Late last month, the Washington state attorney general sued Albertsons and Safeway alleging that they manipulated prices just before promoting buy one, get one free sales. (See complaint.)
*MOUSE PRINT:
The AG asserts:
When Defendants schedule a BOGO promotion, they artificially increase the price of the BOGO item in the run-up to the promotion, only to bring the price back down to the pre-BOGO level after the promotion is over.
…on August 20, 2020, the price of a 16.9 oz bottle of O Organics Extra Virgin Olive Oil was $6.99 at the Albertsons on 51st Avenue in Gig Harbor, WA, but Defendants raised the price over 57% (to $10.99) for a BOGO promotion that started a week later. After the BOGO promotion ended, Defendants brought the price back down to $6.99.
Over a five-year period, the lawsuit alleges that Albertson’s overcharged consumers on more than three-million transactions, netting the company almost $20-million.
And this is not the first time the supermarket company has faced charges like this. In 2016, they paid $107-million to settle a similar class action lawsuit, and an unspecified amount in 2023 after a similar suit was settled.
The AG asserts various law violations under the state consumer protection act and seeks restitution for shoppers.
Albertsons Companies operates supermarkets under many different nameplates around the country, including Acme, Carr’s, Haggen, Jewel Osco, Lucky, Pavilions, Randall, Star Market, Shaw’s, Tom Thumb, Von’s, and more. There is no reason to believe that some of these alleged shenanigans are limited to their stores just in Washington state.
However, don’t jump to the conclusion that all their BOGO sales are bogus. There is not a single “regular” price for groceries at supermarkets. Stores offer a variety of sale prices throughout the year. The olive oil above, for example, might be offered at various sale prices during the year, such as $6.99, $9.99, or even buy one, get one free.
Certainly if the store jacks up the price the week before the BOGO sale just to discount it the next week, that is a problem. But retail and advertising laws generally allow stores to establish a “regular” by offering the product in good faith for a reasonable period of time before being allowed to discount it (and make savings claims comparing that sale price to its former price). Washington state does not appear to have specific regulations in this regard.
However, the Federal Trade Commission’s Deceptive Pricing guidelines make clear this prohibition:
Where the seller, in making such an offer, [like BOGO] increases his regular price of the article required to be bought … the consumer may be deceived.
And in a move not good for shoppers just last month, the Washington state supreme court ruled against a consumer who claimed they didn’t really save as much money as they were led to believe when the seller used a misleading regular price. The court found against the consumer saying he/she suffered no actual loss of money despite the misrepresentation.
If I had to guess, Albertsons will settle this case with the WA-AG eventually for a lot of money.
Harris-Teeter does the same. For many years I have noticed price rises a week before a BOGO sale. At least they offer half-price if you purchase one item. No other store I know of does that so at least it’s a plus.
Publix also makes it half if you only buy one
Buy 1 for the price of 2 get one free.
Last week I was at a bar during Happy Hour where they had $5 Margueritas. They were half the size of the regular Margueritas, so what’s the savings???
Why I have started shopping more and more at Walmart Neighborhood market. The price you see is the price you get. Kroger, Albertsons, and most others have so many qualification prices you really don’t know the price.
I’m on the fence and maybe leaning a little on Albertson’s side here. Consumers need to be making value-based decisions at the time that they are purchasing products. I don’t know that it should be Albertson’s responsibility to make sure the customer knows what the price was last week, three weeks ago, and two months ago when posting a price for the product this week.
I would say doubly so, in this case, where the product is actually cheaper (if you buy two) on the BOGO ($5.50/ea) vs the regular shelf price of $6.99 which the product was sold at before and after the sale period. How would the buyer show damages? Are they going to argue that Albertson’s forced them to buy 2 when they didn’t need a second one?
I think we can all agree that we don’t want to consumers to be deceived, but I can hardly agree that they’re being deceived when the price is clearly listed on the label and works out to a cheaper price per product than the regular price. Consumers need to be making value decisions at point of purchase.
It is deceptive because if the price wasn’t raised just before the BOGO sale, the consumer would have paid $3.50 per bottle, not $5.50 per bottle.
I stopped shopping, and using the pharmacy, at Safeway within a matter of months after Albertsons took them over. Way too many issues! Like sales on meat – but if you go in the store there is none of the advertised in the meat case. One day I asked the guy and he said “we only get so many to put out per day and there is no set time to put them out”. Another was buy X number of boxes of soda, but there were never that number of the same kind on the shelf…..
The “old bait and switch” routine
My question is, when stores like Albertsons pay these hefty fines, where does the money go? Is it just lawyers making money? Do shoppers see any of the money? Does the state receive the money? You never hear about what actually happens with the money.
Andy… When the state sues, as in this case, the money generally goes back to consumers as refunds and/or to consumer education programs in the state.