Coles will correct claims it made about milk prices in an online video last year following an investigation by the Australian Australian Competition and Consumer Commission (ACCC).
The online video ‘Our Coles Brand Milk Story’ ran from February to May last year on a variety of social media platforms including YouTube, Coles’ website and Facebook page, and was promoted in links from Twitter and other social media.
Coles published the video and cartoon during a time of intense public debate about the impact of $1 milk on Australian dairy farmers who supplied the product.
The ACCC’s investigation followed complaints from dairy farmer organisations about representations in the cartoon and video about the impact of Coles’ January 2011 retail milk price reduction on the average price paid to dairy farmers for supplying milk to processors.
“Coles represented in a video and cartoon on social media that the farmgate milk price increased from 86 cents per two litre bottle of Coles brand milk in 2010-11 to around 90 cents in 2011-12, when in fact this was an estimate and final industry figures showed the 2011-12 farmgate milk price actually decreased to 84 cents,” Rod Sims, ACCC chairman said.
Coles has admitted that its making of these representations would be likely to have contravened section 18 of the Australian Consumer Law, which prohibits misleading or deceptive conduct. Coles has worked with the ACCC to resolve these concerns, and will publish corrective advertisements on the same online platforms that the original representations were published.
“The ACCC is concerned to ensure that companies are applying the same degree of Australian Consumer Law compliance to representations made in social media versus other forms of advertising. For this reason, the ACCC considered it was important that Coles used social media to correct any misleading impressions formed by viewers,” Sims said.
“The ACCC was concerned that Coles presented estimates and opinions as facts and that a number of representations made in the video and cartoon could not be substantiated by Coles,” Sims said.
In its undertaking to the ACCC, Coles also vows to for a period of three years not make misleading or deceptive representations in relation to the impact of reductions in the retail price for Coles brand milk on the farmgate milk price, Coles’ or processor margins on Coles brand milk, and/or Australian milk production generally.
It will also review its Consumer Law compliance as it relates to section 18 of the Australian Consumer Law to advertising and promotional strategies relating to Coles brand milk, including social media, and to identify specific compliance processes and training for employees to ensure the conduct of concern to the ACCC does not occur again.
