Shoppers call out Woolworths, Coles over discount tactic: 'Raising then lowering'
Retail experts say consumers should be wary of supermarket price drops.
A Woolworths shopper who shared his observation of the retailer's discount on a popular product has stirred anger about the way supermarkets price their goods – particularly items that go on sale.
"Anyone else noticed, or tired of Woolworths (and I assume Coles) raising then lowering their prices just so they can whack a big 'Prices Dropped' tag on the shelves?" the customer asked on Reddit.
Citing the example of a 30-pack box of Pepsi Max, the customer posted a web archive showing the price of the soft drink reduced to $24 from $33.50 on August 30 last year. He claimed that this price remained in place "for ages".
"Then somewhere around 17 April 2023 it went up to $35. Now it's back to $26 with a 'Was $35 on 17/5/23' [sticker]," the Redditor continued. "So they raised the price by $11 for a month, then dropped it $9 a month later."
Scores of frustrated shoppers responded with their own examples of supermarkets using this discount tactic, with several people claiming Coles does the "exact same thing".
"These scumbags have made record profits in a time when the supposed reason for price hikes were cost increases for them," responded one disgruntled customer.
Discount rules
Jana Bowden, Professor of Marketing and Consumer Psychology at Macquarie University, says shoppers need to remain vigilant when it comes to deals. "Big brands regularly raise and then drop their prices at various times throughout the year to encourage consumers to buy," Professor Bowden told Yahoo News. "Promotional sales tags or 'specials' discourage consumers from doing their price homework," she noted.
The Australian Competition and Consumer Commission (ACCC) advises in its guidelines around discounts that a "was" or "strikethrough" price must have been paid by consumers for a reasonable period of time before a sale commenced (what is considered "reasonable" varies from case to case).
'Buyer beware'
Professor Bowden adds that discounts create excitement, which leads to consumers buying more on emotion and impulse than rationality.
"This is especially the case when they are used as a 'nudge' tactic to get consumers to spend – a great example of this is the end-of-aisle displays in supermarkets with a 'bargain' being offered, especially multi-pack soft drinks," she said. "However, consumers also frequently (and unfortunately) also assume that a discount tag means that it is a great time to buy."
"Consumers need to do their homework, especially for products that they buy often. That means researching prices over time, knowing what specials are likely to crop up and when, and being aware of whether a promotion is a legitimate promotion or not. It really is a case of buyer beware," Professor Bowden explained.
Woolworths explains pricing
In a statement to Yahoo, a Woolworths spokesperson explained the reasoning for fluctuating prices. "We have received a very large volume of supplier cost price increases during the past 12 to 18 months. These cost price increases have resulted in higher retail prices," they said.
"Woolworths endeavours to be very clear with its pricing so customers can see the benefit of the shelf price reductions in their seasonal 'Prices Dropped' program regardless of whether it's through our catalogue, in store or online.
"The purpose of our seasonal and longer-term 'Prices Dropped' programs is to provide better price certainty for longer on lower shelf prices for our customers."
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