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Are special offers on electrical items too good to be true?

Special offers

In the market for a new TV? Or maybe a camera for Christmas? Watch out for dodgy offers on electrical goods that might not always be as attractive as they seem. In some cases these deals don’t deliver any savings.

When we looked at the prices of electrical goods over the course of six months at Amazon, Argos, Currys and John Lewis, we found a number of ‘special’ offers that weren’t very special.

In fact, some special offers provided no real savings at all.

Top dodgy discounts

• Comparing an offer price to a recommended retail price (RRP) that was higher than the RRP given by the manufacturer or higher than the price the manufacturer was selling the product for on its own website.
• Claiming that a product was on special offer and suggesting customers stood to make a saving, when other retailers in the market were selling the product for the same price without any kind of special offer being in place.
• Steadily reducing the price of a product over time, but continuing to compare the offer price to the highest price at which the product was ever sold.
• Selling a product at a high price for a short initial period, then selling it at a lower price for months and months while continuing to call this a discount.

Check out our picture gallery to see the dodgy special offers we uncovered, or read the full investigation in the January 2015 issue of Which? magazine.

Are these dodgy deals allowed?

In 2010, the Government published its Pricing Practices Guide, which provides guidance to retailers about how they should display prices, including special offers and discounts. The guidance is based on consumer protection laws – most importantly, the Consumer Protection from Unfair Trading Regulations 2008. Those Regulations ban misleading actions (such as making misleading price comparisons or advertising prices that can’t be achieved) and misleading omissions (such as failing to give you key information about how much you will pay for a product).

However, we found that even where retailers comply with the ‘letter’ of the Pricing Practices Guide when advertising special offers, they don’t necessarily comply with the ‘spirit’. We’re concerned that the current rules aren’t sufficient to ensure that consumers are protected from being misled by dodgy deals.

And we know that everyone likes a bargain. Our research shows that people are inclined to buy products they wouldn’t have otherwise bought when they see a discount that looks attractive.

We don’t think it’s good enough for retailers to say that people should shop around to check the veracity of special offers. We want everyone to be confident that, when they see what looks like a good deal, they can trust that they’re getting real value for money.

Make Special Offers Special

We launched our campaign to Make Special Offers Special last year, calling for changes to the Pricing Practices Guide to ensure we all get value for money from special offers.

The Government has asked Trading Standards to review the Pricing Practices Guide, but progress has been slow. We’re expecting Trading Standards to consult on new guidance at some point in 2015. It’s essential that the Pricing Practices Guide is amended in a way that puts an end to dodgy deals that we believe are misleading shoppers.

Have you seen an offer that looks too good to be true? Or bought something at a ‘discount’, only to find that other outlets are selling the product at the same price without claiming that it’s on offer? And are you confused by RRPs that seem to be sky high compared to what retailers are actually selling the product for?

Comments
Member

Looking at the four Top Dodgy Discount tricks, I think the first one should be outlawed by banning the phrase “Recommended Retail Price”. Recommended by who? Probably the manufacturer, but possibly also the wholesaler, and sometimes the retailer has made it up. In my view the only price that matters for comparison purposes is the one recommended by me! I cannot see what purpose is served by an RRP in a truly competitive market and on-line retailing has made it even more irrelevant.

The second dodge should certainly be prohibited even though it is arguably caught by the offence of making a misleading statement; it’s about time there were a few prosecutions here. Our trading standards services have been starved of resources and become supine in consequence. Not necessarily involving big ticket items, Tesco [and may be others] have a cunning twist on this practice: we are used to their bright yellow shelf labels marking price offers and BOGOF deals but I have noticed they are using the same style of label to show a stock price without indicating in any way that it is lower than in other shops, or lower than a previous Tesco price – this is probably not a contravention but I bet plenty of people fall for the trick and buy one thinking they’ve got a bargain.

Only an organisation like Which? or a dedicated follower of retail prices would be able to spot the third and fourth manipulations. This means they are intrinsically against the interests of consumers and should be forbidden outright.

It will be interesting to see what Trading Standards come up with at some point in 2015 after an unspecified period of protracted deliberation. I shan’t be sitting on the edge of my sofa.

Which brings me to the furniture industry: I have lost touch with the problems we were continually having with their never-ending-but-suddenly-it’s-over sale scenarios. I vaguely remember some sort of concordat being reached but I should appreciate a refresher – especially on whether or not the ‘after offer’ price suggestion has been suppressed as being open to misinterpretation.

Member

If you use mysupermarket dot co do uk, to look up a specific item, there’s usually a graph showing the price over the last year. Many products have yo-yoing prices to such an extent the product has never been on sale at full price for a 28 day period. In fact the “offer” prices tend to account for more the majority of the year, Under sales laws these lower prices should be treated as the new correct price. Yet they’re not. Tesco seem to be very good at doing this,

The level of fines that Trading Standards can issue should be upped 100-1000x fold. And they get to reinvest the money in more resources.

Member

That’s a good point William – when the lower price outlasts the original price [irrespective of length of time] it should prevail and become the reference price for any subsequent change.

Member

I pay no attention to the previous price or recommended retail price of a product. All I care about is the current price.

Member

Likewise. Presumably the theories of market and retail psychology and the results of their research have convinced the store bosses that you and I are exceptions to most shoppers’ behaviour so they persist with their tiresome promotions.

I suppose there are none more smug than the ungullible!

Member

I saw Trading Standards tweet about this article from Which when it was covered by the guardian, so I asked them when will the prosecutions start. As yet they’ve not replied.

Have Which reported these companies and your findings to Trading Standards, and will they actually bother to do anything about this ? I suspect not.