Woolworths raised prices on key items during advertised price freeze

Woolworths raised prices for popular items – including a 33% mark up on chicken fillets – within days of promising to freeze prices on 300 “family staples” for three months to help customers with the cost of living.

Pricing data, compiled by comparison website CW Scanner and provided to Guardian Australia, shows the supermarket chain increasing the prices of at least four key products after starting the three-month “Price Freeze” promotion on 1 May.

The supermarket nearly doubled the price of a 420g can of Woolworths “Mexican Style 3 Bean Mix” during the promotional period – from 60c to $1 on 17 June – the data shows. Woolworths dropped the price back to 60c on 17 August.

Woolworths has justified the increases because it regarded the previous prices as promotional prices, rather than the “standard shelf price” for each product.

A Woolworths spokesperson said that the end of a temporary promotion did not represent a shelf price increase.

“The Price Freeze gave our customers the certainty that they would not pay more than the shelf price on 300 popular products for three months – and we delivered on that,” the spokesperson said.

When the price freeze was announced, the Woolworths chief executive officer, Amanda Bardwell, said the supermarket wanted to help customers who were concerned about how inflation driven by the war on Iran was affecting household budgets.

“That’s why, for the next three months, we’re freezing the shelf price on 300 staples that families rely on most, like eggs, chicken breast fillets, pasta, beef sausages and nappies,” Bardwell said in a press release on 30 April.

“It’s our promise that the shelf price you see on these items today is the most you’ll pay for the next three months. We’ll invest to absorb any extra costs that are agreed with suppliers on these products to make that happen.”

Prof Jana Bowden, a marketing expert and chair of ethics at Macquarie University’s business school, said raising prices after claiming they had been fixed was “akin to not delivering on the everyday consumer’s interpretation of a ‘price freeze’ promise”.

“How is the consumer expected to know what the start prices were before the campaign or even after the campaign started?” Bowden said.

“No consumer walks into a supermarket with the insights of how the prices for the hundreds of products that they buy vary over a day, week, month or year – nor should they have to.”

The analysis comes at a time of high scrutiny of the pricing tactics used by Woolworths – and rival Coles – after landmark court cases involving both companies.

Woolworths is awaiting the verdict in the federal court case brought against it by the Australian Competition and Consumer Commission (ACCC), with the watchdog alleging the supermarket misled shoppers with effectively fake discounts on its “Prices Dropped” campaign.

Prices unfrozen

During its price freeze period, Woolworths increased the retail price of 350g packs of RSPCA-approved chicken breast fillets by 33%.

While a customer would have paid $9 for the chicken breast fillets on 29 April, the price increased to $12 on 5 May. It then alternated between $9 and $12 twice more during the “Price Freeze”.

But, after the promotional period ended, the price dropped to $4.20 on 17 August.

Before the promotion, Woolworths’ 2kg bags of washed potatoes had consistently followed a routine high-low pricing pattern alternating between $6 and $8. This appears to have occurred during the promotional period, with CW Scanner data showing they cost customers $6 on 29 April, before the price went up to $8 on 6 May.

The price of a 12-pack of the supermarket’s own-brand fresh cinnamon donuts was increased from $3 to $3.50 on 6 May. It was reduced to $3 again on 18 August.

Choice’s senior campaigns and policy adviser, Bea Sherwood, said the advocacy group regularly heard from consumers who said they were confused by the pricing tickets they saw on supermarket shelves.

“Prices have changed so much over recent years and we’re seeing them continuously increase, so having an understanding of what a regular shelf price is is not something we can expect consumers to stay on top of,” Sherwood said.

“When Woolworths or Coles say something is a standard price, we don’t have the transparency to understand how they’ve come to that.”