Dive Brief:
- Lidl US has agreed to adjust its approach to comparing its prices with those at stores run by Ahold Delhaize USA in response to a decision announced Monday by the National Advertising Division of BBB National Programs, a non-profit body that provides self-regulation and dispute-resolution services to advertisers.
- The decision stems from a challenge filed by Ahold Delhaize USA that said the discounter’s claims that its shoppers score substantial savings for the same basket of goods were confusing.
- Lidl’s decision to make the changes comes as grocers are jockeying for attention at a time when affordability is top concern for consumers.
Dive Insight:
The National Advertising Division said Lidl should stop using the phrase “exact same basket” in its ads because the goods it refers to are not identical. In some cases, Lidl compares private label goods it sells to national brand items sold by its rivals or presents items of different quantities or weights as the same, the NAD added.
The NAD said it recommends that Lidl stop making claims such as “Save over 30% on the exact same basket when shopping at Lidl versus Stop & Shop” and “Save up to $28 on the exact same basket when shopping at Lidl vs. Giant,” referring to Ahold Delhaize USA banners.
“When comparing two items, consumers generally expect an apples-to-apples comparison of the most comparable competing product. The FTC has indicated that comparisons to comparable, but not identical, products may be permissible only ‘when it is made clear to the consumer that a comparison is being made with other merchandise and the other merchandise is, in fact, of essentially similar quality and obtainable in the area,’” the NAD said in its report.
The NAD also found that Lidl’s ads were “stale” because they were published weeks or months after the grocer made the comparisons. The NAD said that seven days is a “reasonable period of time” for price comparison claims, citing evidence indicating that prices for at least some goods had changed by the time the ads ran and that Ahold Delhaize USA’s stores update prices weekly.
In addition, the NAD said price comparisons by Lidl that Ahold Delhaize USA took issue with could reasonably be seen as confusing by shoppers because they did not reflect discounts tied to a loyalty program.
“Accordingly, NAD recommended that as part of disclosing the basis of its comparison … the Advertiser disclose whether the comparison is to the base price or to the discounted loyalty price,” according the report.
In a statement included in the NAD’s report, Lidl said it would implement the guidance issued by the group “as part of the voluntary self‑regulatory process,” but “respectfully disagrees” with some parts of the decision.
Lidl added that it “will ask that its stores take NAD’s guidance into account in developing future advertising, including the timing of price checks, relevant disclosures about the basis and date of comparison, and avoiding the specific ‘exact same basket’ phrasing addressed in the decision.”
“We appreciate the National Advertising Division’s review and value its role in guiding industry standards – we’re pleased NAD recognized our comparative price claims as accurate at the time they were made,” Lidl US said in a statement sent to Grocery Dive. The grocer noted in the statement that it is “dedicated to providing our customers with high-quality products at everyday low prices, alongside clear and transparent communication about our offerings.”
An Ahold Delhaize USA spokesperson declined to comment on the NAD’s recommendations.
BBB National Programs was formerly part of the same organization as the International Association of Better Business Bureaus, but the two groups are no longer affiliated with each other.
