Sainsbury's to axe its Brand Match price-matching scheme
Introduced in 2011, Brand Match is a guarantee that Sainsbury’s shoppers will receive a coupon for the difference in price if they had bought identical goods at rivals Asda or Tesco. Similar schemes are run by other UK supermarkets.
But Sainsbury’s has said it will stop issuing coupons from April 26 after research showed clearer, regular low prices now matter more to consumers.
Growth of the discounters
UK retailers are currently battling to maintain market share in the face of the growth of discounters such as Aldi and Lidl.
Retail spend in Aldi and Lidl was up 14.4% and 17.7% respectively year on year according to figures released this week by Kantar Worldpanel [12w/e 27 March 2016]. In contrast, Sainsbury’s sales grew 1.2% - which was ahead of most of its traditional supermarket rivals.
Tesco to accept Sainsbury's coupons
Tesco has said it will accept coupons from Sainsbury’s axed Brand Match price-matching scheme.
Just days after Sainsbury’s said it would stop the scheme at the end of this month, Tesco has announced customers will be able to use their Brand Match coupons at its stores until June.
“This is a little help for Sainsbury's customers from us at Tesco,” said Tesco UK and Ireland CEO Matt Davies, adding it also provided an opportunity for Sainsbury’s customers to experience Tesco’s Brand Guarantee.
Launched last October, Tesco’s Brand Guarantee offers an immediate price match at tills without the need for paper coupons.
Sainsbury’s said all the money from the scheme will be reinvested in lowering the price of popular key products including bread, cheese, chicken, fresh produce and household cleaning items.
Higher average price for bread
Currently, the average price of a large loaf of bread from the leading brands or retailer own-label ranges is higher at Sainsbury’s than other major UK supermarket chains (not comparing like-for-like products).
The average price of 100 g of crisps or nut has been higher at Sainsbury’s than other chains for much of the past 12 months, but has dropped below Tesco since January (see tables below).
“Customers have told us they want lower regular prices, and that this is more important to them than Brand Match,” said Sainsbury’s marketing director Sarah Warby. “We’ve taken this on board and will now be investing all of the money from the scheme into lowering the regular prices on everyday products.”
Drop in use of multibuys
Sainsbury’s has already reduced its use of multi-buy promotions, and customer spend on deals that require consumers to buy two or more items together fell by 73% year on year in the last 12 weeks [Kantar Worldpanel].
“We know that customers like the changes we’ve already made to the way we price our products because it fits in with the way people shop now,” added Warby. “Our customers are shopping more frequently across multiple channels and they want to be able to buy the products they love, in the quantities they need.”
Source: Brand view