Harvey Norman says it won't honour the sale of hundreds of furniture products sold at bargain basement prices yesterday, following a 'technical glitch' on its website.
The furniture and appliance giant's 'New Zealand's Biggest Retail Sale' began after the clock turned midnight yesterday.
Customers that happened to be on the website couldn't believe their eyes when they noticed lounge suites going for under $100, seven-seater dining suites going for $159 and other too-good-to-be-true bargains selling to less than $100 online.
Last night, Harvey Norman it emailed some customers stating that a "genuine error" had occurred.
"We sincerely apologise for this error, which is currently being investigated.
"All sales made during this period cannot be honoured. Our website terms and conditions state that we may accept or reject any offer to purchase made by you and that we have the right to correct any errors."
The company's website incorrectly sold the products at the wrong prices for eight hours until it was fixed at 8am.
Harvey Norman is shutting down the deals, despite comments by Auckland barrister Patrick McGrath that the company was on the back foot legally because the sale and purchase had been completed.
Mr McGrath said customers have the right to keep their products and that could force the retail giant to take legal action to get the products back.
More than 300 people took advantage of the online discounts. The company's email said they would get a refund and a $100 voucher instead.
"By way of apology we would like to offer you a $100 Harvey Norman gift voucher, which will be couriered directly to your address that you have provided to us when you placed your order."
Customers furious
Some customers who landed cheap deals are yet to receive any communication from the company. Those that have received the email are infuriated because they believe the sales should be honoured as they bought the items in good faith.
A Christchurch woman says although surprised by the prices, she thought they were genuine due to the "massive advertising campaign" the company had undertaken in the days leading up to the sale which kicked off at midnight yesterday.
"It's unfair and I think it's rude. People say we just took it for granted but [Harvey Norman] did not have comparative prices. It was advertised as the biggest sale, so you would think it's the biggest sale."
She said Harvey Norman is a big company and should have picked up on any "errors" before eight hours had passed. She is out of pocket because she had maxed out her credit card on the purchases and was yet to receive the refund promised.
A Cambridge woman who also bought products said she was surprised by the company's handling of the debacle.
"I am disappointed that I haven't had 'personal' contact from Harvey Norman. I really think it would have been polite and reasonable to expect something with my name on it."
Dannevirke's Alex Lewis jumped on Facebook and saw a post from a member of the Farming Mums NZ page spreading the link.
"This lady put [a post up] and said 'oh look what I've got for $103'. And so we were all like, 'yeah, let's all get in too' and we all did ... I have my receipt for my $103 lounge suite and I actually bought another couple of lounge suites too cos at that price, why wouldn't you ... so three lounge suites for under $500."
Other shoppers said a $100 voucher was cheap compared to legal fees the company might face and that customers should hold out for more compensation.
Harvey Norman has not yet to respond to New Zealand Herald requests for comment.
The company also apologised directly to customers for a privacy breach.
In a second email, Harvey Norman said an initial email to customers incorrectly carried the email addresses of all recipients. The company put that mistake down to a "processing error".
"Unfortunately, due to a manual processing error, your email address was not 'hidden' from other recipients of the email and as such, was potentially visible by all customers affected by the purchase issue that occurred this morning. No other information about you has been disclosed to other customers, this is limited only to your email address. We have taken immediate internal measures to rectify this issue.
"Harvey Norman takes its customers' privacy very seriously and sincerely apologises for any inconvenience caused."
Eight hours to fix problem
Auckland barrister Patrick McGrath said Harvey Norman "were on the back foot here" in terms of challenging the sales which were now official contracts as the sales had been completed.
"The starting point is that it's a binding contract because you've got money that's been exchanged and people have got their receipts and it's all done. So definitely Harvey Norman are on the back foot here if push comes to shove they have to prove to the court that they were mistaken and these people knew about the [online pricing] mistakes."
Mr McGrath said Harvey Norman would have to apply to the court to get out of the contracts if the customers insisted on keeping their products.
Maggie Edwards, consumer adviser for Consumer New Zealand, said the watchdog could have sympathised with Harvey Norman if the low prices had been changed after one or two hours.
"We're surprised it took such a large company, given all the advertising that they took, eight hours to fix the problem. So if somebody thought this was too good to be true and checked it out an hour later, two hours later, three hours later, they would have seen the prices still there. So eight hours is not reasonable nowadays, given the size of the company, to keep offering. One or two hours, honest mistake.
"They've had this huge advertising campaign...so you'd be expecting some good buys. So you wouldn't know that this was a mistake because they were having this really big sale."
A Commerce Commission spokesperson said traders needed to take care over advertised prices.
If consumers were misled by a price then it could be an issue under the Fair Trading Act. However, if a genuine mistake had been made in pricing (eg a $1400 flight was advertised for $14) then consumers were not necessarily being misled and they should discuss their purchase with the retailer in the first instance.
Privacy breach
After being told their bargain purchases were the result of a computer glitch, Harvey Norman customers balked after finding all their email addresses were made public.
Instead of ensuring the customers' addresses were blind copied, a staff member had apparently mistakenly sent them out in an open email so those who received it were able to see the email addresses of others who had taken up the dirt cheap deals.
"Not happy here," one woman wrote. "Seems to be mistake after mistake ... but I have complete faith you will honour and do the right thing."
Another shopper, Fiona Wolff, said it was "incredibly unprofessional to send off a knee-jerk email like this, and even more so to allow all of us to see the other affected parties".
"Since then, I've had about 10-15 emails from other customers, there is a 'reply all' action happening, which is pretty amusing. Unwittingly, Harvey Norman has allowed all of their affected customers to communicate with each other, and this has meant they can't pick us all off one at a time. More power in numbers."
A Wanganui customer, who bought two lounge suites for $95 and $103, said he couldn't help but notice the privacy clause in the company's terms and conditions:
"Harvey Norman Stores (N.Z.) Pty Limited (referred to as "we", "our", or "us") is committed to protecting the privacy of any personal information provided to us."
He labelled the email blunder "utterly unprofessional".
A Privacy Commission spokesman said the depth of the breach sounded fairly limited - to email addresses - and the cause appeared due to human error.
"This sort of breach is relatively common and an easy mistake to make. We advise Harvey Norman to follow the breach guidelines on our website. We would take any complaints from customers seriously - the same way we do for all complaints."
- NZ Herald
