(Updated throughout with details from the latest ordinance rewrite, since obtained by Coupons in the News)
The first attempt was draconian. The second was toothless. The third may be the closest they’re going to get to “just right.”
San Diego, the first city in the nation to pass legislation requiring grocery stores to offer in-store alternatives to digital-only discounts, has agreed to further refine proposed amendments to the original ordinance, which could finally accomplish what its proponents have been advocating for – though it still contains some imprecise language that could cause additional confusion.
In response to concerns that the original ordinance passed and signed into law earlier this year went too far in trying to make digital coupons more equitable and inclusive for the benefit of the digitally-disengaged, the city council yesterday voted to amend that ordinance before it came into force.
In proposing those amendments late last week, though, the ordinance’s co-sponsor inadvertently gutted it, by stating that it would not pertain to digital-only discounts offered via grocery loyalty programs. And that describes just about every digital-only discount there is.
So the council has now approved amendments to the amendments, aiming to clarify that loyalty programs are not fully exempt. The revisions explain that a store offering “publicly available digital discounts,” or “a digital discount to all participants of a loyalty program or rewards program, must provide in-store alternatives, so participants engaging in loyalty or rewards programs have access to the digital discount for the same groceries without needing to use a smartphone or the Internet.”
“Publicly available” digital-only discounts appears to refer to advertised digital deals, where the final after-coupon price is featured in a store circular or on a shelf tag.
Those clarifications came near the end of a discussion about the proposed changes to the original ordinance. “I do have one more small amendment to make from here on the dais that we caught yesterday,” council member Marni von Wilpert told her council colleagues.
The problems that she “caught yesterday” were first raised in a Coupons in the News article on Friday that came to the attention of city council staff. Several advocates representing consumers and senior citizens who had supported the intent of the original ordinance were caught off guard by the proposed revisions, telling Coupons in the News that they were not consulted about the changes – particularly the loyalty program loophole – and that they would raise those concerns with the city council.
“We’ve learned so much about grocery stores,” von Wilpert said, acknowledging the help of industry participants and advocates who sought to explain how digital coupons and loyalty programs work. The latest revisions, she said, make clear that “if a digital-only discount is advertised through that loyalty program, that (digitally-disengaged) folks in the loyalty program can still get that digital coupon as well.” If “I see on the shelf there is a digital discount for loyalty member program participants,” she continued, all a digitally-disconnected loyalty program member has to do is say, “I would like that digital discount too,” without having to clip it themselves.
So the newly-revised amendments would no longer offer a blanket exemption to loyalty programs. Instead, as von Wilpert described it, only paid subscription programs and personalized deals are excluded. Otherwise, stores must make “in-store alternatives” to digital-only deals available to those who cannot access those digital deals themselves.
Where does that leave digital manufacturers’ coupons, then? They appear to be in something of a murky middle ground.
The original ordinance would have required stores to offer paper versions of all digital discounts, including the hundreds of digital coupons that many stores have available on any given day. “That was going to be kind of a mess, we realized,” von Wilpert admitted. The revisions allow stores to come up with their own “in-store alternatives,” such as coupon kiosks or printed digital deal “scan sheets.”
But the new revisions also fail to accurately distinguish between “publicly available” (advertised) after-coupon prices, such as “you pay only $1.99, after digital coupon,” and digital discounts available “to all participants of a loyalty program,” which could be read to include all digital coupons. A strict reading of the revised ordinance could require stores to make any digital coupon available to any loyalty program member upon request. This brings things back to square one in a sense, when retail representatives complained the original ordinance would have required them to give away all coupon discounts to everyone.
On the one hand, if a shopper must be a loyalty program member in order to request a digital coupon discount, that could make compliance relatively easy, if that shopper simply needs help loading whatever coupon they request to their account. But if a shopper were to ask for any and all digital coupon discounts that happen to be available for any of the items in their transaction, an employee might actually be required to scroll through the store’s digital coupon gallery and clip each applicable coupon for them, in order to comply with the letter of the law – which would make compliance cumbersome, to say the least. And if a shopper is not a loyalty program member at all, it’s unclear whether stores are permitted to require them to sign up first before allowing them access to any digital-only deals.
This could have been easily avoided with even clearer language, consumer advocate and ConsumerWorld.org founder Edgar Dworsky told Coupons in the News. Among “the only tweaks that this ordinance needed,” he said, “was to include only advertised digital-only offers” – the handful of after-coupon prices displayed in the weekly ad and on shelf tags – but excluding all other manufacturers’ digital coupons that shoppers need to discover for themselves.
Instead, the improved-but-imperfect revisions that passed unanimously yesterday represent an ambiguous but apparently good-enough compromise that business and consumer representatives in attendance, and council members alike, appear to be able to live with. “This is the essence of really fine-tuning,” council president Joe LaCava said. “I really like where we landed on this,” council member Stephen Whitburn echoed.
The revised ordinance will come up for a second reading later this month. If passed again as written, and signed by the mayor, it will repeal and replace the original ordinance and take effect October 1st.
The measure’s sponsors said the twists and turns, the confusion and clarifications, the provisions that went too far and not far enough, simply came with the territory of forging a new path. “There was no legislation to model ours off of,” co-sponsor Sean Elo-Rivera said. “We’re doing what no one else in the nation has done, in terms of making sure we have equal access to online grocery coupons,” von Wilpert seconded. And “the thing about being the first in the nation to adopt this new policy is that we want to make sure we do it right, so the rest of the nation can follow suit.”
Whether they truly did it right, remains to be seen. Either way, it seems that some are already predicting that their efforts to perfect this first-in-the-nation law, will help ensure it won’t be the last.
