Australian online retailer Kogan is facing calls for an investigation into whether its discounting practices mislead consumers [1, 2].

The controversy centers on the use of a secondary website to establish artificial price benchmarks. If a retailer creates a high price on one site to make a price on another look like a bargain, it may violate consumer protection laws regarding deceptive pricing.

Reports indicate that Kogan operates a "clone" website called Exclusive Brands [1, 2]. This second site lists the same products as the primary Kogan store but at higher prices [1, 2]. By maintaining this parallel storefront, the company can present products on its main site as being heavily discounted compared to the Exclusive Brands listing [1, 2].

Critics said this practice obscures the true market value of the goods. When a customer sees a significant price drop, they typically assume the discount is based on a genuine previous price or a standard retail price, not a price from a sister site designed to be higher.

This strategy has prompted demands for regulatory scrutiny in Australia [1, 2]. Authorities may examine whether the company's pricing structure constitutes a breach of Australian Consumer Law by misleading shoppers about the actual savings they are receiving [1, 2].

Kogan has not provided a public statement regarding the specific operational goals of the Exclusive Brands site in these reports [1, 2]. The focus of the potential investigation remains on the transparency of the discounts offered to the public [1, 2].

“Kogan operates a "clone" website called Exclusive Brands”

This situation highlights the growing regulatory tension between dynamic e-commerce pricing and consumer protection laws. If regulators find that 'clone' sites are used specifically to manufacture fake discounts, it could set a legal precedent in Australia that restricts how retailers use multiple digital storefronts to signal value.