By now, it’s no secret that supermarkets often use ‘sneaky’ psychological tricks to get us to spend a little more money in-store.
From putting Easter eggs out immediately after Christmas to rearranging the entire shop, there are plenty of ways they get us to buy things we didn’t really need, and Martin Lewis has just brought yet another example of this to our attention.
The Money Saving Expert shared a snap on social media from a recent visit to a Co-op supermarket in the UK, showing the price of two different-sized packets of Jaffa Cakes on the shelves.
One box was a ‘twin pack’ featuring 18 Jaffa Cakes, while the other a single with 12 Jaffa Cakes inside. The cost of each was circled, showing the twin pack was on offer for £1.85, down from £2.85, while the smaller box was £2.25.
According to Martin, this is an example of a retail strategy known as ‘price referencing’.
What is price referencing?
This is a marketing strategy used in all sorts of stores across the UK, where a lower advertised price is compared against a higher ‘reference price’.
The Advertising Standards Authority (ASA) claims the reference price can be ‘the price at which the product was previously sold, a price recommended by a manufacturer or a competitor’s price’.
These prices are usually shown in order to make the current deal seem like it’s better value – but that doesn’t necessarily mean you’re getting the amazing bargain you think you are.
In the case of Co-op’s Jaffa Cakes, the twin pack does actually work out cheaper than the single pack when you do the math: £1.85 divided by 18 works out at about 10p per Jaffa Cake, while £2.25 divided by 12 is roughly 18p per cake.
However, this isn’t the crux of Martin’s post, as he’s highlighting that the pricing still isn’t ‘particularly cheap’ even though it seems better value.
He explains: ‘Just saw this Jaffa Cake pricing in Co-op.
‘£1.85 isn’t particularly cheap for 18 Jaffa cakes, yet by leaving the single pack there with 12 for £2.25 it provides a psychological reference which makes the discounted price feel cheaper.’
He adds: ‘Ps let alone the fact the twin pack doesn’t have double the single pack. It should be a one and a half pack.’
Look at the unit price instead
In the comments of the post, fellow shoppers were quick to share tips to avoid being sucked in by psychological tricks such as this one, with many recommending going by the ‘unit price’ instead.
This is the cost for a single unit of the product, either per kilogram, litre, pound, or even per item. Looking at this price allows you to compare different-sized packets to see which is actually better value for money.
@tracierose143 said: ‘I try to always check the cost per unit. Sometimes I have to stand for ages, as it’s not always easy to compare a twin pack because the single pack and the twin pack are made up of different volumes. And sometimes I just give in and make a guess.’
Similarly, @itsme_emzyd commented: ‘This is when my maths GCSE comes in. I would be straight on the calculator (you know the one I’d “never be carrying around in my pocket”) and working out how much each individual Jaffa cake was.’
And @yvo_sullie added: ‘I am fed up with all supermarkets doing this. Takes so long checking out what size pack works out cheaper ( and it’s not always the bigger pack), and even more annoying is when some get broken down per 100g and other per kilo.’
Metro has contacted Co-op for comment.
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