Shock, horror! Are some retailers really ripping off their customers?

By: Choc O’Lait • email: info@trunblocked.com

Last year there was a huge scandal related to how some British airport stores were pocketing the Sales Tax (VAT) on the products they sold to non-EU travellers by operating a ”one-price” retail strategy. After a huge public uproar, which actually resulted in the UK’s tax authority (HMRC) instigating an enquiry,many retailers relented and eventually offered full ”Tax Free” shopping to qualifying consumers.

One of these retailers was WH Smith, the news and convenience retailer present in most British airport departure lounges.

Last month, Britain’s Daily Mail featured an article identifying ” Bizarre Offers” made by WH Smith at London Heathrow’s airport stores. Various brands of confectionery, including leading brands such as Kit Kat, Mars and Bounty were being offered at prices dramatically above those found at downtown stores like Tesco. It seems that the airport offer was priced at up to 50% more than usual multi-pack deals.

Kit Kat. Priced at 45 GBP for 48 chocolate bars by WH Smith, when the same number could be bought for 18 GBP at Tesco!

Travellers do not discern between airport stores. Nor do they understand the difference in category or type. They usually buy where the impulse takes them and chocolates are a big driver product in airport stores. Of course they are not duty free in reality, but they are sold in ”Duty Free” stores as well as convenience stores.

Such ”bizarre” and uncompetitive” activity by a major airport retailer goes nowhere to calm consumer anger as to constantly feeling ‘ripped off’ in airports. Nor does it enhance consumer confidence to buy – especially when such a promotion becomes the focus of on-site social media which instantly mocks retailer contempt for shoppers. It does no favours for either retailer or the brand owner.

Is it really any wonder, then, that store penetration is so low? And when will lessons finally be learned to enhance and not inhibit sales?