The competition watchdog analysed about 50,000 grocery products on loyalty price promotions at Tesco, Sainsbury’s, Waitrose, Co-op and Morrisons. It said it found “very little evidence” of supermarkets inflating their “usual” prices to make loyalty promotions seem like a better deal.
The evidence shows that almost all products scrutinised – 92% of about 50,000 items – offered a genuine saving against the ‘usual’ price in the same store.
But it found that while loyalty prices are generally some of the cheapest available, this wasn’t always the case, meaning it’s worth shopping around.
According to CMA calculations, people can make an average saving of 17-25% buying loyalty-priced products at the five supermarkets examined.
What do shoppers think?
The CMA surveyed shoppers about their views on loyalty pricing, with 76% saying loyalty pricing has not changed where they shop and 24% comparing prices more due to the introduction of loyalty pricing.
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More than half of shoppers (55%) surveyed thought the price for non-members is inflated during loyalty price promotions. Four in 10 (43%) thought it was unfair that loyalty scheme members pay lower prices for some products than those without a membership .
Access to loyalty schemes
The watchdog found there was room for improvement regarding people’s ability to access loyalty schemes. For example, some supermarkets could do more to ensure people without smartphones or who are aged under 18 could access loyalty prices. This could include introducing offline sign-up and lowering the minimum age for joining a scheme.
A study by Which? earlier this year found that millions of shoppers are unable to sign up to loyalty schemes because of minimum age requirements, not having UK residency or an address, or because they don’t have an email address or access to an app.
George Lusty, the CMA’s interim executive director of consumer protection, said: “We know many people don’t trust loyalty card prices, which is why we did a deep dive to get to the bottom of whether supermarkets were treating shoppers fairly. After analysing tens of thousands of products, we found that almost all the loyalty prices reviewed offered genuine savings against the usual price – a fact we hope reassures shoppers throughout the UK.
“While these discounts are legitimate, our review has shown that loyalty prices aren’t always the cheapest option, so shopping around is still key. By checking a few shops, you can continue to stretch your hard-earned cash.”
Sue Davies, Which?’s head of food policy, said: “Two-tier loyalty pricing has become a common practice across retailers. It’s therefore reassuring that the CMA has found that most of the prices it looked at across supermarkets offered genuine savings against the usual price. However, it stresses that it is worth shopping around as they aren’t always the cheapest option.
“Which? has also looked at prices for thousands of products and repeatedly found examples of loyalty price offers that aren’t as good as they seem. We have also raised concerns that millions of consumers are being excluded from accessing lower prices due to loyalty scheme restrictions. It’s therefore essential that supermarkets act on the CMA’s recommendation and do more to enable people to join their schemes.
“The CMA should continue to monitor loyalty pricing practices across key consumer sectors beyond supermarkets and be ready to use its new powers to take action against retailers that don’t comply with consumer law.”
