Background: Domain and REA Group are Australia's two largest online real estate portals. REA Group, which operates realestate.com.au, has a market value of more than $18 billion. Domain was taken off the ASX last year after being acquired for around $2.8 billion by US real estate giant CoStar Group, a company known for picking legal fights with rivals.  

What happened: Domain is now accusing REA Group of making misleading advertising claims. The issue surrounds REA's claim that realestate.com.au found buyers for nine in every 10 properties listed on its site... creating a billboard that read: “we help nine-in-10 buyers find the one”.

What else: Domain says the research behind that claim excluded around 20% of properties sold without appearing on any platform. It argues the "nine-in-10" claim makes it seem like sellers don't need to list on alternative platforms (like Domain). So now, Domain wants corrective advertising that would force REA to publicly walk back the claim.  

What's the key learning?

💡 Sometimes the scariest punishment isn't the fine... it's being forced to advertise your own stuff up. And in some cases, the reputational damage from publicly admitting to misleading advertising, can hurt more than the financial penalty itself.

💡 Corrective advertising happens when a court orders a company to publish ads correcting misleading claims at its own expense. For example, Emma Sleep was ordered to publish corrective notices on top of a $15 million penalty, and more recently, Hismile was fined by ASIC after "random shoppers" in its ads were revealed to be employees, forcing a public correction to its 1.7 million followers.

💡 If REA Group faces a similar ruling, the reputational hit could be far more painful than any fine. And having to put up a new billboard saying "whoops, we counted wrong" isn't exactly giving Australia's number one property platform.