MILES OF AISLES -- A SUPERMARKET PRICING SURVEY
5 Supermarkets, 53 Items, and 7 Sets of Prices in 8 Days
by Zelda Gordon, No-Cards Shoppers
November 14, 1999 The Stores The Results
Albuquerque, New Mexico The Short List Specifics
UPDATE! 7/27/2002 Prof. Study Proves Prices Going Up
Finally the week is over and I couldn't collect another meaning-
ful number if I wanted to. Supermarket prices change so quickly that
after a week you'd have to price every item at every store all over
again to get a fair comparison. And since I do want to be fair, above
all, (and not because I feel like I never want to enter another
supermarket as long as I live), I have cut off the data collection
phase of this project and now move on to the analysis.
First to address the questions that lead me to undertake this
dizzying week in the store war trenches:
1) Do supermarkets which have "shopper card" or "loyalty card"
programs inflate their "regular" prices? I have contended that they
do, for several reasons -- to make their card-holder "specials" look
better; to subtly coerce shoppers into signing up for the cards; to
recoup the costs of running their card programs and increase profits.
2) Do supermarkets which have "shopper card" or "loyalty card"
programs offer true savings over other stores' prices? That is, if
you choose to be "loyal" to a store and shop with their card week
after week, will you really be "rewarded" with a lower grocery tab? I
have contended that you won't, that deep discounts on selected items
are offset by average-to-higher prices over all.
Before reporting the results, let me explain my method. My
shopping list started with a set of items provided by C.A.S.P.I.A.N.
(more about the CASPIAN survey). As I took the form around and began
to fill it out, I realized that the task of comparing grocery prices
was every bit as daunting as it had seemed. Even as I began mentally
paring down the survey to a more manageable short list, I was adding a
few items I thought should have been included. Ultimately I priced 53
items at five stores, all within ten miles of each other and five
miles of my home. Two of the stores had card programs, giving me
seven sets of prices, from which I derived an average price per item
and per grocery bill.
With all of this data assembled, I was able to make up my short
list of 25 items, selected on the basis of their being staples in most
households and/or national brand-name products. These totals, then,
do not represent the least expensive way the list could be fulfilled
at every store, but the comparable way. I was trying to price the
same brand, weight and packaging of each item at each store; items for
which this was impossible were excluded from the short list.
The Stores
The Short List
Some Interesting Specifics
The Results -- Week of November 7, 1999, Albuquerque, NM:
______________________________________________________________________
Store Subtotal 22 Subtotal 3 Grand Total %Below/Above
Food Items Non-Food Itms 25 Items Average
Furr's w/Card $ 42.67 $ 5.17 $ 47.84 -8.02%
Albertson's $ 41.52 $ 8.67 $ 50.19 -3.50%
Raley's $ 42.16 $ 8.67 $ 50.83 -2.27%
AVERAGE $ 44.51 $ 7.50 $ 52.01
Smith's w/Card $ 44.88 $ 7.47 $ 52.35 + .66%
Brook's $ 45.34 $ 7.25 $ 52.59 +1.12%
Furr's Regular $ 46.89 $ 7.67 $ 54.56 +4.91%
Smith's Reg. $ 48.13 $ 7.57 $ 55.70 +7.10%
______________________________________________________________________
Based on these results, the answer to Question 1 above is Yes, the
shopper card stores, Furr's and Smith's, do impose higher prices on
those who do not use their cards -- 4.9% above the average cost for
this shopping basket in the case of Furr's, and a whopping 7.1% for
Smith's.
The answer to Question 2 above is Yes for Furr's and No for
Smith's. To Furr's credit, their customers are seeing a real savings
on this basket of groceries when they use the Furr's card. In
exchange for that savings, Furr's customers provide detailed records
of their shopping habits. For some, especially those who can't get to
another store, it may seem like a good deal. Smith's customers, on
the other hand, should be outraged. It looks like they've been
submitting to the surveillance scheme for the privilege of paying the
same or more for their groceries. And if they're not complying with
the card program, they're really getting ripped off!
Now let's compare the card prices and non-card prices to each
other instead of to the average:
Furr's with-card price of $47.84 "saves" the customer $6.72 over
Furr's non-card price of $54.56. Looks like an awesome 12% savings,
but of course it's closer to 8% -- makes it hard to pass up the card
either way. Smith's grocery tab of $55.70 drops to 52.35 with the
card, for an apparent $3.35 or 6% in "savings" -- but we can see from
the above that the Smith's customer isn't even coming out even.
This is fun, isn't it? A lot more fun than crawling along the
aisles on my hands and knees trying to read the price stickers for the
bottom shelf of flour or breakfast cereal or cola. I sure liked it
better when the boxes and bags had price stickers on them. If you
wanted to know the price of something, you just picked it up and
looked... But I digress. What I wanted to say is that the non-card
stores, Albertson's, Raley's, and Brooks, made a good showing without
even getting credit for coupons -- you know, those things the shopper
cards were meant to replace. They all had a variety of items on
"sale," and, more to the point, were actually selling just as many, if
not more items below average prices than the card stores, with or
without their cards. More numbers, please:
______________________________________________________________________
Number of Items Priced Below Average (of this survey) out of
22 3 All 25
Store Food Items Non-Food Items Items
Furr's w/Card 10 3 13
Albertson's 14 1 15
Raley's 10 2 12
Smith's w/Card 10 2 12
Brook's 12 2 14
Furr's Regular 6 1 7
Smith's Reg. 6 2 8
______________________________________________________________________
As far as shopper card specials go, Furr's double-priced 10 of 25
items; Smith's double-priced 7 of of the 25. Out of the big list of
53 items, each store had 15 items double-priced.
I think if there is anything to be learned from this exercise it
is this: A sale is nothing but a sign -- if you really want to save,
know your prices!
Back to Top The Stores
Furr's Supermarket is a New Mexico Corporation. They were the
first to bring shopper cards to Albuquerque. The Furr's I visited is
located in the North Valley at 4th and Greigos. The store is small,
crowded, with narrow aisles and displays squeezed in everywhere. I
used to shop at this store before they introduced the card program.
(Actually, I used to shop at this store when it was a Safeway.) The
workers are friendly and there is a neighborly feel about the place.
The layout is a little quirky, but if you miss something it's not a
very long walk to the other end of the store. Cleanliness is not the
store's distinguishing feature, given the age of the building, but
there was a reassuring scent of cleaning fluids wafting in the air.
I was pleasantly surprised at Furr's with-card showing in this
survey. Too bad those specials aren't available to everyone. And the
"regular" cost of our basket of groceries supports my theory that what
card programs really do is raise the upper limit of grocery prices,
making it possible for the lower limit to creep upward as well.
Update: Apparently the card program wasn't the magic bullet
for the struggling Furrs, which went bankrupt.
Albertson's is one of the biggest supermarket corporations in the
country. They made a name for themselves locally by bucking the card
trend. Recently merged with American Stores Company, they continue to
capitalize on anti-card sentiment, converting west coast Lucky stores
to Albertson's and eliminating the Lucky Rewards Card with great
hoopla. Meanwhile, the two other American Stores' adoptees, Jewel and
Acme, continue to impose card programs on other customers in other
regions. I don't care how low Albertson's prices go, I'll not be
shopping with that company until they stop playing both ends against
the middle. If they really want to be our No Cards store, they need
to eliminate all of the card programs in all of their chains; and deal
honorably with the American Stores databases.
It won't be hard for me to stay away. My nearest Albertson's is
at Montgomery and San Mateo -- not so very far in miles, but those
miles traverse some of the busiest bits of road in the city; and then
the parking lot is just as congested. After fighting my way through
the hordes to get there, the store itself seemed eerily empty -- at
least half of it did. I wandered alone through those miles of aisles
precisely ordered with cosmetics, shampoos, vitamins, even greeting
cards and wrapping paper.
The food half of the store was a completely different matter.
Here were the shoppers, and it appeared that many more had gone ahead
of us. Empty gaps loomed out of the shelves. Several of Albertson's
most appealing "best buy" specials were out of stock. To actually get
my shopping list filled at sale prices, I'd have to go back with rain
checks. Forget it.
Raley's is the new player in town. Their store on the West Side
at Montano and Coors is as pristine and spacious as you'll find. It
almost took my breath away to see the rows of colorful products
perfectly lined up on the shelves. I still had to spend a lot of time
on my knees, though, and those "bonus buy" flags sure didn't help me
read the price cards.
Raley's is huge; it's a long walk up and down those aisles, but at
least the layout is logical and I didn't have to retrace too many
steps. I was pleasantly surprised at the competitive pricing I found
here, as the word around town was that the new Raley's was high.
Perhaps they were at first; if so, they've now brought prices into
line. (At least in the North Valley. Maybe they're trying to lure
those of us who opposed the Montano Bridge across the river. But
that's another controversy...)
A good review for Raley's, then, and we'll be watching to see what
happens as they settle in here.
It's a nice walk for me to the Smith's Food & Drug at 4th and
Guadalupe; I still go up there to use the bank, pay my PNM bill and
have photos developed. But I haven't done much shopping there since
they introduced their Fresh Values Card in the spring of 1997. (I had
only been shopping there for a few months, anyway, since I'd started
boycotting Furr's.) The store is large but not huge. It has the big
housewares, pharmacy and seasonal/specialty sections; and it's open 24
hours. Smith's seems clean enough, but the shelves are cluttered with
lots of little signs and tags for all the different prices and all the
different types of specials they are running. It's the most heavily
bannered store of these five. Various mini-displays obscure one
another in the refrigerator section. The figures above tell us that
this strategic positioning and busy signage is mostly hype.
Smith's was sold to Fred Meyer's soon after introducing their card
program. Fred Meyer's has since been absorbed by Kroger's, now the
country's biggest food retailer. Kroger's is introducing card
programs around the country at a rapid rate.
John Brook's is a local independent grocery chain with several
stores in the Albuquerque area. John Brook's Foodtown on 12th and
Candelaria has become my store of preference since the card programs
chased me away from Furr's and then Smith's.
Brook's is a clean, easily navigated, moderately sized store with
great cashiers and speedy checkout. They do not devote a lot of space
to non-food items but they have a reasonable selection of the
necessities. The produce department is also not exceptional, but
there's a farmer's market right across the street to supplement
Brook's selection and keep prices competitive. Basics like bananas,
apples, potatoes and onions were priced below average at Brook's.
My first impression of Brook's some years ago was that their
prices were a little high. My survey totals bear this out. Even so,
Brook's total for this shopping list is less than both Furr's and
Smith's so-called "regular" price totals. Further, having shopped at
Brook's for a time, I've learned that the store brand is good, and
provides savings on many products without sacrificing quality. The
popular brand name items also go on sale from week to week. In short,
while the card chains make a lot of noise about rewarding "loyalty,"
this store does just that, without fanfare or registration schemes.
Back to Top
Some Interesting Specifics
A pound of butter. On the day the Furr's "Extreme Savings" card
program was introduced three years ago, the price of one pound of
butter (regional brand) jumped from $1.39 to $1.59 for card holders
and $2.59 for the rest of us. Yesterday that pound of butter was
marked at $2.79 for card holders, "regularly" $3.25. Smith's was not
running a special on butter yesterday, they had the same package
marked at $2.79 for everyone. They were also a bit more reasonable
about butter back when their program started. On the day the Fresh
Values card was introduced, the same pound of butter went from $1.19
for everyone to $1.19 for card holders and $1.59 for the rest of us.
For the sake of the current survey, though, I was pricing the national
brand. Where was there real deal on Land o'Lakes? Not at Smith's
($3.89) or Furr's ($3.39), neither of which had a card special to
offer. I would have done much better on butter at any of the non-card
stores, Raley's ($3.09), Brook's ($2.99), or Albertson's ($2.09).
16 Slices of Cheese. You know -- that 12 oz. package of Kraft
American Singles. They seemed to be a featured product everywhere.
Smith's hyped their "everyday low price" of $3.69. But wait, Raley's
had it on special for $2.19 and listed their regular price at only
$3.29. Furr's split the difference with a good solid $2.69, no card
needed; Albertson's beat that at $2.50; and my friendly neighborhood
Brook's stocked our local larders at a mere $1.99 per package.
Bag o' Chips. Lay's, Classic. The bag that's got $2.99 stamped
right on it... Albertson's called this their "everyday low price"
(I'd call it "the going rate"). Smith's posted their card special as
"2 for $4" -- which is just insulting. (Uhm-- duh-- that's 2 bucks a
bag, right?) None of the other stores even bothered. Like I was
saying, things get a lot simpler when the price is marked in dollars
and cents right on the package.
Back to Top
(Disclaimer: Inclusion of a product or brand name on this list does
not represent an endorsement of any kind. Products were selected for
being representative and readily found in grocery stores across the
country.)
ITEM SIZE BRAND/DESCRIPTION
Milk 1 gal cheapest, 2%
Eggs 1 doz cheapest, Grade AA
OJ 1/2 gal Tropicana, not from concentrate
Butter 1 lb Land o'Lakes
Cheese 12 oz Kraft, American
Frzn Broccoli 1 lb Birsdeye or Green Giant, "cuts"
Potatoes 5 lb cheapest, Russet
Onions 1 lb yellow
Apples 1 lb Delicious
Bananas 1 lb any
Hotdogs 16 oz Oscar Mayer, Beef
Egg Noodles 8 oz American Beauty, med/wide/xwide
Rice 28 oz Uncle Ben's or Kraft, Instant
Cereal 15 oz Cheerios
Bread 1 lb 8 oz Wonder "Big" or Sunbeam "Texas"
Flour 5 lb Gold Medal, All Purpose
Sugar 5 lb C&H, White
Corn oil 48 fl oz Mazola
Soup 1 can Campbell's, Cream of Mushroom
Canned Tuna 6 oz Starkist, in water
Peanut Butter 18 oz Jif, creamy
Crackers 16 oz Ritz
Toothpaste 6.4 oz Colgate, Baking Soda & Peroxide
Toilet Paper 4 pk 1-ply Charmin or Scott
Dish Liquid 28 oz Palmolive Back to 7/27/02 Survey
Tips for conducting your own supermarket pricing survey:
* Determine which stores you will survey and plan to visit all of
them within a one-week period.
* Create a form that lists the specific brands and sizes you will
look for, with blanks for entering the card and no-card (where
applicable) prices. Please feel free to use the list above.
* Be consistent in pricing the same or equivalent items from store
to store.
* Fill out the prices for each store on its own form. Log the date
and note any variations in brands or quantities from your master
list.
* Don't try to do your shopping while you're filling out your price
list! Fill in the list, then do your shopping. (Trust me.)
* If in doubt about a price, take the product to the register and
have it scanned.
* Have patience! The first store is really tedious, but this does
get easier as you get familiar with your list.
* Share your results. Reports submitted to No-Cards Shoppers will
be posted on this web site. We'll give you some ideas for
spreading the word in your community as well.
Back to Top
Consumers Against Privacy Invasion And Numbering has posted a
survey of three stores in the San Jose area. Prices were gathered for
41 items. I have taken the same 41 items or equivalents from my
original 53-item survey and tallied them for comparison. Here are the
results:
No-Cards Shoppers Survey/41 Items C.A.S.P.I.A.N. Survey/41 Items
Food4Less $ 85.57
Albertson's $103.14 Lucky w/card $103.39
Raley's $108.84
Furr's w/card $109.36 Safeway w/card $109.10
Smith's w/card $113.28
Furr's regular $116.37 Lucky regular $116.85
Brook's $116.51
Smith's regular $121.88 Safeway reg. $118.25
Wow, Food4Less beat the two card stores' prices handily, and every
price on my survey as well.
Something positive has happened on the West Coast since these
prices were gathered -- two things, really. Safeway has reintroduced
coupons for customers who don't want to shop with cards; and Lucky
stores have become Albertson's, doing away with the Lucky card. We'll
be interested in hearing what impact these changes have on the price
of groceries in Northern CA.
Visit C.A.S.P.I.A.N. for details of their price comparison.
Shopper Cards Raise Prices -- We Told You So!
Reported in 11/29/99 Albuquerque Journal "Business Outlook": A study
commissioned by Wal-Mart Stores, Inc. and conducted by Elliott D.
Pollack and Co. of Scottsdale, AZ analyzed 10 years of grocery pricing
data, measuring Albuquerque prices against the national average.
The conclusion was that Albuq. area consumers have been paying
higher than average grocery prices since 1996, with the disparity
increasing each year. We don't think it's a mere coincidence that 1996
is the year Albuquerque got its first shopper card program, and two
more followed in 1997.
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