Drink Tank

Shopper dockets – the OLGR investigation

Caterina Giorgi and Amy Ferguson investigate for Drink Tank.

Australia’s largest supermarket chains, Woolworths and Coles, furiously resisted attempts to ban alcohol shopper dockets after public complaints were made.

This is the story of the six month investigation by the Office of Liquor Gaming and Racing (OLGR) into shopper dockets, the finding that shopper dockets should be restricted and the eventual decision by the Director General of the NSW Department of Trade and Investment to allow the shopper dockets to continue.

The complaints

On 31 January 2013 NSW parliamentarian Dr John Kaye MLC wrote to the Director General of the NSW Department of Trade and Investment drawing his attention to what he referred to as a ‘loophole in the regulation of liquor promotions’. What John Kaye was raising with Mr Paterson was his concern about promotions now commonly referred to as ‘shopper dockets’.

Shopper dockets are coupons or vouchers for free or discounted alcohol, or petrol products printed at the bottom of supermarket shopping receipts. In relation to alcohol, these dockets are used to promote alcohol discounts, such as two-for-one offers. Both of the big retailers (Woolworths and Coles) use shopper dockets to promote alcohol.

In addition to John Kaye’s complaint, a further complaint was made about Coles shopper dockets on 7 of March. Following both complaints, on 25 March the Director of Compliance at OLGR wrote to both Woolworths and Coles. In this letter OLGR informed the retailers that it had developed ‘a preliminary view that this activity presents an increased risk of encouraging the misuse and abuse of liquor’. Both Woolworths and Coles were then invited to ‘show cause’ by 15 April 2013 why a notice to restrict or prohibit the licensee from carrying on or permitting these activities should not to be issued’.

The Woolworths shopper docket in question offered a bonus 6 pack of Sol Mexican Beer with the purchase of a specified bottle of a South Island Marlborough Sauvignon Blanc. There were two Coles shopper dockets. The first offered a buy-one-get-one-free on Rosabrook Margaret River Classic White 750ml and the second offered a buy-one-get-one-free on Secret Stone Sauvignon Blanc 750ml. Each of these shopper dockets specified a limit of one docket per transaction.

The OLGR Investigation

Section 102A of the Liquor Act specifies that the ‘Director General may restrict or prohibit activities that encourage misuse or abuse of liquor’. More specifically the Director General may ‘restrict or prohibit the licensee carrying on, or permitting on the licensed premises, any activity…that, in the opinion of the Director-General, is likely to encourage misuse or abuse of liquor (such as binge drinking or excessive consumption)’.

Coles responded on 9 April. In their letter, Coles made the distinction between on and off-licence promotions indicating that when alcohol is purchased from off-licence venues, liquor is consumed over a period of time, often weekend and months, after the purchase’. A comment for which they provided no evidence for. Coles went on to say that the offers are only available to people over 18 years.

Woolworth’s lawyers requested an extension of three days on their notice to ‘show cause’ until 18 April 2014 and provided their letter on this date. Woolworths ‘disputed’ that the promotional activity presented a risk. They argued that there ‘is not evidence that this type of marketing introduces new drinkers of alcohol to the market or somehow makes existing drinkers consume more’. A common tactic of the alcohol industry is to say that evidence is needed to demonstrate that every different type of promotion results in particular behaviours. It is never enough to simply show the extensive evidence to demonstrate that promotions impact on consumption and behaviours. Woolworths also specified ‘this type of promotion is common place within the liquor industry’. The lengthy letter included information on who allegedly purchases alcohol using shopper dockets.

On 13 May OLGR wrote to Professor Sandra Jones, Director of the Centre for Health Initiatives at the University of Wollongong, confidentially asking for her expert advice on shopper dockets. Professor Jones has published more than 130 refereed papers on a range of issues predominantly relating to health and marketing. Professor Jones was asked to prepare a document answering ten key questions about the possible risks associated with shopper dockets. Professor Jones’ cited a range of research on the prolific nature of marketing and the impact of marketing on behaviours.

On 21 May OLGR wrote to Woolworths and Coles. In the letter OLGR indicated that they were considering their response to the notice to show cause and also provided the report prepared by Professor Jones on shopper dockets. A submission in response to the expert’s report was requested within 21 days.

OLGR also informed Woolworths that compliance was tested in a Woolworths store on a similar shopper docket promotion. The promotion offered three bonus bottles of Kopparberg cider when purchasing a 750ml bottle of Essenze Marlborough Sauvignon Blanc. The Compliance Officer was able to purchase 6 bottles of wine and receive 18 bottles of cider. This is despite the docket indicating that there was a limit of one redemption per receipt. This demonstrated that Woolworths were not abiding by their own harm minimisation practices.

Correspondence between the retailers and OLGR went back and forth covering a range of issues. These included seeking points of clarification and seeking extensions on timeframes. Extensions on the timeframe for replying to Professor Jones’ report were requested by both Woolworths and Coles. Both submitted three weeks after the due date.

Coles submitted first. On 2 July Coles provided a lengthy submission including a ‘critique’ of Professor Jone’s report by an external consultant. On 4 July Woolworths responded to Professor Jones’ report. They included two ‘critiques’ of Professor Jones’ report. One of these was by Professor Adrian Furnham whose work history includes a previous request from the Advertising Association ‘to conduct expert assessments of three studies which argue that alcohol marketing is a key influence on underage drinking’, finding the ‘evidence to be weak’ in these.

The decision

At this point OLGR considered all of the information before it and made a recommendation to the Director General in a brief on 26 July. The brief concluded that ‘there is sufficient evidence to support a preliminary view that the activity is likely to encourage the misuse and abuse of liquor as contemplated by section 102A of the Act’. OLGR proposed imposing ‘a condition that licensee does not engage in the activity promoted’ and a ‘condition to prohibit redemption in the individual licensees premises’.

In response the Director General in a hand written note on the brief stated that he was ‘Not satisfied that case made out that likely to encourage misuse or abuse of liquor…Misuse and abuse not linked to shopper docket in the analysis in direct way’. OLGR was not invited to provide an alternative recommendation, instead they prepared a revised brief reflecting the Director General’s decision.

The Implications

After a six month investigation, several emails and letters, experts analysis and paid critiques of this analysis – OLGR concluded that shopper dockets were ‘likely to encourage the misuse and abuse of liquor’. This decision was made following what looks like a very expensive exercise by Coles and Woolworths to defend their capacity to offer these promotions.

But in the end the Director General decided not to support his Agency’s recommendation after a six month investigation concluded the practice was ‘likely to encourage the misuse and abuse of liquor’. This decision allows this practice to continue across NSW and in many other states.

The question we must ask now is why?

Find out more about supermarket secrets. 

Caterina Giorgi

Caterina Giorgi

Caterina is the Director of Policy and Research at the Foundation for Alcohol Research & Education.

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