Shoppers’ continued search for value, and the onslaught of
discount grocers has led to the Big 4 supermarkets are tying themselves in
knots trying to assure their shoppers that they offer the same prices as their
competitors.
All claim that the shopper can be confident that their
purchases will be no more expensive than if they had bought elsewhere, but close
examination suggests that the initiatives being run by the supermarkets are
mostly smoke and mirrors designed to give the illusion of value but in reality
offering little of substance.
No store hands back hard cash if they are found to be more
expensive. Instead Tesco, Sainsbury and Asda hand over vouchers and Morrisons
has a complicated scheme where a card has to be obtained, points are added to
the card when purchase at another store would have been cheaper, and the points
are eventually traded in for a voucher. Voucher schemes benefit the supermarket
because many will have been lost or forgotten about before they expire.
There are other wheezes designed
to limit supermarket exposure. Sainsbury only compares with Asda, dropping the
comparison with Tesco in a recent change designed to save money. Asda makes the
shopper do the comparison work. It guarantees to be 10% cheaper than the other
three major supermarkets but the shopper has to go online, enter till receipt
details to find if their shop could have been cheaper
elsewhere, and then claim their voucher.
There are a myriad of exclusions
and exceptions to the various price promises. To be fair, Tesco’s Price Match
covers all shops big and small, and fresh and own label products as well as branded.
Morrisons compares with Lidl and Aldi as well as the majors across branded and own label. But Sainsbury
does not offer its Brand Match in convenience stores, neither does Morrisons,
and Sainsbury only compares branded prices. All the supermarkets stipulate a minimum spend.
No store gives out a voucher worth more than £10. Many everyday items are
excluded such as baby formula.
There will be shoppers who have
the time to go into the detail and work out how to make these pricing
initiatives work in their favour. Many though will quickly conclude that the
only thing that counts when shopping is the size of the bill week in and week
out.
Which takes us back to Lidl and
Aldi.
Despite the flurry of reduced
prices and price promises among the “Big 4” both discount stores continue to
flourish. Add to this Aldi’s recent commitment to keep the price differential
between themselves and conventional supermarkets at a minimum of 15%, and it is
difficult to see how the majors can hold their position without concrete and
continued price reductions across their whole range of goods. So far, they are
only playing at delivering competitive prices.
