Opinion: The Marketing Society Forum - Are Supermarkets Duping Consumers with Nominal Price Cuts?

Marketing, March 17, 2010 | Go to article overview

Opinion: The Marketing Society Forum - Are Supermarkets Duping Consumers with Nominal Price Cuts?


Supermarkets are defending themselves against accusations of cynical price manipulation and an Early Day Motion calling for legislation to force them to publish weekly price lists of all their stock.

NO - TIM DUFFY, CHIEF EXECUTIVE, M&C SAATCHI GROUP

Shoppers aren't stupid. I'd love to think that advertising causes people to run blindly into shops and do exactly as we say, but this is just one part of a bigger story. There is a cocktail of price and value stories - reward schemes, special offers and myriad other deals. The shopper takes into account many factors; and don't forget product quality and brand preference.

Is it devious? Not really. All retailers cut prices, and smart ones do so selectively. This is hardly a revelation.

What are we to make of Professor John Bridgeman's allegation in The Guardian that most price cuts are just 1p? In my book, that is still a price cut. Where would he like us to draw the line - 5p, 10p?

But, says the cynic, the overall basket price might go up. Maybe, but the consumer now has more power and knowledge than ever. Check out Mysupermarket.com - millions of consumers do, and they can use it to compare prices trolley for trolley.

Bad for the consumer? Not really; after all, every little helps.

MAYBE - MARGARET JOHNSON, GROUP CHIEF EXECUTIVE, LEAGAS DELANEY

This is macho marketing. The brands concerned purport to have value propositions for their consumers, but are in fact obsessed with 'not being beaten'.

While we are all moving to a much more transparent world where pricing is clear and tricks can be exposed, the reality for a busy housewife is that she trusts a value proposition and does not forensically check.

Yet, when that same housewife then discovers the brashly advertised price cuts were nominal, when all the while prices were rising more steeply elsewhere in her shopping basket, she will feel duped.

Suddenly, that short-termist 'macho' marketing strategy, that Christmas price war designed to drive shoppers into stores for 'bargains' at an expensive time of year, has undermined the faith in a long-term consumer proposition.

That trust, once gone, is not so easily restored. Asda's brand promise of 'Saving you money every day' and Tesco's pledge that 'Every little helps' don't seem so believable after all - and that's a shame.

NO - NEIL HAMANN, MANAGING DIRECTOR, DIALOGUE141

Price cuts are a tactical way for supermarkets to promote their products and address shoppers' changing needs. …

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