[ad_1]
Sincere support
Independent News
Our mission is to provide unbiased, fact-based reporting that holds power accountable and reveals the truth.
Whether it’s $5 or $50, every contribution counts.
Support us in journalism without an agenda.
The loyalty card strategy used by major supermarket chains has been slammed as a “rip-off” by Which?, with the consumer watchdog exposing the practice in shocking before-and-after price comparisons.
In a long-term study of the prices of 12,000 products, researchers found that many stores raised prices a few days before offering a loyalty card discount, making the offer seem much better than it really was.
Boots and Superdrug were singled out as the biggest offenders, with loyalty pricing practices described by Which? as “worrying”. Their report found that over a six-month period, 16% of Superdrug’s products were at non-loyalty prices less than half the time.
At Boots, this applied to 10% of its products. The report also found that in one example, the high street health retailer increased the price of an electric toothbrush from £150 to £400, a 166% increase. This new price was in place for less than two weeks before the Clubcard price was reintroduced – returning the price to £150.
Several supermarkets were named in the report, including Tesco, Sainsbury’s and Morrisons, which all offer discounts of 23 to 25 per cent to card members.
The Which? report acknowledged that the discounts looked “huge” but said the more important question for consumers was whether they were “real”. The consumer watchdog said it had found evidence that loyalty prices that looked like big discounts were actually still higher than non-member prices in other stores.
For example, a 695g packet of Birds Eye chicken nuggets was once priced at £5.50 for non-members and £4 for members at Sainsbury’s. At the same time, it was £5.25 at Waitrose and £4 at Asda. Three weeks before that, Sainsbury’s had been selling it for £5.
This is another surprising pattern noted by the report’s authors, with Tesco and Sainsbury’s subsequently introducing non-loyalty prices for products that were on average 12% higher than Waitrose’s normal price.
Ele Clark, retail editor at Which?, said: “The loyalty card business is growing bigger and bigger, and the rise of two-tier pricing models means shoppers often pay more if they are not a retailer member. While the discounts can seem very tempting, many shoppers are increasingly sceptical of exorbitant prices for non-members.
“We looked at pricing history on thousands of products and found that while most discounts weren’t misleading, there were some non-member prices that were questionable and some products that looked like outright scams. At the same time, some products were always or almost always on loyalty promotion, making it hard to spot a genuine deal.”
Previous research by Which? into loyalty pricing prompted the Competition and Markets Authority (CMA) to investigate the practice. A new bill passed earlier this year gives the competition watchdog greater powers to crack down on unfair consumer behaviour, including through fines.
However, a CMA update in July said it was unlikely to find substantial evidence that loyalty card pricing misled customers. It did, however, acknowledge that some front-end and back-end pricing practices could make it unclear what the “normal” price of an item is. A final report is due in November 2024.
Responding to the Which? report, a Boots spokesperson said: “We are always committed to offering great value to our customers and helping them save on their health and beauty items. Price Advantage enables our loyal Boots Advantage Card customers to make real savings on over 8,000 products. Not only do customers receive lower prices, they also receive a host of other benefits including personalised offers, Advantage Card points every time they shop and always 10% off Boots own brand products.
“All promotional activities, including price advantages, are assessed against all applicable laws and guidelines set by the Chartered Trading Standards Institute.”
A Sainsbury’s spokesperson also responded: “More and more people are choosing to shop with Sainsbury’s and we know our customers are savvy shoppers who understand that factors such as inflation, products going out of season or promotions can affect our prices. “But this doesn’t stop us following industry pricing guidance and offering great value for money on the products our customers buy the most – whether that’s our everyday low prices, Aldi price matching or Nectar prices.”
[ad_2]
Source link
