Bed retailing franchisor Snooze has admitted advertising in a campaign last year could have misled customers.

The breach was uncovered in an Australian Competition and Consumer Commission audit of ‘two-price’ advertising in bedding retail stores.

Snooze had used a ‘was’ and ‘now’ campaign but advertised the ‘was’ price as an internally-set recommended retail price which was higher than the cost of goods actually sold.

This was in breach of the Trade Practices Act 1974.

ACCC chairman Graeme Samuel said “Two-price advertising can make a sale price seem more attractive to consumers, but where the ‘was’ price is false or inflated, customers can be misled. Such advertising places businesses at serious risk of breaking the law.

“An advertised higher price must be genuine and have applied prior to the sale for a reasonable period of time.”

Snooze has offered court-enforceable undertakings including publishing corrective notices and establishing a trade practices compliance program.

The franchisor will also write an apology letter to customers known to have purchased a product promoted by ‘Was/Now’ pricing during the campaign and offer a $50 gift voucher.

* New ACCC guidelines on price comparison or ‘two-price’ advertising are now available on the ACCC’s website. Business groups seeking multiple printed copies should contact the ACCC Infocentre on 1300 302 502.