Why the ‘Law of Tesco’ – what have they got to hide?

Patrick Collinson of the Guardian had a brush with the mighty Tesco last week. Caught on the ‘big brother’ cameras of a London branch of the grocery colossus writing down prices. He was soon accosted by the deputy manager and the manager, and threatened with eviction from the store. In the land of Tesco “thou shalt not write down prices”. It’s against the law – not the law of the land, but the ‘law of Tesco’.

Tesco certainly have the right to ensure their customers behave reasonably and within the law of the land, but they have absolutely no right to prevent people writing down prices and imposing their ‘laws’ on their customers.

So why are Tesco so sensitive about their pricing?  Well, one of the main reasons why Tesco has set out to colonise practically every town in the country is not only to dominate the market, but to be able to set its own area pricing, to be able to trade without any comparison.  They don’t want the value of their ‘special offers’ questioned or compared with other supermarkets. They want you to believe that you’re getting the best possible deal at Tesco – because they say so.

So, if they’re so edgy about their prices, are they as good as they say they are? If you’re not allowed to write the prices down and make your own comparison, you’re never going to know, are you? In the end you have to trust them, but is that trust misplaced? By their reaction, it could well be.

Many people trusted their banks when they sold them PPI insurance. It was a fraud. Supermarket pricing may not be a fraud on the scale of PPI, but it’s a highly sophisticated science designed to confuse. Their pricing algorithms chart every twitch of demand and claw back every penny of any offer made – after all, ‘every little helps’ – Tesco.

The ‘appliance of science’ in supermarket retailing is not what we should be concerned about, it’s another dark art they have mastered – the ‘value bluff’. Patrick Collinson’s  discovery is a typical example. Three bottles of Highland Spring sparkling water £2 (66p a bottle). On the shelf below a pack of four, £3.08 (77p a bottle). The bulk ‘offer’ was actually more expensive. How many shoppers would work out the price per item? Very few.

You’ll find another ‘value bluff’ when similar items are displayed. (A practice frequently used in the fruit and vegetable section.) Let’s take oranges as an example. Some will be displayed priced by weight, others priced individually and there’ll be packs at another price. Not exactly the same items, but similar. The buying decision is most likely be made on perceived value regardless of the item type: however, that perception could well be wrong. How many people will work out whether it’s better value per kilo or by item? Very few.

Both these examples are a deliberate and carefully planned value bluff. It’s not only sharp practice, it’s a betrayal of trust. Banks got too big and powerful and they betrayed our trust. Tesco and the other big supermarkets are doing the same. Will anything change? The supermarket lobby is too strong to expect any positive action from politicians. If there is to be any change it will have to be driven by supermarket customers. So, if you find a value bluff, demand to see the manager and make your point. They might eventually get the message.

‘Tesco’ may be one of the strongest brands in the country, but if Tesco is seen to be guilty of betraying our trust, their precious brand may become seriously devalued.

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