/ Money

Getting things for free is a false economy

Discount voucher

Group buying, discount voucher codes, BOGOF offers… every day we’re bombarded with endless ways to save money and get things for ‘free’ – but do they save us money? Does it really pay to get things for free?

Brits are a nation of bargain hunters. Sales, discounts, big savings and loyalty schemes have become part of our consumer culture. And as times get tougher, we love the feeling of getting something for nothing.

A new survey from Halifax shows that discount vouchers, special offers and free deals are saving the average person £1,196 a year. That comes to £51 billion a year. Welcome to the new (horrible new buzzword alert) ‘freeconomy’.

Free isn’t all it’s cracked up to be

The survey found that 90% of adults used discount routes such as money-off vouchers, with eating out, holidays and flights being the three areas where we’re most likely to use discounts.

With prices on almost all everyday essentials heading north, the call of the coupon or voucher code is louder than ever – but is this really a good thing? Getting a bargain is one thing but buying something you didn’t need in the first place, just because it’s cheap, is the most false of false economies.

Who’s getting a good deal?

Supermarkets are packed with two-for-one deals enticing you to buy everything from cereal to cat food but stuffing your trolley with non-essential extras often means wasting money and food later on.

Group buying sites are great for discounts but only if you wanted a fish pedicure, falconry lessons or laser teeth-whitening in the first place.

Then we have cashback sites such as Quidco or Topcashback. Their popularity has surged as part of the ‘freeconomy’ but you need to check carefully that you are getting the best products, especially if you’re buying financial products – saving on insurance now is a dangerous waste if you find you can’t claim when you really need to.

While over half the respondents in the survey say they are saving on restaurants, takeaways and fast food, the chances are they’d be better off eating at home and saving the money that way.

So, while bargains, discounts and cash back on things you really need are obviously great, remember ‘there’s no such thing as free lunch’ – even at Pizza Express.

Emma Bryn-Jones says:
24 August 2011

We’ve never been fans of these marketing ploys at Zero-credit because they’re carefully crafted to help you part with your cash.

UniqueOxford says:
24 August 2011

A great piece – it’s obviously enticing for people to see offers here, there and everywhere, but we know that often they are misleading, so the higher price is chosen specifically to ensure that the “offer” price is the price that they want to sell at (supermarket chains are terribly guilty of this practice). We also know that it may not be the retailer that is taking the pain – the consumer gets a deal at the expense of the supplier.

But, aside from the truth that offers often entice people to buy something they wouldn’t have bought normally, there are other ways in which the price is paid:

– by a race to the bottom that in effect becomes like deflation
– by unfairly giving advantage to the chains and multiples who can withstand these loss leaders for longer than any small independent business
– by pushing custom to discounters, people stop knowing what things are worth, or they stop being prepared to pay what something is actually worth
– and the small guys suffer, which means that the beneficiaries become the big chains and their wealthy bank shareholders in the city
– the local economy becomes a means by which money is transferred outwards and so less employment, less businesses, less opportunity.

You can grab a bargain now, but soon, you may not have income from paid work at all!


I always only buy 2 for 1 items that I would buy anyway – So two packs of dog food simply last two weeks instead of one packet one week – and I get one week’s free.

My only problem is Sainsbury ‘free’ Nectar Bonus points that encourage one to spend more next week for say 100 extra points.- The amount one needs to spend is more than last week – So far I’ve always resisted temptation. It would be nice for the target amount to be less than this week so I could gain a few extra Nectar points – though the number required to get a reasonable reduction in the cost of a weeks shopping is horrendous.


Why do customers flock to loyalty cards?

I ask as the information is used to price goods at a premium to increase profits in any given area/demographic that they assign…. its self defeating, when stores didnt have the customer buying habit information, they had to have genuine offers to entice customers to use their stores.
The more customers use loyalty/reward cards the higher the prices for everyone


I have a Nectar Card because a number of separate businesses I use issue Nectar points – and I can use them all as a discount on my weekly shopping.- or anything else It is not really a loyalty card.

Dave says:
25 August 2011


You may not call it a loyalty card but you are using it precisely as a loyalty card and as Nectar intended. Because you have it, you are less likely to use businesses that you can’t rack up points, and you are less likely to do your weekly shop somewhere else too. It is keeping you loyal and your words are absolute proof of that.

Of course, consumers like to think they are savvy and don’t get conned by the tricks of the trade, but that is understandable self-delusion.


I wish everyone had your perception Dave, and the understanding of how some companies use, in my view, marketing techniques and subtle deception in pursuance of maximising their profits. I drew to the attention of Which? some time ago that these ‘offers’ merely discriminate against the elderly and single people, whilst also encouraging waste. Whilst I had no response I do notice that they do not now so readily embrace these type of ‘offers’.


Sadly you are completely wrong in my case.

I was using the companies and shops that now issue Nactar points many years BEFORE Nectar was invented. I chose these shops over other shops because they offered cheap good items and were reliable and convenient. They STILL offer excellent value.. I would STILL use them if they didn’t issue Nectar Points – just as I did BEFORE Nectar. If another company offered better service and goods I would use them.

But my business needs are catered for by some companies that coincidently issue Nectar points – they all have excellent goods at excellent prices (I do check) and superb accurate deliveries. I use the points awarded to occasionally pay for my week’s food shopping. What do you expect me to do with them? Throw them away??.
I have a loyalty card for WH Smith but I never use.it – I buy my books on-line – it’s cheaper.

Frankly buying two packets of strawberries that went rotten before eating in thirty years (because I didn’t check the date) is NOT an indication I use the Nectar Card as a loyalty card. If another supermarket was local, as convenient, and had the same or better excellent products – I would use it.

I do accept that Iceland frozen veg is marginally better (we had a local one a few years ago) – but if you think I will now drive seven miles – pay £2 for parking – for a £1 packet of frozen veg – you are very much mistaken.

As I said – you are mistaken – YOU may be swayed by loyalty cards – I’m not.


Richard – Loyalty cards work and Dave is right.

You have explained what you do, and I have shopped at Tesco since before they brought out their Clubcard since there is no alternative locally. There will be many exceptions but, in general, loyalty cards work.

Because of the number of people using loyalty cards, the shops raise their prices. The intention is that the customer believes that they are getting a discount, but the truth is that customers who don’t use a card are paying inflated prices.