ACCC, while you’re at it, why do pink razors cost more than blue ones?

Thanks to the Australian Competition and Consumer Commission, two of our biggest supermarkets are facing fines that could stretch into the hundreds of millions of dollars due to allegedly engaging in dodgy practices at the expense of us, their consumers.

In case you missed it, this week, the ACCC announced it is taking legal action against Woolworths and Coles, claiming the supermarket giants manipulated prices on over 500 products, including everyday pantry staples such as cereals, coffee, biscuits and toothpaste, to boost their bottom line.

Next time you’re in the supermarket, take a look at the men’s and women’s razors or deodorant, and you’ll quickly see a glaring disparity.Credit: Getty Images

Using a practice known as deceptive pricing, the ACCC says the supermarkets raised the cost of an item for a period of time before then marking them down or bundling them into a deal, (two for the price of one; three for $15).

Once the sale or deal period was over, you’d assume the product would return to its standard price, right? Well, according to the ACCC, the “standard” price these products were reset to was actually higher – in some instances by as much as 29 per cent – than its original pre-special price.

Oreos, for example, were priced at $3.50 for almost two years straight before suddenly rising to $5 in November 2022. Just one month later, the biscuits were “on sale” at $4.50, with the non-promotional full price marked as $5.

As the ACCC chair, Gina Cass-Gottlieb, said in bringing forward their case: “For many years, each of us, as consumers, will have seen the campaigns of Woolworths and Coles that have led us to understand that the ‘Prices Dropped’ and ‘Down Down’ prices promotions relate to sustained reductions in regular pricing. In these cases, however, the new … promotions were actually higher or the same as the prior regular price.”

To the best of my knowledge, blue dye isn’t cheaper than pink dye, so charging women more for the same product is beyond messed up.

At the same time as the ACCC announcing its plans to take the supermarket giants to court, the federal government unveiled its draft mandatory code of conduct for supermarkets, which will govern the behaviour of Australian grocery stores earning over $5 billion per year and implement penalties where inappropriate or illegal behaviour occurs.

While all of this sounds promising, and will no doubt go a long way in ensuring supermarkets think twice before putting shareholder returns over customer loyalty, there’s another dodgy practice that’s been going on in our supermarkets for far too long and that, if the government and ACCC are serious about reform, needs to be on the agenda: eradicating the pink tax.

While not a literal tax like the GST, the pink tax refers to price disparities that exist on items that are similar or identical in every way except one: the gender of whom the products are marketed to.

Spend a couple of minutes looking at razors next time you’re at the supermarket, and you’ll quickly see what I’m talking about. On one side, a pack of blue razors marketed towards men will cost, say, $10. On the other side, you’ll find the same razor, from the same company, in the exact same model, but this time it’s pink instead of blue and costs $13.

Once you’re finished looking at razors, why not make a stop in the deodorant section or compare the prices on body lotions, hair-care products and earplugs? Don’t forget to take a look at underwear and socks, too.

According to one US government study, personal care products targeted at women are 13 per cent more expensive than mens, while research from the UK found women to be paying 8.9 per cent more for deodorant.

In 2020, a California senate committee investigating the issue estimated the pink tax will cost the average woman around $270,000 across her lifetime. Bear in mind, that’s just the mark-ups we’ll have to pay on products that both men and women use – it does not include what we shell out for gender-specific items such as sanitary products or bras.

And yet, despite this being an incredibly clear example of women being taken advantage of financially, and despite the United Nations calling for member nations to end the practice, it remains perfectly legal in Australia.

No doubt, supermarkets and major companies would love us to keep believing there is some mysterious but perfectly justifiably reason to have different price points for the same products that isn’t blatant gender discrimination.

If there is, I’d love to hear it. But to the best of my knowledge, blue dye isn’t cheaper than pink dye, so charging women more for the same product is beyond messed up. And for supermarkets to think women are silly enough to not spot what’s going on is offensive.

Woolworths and Coles control two-thirds of our national grocery sales. And in many parts of Australia, there simply aren’t other options available when it comes to doing a weekly shop.

That our supermarkets would allegedly engage in price gouging at all is disgusting, but that it is alleged to have taken place during one of the worst cost-of-living crises of our time makes it all the more galling. Add the pink tax on top of that, and it’s difficult to feel anything other than rage.

Among the everyday items that the ACCC is alleging Woolworths and Coles used price gouging techniques on were sanitary products like pads and tampons. So it’s great that the supermarkets will be forced to acknowledge if they did, in fact, do what they have been accused of in the Federal Court.

It’s even better that the government wants to make practices like this illegal. But if the government’s code puts an end to one discriminatory practice, but allows another to remain unchecked, how reforming is it, really?

Victoria Devine is an award-winning retired financial adviser, best-selling author, and host of Australia’s number one finance podcast, She’s on the Money. Victoria is also the founder and co-director of Zella Money.

• Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.

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