Check it out - a bizarre week of supermarket spin
Last week we were treated to a bizarre week of self-congratulatory media releases by Coles and Woolworths. Was this just another round of spin from the chains or were we finally seeing some real “action”? Well, only time will tell and until will see all the details from Coles and Woolworths the jury will be out.
Let’s look at the PR trail last week. First, we had Coles announce on Australia Day that as of 1 February it was moving to a single national price for 8,000 grocery items and that 97% of products would have the same price within a State.
Why Australia Day? Well there are a couple of theories. Announcing price changes on Australia Day could be seen as patriotic. The other possibility being that Australia Day is ordinarily a “slow” day for business media stories and a “feel good” story may get some attention.
Well, attention it did get, but probably not the attention that Coles was expecting as their announcement sparked strong calls from the media for Coles to “come clean” on the full details of the pricing changes. The media was picking up on the obvious lack of detail in the Coles media release. There was no list of products affected. There were no details on how or whether the prices of individual products would change.
So was the Coles announcement just spin or truly “ground breaking”?
Of course, we can’t tell until we get the full details from Coles. A “trust us” approach from Coles was not going down well with the media and, more importantly, with the customers. The questions for Coles came thick and fast and suspicions of a PR stunt were fed by Coles’ repeated refusal to publish full details on their website. “Let consumers see the full list of products and let them judge for themselves” became the catch cry for the talkback hosts around the country.
What was the Coles’ response to the growing calls for full transparency on the pricing announcement?
In a nutshell “Trust us, it’s all good” but still no details of the actual products involved and any actual price changes. How do we explain the Coles reaction? Well, either the Australia Day announcement was just a PR stunt or any possible savings from the pricing changes are so small or marginal that the media and consumers would be left disappointed if they got the full picture. Of course, if the possible savings were significant, then Coles had missed a golden opportunity to prove how wonderful they really are, something they could have easily done by giving us the full list of affected products and price changes on the day of the media release.
With the relentless questioning of the Coles announcement it was somewhat surprising to find Woolworths making its own pricing announcement that it had moved to a single national price for 12,000 grocery items and that it had “slashed” the price of 3,500 products in the “last few months.” Apart from listing just 16 items in the media release, there were no details from Woolworths regarding all the other products affected and by how much the prices on each of those products had changed.
The lack of full transparency from Woolworths on its pricing announcement just 2 days after the lack of full transparency from Coles on its pricing announcement kept the media interest well and truly alive. Suspicions kept growing that this battle of the media releases from Coles and Woolworths was just another PR stunt.
Why did Woolworths join the battle of the supermarket media releases? Well, with Woolworths unlikely to have appreciated the attempts by Coles to try and upstage Woolworths on pricing issues, there was a “me too” flavour to the Woolworths pricing announcement. “Hey consumers look at us” seemed to be an underlying and recurring theme in the Woolworths response.
The only problem for both Coles and Woolworths was that the media and consumers were not being impressed with the self-congratulatory pricing announcements by the chains given their steadfast refusal to publish a full online list of affected products and any price changes. The sad reality is that Coles and Woolworths could have put the suspicions about a possible PR stunt to rest by simply giving consumers complete transparency on the pricing announcements.
Interestingly, the battle of the supermarket media releases has had one very important outcome and that’s the fact that Coles and Woolworths are telling us that they have a single national price for “thousands” of products. In-store ads at Coles supermarkets around NSW boldly proclaim “same low prices across NSW.” If that’s the case then surely Coles and Woolworths would have no objection to putting that single low price for each product involved on their own website. Once again, consumers need complete transparency from Coles and Woolworths and telling consumers the actual products that have a single low price is critical to consumers making informed choices about where they shop.
The other very important fact to come out of the battle of the media releases is that Coles and Woolworths have joined the food discounter ADLI in recognising the importance to consumers of the chains having a single lowest pricing policy for their products. This recognition is an important step towards putting an end to geographic price discrimination, the practice where Coles and Woolworths have historically charged a different price for the very same product even in the same geographic area.
Now that the supermarkets chains have come on board with a single lowest pricing policy, it’s time that the Federal Government also come on board and give consumers a legal guarantee that the chains, in fact, give consumers the single lowest price for a product in the same geographic area. That legal guarantee can quickly be implemented by enacting the Blacktown Amendment, a Private Members’ Bill sponsored by Senators Nick Xenophon and Barnaby Joyce and written by this author.
The Blacktown Amendment provides that companies such as Coles and Woolworths would be legally required to sell the same product at the same low price at all their respective supermarkets in the same geographic area. The same geographic area is defined as covering all supermarkets of a particular chain within a distance of 35 kms of each other and effectively covers all metro areas and regional centres where Coles and Woolworths have supermarkets.
With three supermarket chains telling us they have a single lowest pricing policy, it’s essential that the Federal Government moves quickly to stop the chains from playing games with the application of that single lowest pricing policy by enacting the Blacktown Amendment.
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