Around 92% supermarket loyalty schemes offer ‘genuine’ savings, CMA finds
People’s concerns about how their personal data is used did not stop them from joining a loyalty scheme – only 7% of those surveyed said they hadn’t signed up to a scheme due to personal data concerns
The Competition and Markets Authority (CMA) has found that people who are members of a loyalty scheme can almost always make a genuine saving on the usual price by buying loyalty priced products.
Having analysed around 50,000 grocery products on a loyalty price promotion, the CMA found very little evidence of supermarkets inflating their “usual” prices to make loyalty promotions seem like a better deal, with 92% offering genuine savings against the usual price.
As part of the CMA’s work to help people facing cost of living pressures, it conducted a rigorous investigation of loyalty pricing.
This sought to get to the bottom of a number of potential concerns, including whether loyalty prices can be trusted, how they compare to prices at other supermarkets and how accessible they are.
The CMA conducted a consumer survey to understand what shoppers specifically think about loyalty pricing, for example: do they trust it, do they think it’s fair, and does it change where people choose to shop. The CMA also examined supermarkets’ behaviour – including, importantly, their use of customers’ data.
The evidence revealed that almost all products scrutinised – 92% of around 50,000 items – offered a “genuine” saving against the “usual” price in the same store.
It also found that while loyalty prices are generally some of the cheapest available, this wasn’t always the case, meaning it is still worth shoppers looking around.
It was also highlighted that people can make an average saving of 17-25% buying loyalty priced products at the five supermarkets examined: Tesco, Sainsbury’s, Waitrose, Co-op and Morrisons.
76% of shoppers say loyalty pricing has not changed where they shop, but 24% now compare prices more due to the introduction of loyalty pricing.
Additionally, 55% of those surveyed thought the price for non-members is inflated during loyalty price promotions. While 43% of those surveyed thought it is unfair that loyalty scheme members pay lower prices for some products than those without a membership.
People’s concerns about how their personal data is used did not stop them from joining a loyalty scheme – only 7% of those surveyed said they hadn’t signed up to a scheme due to personal data concerns.
As part of its wide-ranging review, the CMA also looked at the way supermarkets collect and use people’s data when they sign up to a loyalty scheme. It did not see evidence of consumer law concerns in relation to this.
However, the CMA did find that there was room for improvement regarding people’s ability to access loyalty schemes.
It suggested that some supermarkets could do more to ensure people without smart phones or under 18s, for example, can access – and know how to access – loyalty prices. This could include introducing offline sign-up, in-store or via the telephone for example, and lowering the minimum age for joining a scheme.
George Lusty, 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.”
