The Competition & Markets Authority has finally published this week the results of its ‘investigation’ into loyalty pricing. What a damp squib! After examining “tens of thousands” of prices it’s concluded “it is unlikely to identify widespread evidence [that] loyalty promotions mislead shoppers”. You don’t say!
And yet, incredibly, its investigations are “ongoing”: after a year’s painstaking and pointless analysis, only now is it ready to ask shoppers how they feel about loyalty prices. Of course they could have taken a sneak peak at the research The Grocer conducted with Toluna & Harris International in March. That would have told the CMA what they already appear to know: that shoppers love loyalty prices. But why not string it out and report back in November, eh?
Don’t get me wrong. The CMA’s recommendations on unit pricing are a good thing: as it notes, poorly drafted legislation has resulted in a lack of consistency and transparency in the presentation of pricing. I also think the fuel price finder scheme will be a good thing as the lack of national pricing means it’s hard to know when you’re getting good value at the pump.
But I do worry sometimes at the conclusions the CMA draws from some of its findings. On fuel for example, it’s observed that “retailer fuel margins – the difference between what a retailer pays for its fuel and what it sells at – are still significantly above historic levels”. You don’t say! Is the CMA not aware that the cost of living crisis has resulted in a “significant” and “historic” increase in pay and other costs? It’s also bizarre to assume that supermarkets – with their sub-3% profit margins – will, either individually or collectively, set a good example (as the driver lobby suggests) based on historic norms, so that the oil majors follow suit.
As a market regulator the CMA needs to be more measured and accountable before launching into some of its gold-plated investigations. And none more so than its byzantine loyalty price investigation: a scandalous waste of taxpayer money precipitated by the “dodgy analysis” of Which?, who are accountable to no one – least of all consumers.
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