Australia's competition regulator has taken controversial Melbourne-based technology vendor Kogan to task for what it said was misleading advertising which could contravene the Trade Practices Act.
(Credit: Kogan Technologies)
The Australian Competition and Consumer Commission (ACCC) said in a statement today that Kogan's advertisements had used price comparison that could be misleading, such as "Now $X (Save Y%)" and "Save over $X". The savings, the ACCC said, were based on an estimated average price a consumer might pay for a product with similar specifications from another manufacturer — products Kogan wasn't itself retailing.
But the products might not be directly comparable with Kogan's own, the ACCC said, due to value-added features such as warranties and proprietary technology.
Consequently, Kogan has undertaken not to advertise its products at a discount unless that product has previously been advertised or sold in reasonable quantities at the higher price for a reasonable amount of time; not advertise savings unless it states how they are calculated; and implement a trade practices law compliance program.
Kogan, founded and operated by one-time Accenture consultant Ruslan Kogan, has achieved notoriety in the Australian market over the last several years by offering its own branded versions of netbooks, televisions and other technology goods, and going up against bigger multinational companies by doing so.
It had also promised to bring a mobile phone to Australia based on Google's Android operating system; a claim that never eventuated, although several preview models of the so-called Agora were displayed.