermarket giant Woolworths (ASX: WOW) over similar discount pricing practices are still ongoing.