My Musings

November 15, 2011
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#occupycoles

Coles has placed itself in the middle of a social media shit-storm today following a pricing error which offered cases of popular beers James Squires Golden Ale and Coopers Pale Ale at the unbelievably (unbelievably) low price of $15.99 – a discount of almost $35.00!

The error was picked up at around 8pm Monday evening and within the hour was posted to deals website OzBargain. Twitter and Facebook took care of the rest and shortly thereafter Coles Online ground to a halt under the strain of thousands of bargain hunters attempting to order the beer-deal of a lifetime. Comments on OzBargain indicate stock of each beer sold out by midnight that night.

Predictably, the error was soon discovered and presumably the first members of Coles eCommerce team arrived then next morning found their inbox filled with panicked emails from the social media team, before realising exactly what had taken place.

To Coles credit, they were able to investigate the issue, fix the pricing error, decide on a resolution, and deliver communications to customer just before 10am this morning.

Sadly for tech-savy beer aficionados Coles did not opt to fulfill the orders, instead communicating their apology for the accidental pricing error, and providing all affected customers a $15.00 Coles Online credit as a token of apology. For the Twitterati, this just would not stand.

As much as I enjoyed trolling the outraged would-be Coles customers on Twitter today, 140 characters didn’t really cut it for a few of the responses I hoped to provide in response to arguments of why we should all receive half-off-wholesale beer, so now I’d like to take a few minutes to defend the indefensible and argue on behalf of Coles as to why you – yes you – really don’t deserve your cut-price beers.

1) Stop it’s a trap!

The contention here is Coles Online used an unbelievable offer to bulk up there customer database with new members. This falls apart for a number of reasons:

  • Sure you’ve got 4000 new customers, but guess what? They all hate you and will never shop with you again. Whoops.
  • Surely there must be better ways to attract members. I know.. why doesn’t Coles offer all new customers a $15.00 voucher to use towards their first purchase! Seems a lot less drama than the above exercise.
  • Last but not least, no one in the business is going to sign-off on something guaranteed to provoke this much damage to the brand. Even if it worked beyond their wildest dreams you would never get it past the marketing department. Just.would.not.happen..

2) LAWYERED!

Hello Armchair Lawyer! I will concede that some terms or warranties can not be contracted away. Yes. Problem is, issue here is you never had a contract with Coles Online. A valid contact requires offer, acceptance, and consideration. Just because you sent through an order does not mean Coles accepted your consideration (your payment). The publishing of a price online is simply an invitation to treat:

Invitation to treat (ACCC definition)

You have not entered a legally binding contact until they have accepted your offer (payment of $15.99 a case). Lawyered indeed.

3) Dodgy

Finally, a few Tweeters have made the point that Coles must have been aware of the issue early on, so why didn’t they communicate the error in price immediately instead of waiting till the next morning. The basis for this argument is usually around the Coles social media team continuing to Tweet even while the website was collapsing under the pressure of orders.

I guess this is one of the perils of working in a 24/7 online world. Organisation the size of Coles work in silos. Yes, Coles social media team was obviously aware of the issue and would have worded-up the higher-ups before communication was sent the next morning, but crisis resolution to issues like this takes time. By midnight – four hours after the issue was discovered – customers were no longer able to purchase beer. Shortly after that, prices had updated to reflect the correct value. At that point (from Coles internal perspective) the damage was already done . Rushing out an email at 3am would not provide any benefit (and potentially deliver a great degree of risk). I imagine everyone at Coles was in very early this morning, working through an appropriate solution and signing-off comms before customers were communicated to today.

Rather than berating Coles for failing here, I have to commend them for such a speedy resolution. I’ve seen much worse from similarly scaled organisations.

Get serious people

Like you, I found out about the beer deal last night  and attempted to purchase a couple of cases for myself, fully aware that this was a pricing screw up, but thinking “what the hell, even if it’s only a 1% chance, nothing ventured nothing gained”. Guess what: the 99% won out this time. This level of entitlement and moral outrage at Coles not honouring what you all knew was a screw up is beyond me.

From my perspective this wasn’t a nefarious bait-and-switch aimed at stress-testing their servers (lol, serious?), or a marketing ploy to swell their customer-base. Some idiot pressed the wrong button. It was resolved quickly, communicated well, and you even got $15.00 out of it.. Now. just think of what you could do with that!


17 Comments

  1. Reply

    Rick

    November 15, 2011

    Agreed, it's just fun to get riled up about something. But seriously, you must agree that your hopes were up and you were fantasizing about all that delicious beer. I know I was. And so was the guy who posted the dick move on our site http://dkmvs.com/posts/372

  2. Reply

    Jimmy

    November 15, 2011

    I am thinking what I can do with that $15 as you just mention, it may cover the delivery costs, after I spend an extra $35 to make the $50 online minimum. The facts are I got a receipt, the payment went through and then the next morning they decided not to honor it.

  3. Reply

    peter

    November 15, 2011

    Mate, decent article but no. What about honor, loyalty, faith. Coles first drop their milk prices to cut out the corner shop but dont drop price on anything else. Suddently they bend us over on beer.

    NOT GOOD ENOUGH!

    EVERYONE PLEASE SHOW YOUR SUPPORT. MAKE COLES ACCOUNTABLE!! http://suggest.getup.org.au/forums/60819-getup-campaign-suggestions/suggestions/2389664-making-coles-honor-their-transactions-about-the-be RETWEET AND SUPPORT!!!

    • Reply

      james

      November 15, 2011

      Bend us over? They made a pricing error, not a conscious choice to price a product at a particular point such as milk

      Using getup over a pricing mistake on beer, seriously?

      • Reply

        Tom

        November 15, 2011

        I doubt any big companies would dare do this on purpose, but if we let people get away someone will try to capitalize and it they will do it on purpose, then back out.

  4. Reply

    Tom

    November 15, 2011

    If you could publicise something for ridiculously cheap and then back out saying it was a ''mistake'' every guy and his dog would be swimming in the free advertising of $15 cases of beer.

    I think it was a genuine mistake, but they need to make with the beer and be more careful in future.

    • Reply

      LongStraws Admin

      November 16, 2011

      Agreed, false and misleading misconduct differs from genuines errors such as the above. Don't worry, if the ACCC actually thought Coles had done this on purpose they would be all over it. Those guys loves smashing the consumer staples duopoly!

  5. Reply

    TheGreatSpaces

    November 15, 2011

    A fb friend told me about it, and I was in fact doing my Woolies online grocery shop at the time. When I actually signed in and saw the price, it didn't look like a mistake to me - because under the discount price was written 'Limit 4 per customer'. So that's a very elaborate mistake to make, and not very plausible. Also in the email they sent me the subject line read 'Out of Stock Issue' - so what is it? Out of stock or incorrectly priced? Inconsistency to me indicates mendacity. The email didn't mention a refund. So are they going to deliver me less beer and still take my money?
    I'm getting my beer - they can deal with me as an individual but I'm getting my beer. If they're out of stock they can substitute it for another line as per their own policy.

    • Reply

      LongStraws Admin

      November 16, 2011

      My understanding is you won't get a 'refund' as your credit card never actually had a finalised charged applied. Can you confirm whether you card was charged or not.

      I'd also like to understand under what ground you expect to get your beer, even if you do "deal with them as an individual"?

  6. Reply

    Em

    November 16, 2011

    Thanks for the article, an interesting and measured post.

    • Reply

      LongStraws Admin

      November 16, 2011

      Thanks Em!

  7. Reply

    daurnimator

    November 16, 2011

    I disagree on point 2 above;
    Coles intended the order confirmation screen to constitute a contract: it shows a final price which their Customer Agreement says cannot be changed.
    According the Goods Act 1958; it constitutes an "agreement to sale" See: http://www.austlii.edu.au/au/legis/vic/consol_act/ga195876/s6.html

    Which IS enforceable by law.
    You could take the point that there was no consideration, but a promise to pay (such as handing over credit card details) does count.

    • Reply

      LongStraws Admin

      November 16, 2011

      It's certainly open to interpretation, but based on the T&Cs contained in the Coles Online customer agreement I disagree:

      ORDERS, DELIVERY AND COLLECTION OF GOODS
      Orders: You must place an order with Coles Online by selecting goods and pressing the "Submit Order" button. Orders are deemed to be received by Coles Online at the time of successful transmission of the order. In respect of liquor, an order is deemed to be received by Liquorland when the order is received at a licensed premises of Liquorland (Australia) Pty Ltd:

      I interpret this as the contact not being accepted until it is received and accepted at the Liquorland that would fulfil the order.

  8. Reply

    Max

    November 16, 2011

    Coles is emailing customers that this was a “Tuesday evening pricing error” which is a blatant lie and suggests to me that they have legal advice that unless they can show they took immediate action, they will have to fulfill the orders. Coopers Sparkling Ale was advertised on Sunday (I have screenshots to prove) with the limit of 4 cases per customer. Orders were fulfilled Monday and right up to AM Tuesday morning, so making false claims that an error was rectified as soon as it was noticed, is simply implausible. How many order processors, managers, delivery and invoicing staff saw the pricing during these 2 days? A disgraceful effort by Coles (and especially the decision makers for concocting a weak excuse and trying to claim it's with their Customer Agreement).... and emailing customers with a lie about it only happening on Tuesday night, makes it even worse. Cop it on the chin Coles and do what any good retailer would.

  9. Reply

    Mot

    November 17, 2011

    Is that true? Coles are only offering a site credit rather than refund? Why would anyone affected by this want Coles to retain that $15.00? this happened in the States about a year ago and the retailer opted for apology and refund rather than honoring the deal, similar shitstorm erupted, retailer rode it out, and now I can't even remember which one it was. This ^will^ damage their online facility though, which I unrest and is still funding its feet. It basically reinforces all the questions of trust and reliability that inhibit shoppers from using it in the first place.

  10. Reply

    Greg Harbour

    November 17, 2011

    Scanning the tweets of rage from @coles online customers, the meta complaint seems to be "I don't trust you to do what you say you will, and when you don't, there's zero acknowledgement that you've not acted in good faith". A store credit for $15 leaves customers where they were if they ^hadn't^ entered the deal. The problem is, they have. And they're disappointed. This kind of thing happens. It's happened to me. And that retailer gave me the choice of a refund, or store credit with an extra $5 for my patience. And we're good. Ish.

  11. Reply

    Richard

    November 17, 2011

    Well, I didn't think it was a price error or 'screw-up'.

    I thought it was a social media experiment.

    Paradoxically, that is how it has turned out! Coles should have looked at what QANTAS did and followed. My guess is that this will get to court and then deficit their brand and accounts some more. When I visited the COlesonline site on Monday evening, the Coopers was at the normal price, but the Boags was still cheap. I assumed they had sold all they wanted to of the Boags, but had some Coopers left. That served to confirm my thoughts that it was a promotional exercise.


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