ACCC takes The Good Guys to court over allegedly misleading store credit promotions

ACCC takes The Good Guys to court over allegedly misleading store credit promotions

Photo: Sunshine Plaza.

Home appliances and electronics retailer The Good Guys will face court over allegations of false or misleading representations about its store credit promotions between July 2019 and August 2023, regarding both the conditions of the credit and timelines for expiry.

The Australian Competition and Consumer Commission (ACCC) has instituted proceedings in the Federal Court against the company, a JB Hi-Fi (ASX: JBH) subsidiary that raked in total sales of $1.39 billion in the December half, also alleging it failed to provide store credit to eligible consumers in breach of the Australian Consumer Law.

The Good Guys ran 116 promotions between July 2019 and August 2023 in which it offered consumers a store credit or StoreCash if they spent a certain amount of money on qualifying products in its online or physical stores.

The consumer watchdog alleges The Good Guys represented that the only requirement to receive the store credit was to make a qualifying purchase, when that was not the case because consumers were also required to opt in to receive marketing communications in order to receive a store credit.

"We allege that the conditions for consumers to receive a store credit as part of The Good Guys’ promotions were not communicated adequately in The Good Guys’ marketing materials," ACCC Chair Gina Cass-Gottlieb said.

The ACCC also alleges that The Good Guys represented that store credit or StoreCash would not expire or would expire after a reasonable period, when in fact for the majority of promotions it expired within seven to 10 days.

Business News Australia can confirm that more recent customers who signed on for extras have also been given tight windows to cash in on store credit, with one text message revealing an expiry date of within just 11 days and a minimum spend of $100 for a $30 voucher, which was not communicated to the customer by the sales clerk who had indicated a three-month period for each granting of store credit. 

The ACCC chair says for the majority of promotions in the time period covered by this case, the store credit being offered expired within a very short period of time of ten days or less, "which many consumers were unaware of".

“We are concerned that as a result of the alleged conduct, consumers may have purchased products from The Good Guys which they might not have done otherwise," Cass-Gottlieb said.

“Businesses should be on notice that promotional conditions must be prominently disclosed to consumers, rather than buried in hard-to-find locations, or they risk enforcement action under the Australian Consumer Law."

The ACCC has also alleged that The Good Guys failed to provide store credits to thousands of eligible consumers within the time specified in the offers, or within a reasonable time, in breach of the Australian Consumer Law.

“Even where consumers met the conditions, we allege that The Good Guys did not provide a store credit at all to many eligible consumers,” Cass-Gottlieb said.

The ACCC is seeking consumer redress, penalties, declarations, compliance orders, publication orders, and costs.

In a statement released by parent company JB Hi-Fi Group, it said The Good Guys took its compliance with the law very seriously with a "comprehensive compliance program in place".

"The Good Guys has always sought to provide value and benefits to its customers and has worked cooperatively with the ACCC throughout its investigation," the group stated. 

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