Many products investigated by Which? were at a reduced price for members longer than the original listed price to ‘non-members’ in retailers including Superdrug, Boots, Tesco and Co-op.
Across a six-month period, Superdrug was the worst offender for this, with one in six items listed at the discounted price for more than three months.
For Boots, this occurred for a tenth of the products on offer to its Advantage Card holders, double the number of occasions at Sainsbury’s and three times the number of occasions at Co-op.
This led to the consumer champion questioning how special the offers for customers are in its investigation of 12,000 prices at those retailers.
One case in Superdrug found the Ultimate Day & Night Duo – Olay Regenerist and Retinol Bundle increased to a much higher price for a brief period before being reduced for members.
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The beauty product landed on the shelves at a non-member’s price of £71.98 for just 13 days, while for members, it was £59.99. However, before the hike, it was available at over half the price at £35.98 – whether you had a Superdrug Health & Beautycard membership or not.
In its cosmetic retailing rivals’ stores, Boots had 649 products that rose for non-members on the same day a special loyalty scheme card was introduced.
While the discounts offered on average by the supermarkets and health stores are hefty, with Superdrug slashing by 33% and Morrisons cutting by 25% if you have a membership, the consumer champion warned shoppers “they may not actually be as good as they appear”.
In supermarkets, the discounts were an average of 24% at Sainsbury’s and 23% at Tesco, while Co-op’s new loyalty scheme and Boots both knocked off 10%.
At the beginning of the year, the Competition and Markets Authority (CMA) launched an investigation into the ‘loyalty pricing’ of supermarkets and the wider grocery sector.
The results of that probe will be released before the end of 2024.
‘Some prices looked like an outright rip-off’
Ele Clark, retail editor of Which?, described loyalty cards as “increasingly big business” and thinks the “explosion in two-tier pricing” means shoppers are often paying more than they ought to.
Clark said: “But while the discounts can look impressive, many shoppers are growing suspicious of non-member prices that seem high.
“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.”
Clark added: “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.”
The retailers responded to the consumer champion following the study.
The retailers’ responses
Boots
A Boots spokesperson said: “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.”
Co-op
A Co-op spokesperson said: “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
A Morrisons spokesperson said: “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
A Sainsbury’s spokesperson said: “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.”
Superdrug
A Superdrug spokesperson said: “Our products are regularly on a mixture of members-only prices, multi-buy 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 and 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.”
Tesco
A Tesco spokesperson said: “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.”
