Supermarket Price Wars

We’ve had superheroes, supersizing, super-injunctions and this morning we had a new one to get our heads around – the super-complaint.

For those not in the know – the super-complaint is something that consumer body Which? calls the “most powerful legal weapon at its disposal”.

In essence the Enterprise Act 2002 allows consumer bodies such as Which? to raise concerns over features of a market in the UK they feel is significantly harming the interest of the consumer.

The last such complaint by Which? until today of course, was in 2011 when it asked the OFT to investigate excessive credit and debit card surcharges. It says the OFT agreed with its findings and subsequently made recommendations for changes which were adopted by the industry.

And so now Which? is calling on the Competition and Markets Authority to look into potentially misleading and opaque pricing practices in the grocery industry.

Which? has identified three main areas of concern. These are confusing and misleading special offers; a lack of easily comparable prices due to the way unit pricing is being done; shrinking pack sizes without any corresponding price reduction.

The CMA also said that Which? is also concerned about the impact of supermarket price match schemes on consumer decision making.

In fact, it’s this latter concern with which I have the most sympathy with the consumer champion.

As someone whose job is to understand the vagaries and finer details of these schemes I certainly couldn’t swear to fully understanding each and every one of them, how they differ, which items the retailers are using to compare their baskets and importantly which items they don’t compare.

Believe me when I say I’ve studied these in detail and still find them less than straightforward. How a busy, time-pressed shopper is supposed to understand them fully, I just don’t know.

However, on the other issues raised, I can’t believe there is a still a systemic problem as highlighted by Which? into misleading prices and promotions. If there is, it is to the detriment of the retailer rather than the consumer.

Which? says it has found evidence of these practices on a regular basis for the last seven years, and yet in the actual evidence submitted to the CMA it has only provided 12 examples.

Given the number of products currently on sale in the grocery market every week and the prevalence of deals – it is estimated that as many as 15,000 lines could be on promotion in any given week - it is hardly surprising that mistakes are made when it comes to shelf-edge labelling and pricing in general.

However misleading or not – there isn’t a single supermarket executive out there right now that won’t admit that over the last few years trust in retail pricing has fallen away and their offers and deals have simply got out of control.

Which? may say it is acting on behalf of the consumer here, but in reality the consumer already knows what is going on, hence the massive migration to the likes of Aldi and Lidl, the variety discounters and the pound shops. Why? A big part of this is the clear pricing strategies.

The new mantra across the big supermarkets is clear, consistent pricing – it may take a while to completely get there but the market has already dictated the direction of travel – we don’t need another investigation to bring in change that is already happening.