Report: retailers mislead with bogus sales prices

WEST ROXBURY—Sherry Tyrance loves to compare prices when she shops, but admits it’s hard to resist buying something when it’s marked 40 or 50 percent off.

“If it’s 50 percent [off] it’s very hard to walk away from it, absolutely,” Tyrance said.

Boston Consumer’s Checkbook Executive Editor Kevin Brasler says retailers know this, and says companies are using misleading sales prices to fool you into thinking you’re getting a good deal.

“It’s definitely misleading. It’s for sure dishonest,” Brasler said.

Brasler’s team spent 33 weeks tracking sale prices at 25 major retailers. Researchers found many stores’ discounts aren’t really discounts at all, and the regular list price is seldom—if ever—used.

“What we found is retailers overall, when they cross out that list price and say they’re giving you some special price, they’re really not ever charging that list price, so you’re not really getting a deal,” Brasler said. “If you’re showing someone a price and say this is the regular or prevailing price, but you rarely if ever charge that price, well that’s not the prevailing price anymore.”

According to Boston Consumers’ Checkbook, the worst offenders were Amazon, Banana Republic, Dick’s, Foot Locker, Gap, Nordstrom, Old Navy, Wayfair, and Williams Sonoma. Brasler said most of the items tracked at these stores were always—or almost always—on sale. (You can read the full report here.)

Brasler said by constantly offering items at sales prices—and rarely offering them at regular prices—retailers are engaging in deceptive advertising.

“The FTC has a clear regulation on this. It says you can’t say to someone this is the regular prevailing price if you don’t charge that price more than half the time,” Brasler said. “The FTC has really done nothing--in terms of actions against retailers--for doing this.”

Boston Consumers’ Checkbook found a handful of other retailers often misled consumers with discounts. Only three of the 25 retailers—Apple, Bed Bath & Beyond, and Costco—offered legitimate sales, the organization said.

Boston 25 contacted the companies included in Consumers’ Checkbook report. Only Amazon responded to our request for comment.

“To help customers easily understand the price and discount they’ll receive and make the purchasing decision that is right for them, we use a reference price as a basis for savings display. For example, List Prices are suggested retail prices provided by our Selling Partners and displayed only if purchased by customers in our store or offered by other retailers at or above that price point,” an Amazon spokesperson said in an email.

“The industry has a term for these crossed out prices. They’re called anchor prices and they’re a fabrication. They exist only so that they can later on tell you, ‘I’m offering you this for 60 percent off.’ But more retailers these days aren’t ever charging these crossed out prices.”

Brasler said there are things you can do to protect yourself:

DON’T ASSUME THAT A SALE PRICE IS A GOOD PRICE- The store probably offers that price—or an even lower one—much of the time.

SHOP AROUND- Compare prices with other stores and use online tools like Pricegrabber and CamelCamelCamel.

ASK FOR A PRICE MATCH if you find a lower price online. Sherry Tyrance said she does this all the time.

“I still always have to check to see if anybody else has it cheaper. I’m always looking for the best deal so I know just because it’s on sale somewhere does not mean that it is the best deal out there,” Tyrance said.

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