Investigation: Stores offering 'bogus bargains?'

PHILADELPHIA, Pennsylvania -- Stores are always advertising sales, but are they really offering you a great deal?

As it turns out, a nearly year-long test has found potentially disturbing pricing policies at more than a dozen national retailers.

Checkbook Magazine found that, too often, sale prices aren't offering you special savings at all. Instead, they're creating a bogus sense of urgency to buy.

Stephanie Patterson is one shopper who found an unwelcome surprise after looking at little more closely at a pair of earrings. They had a yellow clearance tag with a price of $128.

"And I said, 'Geez, I wonder how much the earrings were originally?'" Patterson said. "So I peeled the sticker back and - lo and behold - they were priced at $98."

Yes, the original price was $30 less than the advertised clearance price!

"I feel deceived. I feel as though I was being taken advantage of," Patterson said.

But this is apparently just one kind of bogus bargain.

Over the course of 10 months, Checkbook Magazine's undercover shoppers tracked prices of select items available for at least five weeks at 19 major retailers. They found in most cases, the advertised sale price was actually the routine price: the one the store charges more than half the time.

When you see 'buy one, get one half off,' you might be inclined to buy the product right then and there.

"You're worried cause if I come back next week the price will be higher," said Kevin Brasler, the executive editor of Checkbook Magazine. "It could be that you have a lower price next week."

At Kmart, Brasler says toy sales are not always what they seem.

"Kmart wants you to think you're saving money by buying it on sale, the problem is they never in our test charge the regular price for it," Kevin said.

A knife set at Kohl's was on sale when the Action News team stopped for a visit. Brasler said they've been tracking it for 44 weeks and was on sale for almost every week.

According to Checkbook Magazine, the worst offenders are JC Penney, Kmart, Kohl's, Macy's, Neiman Marcus and Sears.

They're followed by Banana Republic, Best Buy, Bloomingdales, Gap, Home Depot, Lowe's, Nordstrom, Office Depot/OfficeMax, and Walmart.

"It's for sure misleading. They're just manipulating you into buying now, feeling good about your purchase so you'll make a bunch of purchases while you're there," Brasler said.

President's Day sales are coming up: so will the sales be even better? Brasler says no.

"Even the Black Friday sales we looked at, the offers weren't any better than any other week," Brasler said.

The Federal Trade Commission has a pricing rule, but Checkbook Magazine believes these practices deserve a closer look and consumers have to be smart shoppers.

"Don't be induced to buy that item because it's on sale. Buy what you need when you need it and don't be in a rush," Brasler said.

Also, shop around and ask for a price match. Checkbook Magazine says its testers often found so-called sale items were being sold for less elsewhere.

So, at which stores did they find sales prices do offer special savings? Bed, Bath, and Beyond and Costco.

For more information about Checkbook Magazine's investigation, and what they specifically found at each retailer, visit this page at Checkbook.org.

As for the retailers named as the worst offenders, they tell us they stand by their sale policies, with many telling us their sales comply with applicable pricing and advertising laws. They believe the test failed to consider things like everyday low pricing, price-match guarantees and member pricing.

Action News requested statements from the retailers named the worst offenders. Here are the replies so far:

Sears Holdings

"Sears disagrees with any suggestion that its pricing is misleading or deceptive. Sears is focused on providing its members with great prices on a wide variety of products and services. We do not publicly discuss the details of our pricing strategy, however we can confirm that Sears complies with applicable pricing and advertising laws. While we cannot speak to other retailers' pricing behavior, as a multi-channel, leading integrated retailer we are uniquely positioned to provide discounts to our members and customers in a number of different, legally compliant ways, including things like member pricing, Your Way to Save, store or online only promotions, clearance offers, and offers from third-party marketplace sellers. It is unfortunate that Checkbook.org did not appear to take these factors into account before making its assumptions."

Home Depot

We disagree with the study because it appears they may have counted our "everyday low price" and "new lower price" items, or seasonal and clearance markdowns.

In fact, we rarely have sales because we're an everyday low price retailer and also price match.

Macy's

At Macy's, our pricing cadence varies for each item, based on the nature and seasonality of the merchandise, its family of business, and customer response. Some items rarely go on sale prior to clearance; others, particularly seasonal fashion items, go on sale more frequently as part of promotional or clearance events.

Lowe's

We strive to offer customers the best value at competitive prices in the marketplace. To give customers increased confidence in their purchase decisions, we offer everyday low prices as well as a price-match guarantee.