Thursday, 24 May 2012

Special offers

Breakfast TV had a big thing this morning on supermarket special offers being misleading. I was quite surprised at how polite the response from the supermarkets were, to be honest.

I have moaned about "special offers" before, the classic being confusion over adding and removing percentages, but this time I am with the supermarkets.

The sort of thing there were slating was a "3 to 2" offer.

This is a very simple concept for everyone to understand, surely. The item has a price, and if you buy one or two of them, that is the item price you pay, but if you buy three of them then you pay as if for the price of only two.

A "3 for 2" offer is not in any way whatsover suggesting that the item price is lower (or higher) than it was yesterday or will be tomorrow. It is a price right now, and a choice of buying a specific quantity for a specific price, or not. It is clear and unambiguous, and not misleading.

The supermarket did exactly what they said - they charged for two item's price when buying three, exactly as the offer.

The complaint, and crux of the TV article, was that "before the offer" the item price was lower than when they started the offer. In this instance the "offer" did make the price per item lower than before when buying three items, but buying one or two cost more than before.

BUT THE SUPERMARKET NEVER SAID THIS WAS A CHEAPER PRICE THAN BEFORE!

They were not at all misleading in their offer. Prices can change whenever they want and by whatever amount they want. There are rules on claiming a "reduced price" to avoid prices going up for a day and then going down a bit, etc. A "reduced price" offer would be misleading if it was not indeed a genuine reduction. But this is not one of those instances. It was not misleading. It was "3 for 2" as stated.

If the TV article had been at all balanced they would have pointed this out, but no, they claimed it was misleading, and even managed to get the supermarkets to apologise for a "mistake"...

Madness.

20 comments:

  1. Yes but I also heard that one example of these "offers" was a "10 for £4" offer on some yoghurts which were 30p each in the first place....

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  2. There have been offers where the bulk price is more expensive, but not the examples from this morning on TV. If I recall, they said those were previously 30p and now 61p. But that they are 10 for £4. 10 for £4 compared to 61p each is not wrong or misleading. Again, saying 10 for £4 is absolutely not saying this is cheaper than "before". It is saying buying 10 *NOW* is cheaper than buying 10 lots of one *NOW* and that is not misleading.

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  3. You're right about this particular case but you do need to look at each offer critically - which I suspect most people don't.

    The supermarkets know that "on offer" is a powerful selling tool. "2 for 1's" and "3 for 2's" look straightforward enough but not always and here is a good example. I wouldn't be surprised to find that a 3 for 2 offer not only increases the sale of 3x lots of the item but also sales of single units as well. It's the automatic "it's on offer so I'll buy it" response which can easily be exploited. I'd be interested to know whether the unit price dropped after the offer ended. If so it suggests more subtle (and cynical) manipulation of sales than simply "a good offer".

    The scheme-du-jour at the local Tesco is to collect vouchers to purchase items that are "marked down" from ludicrous prices to merely twice what you'd pay elsewhere - I suspect the voucher scheme works around the rules regarding how long items have to be on sale at the higher price before you can claim price reductions with the happy side effect of turning people's brains off in the rush to collect vouchers before the "offer" ends.

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    1. Well, I am not sure they need careful analysis. People are simply mistaken assuming that an offer is any more than it says, and assuming it is "lower than before" is just wrong. All people need to do is consider the price they are being offered, simple as that. Is that a good price or not. Is it worth it for them to buy that item at that price. This is no different whether there is an "offer" or not.

      If the rules have somehow changes, and any "offer" is always to be assumed to be "lower than before", or "cheaper than other shops", then that is going to make it very difficult to do business.

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    2. "All people need to do is consider the price they are being offered, simple as that. Is that a good price or not. Is it worth it for them to buy that item at that price."

      That's simply not true. For items which are not needed right this minute, knowing whether you are saving money over the normal price is an incentive to buy now, rather than waiting a week to buy it then.

      To take a simple example - I can buy a single roll of toilet paper, or I can stock up on a load of it and put the extra in a cupboard. If it's cheaper than usual then I'll stock up. If it's not then I'll buy the best value right now. Knowing which is thus important for me to make a choice.

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    3. OK, yes, true. But that means you need to know what this shop will be charging later, and what other shops will be charging later.

      I would say that no "offer" ever says that, but I know a few cases where "price after sale £X" is stated as a way of avoiding the rules on claiming price reductions.

      Whether the price has simply changed, or whether there is a "3 for 2", does not have any impact on whether the price will be higher next week, does it?

      And even saying "This is lower than it was last week" or "this is lower than other shops" does not say what it will be next week either.

      The old fashioned "sale, all items 10% off, this week only" type think, yes, that is implicitly saying prices will go up next week, though even that is not explicitly saying so. It could be that after the same the company happens to be reducing prices anyway.

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  4. Don't get me wrong - offers should not be misleading. Suggesting something is cheaper than elsewhere, or is cheaper than before, should be a justifiable claim.

    But when all the offer says is "3 for 2" and that is what you get, I think it is crazy for anyone to complain.

    What would happen if a shop routinely has bulk pricing. i.e. every price says "single item price: X, price for Y or more: Z". I could see shops could do this. not an "offer", just that is how they price things. Then one day a they change prices. Is there pricing misleading now because it changed?

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  5. The consumer protection act says:
    Free Offers:
    1.10.4 Do not claim that an offer is free if:
    (a) you have imposed additional charges that you would not normally make;
    (b) you have inflated the price of any product the consumer must buy or the
    incidental charges the consumer must pay to get the "free offer"; or
    (c) you will reduce the price to consumers who do not take it up.

    So it sounds that they can not offer a buy one get one free if they have increased the prices just prior to the "offer".

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    1. Interesting - not actually phrased as "buy 2, get one free", but that would be one way to look at it. Other offers such as 10 for £4 are not a "free" offer though.

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    2. Actually, pondering it, it is the use of "free" as a word that is "misleading" in such cases I expect.

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  6. Perhaps misleading isnt the right word, but is it ethical to increase a price soley to show a phantom saving?

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    1. But not unethical simply to increase the price, only if you do that *and* make a bulk discount offer as well? I sometimes wonder how "ethics" are meant to work? :-)

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    2. I would have thought that the first ethics test would be whether you were aiming to profit from providing a benefit to your customers or aiming to profit from knowing that your consumers are not going to be fully informed.

      Even if you aren't deliberately intending the latter, a behaviour is surely questionable if you are aware of a risk but nevertheless deliberately go on to take it. (In criminal law, FWIW, that would be the mens rea of "subjective recklessness".) A corner shop would be less clued-up than a supermarket chain which carefully studies consumers, knows exactly how they behave, and has the choice to either avoid these sorts of offers or make the terms of the offer more clear.

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    3. Obviously the 3 for 2 offer is intended to get more people to buy more of the item in such a way that makes them more money. But I really do not think it misleading and I would be surprised if they intended to mislead - it is not a time related offer.

      I am not even sure the rules quoted on "Free" count, as you don't inflate the price for one to get the free item. The unit price is the same for one and two of them. It is inflated from previous prices but not inflated as a condition or requirement of taking the 3 for 2 offer - just inflated anyway.

      Maybe I am just naturally more cynical and so would not assume something others do when they see such an offer.

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  7. I remember hearing of someone complaining that an item he was buying in a "10% extra free" pack had in fact gone up so the offer was "wrong". In fact, it had gone up a month previously, for the standard size, and the offer was genuine and had only started that week.

    Comparing prices can get interesting. The most underhand trick, though, is downsizing - selling a smaller quantity for the previous price of a larger one (2 litres for the previous price of 4 pints, for example). I even caught one store doing that, and pointed out that they have a sign up stating that they "will not use metrication as a means to increase prices". All that happened was that the shelf tickets were changed to show the new quantity - no reduction in price.

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    1. I think is someone is making claims that do relate to time - past and future - then it gets quite complicated. People will assume that for some period in the past or future even when not stated, and it makes some sense that there are regulations on that.

      But when shops are not making any time related claim then I cannot see why people assume there is one.

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  8. My current favourite is Sainsbury's, who are selling Discover Fajita Spice Mix at 3 for £4. Or 89p each.

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    1. A certain percentage of people will take the 'offer' without checking. They do it with 4x packs of Coke in the local coop... it's quite a bit cheaper to buy individual bottles.

      We have to remember that shops are not trying to do us a favour. They're trying to get us to spend as much as possible with them whilst not being so blatant that we shop elsewhere. I look on every 'offer' with suspicion. For bigger items I verify against the internet too.. I like to think I mostly come out ahead.

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  9. Was the everlasting "sale" at DFS mentioned?

    I feel sorry for whoever actually paid full price!

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  10. A favourite trick of the supermarkets is the 3 for £2 where the price of the item is something as small as 67p (3 x 67p being £2.01) but usually around 69p or 70p - Hardly an earth shattering saving.

    The other thing that I've never seen mentioned by Watchdog etc is the price per 100g, particularly on offer items. Rarely is the price per 100g shown as applied to the discount price, just the products /original/ price. This is a cute thing to do as somebody comparing items based on the price per 100g may not choose the discounted product because it looks, on the face of it, less value for money.

    Plus the supermarkets are moving back to price per 10g, price per 1000g, price per 1kg whereas they said a few years ago they'd stick to price per 100g for everything (admittedly it was voluntary). Again they use this to confused by having similar items one a shelf with one price per 100g and another price per 10g - the 10g one "looks" expensive but in actuality is great value.

    but anyway that's my rant over for now :)

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