How To Avoid Price Jacking On eBay

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As any bargain hunter worth their salt will tell you, eBay 'price jacking' is a depressingly common problem. As an online marketplace, eBay does not set the prices of goods it sells - which makes it easy for third-party sellers to rip people off. This is especially prevalent during site-wide sales, with merchants regularly inflating the "RRP" to fool uninformed customers.

It's a pretty scummy practice, but thankfully one that is easily avoided. Here's what you can do about it.

Last week, we reported on a dubious Samsung Galaxy Note 9 'deal' from Allphones' eBay store. The company advertised the device as being 20% off - but the 'before' price was $1619.99. That's a massive $120.99 markup on the phone's actual RRP.

eBay Has A Serious 'Price Jacking' Problem

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When we brought this clear-cut case of price jacking to eBay's attention, it booted Allphones from the sale and issued the following statement:

This seller has been removed from this promotion as they are in breach of our retail promotion terms and conditions.

All sellers who take part in our retail promotions are subject to contractual terms and conditions that prohibit this type of activity and we will continue to enforce these as part of our ongoing commitment to ensuring genuine value is offered by our sellers.

While eBay's swift response is to be commended, the problem remains rife on the platform. There also don't appear to be any lasting ramifications for sellers who break the rules. (Indeed, Allphones is back in this week's sale, although its 'before' prices are now conspicuously absent.)

The problem, as pointed out by Alexis Carey over on news.com.au, is that sellers are legally allowed to sell a product at a price they deem is appropriate, even if that price is well above a manufacturer’s recommended retail price. This makes it exceedingly difficult to prove that Australian Consumer Law has been broken.

Here are some tips you can employ to reduce the chances of getting burnt:

Do your homework

This should go without saying, but if you see a product being sold for a massive discount, do some online research before hitting the purchase button. How much are other eBay sellers charging for the same product? What's the 'street price' in brick-and-mortar retailers? Are other online merchants providing similar deals? In short, don't believe a listed discount until it's been independently verified.

Use aggregation sites and deals forums

To ensure an online deal is legit, don't go straight to the source - instead, trawl deals sites for the item or product type you're looking for. These sites are carefully moderated and only post deals that are worth knowing about. Worthy sites you should bookmark include Static Ice, Oz Bargain, IsThereAnyDeal.com and Lifehacker's own Deals page.

Consider the deal on its own merits

Artificially inflating the 'before' price on a discounted product is a gross thing to do. But that doesn't mean you aren't getting a good deal. For example, the aforementioned Galaxy Note 9 deal worked out to around $170 off the RRP. While that's well below the advertised saving of $324, it remains a significant discount. Sometimes, a deal is still worth getting even when the sale is misleading.

Use a price comparison tool

Price comparison widgets, like Shoptimate on Chrome, automatically go on price scouting missions while you're shopping online. If it finds better deals, it will show the price on the product detail page.

Get eBay to pay you back

eBay recently launched Best Price Guarantee which provides instant restitution when you pay too much for a product. All you need to do is send eBay proof that the product was cheaper on another site at the time that you purchased it. eBay will then send you a monetary voucher for the price difference plus an extra 5 per cent. While that's not quite as good as having the money back in your bank account, it's better than nothing.

Contact the ACCC

As mentioned above, merchants are given quite a bit of wriggle room when it comes to Australian Consumer Law. However, deliberately misleading customers via false advertising is definitely against the law. If you see a two-price comparison advert that looks blatantly misleading, be sure to lodge a complaint with the Australian Competition and Consumer Commission. Sometimes, stiff fines are the only way these companies will learn.


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