Supermarket loyalty pricing not disadvantaging consumers - CMA

The Competition and Markets Authority (CMA) published its findings on loyalty pricing in the UK grocery sector on Wednesday, concluding that such practices were not creating unfair disadvantages after a nearly year-long review.

It found that loyalty schemes generally offer genuine savings for members without inflating regular prices.

Analysis of around 50,000 grocery items revealed minimal evidence of supermarkets artificially raising standard prices to exaggerate the value of loyalty discounts, the CMA said.

Additionally, non-loyalty customers typically paid consistent prices before, during, and after loyalty promotions.

However, the CMA's report highlighted some cases where loyalty-priced items were significantly costlier than similar products available at other retailers.

That, the competition regulator said, underscored the importance of consumers comparing prices to maximise savings.

It also noted that loyalty discounts were not universally accessible, particularly to individuals without smartphones or those under 18, prompting calls for inclusivity in loyalty programmes.

The CMA advised supermarkets to reassess their practices to ensure compliance with consumer protection laws, particularly regarding alternating promotional strategies such as “was/now” pricing and loyalty discounts.

The authority also conducted a consumer survey to understand how loyalty pricing influences shopper behavior and trust.

It said that while loyalty schemes were generally viewed positively, concerns persisted about the accessibility of the programmes and the use of personal data.

Reporting by Josh White for Sharecast.com.