A new report by the Competition and Markets Authority examines loyalty pricing in major UK supermarkets, highlighting potential savings and consumer scepticism.
The Competition and Markets Authority (CMA) has released an analysis of loyalty pricing across major UK supermarkets, including Tesco, Sainsbury’s, Morrisons, Waitrose, and Co-op, revealing intriguing insights regarding the savings offered through loyalty schemes. The study examined approximately 50,000 loyalty-priced products and concluded that an impressive 92% provided savings when compared to standard prices.
According to the CMA, customers could achieve savings ranging from 17% to 25% by purchasing items under loyalty pricing promotions. However, the watchdog acknowledged a significant level of consumer scepticism surrounding these discounts; over half of surveyed shoppers (55%) believe that regular prices are deliberately inflated to enhance the attractiveness of loyalty prices. This indicates a general distrust towards the perceived value of loyalty schemes among consumers.
The study was motivated by concerns that non-member prices might be artificially elevated, thereby making the loyalty discounts appear more enticing. Despite the reassurance that loyalty prices do indeed offer legitimate savings, George Lusty, the CMA’s interim executive director of consumer protection, emphasised the importance of consumers shopping around to ensure they are receiving the best deal available.
The CMA highlighted that the access to loyalty schemes presents challenges, particularly for individuals without smartphones or those under the age of 18. A considerable 43% of respondents in the CMA survey expressed their concern about the fairness of differential pricing, as non-members pay higher prices for products that loyalty members can purchase at lower rates. Recommendations were made for supermarkets to enhance accessibility, including potential measures like offline sign-up options or lowering the minimum age for participation.
Moreover, the CMA examined the usage and collection of personal data within these loyalty programmes, reporting that there was no evidence of any laws being breached in this regard. The findings have sparked discussions within consumer advocacy groups. Sue Davies, head of food policy at Which?, acknowledged the reassurance provided by the CMA’s findings while raising concerns regarding the overall effectiveness and fairness of loyalty pricing practices.
Davies noted that, based on their own investigations, consumers often encounter loyalty pricing offers that do not provide the savings they promise. She advocated for supermarkets to consider the CMA’s recommendations seriously and take action to broaden access to their loyalty schemes, thereby ensuring that all consumers can benefit from the associated savings.
In summary, the CMA’s comprehensive evaluation indicates that while loyalty pricing in UK supermarkets can offer notable savings, shoppers are encouraged to remain vigilant and compare prices across all available options to avoid potential pitfalls associated with these schemes.
Source: Noah Wire Services
- https://www.independent.co.uk/business/supermarket-loyalty-pricing-offers-genuine-savings-says-watchdog-b2654421.html – Corroborates the CMA’s analysis of 50,000 loyalty-priced products showing 92% offered savings and the potential savings range of 17% to 25%.
- https://news.sky.com/story/supermarket-loyalty-prices-offer-genuine-savings-regulator-rules-13261527 – Supports the finding that 92% of loyalty-priced products offered genuine savings and addresses consumer scepticism about price manipulation.
- https://www.gov.uk/government/news/groceries-loyalty-prices-offer-genuine-savings-says-cma – Confirms the CMA’s review of 50,000 loyalty-priced products and the conclusion that 92% offered genuine savings.
- https://www.gov.uk/government/publications/review-of-loyalty-pricing-in-the-groceries-sector – Provides detailed information on the CMA’s review and the findings regarding genuine savings through loyalty schemes.
- https://www.miragenews.com/cma-loyalty-prices-on-groceries-offer-real-1366354/ – Reiterates the CMA’s findings that 92% of loyalty-priced products offered genuine savings despite consumer scepticism.
- https://www.independent.co.uk/business/supermarket-loyalty-pricing-offers-genuine-savings-says-watchdog-b2654421.html – Addresses the concern that non-member prices might be artificially elevated and the importance of shopping around for the best deals.
- https://news.sky.com/story/supermarket-loyalty-prices-offer-genuine-savings-regulator-rules-13261527 – Highlights the CMA’s investigation into whether supermarkets inflate regular prices to make loyalty deals more appealing.
- https://www.independent.co.uk/business/supermarket-loyalty-pricing-offers-genuine-savings-says-watchdog-b2654421.html – Discusses the challenges in accessing loyalty schemes, particularly for individuals without smartphones or those under 18, and recommendations for improvement.
- https://www.gov.uk/government/news/groceries-loyalty-prices-offer-genuine-savings-says-cma – Mentions the CMA’s survey findings on consumer concerns about the fairness of differential pricing in loyalty schemes.
- https://www.independent.co.uk/business/supermarket-loyalty-pricing-offers-genuine-savings-says-watchdog-b2654421.html – Reports on the CMA’s examination of personal data usage within loyalty programmes and the absence of any law breaches.
- https://news.sky.com/story/supermarket-loyalty-prices-offer-genuine-savings-regulator-rules-13261527 – Includes comments from Sue Davies of Which? regarding the effectiveness and fairness of loyalty pricing practices and the need for broader access.