Woolworths 'misleads' customers with phone app petrol prices as Costco price war continues
Woolworths is misleading customers using its phone app to find the cheapest petrol by failing to advertise the Majura Park service station's price-matching with the nearby Costco Petrol.
That's the view of motorist Steve Horswell who regularly uses the app to check whether petrol is cheaper at the Dickson Woolworths' petrol station closer to his O'Connor home or the Majura Park service station.
The electronic advertising sign outside the service station on Monday morning showing unleaded petrol at 123.7 cents per litre for customers with a discount, the same price as the supermarket chain’s rival Costco. Photo: Clare Colley
But over the weekend he noticed the phone app was still advertising the Majura outlet's petrol at the pre-Costco prices prompting him to complain to Woolworths about the incorrect information.
"The app is meant to assist people about where to buy petrol, it they're not showing the real price they're misleading people," he said.
A screenshot of the Woolworths fuel app shows the unleaded petrol price at 137.7 cents per litre for customers with an in store discount or 141.7 for those without.
"A user of the app won't be told that the petrol at Majura Park is very significantly cheaper and hence will simply attend another petrol station.
"This behaviour by Woolworths is extremely deceptive and designed solely to boost their profits at their customer's expense."
The situation remained unchanged on Monday morning when the phone app advertised unleaded petrol at 137.7 cents per litre for customers with an in store discount or 141.7c for those without.
But the electronic advertising sign outside the service station showed unleaded petrol at 123.7c for customers who had a discount, the same price as the supermarket chain's rival Costco, and 127.7c for those without.
By comparison, the unleaded petrol prices of 142.9c per litre with a discount and 146.9c without displayed outside the Woolworths petrol station at Dickson were the same as the phone app.
It meant only motorists who drove past the Majura service station were aware Woolworths was matching newcomer Costco, with a staffer at the service station saying petrol price information was not given out over the phone, when contacted by the Canberra Times.
But a Woolworths' spokesman blamed the price discrepancy on a glitch.
"We have been aware of a technical issue where the app is displaying a higher price than that being displayed at our Majura Park service station," he said.
"We're attempting to resolve the problem as quickly as possible.
"The price available to customers is of course the lower price displayed on the pumps and on the price boards at the station."
The rivalry between Woolworths and Costco began heating up last Thursday when the supermarket chain matched prices as low as 129.7 cents per litre on Costco's opening day.
But the joy for motorists was short-lived with the supermarket chain coming under fire for ceasing the price-matching when Costco turned off its pumps each night.
The Woolworths spokesman said the app prices were provided by a third party, Informed Sources.
The company has been under investigation from the ACCC since May 2012 and along with several service station chains was subject to legal action for alleged price collusion in August.
A spokesman for the ACCC said the watchdog had not received any complaints about Majura petrol prices since Costco had opened, but it was important price reductions in response to new market players were to compete with and not damage the opposition.
"It is also important that competing businesses are clear about their pricing in marketing to consumers and don't risk misleading consumers in the way they change their prices," he said.
"At one level, it is good to see the effect competition can have in reducing prices."
The ACCC spokesman said motorists who believed price representations were misleading could complain to the ACCC, but at this stage the watchdog had not received any information that raised concerns.
Mr Horswell called for his fellow ACT motorists to boycott Woolworths to put pressure on them to match Sydney prices with an allowance for freight.
"I've been writing to Woolworths about their pricing policy, Canberra motorists have been ripped off for years," he said.
"It's difficult; you have little choice. Coles would do the same thing if they were next to Costco we're caught between a rock and a hard place."