Cagey Consumer

The Great Safeway Savings Scam

In northern California and western Nevada, Safeway has been heavily promoting their recently introduced Safeway Club card. In conjunction with this, Safeway has been promising customers that they can earn 5% off their purchases if they reach a total of $250 by Thanksgiving. Here's the exact wording from the October 1997 Safeway coupon book:
From now until Thanksgiving, receive a 5% Savings Award...
each time your purchases reach a total of $250 using your Safeway Club Card.

It's easy...
Over the next 10 weeks, remember to present your Safeway Club Card each time you shop. We'll keep track of all your purchases automatically and show your progress on your receipt tapes. Every time you reach a total of $250 you'll receive a 5% Savings Award -- instantly!

Some shoppers might assume that a 5% Savings Award earned on $250 of purchases would be worth 5% of $250, or $12.50, and that the "award" would be in the form of a gift certificate good for a discount on your next purchase of that amount. Read on!
The more you shop, the more you save...
There's no limit to how many 5% Savings Awards you can earn.

Use your 5% Savings Award to get 5% off your total purchases on any future shopping trip you choose at Safeway. You can use your 5% Savings Awards through December 25, 1997. Limit one 5% Savings Award per trip.

Because the Savings Awards are only good for 5% off of "any future shopping trip", the effect is to reduce the promised savings for most shoppers from 5% to only about 1%. For instance, if you earned a savings award on exactly $250 in purchases, and then used that on a $100 shopping trip, you would receive only a $5 discount on a total of $350 in purchases (i.e. your original $250 in purchases plus the $100 on the trip in which you used your Savings Award), or only 1.4%. If you only made $50 in purchases on the trip in which you used your Savings Award, you would receive only $2.50 on $300 in purchases, or 0.8%. Even if you spent $200 when you used your Savings Award, your $10 savings on $450 of purchases would still be worth only 2.2%.

The worst part about this deception is that many people will not realize that Safeway is offering only about 1% back instead of 5% until after they've received their Savings Award. It will then be too late to decide that they need to "earn" their savings somewhere else.

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