San Diego earned national headlines and accolades from consumer advocates for passing a historic, albeit imperfect, ordinance earlier this year to make digital-only grocery coupons and deals more accessible to the digitally-disconnected.
So what are they all going to say now that the city has proposed a revised ordinance that doesn’t regulate most digital-only deals at all?
San Diego’s Grocery Pricing Transparency Ordinance hasn’t even taken effect yet, after it was signed into law two months ago, with a 90-day grace period. But the City Council is already looking to rewrite it, proposing significant revisions that solve many of the original’s problems, but do little to solve the underlying problem that the measure aimed to address.
The just-released set of amendments, due to be considered at next Tuesday’s council meeting, addresses many of the concerns raised about the original ordinance, which required retailers to offer physical alternatives to all digital coupons and discounts.
“Some retailers indicated that requiring printed coupons may be operationally burdensome or environmentally unsustainable,” a memo from Councilmember Marni von Wilpert reads. So the amended ordinance she’s proposing would allow stores more flexibility in providing any form of “in-store alternative” to digital-only discounts. “Industry stakeholders requested clearer language around which types of stores are subject to the ordinance,” the memo continues. So the amended language clarifies that it pertains to grocery stores only, not convenience stores, warehouse clubs or pharmacies.
And, most notably, grocery industry representatives sought clarification on “which discount programs are exempt.” So the amendments explain “that loyalty programs and paid membership discounts are not included under the ordinance’s scope.”
And that could be a problem for many of those who supported the original ordinance. The revised ordinance states specifically that it “does not apply to digital discounts offered to individuals by or through grocery store loyalty programs… like Vons for U and Ralphs Rewards.”
Vons, Ralphs and other major grocers doing business in San Diego offer and advertise plenty of digital-only coupons and deals. But they’re only offered to members of their loyalty programs – you must join in order to access those digital-only coupons and deals. By exempting digital deals offered via a loyalty program, then, the revised ordinance effectively exempts all digital deals offered by the city’s largest grocers, making none of them more accessible to the digitally-disengaged.
The proposed revisions would therefore preserve the status quo, as though a Grocery Pricing Transparency Ordinance was never passed in the first place.
“It sounds like the city overcompensated in trying to address the concerns of the business community,” consumer advocate Edgar Dworsky told Coupons in the News. By “inexplicably excluding any discounts offered through the store’s loyalty program,” the revised ordinance “provides zero benefits for shoppers” and “zero protection for non-tech-savvy shoppers.”
Dworsky, the founder of ConsumerWorld.org, was instrumental in calling attention to many grocers’ habit of prominently advertising after-coupon prices in their weekly circulars, and only disclosing in the fine print that you had to go online to clip a digital coupon or activate a digital deal in order to get that special price. The whole point of San Diego’s original ordinance, he said, “was to help folks like seniors or low-income people who see sale items in the store’s weekly circular or on in-store signs to be able to obtain those sale prices without the need to use the store’s website or app.”
Many stores have been inspired – or perhaps publicly pressured – to address this problem on their own. Some, like Stop & Shop, have installed in-store kiosks where shoppers without their own digital devices can load all of that week’s advertised digital deals to their loyalty account. Others, like Kroger, have printed separate flyers picturing all of the digital deals highlighted in the weekly circular, with a single bar code that can be scanned in store for those who can’t log in to a digital device in order to clip them individually. Still others, like Albertsons, say all a shopper has to do is present the weekly ad to the cashier when checking out, in order to get any advertised digital-only price upon request.
“There are many possible in-store alternatives” to digital-only deals, Dworsky said. “The only tweaks that this ordinance needed was to include only advertised digital-only offers such as in the store’s weekly circular, exclude manufacturers digital coupons that only appear in the store’s digital coupon section of their website or app, and allow stores to make their own choice of how to offer the same digital discounts in-store to their non-tech-savvy shoppers.”
Local organizations in San Diego like AARP and Serving Seniors were very vocal in their support of the original ordinance. Neither of them responded to requests for comment about whether they support the revisions.
Councilmember Sean Elo-Rivera sponsored the original ordinance, pledging to “to ban this unfair practice of only offering discounts digitally.” He boasted before its unanimous passage that “corporations are freaking out” and “trying to water it down,” but promised that he would “not let the corporations win.” A spokesperson for his office also did not respond to a request for comment about whether the revised ordinance serves his stated goals.
A spokesperson for Councilmember von Wilpert merely restated that the revised measure “applies to digital-only discounts that are publicly advertised to all shoppers, and accessible only through digital means” that are “not part of a loyalty program” – but would not clarify which “digital-only discounts” in the city are “not part of a loyalty program.”
A few Southern California-based grocery chains like Stater Bros. offer digital coupons and advertised deals for which you need a store account, though they technically don’t have “loyalty programs.” They may be able to argue that the store account is the equivalent of a loyalty program, and is therefore exempt. Or these locally-owned grocers may find themselves the only ones subject to the revised ordinance, while the larger, national chains – the very “corporate grocery conglomerates” that Elo-Rivera railed against – get off scot-free.
One requirement retained in the revised ordinance states that all grocers doing business in San Diego must post in-store signs informing customers that, by law, “publicly available digital discounts must be available to all consumers without needing to use a smartphone or the Internet, and in-store alternatives must be made available.” The signs do not explain that the law “does not apply to digital discounts offered… through grocery store loyalty programs.” If the revisions pass, shoppers who see the signs, and who have seen all the news coverage about the original ordinance, are likely to be confused when they ask for a digital-only discount and the store insists it’s not required to offer it to them.
If the original ordinance were to take effect as-is – and it still may, if the revised version fails to pass – there was a very real possibility that grocers in San Diego would have shut down their digital coupon programs altogether, rather than try to comply with the measure’s cumbersome requirements. So retailers and consumers alike stand to benefit from what von Wilpert describes as efforts to address “practical implementation concerns.”
But excluding digital discounts offered via a loyalty program effectively guts the measure. “Every store only offers digital discounts through the store’s loyalty program,” Dworsky said. “That’s why you always have to enter your phone number or scan your membership card at the checkout.”
von Wilpert says the proposed revisions “maintain the spirit of the original ordinance — ensuring equitable access to discounts — while making the law clearer and more feasible for all parties to comply with.”
Others are likely to disagree. We’ll find out on Tuesday whether von Wilpert’s council colleagues do.
