Are Kmart’s "price drops" really making life more affordable?

A video posted on Kmart’s social media platforms showed a range of products, from candles to placemats, and the corresponding price drops. Candles that had been $7 dropped to $6.75, a bath mat that had been $16 dropped to $15, and place mats that had been $2.75 dropped to $2.50.

However, the retailer faced some backlash for the price drops, with comments on Facebook agreeing that 25¢ wasn’t much of a drop, and $1 wasn’t any better.

“$1 off is barely worth mentioning,” wrote one Facebooker. Instagram commenters echoed the sentiment, with one consumer stating, “These drops are not worth advertising.”

Consumers also noted that the price drops were purported to make “everyday living” more affordable. Yet products like candles and beauty products aren’t necessarily a part of everyday living.

“Not really things people really want and need though,” said a Facebook commenter.

The retail giant said the price drops were “here to stay”, but now there are only four products on the list of price-dropped items at the Porirua store. They include a pair of children’s track pants, a bath towel and a plastic lazy Susan storage tray. Two of the four products are on clearance, meaning they won’t be around for long.

The page for Christchurch’s Papanui store lists 24 items: the same four products as above plus 20 different types of Christmas decorations.

So, are the price drops really here to stay?

Specials should be special

It seems as if the “Price Drop” label has quietly been retired, along with the marketing. It’s still in Kmart’s webpage’s code for several products but isn’t visible on the page itself. The few products we could cross-check against the videos that are still on Kmart’s social media platform show the prices haven’t increased.

We asked Kmart if it could tell us what happened with the promotion and its marketing. The organisation didn’t answer our questions, but a spokesperson said, “As an everyday low price retailer, we are proud to offer our customers access to great quality products at affordable prices. As part of that, when it's possible we provide our customers with price drops on a variety of products across our ranges".

We think that if something is called out as a special, it should genuinely be special. Even though Kmart’s price reductions were drops, they might not have been enough to justify the retailer’s marketing. According to the Commerce Commission, businesses shouldn’t exaggerate the savings to be made, and we think it’s possible Kmart did just that.

The Commission said it had received 29 enquiries in the last 12 months related to Kmart. Of these enquiries, seven were about promotions, five were about customer service, with another five about product safety.

Our tips for spotting real specials

1. Check that the deal is really a bargain. See if you can compare the special price with the store’s usual price. Specials should be genuine, and you could be forgiven for thinking a saving of 25¢ isn’t that special.
2. Be wary of comparisons that come straight from the retailer. It’s easy for businesses to fudge comparisons, and our research in the supermarket sector revealed some products are on promotion so often that the special prices are more like the products’ usual prices.
3. Shop around. Have a look at what prices similar products are selling for at other retailers. You might be able to get the same or similar for a better price elsewhere.
4. Look out for other promotions. Along with specials, you’re likely to find other marketing and promotional material, such as “every day low price” or “great value”. These might entice you to buy, but don’t assume the product is any cheaper than it was the week before.
5. Take surcharges and fees into account. Whether shopping online or in the store, make sure you keep tabs on what surcharges and fees you’re paying. Delivery fees and credit-card or payWave surcharges can quickly eat up any savings you make.