Asda ordered to change ‘misleading’ supermarket prices

The Competition and Markets Authority (CMA) has been investigating the use of multi-buys, buy one get one free and was/now pricing promotions by supermarkets

76 per cent of people regularly spend more than they meant to in the supermarket because of special offers and multi-buy deals (PA)

Asda has been ordered to change the way that it prices multi-buy items by the competition watchdog as part of a probe into “misleading” supermarket promotions.

The Competition and Markets Authority (CMA) has been investigating the use of multi-buys, buy one get one free and was/now pricing promotions by supermarkets.

It was specifically concerned about the use of such pricing at Asda, which has been asked to provide a written commitment that it will follow industry guidelines from now on.

Multi buy deals and was/now offer have to be genuine, “so shoppers can see when they are getting a real discount and make informed shopping decisions,” the CMA said.

Under the new rules Asda will have to ensure that:

•    “now” prices will not be advertised for longer than the “was” price applied, ensuring they are a meaningful comparison.
•    multi-buy offers will represent better value than a single product before the offer.
•    multi-buy offers will not be immediately followed by “was/now” promotions, so it will be easier for shoppers to tell what is a good offer.

The investigation came after Which? raised concerns about supermarket pricing and promotional practices in 2015.The consumer group accused retailers of using “misleading” deals to create the illusion of cheaper prices.

The CMA said Asda has already started making changes which will be fully implemented by August 2016.

Andy Clark, Asda chief executive, said the grocer is “consistently” recognised as the UK’s lowest price, full range supermarket.

“Asda has won the Grocer 33, the most credible pricing measure in our industry, for the last 18 years, and we’re pleased that the CMA has today recognised that we take pricing compliance seriously,“ Clarke said.

The vast majority of shoppers cannot accurately identify which “buy one, get one free” or other special offer deals are the best value for money, according to a recent survey by the Government-backed Money Advice Service (MAS).

Just one in 50 people selected the best-value option from four sets of offers. About three-quarters of people answered at least one question correctly. The MAS also found that over three-quarters of people regularly spend more than they mean to in the supermarket due to special offers and bogof multi-buy deals.

Asda, owned by the US retailer Walmart, has been hit the hardest by the supermarket price war. In February the retailer announced it will spend £500 million cutting prices in its stores. In February, sales were down 5.8 per cent in the 13 weeks to January 1 – marking its sixth consecutive quarter of declining sales and making it the worst perfomer of all major supermarkets over the Christmas period.