PIAC highlighted the challenges consumers face in comparing grocery prices and recognizing when they are getting less value for their money. While loyalty programs and member-only offers can provide savings, complicated conditions, digital requirements and data-sharing demands may put those savings out of reach for some shoppers. PIAC recommended that the Bureau examine the practical implications of retail pricing practices for consumers in the Canadian grocery market. That could be done with further consumer-centric research and analysis, including research involving lower-income and vulnerable consumers.

Personalized pricing may also allow retailers to charge more to consumers who have fewer alternatives. PIAC commented on how shrinkflation—smaller quantities for the same price—and skimpflation—lower quality for the same price—can make it harder to spot reductions in value and choose better alternatives. PIAC discussed how standardized unit pricing can help consumers compare products and package sizes, while emphasizing that it cannot, on its own, reveal reductions in product quality.

PIAC recommended the following:

• Require standardized unit pricing in stores and online: Packaged groceries should display both their selling price and their price per standard unit, such as per 100 grams. Comparable products should use the same measure so shoppers can easily compare value across package sizes. These requirements should cover regular, sale and member prices, as applicable.
• Make discounts and their conditions easier to understand: Member and non-member prices should appear side by side, with the conditions for receiving a discount immediately beside the offer. A member or targeted price should be presented as a conditional discount, separate from the generally available public price, rather than replacing it. This would give consumers a clear benchmark for assessing savings.
• Protect consumers’ personal information: Access to an advertised grocery price should not depend on consenting to marketing, third-party data sharing or other uses of personal information that are unnecessary to administer the discount. Where data collection is necessary, retailers should clearly explain what information they collect, how it will be used and shared, how long it will be retained for, and whether it will be used to select or calculate prices.
• Require clear notices for shrinkflation and material skimpflation: Where the quantity, volume and/or count of a familiar prepackaged grocery product decreases and its unit price increases, a clear notice should appear beside the shelf price and on the product’s online page. PIAC also asked for a more comprehensive disclosure requirement related to skimpflation that could be harder to detect by consumers.
• Protect consumers against unfair personalized and algorithmic pricing: Retailers should not be permitted to charge a consumer more than the public price, or more than otherwise comparable shoppers, because personal or behavioural data suggest that the consumer is willing to pay more or unlikely to switch stores.
• Strong oversight, redress and implementation: PIAC submitted that compliance should not depend on individual consumer complaints. Relevant governments and regulators should proactively monitor compliance and coordinate their efforts to ensure that the framework operates effectively.

For PIAC’s submission, and more details, see here.

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“We applaud Minister Champagne’s action to fund hardworking consumer advocates who for too long have struggled with their own budgetary constraints in trying to help Canadian consumers with their own challenges,” said John Lawford, Executive Director and General Counsel of PIAC.  “The Minister heard the voice of consumers facing higher food prices and is showing consumer groups that the government trusts us and the Office of Consumer Affairs to make a real difference for Canadians,” he added, after an hour long meeting with Minister Champagne and other consumer groups, including Consumers’ Council of Canada, Option consommateurs and Union des consommateurs.

PIAC’s recent submission to the Competition Bureau of Canada’s Retail Grocery Market Study highlighted “shrinkflation” and “shelflation” and other dubious tactics of grocery retailers to confuse customers looking to shop smart and save money. PIAC was pleased to see the Competition Bureau’s Retail Grocery Market Study Report’s conclusion that “Canada Needs More Grocery Competition”.

PIAC was then thrilled to see the Government of Canada’s reaction to these competition concerns in the grocery sector and across essential goods and services in the introduction of Bill C-56, An Act to amend the Excise Tax Act and the Competition Act, which would enact the Affordable Housing and Groceries Act. Bill C-56 seeks to remove the hated “efficiencies defence” (which PIAC has opposed since its creation) that harms consumers from merging companies’ tactics and restricts unfair use of schemes such as restrictive covenants, that limit where competing grocery stores can open. PIAC calls upon all parties and members of the House of Commons and the Senate of Canada to swiftly pass this essential competition law reform.

For more information, please contact:

John Lawford
Executive Director and General Counsel
Public Interest Advocacy Centre (PIAC)
tel: 1-613-562-4002 ext. 125

cell: 1-613-447-8125

@CanadaPIAC

jlawford@piac.ca

https://www.piac.ca

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