Supermarkets unlikely to be misleading shoppers over loyalty prices – watchdog

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Andrew Feinberg

White House Correspondent

UK supermarkets are not likely to be misleading shoppers over loyalty pricing – but questions remain over whether displayed savings are genuine, the competition watchdog has suggested.

The Competition and Markets Authority (CMA) said it was in the process of analysing thousands of loyalty price promotions among grocers.

They form part of loyalty schemes, whereby customers can sign up to access lower prices, personalised rewards and offers, and loyalty points.

Tesco Clubcard, Sainsbury’s Nectar, Morrisons More and Lidl Plus are among the major membership schemes.

The CMA was looking into whether non-member, or regular, prices may have been artificially inflated by supermarkets to make their loyalty price appear more attractive.

It said it was still undertaking analysis, but that “the results to date suggest we are unlikely to identify widespread evidence of loyalty promotions that mislead shoppers in this way”.

It suggests major supermarkets could avoid the wrath of the regulator when it publishes a full report of its findings in November.

Nevertheless, the CMA said it was looking deeper into the issue of retailers alternating between loyalty prices and “was” and “now” discounts.

The practice raises questions as to what the regular price is for a product and therefore whether shoppers are genuinely making the savings advertised to them, the regulator said.

It is also examining whether shoppers trust that savings are genuine, and how much people shop around and compare prices.

Helen Dickinson, chief executive of trade group the British Retail Consortium, said it welcomes the CMA’s update suggesting it has not found “widespread evidence of misleading loyalty promotions”.

“Whether it’s everyday value, or loyalty schemes discounts, retailers know they have to demonstrate clear value to attract and retain customers,” she added.