UK watchdog says supermarket loyalty scheme prices offer genuine savings
CMA launched review into loyalty prices in January
Analysed 50,000 grocery products on promotion
Says shoppers can make average saving of 17-25%
Adds review's findings in paragraphs 4, 6-9, share reaction in paragraph 10
By James Davey
LONDON, Nov 27 (Reuters) -British supermarket prices offered through loyalty schemes do provide genuine savings, the competition regulator said on Wednesday.
Loyalty schemes such as market leader Tesco's TSCO.L "Clubcard Prices" and No. 2 Sainsbury's SBRY.L "Nectar Prices" offer significantly lower prices for members and have proved hugely successful for the UK's biggest supermarkets.
The vast majority of UK shoppers now use them and an increasing number of products are covered by the schemes.
The Competition and Markets Authority (CMA) launched a review in January to consider their impact on shoppers. In July, it said it did not expect to identify widespread evidence of promotions that mislead consumers.
It said on Wednesday it had analysed around 50,000 grocery products on promotion and found very little evidence of supermarkets inflating their "usual" prices to make loyalty promotions seem like a better deal.
The CMA found shoppers can make an average saving of 17% to 25% buying loyalty priced products at the five supermarkets examined - Tesco, Sainsbury’s, Waitrose, Co-op and Morrisons.
"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," said George Lusty, the CMA's interim executive director of consumer protection.
"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."
However, Lusty did note that the CMA's review had shown that loyalty prices were not always the cheapest option, and advised customers to shop around.
Shares in Tesco and Sainsbury's were up 0.5% and 0.2% respectively in early trading.
As part of its 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.
Reporting by James Davey, editing by Paul Sandle and Edwina Gibbs
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