Two California consumers are suing T.J. Maxx for using deceptive price comparisons on their price tags. [See lawsuit.]
T.J. Maxx price tags looks like this:
It shows a higher “compare at” price and the lower T.J. Maxx selling price. Average consumers, like the plaintiffs, might believe they were saving that amount of money on the items they were buying because the same item or a similar item was selling elsewhere for the stated higher price.
As it turns out, T.J. Maxx defines “compare at” on their website (and they say on signs in their stores) in a bit of an unexpected way:
What do we mean by “compare at”?
The “compare at” price is our buying staff’s estimate of the regular, retail price at which a comparable item in finer catalogs, specialty or department stores may have been sold. We buy products from thousands of vendors worldwide, so the item may not be offered by other retailers at the “compare at” price at any particular time or location. We encourage you to do your own comparison shopping as another way to see what great value we offer.
T.J. Maxx seems to be saying that its “compare at” prices are merely estimates and not actual prices that it has found for comparable merchandise in the marketplace.
This does not square with state or federal guidelines that seem to require substantiation that a reasonable number of sellers are actually offering a comparable in quality item at the stated “compare at” price.
In T.J. Maxx’s defense, the actual selling price for their merchandise tends to be as low or lower than some of the best prices being offered elsewhere for the same item. And, in many of the cases that we checked, the compare at price that T.J. Maxx uses is conservative and sometimes less than the manufacturer’s suggested retail price.
In this case, Nautica claims the list price of the 20-inch (not 21-inch as T.J. Maxx asserts) suitcase is $320. T.J. Maxx says the “compare to” price is $140, and they are is selling it for $69.99. Who knows what other brand is comparable to this particular item, but this very item sells for no more $99.99 at other stores.
So real life savings are $30 rather than $70 (at least for an identical item).
None of this excuses the company, however, for using estimates instead of basing its “compare to” prices on actual products and their real prices in the marketplace.