Retailers deliberately use misleading pricing to catch you out and confuse you into spending more money.
Not really a shocking revelation, I'm sure you'll agree, but certainly one that's infuriated savvy shoppers and duped those who are less on-the-ball when it comes to getting a good deal.
Thankfully, now the OFT have officially investigated the sometimes-dubious pricing tactics used by shops and other sellers, they should start to clean up their act.
The OFT have issued guidelines designed to encourage transparent pricing and make it easier for you as a consumer to assess the full cost of something and check that you're getting a good deal before you buy.
However, while they will be policing retailers to make sure they're playing by the rules, there's no guarantee that every company will comply all of the time. So it's essential that you learn their game so you can make an informed decision each and every time you spend.
The OFT identified 5 potentially harmful practices retailers use to get consumers to buy something they didn't need, or spend more than they should. These deals aren't misused all the time, and often they can present an opportunity to save. But some retailers have been taking advantage of the situation and taking shoppers for a ride. Here are the tactics you need to treat with caution:
1. Drip pricing
Favoured by budget airlines, ticket sites and too many shops to count, this is where the full cost of a purchase isn't made clear up front. You think you're getting a good deal only to find that booking charges, credit card fees or postage bump up the cost at the last minute adding a significant amount to the total.
The OFT plan to outlaw this practice so that it's easier to compare prices on a like-for-like basis, but it's important for you to make total cost comparisons when you're shopping around too. It may take a little longer but it'll be worth your while.
2. Time-limited offers
"Today only" type deals that pressurise you into making a purchase without shopping around. While they're fine in principle, the OFT found that some retailers were advertising prices as limited time only deals, when in fact they weren't.
The easiest way to protect yourself from this 'buy now or else' pressure is firstly to ask yourself whether you really need whatever is on offer.
If the answer is yes, then it's worth doing a quick price comparison to make sure it really is a good deal. This could be by comparing cost per unit with other similar products that are available in the store (if you're in the supermarket for instance) or by checking online (this is easiest if you have a smart phone).
Failing that, check a shop's price-match or refund policy to ensure that you can get your money back in full should you need to. Then, purchase the item, compare prices when you get home and if you could get a better deal elsewhere return it.
3. Baiting sales
£99 iPhones, £10 champagne; these are deals that get you rushing to buy whatever's on offer before it's too late.
Designed to draw you into the store and fill you with spending frenzy, the OFT believe this type of deal is absolutely fine providing you actually stand a fair chance of getting whatever's on offer.
Unfortunately this isn't always the case. They found that some retailers were taking the 'limited stock' angle to the extreme and not starting with anywhere near enough stock to fulfill expected demand. Shoppers are left disappointed and retailers are left the opportunity to capitalise on the 'while I'm here I'd just as well pick up...' attitude many of us shop with.
Here's hoping the OFT's crackdown will mean more of us get to take advantage of special offers and not an end to this type of deal altogether.
In the meantime you should make sure that you approach any baiting offer with reason. Check that it is a good deal before you buy, and leave the store empty handed if you couldn't get what you went in for.
4. Reference pricing
These are the 'was £10, now £5' type offers that drive home the fact that you're getting a good deal - whether you are or not.
While this isn't always a problem - although it may encourage you to buy something you don't particularly need just because it's cheap - the OFT found that retailers were advertising products at discounted prices when they hadn't been sold at the higher price for very long, if at all.
The simple way to sidestep this issue is to judge everything you buy for the price you actually have pay for it, not just what the retailer says it should be worth. A good indicator is to consider whether you'd pay the full recommended retail price; if not then you should walk away.
5. Volume offers
The BOGOFs and '3 for 2s' that entice you into paying out for a more expensive brand or item, or buying more of something than you could conceivably use just because it's on offer.
The OFT are stopping retailers falsely inflating standalone prices to con shoppers, and asking that they make the total price transparent so it's easier to judge whether the 'bargain' is as bargainous as it seems.
However, you'll still need to be wary of this type of offer and do the math to make sure buying in bulk is worth your while. Read this article to find out how to make the most of volume offers.
