Retailers accuse Walmart of falsifying "Walmart Challenge" price-comparison ads

I've blogged off and on about the accuracy of Walmart's price comparison ads, but now other retailers are calling Walmart out on them as well.

Best Buy, Toys R Us, and several supermarket chains have filed legal complaints against Walmart's advertising practices, saying that in some cases, the prices being compared in the "Walmart Challenge" commercials weren't active during the same weeks the commercials were filmed. Example: A store has an item that regularly sells for $3.99, but the week the Walmart challenge was done, it may have been on sale for $1.99. Walmart has been accused of using the higher, previous-week's price in their challenges to stack the challenge in its favor.

This is something we've known for a long time - as far back as last summer, I took the Walmart Challenge with a receipt I got at Meijer. Walmart compared my receipt to their prices and said I would have saved 65% by buying the same groceries at Walmart... but when I did the math, I paid 20% LESS at Meijer over Walmart's prices -- without even taking into account any coupons. Something wasn't adding up.

CouponsInTheNews.com has several reports on the complaints against Walmart:

Best Buy, Toys “R” Us and a number of unnamed supermarket chains have filed formal complaints with several state attorneys general (read: “Legal Challenges to the ‘Walmart Challenge’”).

In letters to the state’s Consumer Protection Division, Toys “R” Us lodges similar complaints as those it filed in Florida, with somewhat stronger wording. It accuses Walmart of “cherry picking” products and prices, displaying prices that were not accurate at the time the ads ran, employing “bait and switch” tactics in promoting products for which it didn’t have sufficient stock, and engaging in “potential predatory pricing” for selling some items at well below cost.

But in this case, it gets a little murky. Toys “R” Us complained that in one ad, Walmart used different sets of prices that were in effect on different dates. One ad, filmed on December 9th, featured Toys “R” Us prices that were no longer accurate when the ad began airing on December 12th. Yet, Walmart acknowledged, some of its own prices featured were also not accurate when the ad was filmed on December 9th, but instead were in place by the time the ad began airing on December 12th. At no time, it appears then, were the prices that were compared in effect at the same time.

Interestingly, through following this story I learned that Toys R Us' attorney has listed one of my Walmart price-comparison blog posts in its complaint to the Michigan Attorney General. The thing is, the Walmart challenge can easily be "stacked" in favor of Walmart at any time by buying items that aren't on sale, and are at their highest prices at a competitor - then making sure to only buy items that are cheaper at Walmart. It's even easier if Walmart compares prices from stores taken during completely different weeks and sales cycles, when neither of the items were actually on sale at the same time.

As this article concludes, "if Walmart is the one making the rules – only Walmart will ever win the Walmart Challenge."

Read the entire article at CouponsInTheNews.com



Another Reason Not to Shop at Walmart

I already have many reasons to not shop at Walmart. I'm mainly against their business practices. This is just one more item to add to my list of reasons not to shop at Walmart. Those of us who follow your blog don't need to shop there anyway. We can save more money by shopping the deals that you find for us.

Walmart

Just to be clear, I don't have a vendetta against Walmart - though I do think their ads are misleading as they seem to imply that the supermarket is *always* more expensive and they're *always* cheaper. Neither is true. I think Walmart's policy of price-matching other ads is great, and it's something I find myself doing pretty often. But no one store is going to have everything cheaper all the time, and it's unfortunate if they're really stretching the truth to make it seem that that's the case.

Check out this article too: http://couponsinthenews.com/2013/01/04/legal-challenges-to-the-walmart-c...

They found that a Holiday Barbie advertised as being $10 cheaper at Walmart, was in fact the same price at Toys “R” Us, and a Fisher Price Kitchen set advertised as being $20 cheaper was actually up to $30 more expensive at Walmart. Walmart tells CNBC that the prices were accurate when the ads were filmed, not necessarily at the time that they aired.

In a separate complaint, Best Buy says a Walmart commercial compared two completely different Dell laptops, and claimed its was $251 cheaper. In fact, says Best Buy, the matching laptops were the same price at both stores. “The idea of a $251 gap between Walmart prices and ours is outrageous when realistically we are within a few dollars of each other for nearly all products,” the complaint reads.

Expert Witness

Sounds like you should be testifying as an expert witness for these companies.

Not really

Seriously, -anyone- could look at two ads for two stores on any given week and say "We beat the other store." Just pick a list of products that happen to be cheaper at Store Y than Store X that week.

But it appears that they

But it appears that they weren't even doing that. Maybe I'm misreading the article, but it seems that what they were doing was using regular shelf prices ("every day" prices) at Store X and comparing them to sale prices at Walmart, even if Store X had the items on sale in the comparison week.

True

You're right. I was more saying that it would be easy to stack the deck, so to speak, between any stores - simply by buying just what is cheaper. The article is saying that yes, Walmart wasn't price-comparing some stores in the SAME week (same set of sales.) So if something was cheaper this week, but more expensive last week, they might have used the higher, non-sale price.

Listen to Walmart Radio Commercials

I heard the Walmart price comparison program radio commercial on Tuesday morning before I read Jill's article on her blog. The commercial says that they are asking shoppers to compare their stores' SALE prices against the everyday low prices at Walmart. I admit that I'm biased against Walmart, but how often do you think Walmart's everyday price is lower than a sale price at another store? I doubt that it happens as often as Walmart would have us believe in their commercials.

I agree

I would imagine those commercials are equating "sale price" with "selling price," - but again, back when they offered that send-us-your-receipts challenge in Chicagoland, how many of us beat all of the Walmart everyday low prices with our Meijer, Jewel, and other area store receipts? Several of us here did it easily.

You should publish those!

You should publish those!

We did!

Click the link above. :) Other people did it and linked theirs in the comments and elsewhere in the forum.

Too bad they have deleted

Too bad they have deleted everything! I don't know if it's related to the competitor complaints or something else, but they have pulled the plug on the test marketing of the receipt comparison tool, and they've deleted mine!

Well..

... it's a good thing I took screenshots then. :)

I just checked my link and they deleted it too. I know Chicago was a test-market for the online receipt comparison tool, but I guess it didn't last long.

Rebuttal ads

Target and Jewel et al should start paying you to film rebuttal commercials where you buy the same stuff at the other stores for less than WalMarts "low" prices.

Of course you'd do cherry-picked but honest same-day comparisons.

Some stores have

Publix has already done that in markets where Walmart is airing ads saying they're cheaper - check out this graphic:
http://couponsinthenews.com/wp-content/uploads/2012/09/Publix_Walmart_Bi...