Australia’s largest new and used car classifieds site, Carsales.com.au, is suing competitor CarsGuide.com.au in the Supreme Court of Victoria with allegations that its media campaign is grossly misleading and deceptive towards Carsales.com.au.
According to Carsales.com.au, a campaign started on June 15 by CarsGuide.com.au across radio, outdoor, newspapers and TV makes claims that the former says is false.
Carsales.com.au claims that the CarsGuide.com.au campaign allegedly untruthfully represents its business as one that:
- Sells a consumer’s contact details to dealers.
- Passes on consumer’s details to dealers without the consumer’s knowledge.
- Passes on consumer’s details to numerous (and not necessarily relevant) dealers if a consumer enquires about a car.
The latest campaign is part of an ongoing marketing blitz from CarsGuide, which targets Carsales.com.au indirectly. In fact, in recent months it has taken a few twists as CarsGuide.com.au continues to invest marketing budgets in outdoor billboards near Carsales headquarters in Richmond, Melbourne, targeting the classified leader with well-pointed arrows and inferences.
Up until the launch of the latest CarsGuide campaign, Carsales had remained largely silent on the matter, but due to the new campaign allegedly misleading the Australian public, it has now taken action.
Carsales.com.au’s media statement today says it has already sent cease and desist letters to CarsGuide.com.au but due to the campaign continuously running, it has had no choice but to take the matter to court.
Carsales.com.au is seeking the removal of the allegedly misleading CarsGuide.com.au ads across all mediums and the publication of corrective advertisements.
According to Carsales.com Ltd CEO, Greg Roebuck, there is “no significant difference between the way in which carsales.com.au and carsguide.com.au provide contact details to the relevant dealer”.
"It’s crazy, if you fill in an enquiry form on carsguide.com.au on a dealer car the same process happens as filling in an enquiry form on carsales.com.au for a dealer car; which is the information is provided to the dealer to get in contact with you," Roebuck told CarAdvice.
Roebuck says CarsGuide.com.au appears so focused on attacking Carsales.com.au that they are forgetting the customer.
"I guess if you have nothing good to say about your own product, it’s your only option," Roebuck said when asked if CarsGuide's allegedly deceptive marketing tactics were affecting Carsales.
"Most consumers are pretty smart and are unimpressed by this approach, but when it is simply intended to cause damage to our brand we can’t stand idly by."
CarsGuide recent model change sees the website charge dealers on a per-view basis, which Roebuck says is "completely unaccountable and open to click-fraud".
The court case will get underway on July 10.
*Note: We are covering the court case due to its relevance to Australian new car buyers. CarsGuide has not responded to requests for comment.
Update: CarsGuide chief executive, Lauren Williams, has given us the following response:
“We stand by our claims and will defend them, we have not contravened the Australian Consumer Laws. CarsGuide do not sell consumers' contact details to dealers and our competitor does.
"We knew most consumers had no idea that when they inquired about a car on Carsales their contact details were being sold to the dealer. We believe that the consumer needs to be aware of this.
"Our campaign aims to drive broad awareness on this little known transaction. We want consumers to have the opportunity to have a choice and make an informed decision to either be part of the transaction, or use CarsGuide, where dealer location and name are shown up front.
“When I started as CEO, we could see that the old model of hiding information and selling contact details was not a sustainable practice for a modern online business. We re-engineered our business and dealers now pay for views of their cars and not for consumer’s contact details."