Online error leads to one-cent laptop sales

By Cass Warneminde, Rachel Lebihan and Andrew Colley, ZDNet Australia, 9 May, 2002 09:46

NEWS

Despite its initial denials, Compaq Australia now admits that it did in fact process the payments of customers who bought Presario laptops for just one cent as a result of an online pricing hiccup. As such, the hardware giant has promised to provide refunds to hundreds of customers who took advantage of the implausible offer. Compaq is still adamant, however, that it is not obligated to honour the accidental one-cent pricing, despite mounting industry criticism and ongoing threats of a customer-initiated class action law suit. Refusing to directly answer questions about the matter, Compaq instead issued this general statement: "Compaq takes very seriously all reasonable customer complaints and enquiries. Given that the anomalous pricing was not referenced by any supporting advertising or text, and that it was an obvious error, it is unreasonable to assume that the pricing was some form of promotion or in fact correct." "As this was a genuine error, Compaq cancelled all orders from the system. In instances where one cent was debited from customers' accounts it will be refunded." "Those customers wishing to proceed with an order for the correct price should log on to the Web Store again or call us on 1300 301 234 between 9:00a.m. and 5:30p.m. Monday to Friday, Eastern Standard Time." "Compaq apologises to those customers inconvenienced by the technical problems." This apology has not satisfied many customers, who feel that by not honouring the pricing -- offered unintentionally or otherwise -- Compaq is snubbing consumers and ignoring the rules and regulations that govern "bricks-and-mortar" retail outlets. Gale Kennedy of the Australian Consumers Association, however, is of the opinion that traditional retail outlets are not bound to sell stock that has been incorrectly underpriced for that inaccurate fee. Under such circumstances a store has every right to abide by its "goodwill policy", and sales staff can renegotiate with the consumer at the point of sale, she said. However, if a consumer was undercharged for an online purchase and the company then backtracked on the pricetag, "I would have a problem with that," she said. Kennedy explained that as there is no human interaction involved in online transactions the inaccuracy cannot be renegotiated prior to the transaction. "If you've entered into a contract for that price, for that offer, renegotiation of that contract must not be to the detriment of the consumer," she said. The ACCC agreed that trading laws apply equally to online traders and companies operating out of conventional shops but differs slightly in its interpretation of Compaq's obligation. Spokesperson for the Commission, Lin Enright, agrees that the automatic nature of the transactions may have reduced Compaq's control over the sale but said that it weakens its obligation to honour it. "It probably would depend on how quickly they rectified the mistake," she said. "If they realised very quickly that there was problem and posted the correction, I'm not sure that we would push the issue with them."

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