Brand Match: Price fixing by another name?

Supermarket shoppers are becoming increasingly familiar with "brand match" coupons that they receive after paying for their shopping. These coupons may state that your basket of "brand" goods was cheaper than at competing supermarkets. Fantastic! If, however, it was more expensive, the coupon gives you money off your next shop.

Now, the typical shopper may think that this is great. The supermarkets are keeping an eye on how much others are charging for the same branded products, and effectively pay you the difference back if you paid more. In effect, all of the supermarkets are automatically opting to charge the same for these identical products.

Is this legal, I wonder? The OFT (Office of Fair Trading) will step in when retailers are discovered talking to each other and agreeing how much to charge, but what about this? The supermarkets are spying on each other (or sharing their prices with each other, if you like), with the outcome that they all charge the same for a fair chunk of their shelf-space. Maybe they can get away with it because they're not changing the displayed shelf prices; as a consumer you don't know whether something will be cheaper until you see one of these "Brand Match" coupons.

I personally am not comfortable with the system. Each supermarket should charge how much it thinks it can get away with for each product, and react appropriately as sales indicate. To actively price-fix according to its competitors just doesn't seem right.


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