Pharmacy specials: Are they really saving you money?

My first job as a 14-year-old was at a family-owned pharmacy in Gisborne. Over several summer holidays, I worked the till, wrapped gifts and put price stickers on new stock. When a prescription item was out of stock, I walked to one of the other pharmacies around town to pick up the necessary item to complete our customer’s order.

The pharmacy had a small range of perfumes, make-up and skincare. Other big sellers were sunscreen, mosquito repellents and dietary supplements. But prices weren’t cheap, and specials weren’t common.

These days, the pharmacy retail landscape is a different beast. Gisborne now only boasts one local pharmacy, in the main street.

Whenever we visit a big city, we’ll often pop into a Chemist Warehouse or Bargain Chemist just to stock up. These major pharmacy chains carry thousands of items and their shelves always sport colourful specials tags vying for shoppers’ attention.

But are they cheaper? We tracked online prices for a basket of 14 items over 6 weeks, comparing identical baskets for Bargain Chemist, Chemist Warehouse and Life Pharmacy.

We wanted to find out how often products were on special and whether specials are as ‘special’ as the pharmacies would like us to believe.

Our shopping basket included supplements, skincare, perfume and first aid items. We also tracked the price of 2 bigger ticket items – an electric toothbrush and a blood pressure monitor. We were interested in comparing more expensive purchases. However, we didn’t include these in our total weekly basket because we wouldn’t purchase these items as often as the other products we’ve tracked.

What’s the cheapest pharmacy?

Bargain Chemist was the cheapest pharmacy in our survey. It had the cheapest prices 4 out of the 6 weeks we surveyed. On average at Bargain Chemist, our basket of goods cost $272.51.

Chemist Warehouse, with its “Stop paying too much!” claim, had the cheapest prices 2 of the 6 weeks. But on average, we paid $287.29 a week. That’s nearly $15 a week more than we paid at Bargain Chemist.

Life Pharmacy was a lot more expensive. Its average basket cost $340.22 a week –over $50 a week more than the discount chains. That extra expense will really add up if you’re buying these items several times a year.

The Life Pharmacy brand is owned by Green Cross Health Limited. Individual Life Pharmacy stores are usually franchises or partly owned in joint venture arrangements.

Specials on steroids

Shelves lined with colourful specials tags are a common sight greeting shoppers at pharmacy chains. It’s a similar scene online. Chemist Warehouse touts its “Why pay”, “Stop paying too much!!” and “Better than ½ price off RRP” slogans. At Bargain Chemist, you’re confronted with “Why pay” and “Price alert” tags.

Both chains also have a price promise. If you find a cheaper price at a New Zealand pharmacy, Chemist Warehouse and Bargain Chemist will match the price. Plus, they will give you an extra discount of 10% of the price difference.

Bodo Lang, professor of marketing analytics at Massey University, said New Zealand is in the middle of a ‘pharmacy war’. That’s why we are seeing so much price promotion by pharmacies.

“This fight for dominance between chains, including Bargain Chemist and Chemist Warehouse, means we are seeing aggressive marketing tactics,” Lang said.

According to Nielsen research data, in 2024, chemists had the biggest growth in advertising spend – up 39% on 2023. Chemist Warehouse was the fourth largest advertiser in 2024 – outspending companies such as KFC, ANZ, and One NZ. Chemist Warehouse also uses influencers, including Dan and Honor Carter and Lisa Carrington to promote its brand.

Lang said this means these companies are serious about not just taking a slice of the market but disrupting and dominating it, too.

“These large chains differ from more traditional pharmacies, such as Life Pharmacy, in what products they store, how many items they stock and the store’s price image. As their brand names imply, they are positioning themselves on low prices.”

Lang explained the impression is consolidated through store layout and fit-out and the extensive use of low-price cues, including red and yellow price stickers.

“It’s not surprising consumers feel overwhelmed when they enter a store,” said Lang.

In May, Australian consumer advocacy organisation Choice found pricing tactics at major chemists, including Chemist Warehouse, are confusing customers. Roughly 1 in 3 people find it hard to tell if sales tags represent a discount. 

Nothing special about specials

During our price tracking investigation, we found many examples of price promotions. While the tactics can be very persuasive, we think some specials aren’t as ‘special’ as the pharmacies would have us believe.

Misleading recommended retail pricing claims

Several of the products we tracked at Bargain Chemist and Chemist Warehouse had “Why pay” specials tags. These were sometimes accompanied by a second claim, such as “Price alert 45% off RRP” at Bargain Chemist or “Better than ½ price off RRP” at Chemist Warehouse.

These specials are based on products being priced cheaper than their recommended retail price (RRP). A manufacturer can suggest an RRP for a retailer to sell their product at, but there’s no obligation for the retailer to use that price.

We think it can be misleading for a retailer to compare its prices with the RRP. It only works if the RRP is the price that consumers typically pay and the retailer can show that the product is selling at that price elsewhere.

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Elizabeth Arden Green Tea Scent Spray, 100mL
Elizabeth Arden’s Green Tea Scent Spray 100mL had a promotion claim every week we surveyed at Bargain Chemist (“Price alert”) and Chemist Warehouse (“Better than ½ price”). Chemist Warehouse’s “Why pay” price was consistent at $77. But Bargain Chemist upped its “Why pay” price from $45.99 to $77 during our tracking.

Life Pharmacy didn’t have this product on sale. However, its regular price was only $32.

We couldn’t find this product for sale anywhere at the $77 RRP suggested by Bargain Chemist or Chemist Warehouse. The week we checked, Farmers was selling it for $33. This is the retail cost Elizabeth Arden advised us Farmers would be selling this product.

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Good Health Viralex Attack 60 capsules
It was a similar story with this supplement. Bargain Chemist and Chemist Warehouse both stated “Why pay” prices of $68.95. But we couldn’t find this price online at other retailers.

Lang said retailers often use RRPs as a sales’ tactic to suggest to consumers that their price is lower than normal. But in many cases, the RRP isn’t meaningful.

“Consumers should shop around and compare prices for the same product, at the same time, at a range of New Zealand retailers. If they don’t, they risk overestimating how much they might save. Or they might spend more than if they had bought the product elsewhere.”

Misleading “Stop paying too much!” specials

A Consumer supporter contacted us about the pink price labels used by her local Chemist Warehouse in Henderson, West Auckland. She told us these pink labels are placed over the regular yellow price stickers. She assumed the pink labels meant an item was on special.

However, after removing several pink labels she found the same price underneath. She was annoyed at the deceit.

To verify the complaint, I visited the Hastings Chemist Warehouse. Snap! Every pink label I checked had the identical price underneath.

We think these labels are misleading, giving shoppers the impression the products are on special when they’re not. It’s not the first time we’ve written about this practice.

In our 2023 investigation into pricing confusion at Chemist Warehouse, we found other examples of misleading catalogue deals and pricing in the catalogue.

Lang said the extensive use of tickets and labels in attention-grabbing colours, such as red, yellow and pink, has three main effects.

“First, collectively, these labels suggest that the store offers low prices in general and adds to the store’s ‘price image’. Second, each product that has a special ticket or label leads consumers to believe the advertised price is low. Third, consumers are likely to be overwhelmed by the information tsunami they face in store and online. This means they are likely to take decision shortcuts – using the labels to simplify the options. As a result, they may make a poor decision.”

Misleading long-term specials

Bargain Chemist

• 4 of the 16 products we tracked had a “Price Alert” special each week we surveyed.

• An additional 3 products had this tag 4 out of 6 weeks.

Chemist Warehouse

• 2 of the 16 products had a “Better than ½ price off RRP” special each week we surveyed.
  

Life Pharmacy

• Continuous specials.

• 2 products were on sale each week we surveyed.

While we were pleased Life Pharmacy included a sale-end date with each sale product, for 2 products, a new sales period began immediately after the first one ended. One product (Band-Aid Tough Strips, 40 pack) is still on sale, 1 month after our price tracking finished.

Genuine price promotions are good for your budget. However, we are concerned long-term specials aren’t delivering the savings the pharmacies are trying to convince us about. A 6-week sale seems like a long time for a ‘special’ price.

As Lang said, “This practice can make it difficult for consumers to understand what the real price is versus the ‘special’ price”.

The Commerce Commission says advertising ‘specials’ must be offering something genuinely special, such as genuinely lower prices, or they risk misleading consumers.

In 2023, Consumer NZ lodged a complaint with the Commerce Commission about misleading supermarket pricing and promotions. We received over 600 alleged examples during our 9-month campaign to end dodgy specials at the supermarket.

We will be raising our concerns about pharmacy prices with the commission too.

If you think you’ve been misled by prices at a pharmacy, please email us.

Company responses

We contacted the pharmacies about our concerns.

Bargain Chemist response:

Bargain Chemist is 100% Kiwi-owned.

Our purpose is to help Kiwis save on health and wellness essentials. Independent price tracking has shown shoppers can pay less with us more often, and we’ll keep pushing to make sure families feel that difference at the checkout.

Our nationwide price-match promise means customers can shop with confidence that they’re getting great value from a New Zealand-owned business .

Green Cross Health response:

We take our obligations under the Fair-Trading Act seriously. This includes a significant investment in training, systems, and processes to ensure any promotional price claims are substantiated and clear to the customer.

Ranges and prices vary between chains and suppliers can run price promotions with different chains at different times. As a result, we embrace the fact that customers will shop around.

We are continually working with suppliers to access better cost prices, and we are actively sourcing alternative ranges and products to offer even better value. The example of Panadol 100s is a product that features in many household medicine cabinets, and we have worked hard with our supplier to bring its cost down through our ‘Feel Good, Pay Less’ programme.

We also recognise customer loyalty through our Living Rewards programme which allows customers to accumulate points to earn vouchers as well as providing exclusive member promotions and discounts throughout the year.

Chemist Warehouse had not replied when we went to print.

About our survey

We tracked the online price of 14 products for 6 weeks from 23 July to 28 August. As well as first aid supplies, skincare, perfume and dietary supplements were also on our shopping list.

We also tracked the price of 2 bigger ticket items – Oral B Pro 100 electric toothbrush and Omron Automatic Blood Pressure Monitor HEM-7144T1. We didn’t include these items in our shopping basket weekly price as they aren’t items you would buy regularly.

Our shopping basket

• Band-Aid Tough Strips (40 strips)

• Betadine Antiseptic Ointment (25g)

• Burt’s Bees Moisturizing Lip Balm (4.25g)

• Cetaphil Moisture Cream (550g)

• Claratyne 10mg (80 tablets)

• DermaVeen Daily Nourish Moisturising Lotion (500mL)

• Elizabeth Arden Green Tea Scent Spray (100mL)

• Good Health Viralex Attack (60 capsules)

• Nivea Sun Protect & Moisture SPF50+ (100mL)

• Nutra-Life Vitamin C 500mg Chewables (200 tablets)

• Panadol 500mg (100 tablets)

• Revlon Skinlights Powder Bronzer

• Revlon Super Lustrous Lipstick

• Strepsils Honey & Lemon Flavour (36 lozenges)

Other items we tracked

• Omron Automatic Blood Pressure Monitor HEM-7144T1

• Oral B Pro 100 electric toothbrush.