The NSW Department of Fair Trading is set to be asked to investigate the activities of GNC LiveWell which operates retail health stores in Australia following complaints that the company is engaging in misleading marketing.
Currently the Australian operation which is part of a Singapore based GNC LiveWell franchise is running an up to 40% discount sale based on 25% off for two items 30% for 3 items up to 40% off for 4 items. However when customers go to collect the discounts they are told that they are not available.
Renowned for their expensive vitamins and health care products, GNC LiveWell is the world’s largest health retailer specialising in herb, vitamin, weight management and sports nutrition. GNC has over 6,000 stores in 40 countries worldwide.
Investigations by SmartOffice of GNC LiveWell stores such as the one at North Sydney’s Greenwood Plaza found that the stores are plastered with point of sale material advertising the offer. Shelves of vitamins have pointers that say “20% 30% 40% off these items.
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The only problem is that the discounts are not available on many of the advertised items despite advertising indicating that discounts are available.
When SmartOffice visited the North Sydney store we collected two items from shelves marked with the discount offer. At the checkout till the items were rung up with GNC LiveWell staff asking for the full retail price of the items which were not cheap at $89.50.
When questioned why the 25% discount was not being applied the staff said, “The discounts do not apply to these items” When we point to the shelf where the goods had come from along with the poster saying 20% 30% 40% off these items they said, “It is all marketing, we are not giving discounts to items on those shelves. The discounts apply to other products.”
When we questioned as to why pointers were on the shelves where the items had come from indicating that discounts were available a manager stepped in saying, “It is all marketing, everyone does it”.
When we pointed out to her one of the posters that promoted the offer of a 25% discount off two items she said, “Conditions apply”. When it was pointed out that the word conditions apply was not showing she lifted up the plastic display item to show the words in 8point type hidden from view.
Other posters in the store also had the words conditions apply yet when we asked to see those conditions the manager was unable to produce the written conditions.
When it was put to her that this was blatantly misleading she said, “It’s all advertising and marketing, everyone does it we are not alone. If you want to take the issue up with management call our head office.”