Best Buy and Toys "R" Us Accuse Wal-Mart Of False Advertising, PricingVW Staff
Best Buy Co., Inc. (NYSE:BBY) along with Toys “R” US Inc and several regional supermarket chains accused Wal-Mart Stores, Inc. (NYSE:WMT) of inaccurate pricing and false advertising, according to a report by The Wall Street Journal.
Best Buy Co., Inc. (NYSE:BBY) raised the complaint about an ad in which Walmart had offered Apple’s 16-gigabyte iPhone 5 for about $150, far from its regular $199 price. The ad campaign reportedly brought Best Buy Co., Inc. (NYSE:BBY) a loss of $65,000 on the day when Wal-Mart Stores, Inc. (NYSE:WMT) started the Facebook ad campaign for iPhone 5.
According to the document reviewed by the The Wall Street Journal, rivals claimed that the retailers’ ad campaign had crossed the line by exhibiting a false promotion of products it did not have in its stock to meet the expected demand.
In their defense, however, Wal-Mart Stores, Inc. (NYSE:WMT) claimed that its stores had sufficient inventory to run the iPhone promotion, quoting 98% availability at its stores carrying the device.
“We know competitors don’t like it when we tell customers to compare prices and see for themselves,” Wal-Mart Stores, Inc. (NYSE:WMT) spokesperson Steven Restivo told the Wall Street Journal. “We are confident on the legal, ethical and methodological standards associated with our price comparison advertisements,” he added.
Walmart, which launched the radio and television ads last spring, told the paper it responded to the attorney general in Michigan, Illinois, Pennsylvania, and Missouri over complaints from regional supermarket chains and Toys “R” Us.
Walmart said it has not received complaints from Best Buy. The attorneys general offices in Florida and New Jersey said they were reviewing similar complaints, according to the paper.
An Apple insider writes that Wal-Mart Stores, Inc. (NYSE:WMT) “showed off a more expensive Dell laptop model and claimed it cost an additional $251 at Best Buy. Walmart denies the claims.”