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Regulators in the UK plan to investigate loyalty pricing at supermarkets over competition concerns. The Competition and Market Authority (CMA) said last week it will launch a review of grocery loyalty programs at the start of next year.
“We have seen an increase in the use of loyalty scheme pricing by supermarkets, which means that price promotions are only available to people who sign up for loyalty cards,” said Sarah Cardell, Chief Executive of the CMA. “This raises a number of questions about the impact of loyalty scheme pricing on consumers and competition.”
Consumer groups in the UK claim grocers increase regular prices to compensate for discounts offered to loyalty members. As a result, loyalty discounts aren’t as good as they appear, and non-members pay more than they otherwise would.
Food pricing has come under scrutiny in the UK, where the cost of food has risen at its highest rate since the 1970s. The Office for National Statistics reports that typical food costs are 30% higher than they were two years ago.
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