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Tax time promotion involving 10% off products found to be misleading as a number of products had their price increased before the promotion period and then reduced after it.
Kogan Promotion Found to Be Misleading by Federal Court
contrafibularities on 17/07/2020 - 11:31
Last edited 17/07/2020 - 12:55 by 1 other user
Last edited 17/07/2020 - 12:55 by 1 other user
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eBay itself never will because it's not them doing the price jacking. They're just the marketplace and the ACCC need to go after individual sellers.
I <3 Kogan
eBay sellers should be extremely, extremely nervous.
Kogan eBay got into trouble that one time many many years ago and nothing ever happened to anyone else. Infact I've received dozens and dozens of downvotes for pointing out the fact that nothing will happen…. and I'm still waiting for that action to happen.
Infact I've received dozens and dozens of downvotes
I hope my upvote helps
<3
Same happens in price error deals. This one time there was a HP deal and everyone downvoted/abused me when I said the ACCC do not investigate individual complaints and a pricing error is a valid reason not to fulfill orders. A few weeks later they're all sooking that they wasted their time because the ACCC said "they do not investigate individual complaints".
https://media2.giphy.com/media/wtil0pQFBbNwA/giphy.gif?cid=e…
@ssquid: You were one of them who said I was wrong. How did that report to the ACCC go? Oh that's right nothing happened! I guess it was just a price error afterall.
@ssquid: Hmmmm I don't know. Maybe the ACCC use the internet? It's been well established there are employees here.
One would think out of the 10 million people contacted about the promotion there would be the ACCC? Or maybe part of their job is to actively monitor sales from big companies who have previously been caught out.
Or maybe you're just up to your usual self of arguing with everyone and nothing more?
eBay sellers should be extremely, extremely nervous.
Futu_online: Haha price increases go brrrr
The way eBay runs their promotions is actually the root of the problem. They usually advertise a flat discount (10 to 20 percent) off a range of retailers, but it's very rare that a store can afford to actually take 20 percent off their entire range of goods and still turn a decent profit. Prime example is Futu (shopping express) who sells computer parts — the margins on components are already razor thin
Linus Sebastian from LTT for example replied to a user on their forums
On 6/30/2017 at 6:39 AM, warzkaz said:
I think stores like amazon, bh video, micro center are making 25% of each product
My guesstimate is Based on micro center discountsLinus replies:
You're way off.
On core components (CPU, motherboard, HDD, SSD, GPU) it's under 10% and often as low as 6% GROSS profit.
Other categories like cases, PSUs are a bit higher - 10-15%
And things like cables are higher still.Though I can't say the same for Allphones who jacked the prices of the Samsung Note9 above the standard aussie RRP and then sold it as 20% off which attracted media attention. But that's just one of hundreds of examples. The sellers have to do it because it's simply the way eBay coupons work.
Futu is always the worst.
Those GROSS profit do not factor in manufacturer volume rebates.
Sane merchants in merchant-funded eBay promotions (like Dan Murphy's) simply take any products off their eBay store which are too close to the margin. Jacking the prices is a dog move.
For many eBay promotions though, eBay covers the cost of the promotion out of their own promotional budget.
I thought Kogan had provided enforceable undertakings to ACCC previously on a similar matter…
https://www.accc.gov.au/public-registers/undertakings-regist…I'd send the ACCC a Wet Towel they can whip them themselves with… not from Kogan obviously…
This time though ACCC has taken them to Court, more powerful than an undertaking. Penalty is yet to be determined by the Court but the theoretical maximum is $10million per contravention.
Kogan share price up 500% in the last 90 days
https://www.tradingview.com/symbols/ASX-KGN/Being a Jack makes Jack so rich he never needs to visit OzBargain
Ruslan Kogan already offloaded a lot of the risk of a fine to the shareholders.
Shareholders obviously it is better to be owner of price jacker than being client of price jacker.
Kogan has a cunning business plan and it goes way beyond price jacking.
Without a significant financial penalty, I don't think Jack really cares.
e.g. "It's not the first time the online retailer has fallen foul of the ACCC for hiking prices prior to discounts, with Kogan copping a $32,400 fine in 2016 for raising prices prior to a 20 per cent off Father's Day sale."
https://www.smh.com.au/business/companies/kogan-misled-custo…
Jack doesn't care about $32,400.
lol fines needs to be a lot higher. Maybe even a percentage of their revenue.
That will make them stop doing dodgy things.
Someone said 10 million max, it needs to be 40 for kogan.
$10mil per contravention- there may be hundreds of separate contraventions based on a reading of the judgement. So each ad or each product affected may equal one contravention.
Edit* just checked this conduct occurred just before the penalty increase to $10mil - so it is &1.1mill dollar penalty per contravention.
$32k sounds like a fee for doing business. That's not a fine. It's a minor irritation.
They probably spent more than $32k on lawyers defending the case.
Per day
Where's the upvote button for this forum discussion? Will vote twice if i can.
I think if there are enough comments it appears on the front page. So you could comment twice, three times, etc.
Ok. This is the 3rd one.
Fine should be a deterrent to others hopefully … or not
regardless - just gonna take the high road and not buy from Kogan again … fool me once, shame on you; fool me twice, shame on me
They should do something about the eBay Plus promo too, seemed very misleading and scammy with the $99 AirPod sale but no way of actually getting it.
Pretty sure people got it? I think the issue is they have such a small number available and tens of thousands of people trying at the same time.
Yeah probably that, but I feel like they should at least disclose how many units were available. I’ve tried at least three separate attempts without any success. And if I recalled correctly,I saw a lot of people also commenting on how the items went “out of stock” as soon as the promo begins.
I'll admit I didn't pay attention much to the latest one but I believe the first few showed how many were available? If they didn't this time then that's dodgy all the way.
I personally think Kogan is a scummy business in that they break the law knowing that penalties are less than the profit.
Ahhh, we’ll get a $30,000 fine, but make $500,000 the same week, still $470,000 up.
I've had only poor experiences with their Kogan branded stuff, if people read the reviews before buying they'd be stupid to then go and buy that rubbish … plus they don't like honouring warranty, if you have to claim on that expect a fight.
I would rather shop directly with Aliexpress
On Kogan you get the minimum quality and the terrible service to back it up
They set themselves up in HK to avoid charging GST (when that was still possible)
I wonder how much the ACCC can really do to a foreign retailer
good news. what about another round of litigation for kogan covid price jacking and misleading advertising?
We are the informal ACCC, picked up the pricejacking as soon as it was posted!!
First time OzBargain ever mentioned in a court judgment?
79 There was also evidence given by Mr Shafer that coupon code promotions were “commonly used” by other major retailers in or around June 2018, including eBay, Amazon and Alibaba and that Australian consumers could find out from websites such as OzBargain, Cuponation Australia and Finder – Coupon Code finder what discount code promotions or other deals were on offer from the various online retailers, and in this way were able to compare the offers
https://www.judgments.fedcourt.gov.au/judgments/Judgments/fc…
Merged from Federal court finds Kogan misled customers with 10% price hike
Is this the beginning of the end of price hiking for big retailers? eBay next?
https://www.theguardian.com/australia-news/2020/jul/17/kogan…
Unfortunately not surprising. This has been rife with many retailers in recent years.
One can only hope that these blatant gouging practices are now in the crosshairs of the ACCC, rather than the technical matters that usually have very little effect on the consumer that seem to be their stock and trade.
Can you name any non-eBay marketplace big retailers that jack their prices? Ozbargain likes to think it is more prevalent than it really is or often mistake a promotion ending and product returning to RRP as price jacking which is not what happened here.
If anyone is interested in more detail, found this, includes examples of products, what prices they were, how much they increased etc.
https://www.accc.gov.au/system/files/ACCC%20v%20Kogan%20Aust…
Why this guy and not all the sellers on eBay? Every single % off sale has price jacked items. eBay do nothing about it and the ACCC do nothing about it.
Ebay is a marketplace. They’re not responsible for how the sellers set their prices.
eBay allowing it to happen makes them complicit. ACCC should be going after these sellers and eBay should be banning or limiting the accounts of offending sellers.
(Not my neg, btw…)
(Not my neg, btw…)
It's ok.
eBay and the sellers are different entities. The ACCC have to make their case that they're (eBay & co) colluding in violation of the CCA.
It is much easier to go after a big fish like Kogan and win than tens or hundreds of smaller ones.
2 Kogan branded items I've purchased have died shortly after warranty ended, a TV & GPS attempted to claim on a GPS some 10 yrs ago, it started to show signs of failure days before warranty end, literally 1 day after it boots up with some error message, they ask me to mail it to them them, once they have it they tell me they can't warrant it, if I wasn't dealing with the death of a parent I'd have pushed this along, then get a survey from them, after filling that out they say they'll get back to me , they never did … Don't buy Kogan branded rubbish, every review on their Agora Laptops is negative, I'm surprised they sell any.
how many times can they do this with basically no repercussions. Obviously they are making more in sales than the fines they get because they keep doing it, they need harsher penalties for constantly ignoring the law
The penalty judgment for this case hasn't been handed down yet. I'd be surprised if it wasn't in the millions
I would be pretty pissed if it isn't in the millions, anything less is an incentive to continue doing it as thus far the fines they have received are miniscule compared to the profits they extort through this.
wow this happened in 2018… accc is really slow at dealing with things…
yes, the process might take longer than police fining for speeding, but it shouldnt take years to finally discover that they've been pricejacking.
high labour costs and low efficiency is truly the definition of australiansEvery fine that they get is added to the cost of the items. The consumers always pays.
Yeah, they got done for price-jacking.
Hope eBay gets hit by the ACCC next, before the government closes the ACCC down.