The Competition and Markets Authority (CMA) has started a probe into grocers’ loyalty pricing schemes as part of its work to address cost-of-living pressures in food retail.
The CMA will consider questions including “whether any aspects of loyalty pricing could mislead shoppers, for example, whether the loyalty price is a genuine promotion or as good a deal as presented”.
It will also assess “whether any groups of shoppers are disadvantaged by this type of promotional activity”, whether such programmes affect consumer behaviour and whether that impacts supermarket competition.
Loyalty pricing, such as Tesco’s Clubcard Prices and Sainsbury’s Nectar Prices, has become central to some grocers’ propositions as they compete to win customers when shoppers’ spending power remains squeezed. The Co-op recently made changes to its membership scheme to adopt a similar approach.
Such programmes have prompted questions about whether they result in two-tier treatment of shoppers.
However, such concerns have been rejected by retailers including Sainsbury’s chief executive Simon Roberts. He said last month that its strong Christmas performance was “powered by Nectar Prices” and it had helped customers save an average of £16 on an £80 Christmas shop.
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