An online florist and gift retailer has been pricked with a $1 million fine for publishing misleading star ratings on its website.
The Federal Court ordered Bloomex to pay $1 million in penalties after it admitted to breaching Australian Consumer Law by making false and misleading representations on its website.
Bloomex admitted it had published misleading star ratings for its products, advertised products at a discount when they had not sold products at the ‘strikethrough price’, and added surcharges that were inadequately disclosed.
ACCC Commissioner Liza Carver said Bloomex misled consumers about the quality and price of its products for a long time, and the penalty was an indication of how seriously the court views this conduct.
“Misleading online reviews and star ratings are an issue of significant concern to us because they can influence consumers into purchasing from a business, when they would not otherwise have done so,” Ms Carver said.
Bloomex had displayed products for sale on its website between February 2019 and March 2023 with a ‘star rating’ that remained static since January 2015, and included customer reviews for products prepared and delivered outside Australia, as well as ratings from people who may not have been Bloomex customers.
“The star ratings displayed by Bloomex were misleading about the extent to which other consumers were satisfied with Bloomex’s products and may have led to false assumptions about whether those products were suitable for them,” Ms Carver said.
Between February 2019 and November 2022, Bloomex published ‘strikethrough’ prices, ‘half price’ or ‘50% off’ discount statements in relation to its products on its website, even though it had not sold the products at the higher prices displayed.
And between August 2022 and March 2023, Bloomex admitted that it had failed to adequately disclose that it was imposing a surcharge ranging from $1.95 to $4.95 on orders made via its website. Adding extra fees and charges to the initial price throughout the checkout process online is known as drip pricing.
“Businesses must be upfront, and clearly disclose to consumers the total price for their products, including what types of fees will apply. They must not display prices that are incorrect or likely to create a false impression,” Ms Carver said.
