Tuesday, November 5, 2024

Supermarkets and beauty retailers come under fire for ‘murky’ loyalty pricing

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  • Which? investigation uncovers ‘concerning’ pricing structures at retailers

Leading high street retailers have been blasted for their ‘murky and confusing’ loyalty pricing practices, with some offering deals that are not as good as they appear.

During the cost of living crisis, supermarkets and other retailers have come under fire for introducing a two-tier pricing structure.

Customers without a loyalty card, or simply uncomfortable with the reams of data they hold on you, will likely spend more at the checkout.

Rip off: Which? investigation reveals ‘murky and confusing’ pricing practices by retailers

An investigation by consumer website Which? has discovered ‘concerning membership pricing practices’ at Boots, Superdrug and supermarkets.

Which? analysed the pricing history of almost 12,000 products at health and beauty retailers and supermarkets to investigate how genuine the loyalty savings are.

They found that some discounts and items were always on loyalty promotion deals, while also discovering examples of non-member prices ‘that are seemingly an outright rip-off’.

Which? researchers found Superdrug’s loyalty prices offer an average third off the higher non-member price.

The three biggest supermarkets all offered similar savings: 25 per cent at Morrisons, 24 per cent at Sainsbury’s and 23 per cent at Tesco. Co-op and Boots both offered 10 per cent.

While the discounts are enticing, Which? is questioning how genuine they are, with many non-member prices only introduced a few days before.

On a snapshot day, Which? researchers looked at how many times non-member prices on items with loyalty discounts had been in place during the previous six months.

They found that one in six Superdrug products had been their non-member price for less than half the time, while at Boots it was one in 10.

Tesco also had 10 per cent, followed by 5 per cent at Sainsbury’s and 3 per cent at Co-op.

Which? also found cases of prices being raised to a higher price for a relatively brief period before going on ‘offer’.

For example, Superdrug sold an Ultimate Day & Night Duo – Olay Regenerist & Retinol Bundle for £71.98 for non-members and £59.99 for members.

However, the product was only priced at £71.98 for 13 days, before which it was £35.98 for everyone.

At Boots, an Oral-B iO7 electric toothbrush was sold to non-members for £400 and to members for £150. The product was only priced at £400 for 13 days before which it was £150.

At Tesco, Ambre Solaire Ultra-hydrating Sun Cream Spray SPF30 200ml was £8 for non-members and £6 members. However, it had only been £8 for 14 days, before that it was £6.

Sainsbury’s sold Ariel All-in-1 pod capsules for £10.50 for non-members and £1 cheaper for members. However, they had only been £10.50 for 28 days, before which they were £10 for everyone. Two months earlier they were for £9.50 for everyone.

A previous investigation by Which? revealed that some loyalty prices at Sainsbury’s and Tesco were not as good as they seemed and sparked a CMA probe.

However, the regulator recently said that supermarket loyalty prices aren’t misleading shoppers.  

Ele Clark, Which? retail editor said: ‘We looked at the pricing history of thousands of products and found that, while the majority of discounts were not misleading, there were some questionable non-member prices and some examples that looked like an outright rip-off.

‘Meanwhile some products were always, or almost always, on loyalty promotion, making it difficult to spot a genuine deal.

‘Guidance on pricing laws needs to be updated to include loyalty pricing, to help regulators crack down if businesses break the rules.

‘The CMA should continue to monitor loyalty pricing practices across key consumer sectors and be ready to use its new powers to take action against retailers that don’t comply.’

What do the retailers say?  

Leading retailers have been criticised for their seemingly confusing pricing practices. 

The investigation by Which? revealed some retailers had hiked prices for non-members just days before slashing them. 

This is what the retailers had to say: 

Boots  

We have always been committed to offering customers great value, helping them save money across their health and beauty needs. Price Advantage allows our loyal Boots Advantage Card customers to make genuine savings on over 8,000 products. 

Customers benefit from the lower prices as well as enjoying several other benefits, including personalised offers, Advantage Card points every time they shop and an always on 10% discount on Boots own brand products. Additionally Boots offers a continuous and extensive programme of deals and promotions for all customers, that we know they love. All promotions, including Price Advantage, are assessed against all applicable laws and guidelines set out by the Chartered Trading Standards Institute.

Superdrug 

Our products are regularly on a mixture of member’s only prices, multibuy promos, and price promotions open to all, to ensure all our customers can make savings on their favourite products throughout the year. 

Every month we give our loyal Health & Beautycard members access to hundreds of health & beauty products at a lower price and the investigation highlights the value this offers our members. As an accessible retailer, we aim to offer great value to all our customers, and we prioritise working with our suppliers to secure the lowest costs possible to offer the best price. We regularly compare prices in the market to ensure they are competitive and offer genuine value and savings.

Co-op 

We know our Member prices provide true value for our Members. No base prices have increased to accommodate Co-op member pricing and, in fact, many of the ‘all-customer’ prices were decreased to ensure Co-op was competitive on key lines for all shoppers, whether they are a member or not.

Morrisons 

We have highlighted to Which? that in all three of the examples they shared the ‘before’ price was in fact a promotional price rather than the base price. We are working hard to keep prices down and competitive for our customers and our More Card members can earn points on selected purchases, including fuel, and redeem those points for fivers off their shopping. They also benefit from market-leading discounts as well as personalised offers and surprises.

Sainsbury’s 

More people are choosing to shop at Sainsbury’s and we know our customers are savvy shoppers, who understand that factors like inflation, products falling out of season or promotions can affect our prices. That doesn’t stop us following pricing guidance for the industry and offering great value on the products our customers buy most – whether that’s with our Low Everyday Prices, Aldi Price Match or Nectar Prices. 

Tesco

Clubcard unlocks the best value at Tesco, with thousands of genuine savings on offer with Clubcard Prices each week. All our Clubcard Prices promotions follow strict rules, including considering how they compare against prices in the market, to ensure they represent genuine value and savings, and these rules have been endorsed by our Trading Standards Primary Authority. 

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