Video Ezy is offering partial refunds to consumers as part of court enforceable undertakings accepted by the Australian Competition and Consumer Commission.
In the lead up to Christmas 2007, Video Ezy's television advertising claimed "The cheapest price in Australia - Guaranteed" in relation to the sale of 5 popular DVD titles.
Some of the advertising included for a brief period in the fine print "or we'll beat any lower advertised price by $1". Each of these DVD titles could be purchased elsewhere cheaper.
Video Ezy has acknowledged consumers may have been misled by their price guarantee advertising which was broadcast nationwide across free to air and pay television. In addition, over 100,000 text messages, containing the misrepresentation were sent to consumers in respect of two of the DVD titles. Video Ezy has apologised to its consumers and has offered partial refunds.
The ACCC has accepted a court-enforceable undertaking from Video Ezy under which it will:
- not represent that the advertised price of a DVD is the "cheapest price in Australia, guaranteed" without including the prominent qualification "or we'll beat any lower advertised price by $1"
- ensure that all future national advertising is approved by a compliance officer
- review and implement necessary changes to its Trade Practice compliance program
- provide corrective notices through direct mail, catalogues, instore advertising, the Video Ezy website and also send a corrective text message to those who received the original text messages, and
- offer to refund the difference between Video Ezy's advertised price and the lowest advertised price identified in Australia to consumers who purchased the following DVD's during the promotional period:
- Knocked Up
- Harry Potter and the Order of the Phoenix
- Shrek the Third
- The Simpsons Movie, and
- Die Hard 4.0.
"Consumers have the right to rely on representations made by businesses," ACCC Chairman, Mr Graeme Samuel, said. "If a trader choses to use a categorical statement in their advertising, it must be able to substantiate it."