Consumer Watch: Tricky 'specials' hide real deal

By Susan Edmunds

Supermarket promotions and special price tags may not always indicate a discount

NZ shoppers are among the most "specials-driven" in the world. More than half of what we buy at the supermarket is discounted. Photo / Thinkstock
NZ shoppers are among the most "specials-driven" in the world. More than half of what we buy at the supermarket is discounted. Photo / Thinkstock

If you want to save money at the supermarket this weekend, it might be as easy as spending a bit more time scanning the shelves.

Allegations about the treatment of supermarket suppliers have made headlines, but experts say it's not just producers who are being pushed to offer maximum returns for the retailers - supermarkets have finely honed their tactics to get the most money possible out of every shopper.

And we often fall for their tactics because we want to get through the shopping as fast as possible.

New Zealand shoppers are among the most "specials-driven" in the world. More than half of what we buy at the supermarket is discounted.

But sometimes you can save money by steering clear of not-so-special specials.

Denise Conroy of the University of Auckland said it was common to see bigger price tags as a tactic to make it appear an item was discounted.

"They're not always. You lift up the tag and there's the same price underneath."

That was the case this week with Homebrand malt biscuits. A large tag advertised it was $1.29 but the tag underneath said the same thing.

Supermarkets would also price a new item highly so it could then be reduced to make it seem discounted, she said.

Consumers should be careful about specials that meant buying more than they needed to get a discount.

"You might pay 20 per cent more to get 50 per cent more, then end up not using it anyway," Conroy said.

Supermarkets have their own branded discount campaigns - such as Countdown's Price Lock Down deals and New World's Super Savers - but Rob Hamlin, senior lecturer at the University of Otago's marketing department, said customers should not always rely on these being the cheapest deal.

Hamlin said those brands were some of the most powerful and usually there would be a Super Saver deal in each category at New World.

"People assume it's selling for less than normal and go for it in greater numbers."

That would sometimes be at the expense of a special that offered a bigger discount or a cheaper everyday price, he said.

"It's worth spending an extra second or two looking at the displays. These little differences add up to a lot of coin over a year. The more care you take, the better off you should be."

Nielsen research showed shoppers spent an average of 15 seconds at the supermarket shelf and noticed less than 40 per cent of the products. In some categories they noticed as little as 15 per cent of products. And you could almost always get a deal by comparing brands.

Dr Rick Starr, senior lecturer in the department of marketing at Auckland University's graduate school of management, said each category would always have a discounted item.

If it's not Coke, it will be Pepsi. If what you want isn't on special one week, buy it the next week.

Last week, 2.5-litre Coke was for sale as two for $5 at Countdown. This week it was three for $6, and 2-litre Pepsi was $2.29.

Countdown this week had a 12-pack of Purex toilet paper for $5.99 on a "price drop" special and Quilton for $4.99 on a "windback" special. But Homebrand's non-discounted variety was $3.89.

"Most people assume that if it's got 'special' it's a bargain," Hamlin said. "Maybe it is, maybe it isn't."

The Nielsen research showed two-thirds of the decisions about brands were made in-store. Supermarkets laid out their shelves accordingly: eye-level shelves were premium real estate and big-name brands were usually placed there.

But a practice known as ribboning meant a strip of store-brand products were placed alongside, making them look cheap in comparison to the premium brand. But if customers looked lower, they might find a basic brand was cheaper.

Hamlin said supermarkets used brands such as Basics and Budget to set the bottom of the market. Customers would judge the price of more expensive brands in comparison. "It's organised so we will spend the maximum we can be persuaded to spend."

Conroy said people could save money by being more aware. Planning what to buy and keeping an eye on prices would help, she said.

A Countdown spokesperson said: "How specials and pricing is developed involves a number of factors, however, ultimately it's up to our customers as they decide what they're willing to pay."

- Herald on Sunday

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