Sainsbury's cuts prices - and drops Tesco from Brand Match scheme

Emma Woollacott
Supermarket special offer
Supermarket special offer

Following the lead of Tesco, Morrisons and Asda, Sainsbury's has joined the war against the discount supermarkets, cutting prices across thousands of its food products.

It's also aiming to play down the importance of special promotions by stressing low prices every day.

"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," says marketing director Sarah Warby.

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"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."

Covering all bases, she adds: "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."

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Sainsbury's Nine Years of Growth Comes to an End
Sainsbury's Nine Years of Growth Comes to an End

Simplified pricing

The company says its been working to simplify its pricing, dropping references to fractions and percentages, moving to round-number pricing and making shelf-edge price labels simpler.

Meanwhile, in what may add insult to injury for Tesco, Sainsbury's is to drop its beleaguered rival from its Brand Match scheme. Until now, customers have been given a coupon for the difference if their shop is more expensive than at Tesco or Asda.

From October 2, however, Sainsbury's will promise to match prices from Asda alone. The reason, says the company, is that Asda is seen as the market leader on price - and Sainsbury's believes that it's cheaper than Asda for branded goods more than half of the time.

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Change in pricing strategy

The company plans to publicise the change in its pricing strategy - a bold move by new chief executive Mike Coupe - through a campaign across TV, print and in-store signs.

Sainsbury's is the UK's third-biggest supermarket, but has struggled along with the others to fight off competition from discounters Aldi and Lidl. Tesco is sacrificing £200 million this year to cut prices, while Morrisons is spending £1 billion over three years and Asda the same amount over four years. Sainsbury's hasn't revealed the cost of its latest efforts.

Until earlier this year, the company was managing to hold its own, with nine years' solid growth. But sales have fallen by 1.8% over the last quarter, says Kantar Worldpanel, and the company's expected to report quarterly sales down by as much as 3% next week. And today's announcement doesn't seem to be impressing the City: shares have fallen by more than 2%.

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