Sainsbury's to compete with Asda prices

26 September 2014

sainsburys With the grocery market stagnant, competition between supermarkets is hotting up in the quest for shoppers' cash. Now, Sainsbury's has made a big announcement that it is overhauling its pricing strategy and is permanently lowering prices. Sounds good.

Sainbury’s says it wants to simplify the customer experience by removing "confusing" price mechanics like fractions and percentages and consistently using round pound pricing for more products. The new strategy is designed to make it easier for shoppers to buy "what they like, when they like" without having to wait for specific products to go on offer.

However, Sainsbury’s claim the strategy- which has been 18 months in the making- was actually nothing to do with deepening the price war with competitors, but was instead designed to help consumers feel confident that they were not buying products on offer based on "fanciful" regular prices. Nevertheless, the supermarket claims it will continue to run as many promotions as before.

Sainsbury's marketing director Sarah Warby said: "Customers tell us they find supermarket prices and promotions confusing and don't always know who to trust when it comes to getting good value. So we've taken this feedback on board and we're making it easier for customers to buy the products they love whenever they like, safe in the knowledge that they can get good value all the time on all products, without having to wait for promotions.”

She added :"We will continue to run as many promotions as before and they will be just as competitive, but customers now have the added reassurance that prices will always be great value at Sainsbury's, both on and off promotion."

So Sainsbury’s seems to have adopted the Asda ‘rollback’ style of pricing, and their revamped Brand Match will now specifically match Asda prices, even when on offer in Asda stores. Some commentators are even suggesting that Sainsbury’s might start using green on their signage in recognition of the association of green with lower prices.

Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, commented that it was “interesting” that Sainsbury’s was referencing Asda, where previously Tesco might have been the competitor to beat. He went on to say: “What remains to be seen is if Sainsbury's is really going to lower prices to the extent that customers notice. They say they are going to lower their prices while running as many promotions as before. That's quite a commitment to do both.”

“We won't know how big this is until we see the actual prices," he added. While we will have to wait until 2 October to see just how amazing the new prices are, this healthy competition can only be good news for consumers.

TOPICS:   Supermarket

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