Asda is to spark another price war among the big four grocers with an ad campaign that launches today.

The UK’s second-biggest supermarket will unveil the ads on TV, billboards and in the press, in an effort to reinforce its value credentials for both food and non-food.

Its renewed focus on price will provoke concern among other grocers that a renewed price war could hit profit margins this year.

Some of the ads will use arrows to highlight the price differential between Asda and its rivals – based on figures from leading price comparison site

Last week, Asda said that it had invested so much in price cuts that the typical Asda shopper’s basket is now 22 per cent cheaper in real terms than in 1997.

Allegra Strategies project director Steve Gotham said: “Price will be more central in 2008, but it will not be the only dimension on which there will be competition in the market.”

He added: “Asda is the most competitive on price of the major grocery chains and it is keen to force that advantage home.”
A Tesco spokesman said the grocer will carry out some half-price offers throughout January. Sainsbury’s and Morrisons declined to comment.

…As eco plans scuppered

Asda has been refused permission to install a huge wind turbine at its distribution centre in Falkirk in the latest case of retailers’ efforts to be eco-friendly being stymied by over-zealous planners.

The bid to install a£2.5 million, 127m turbine was rejected by the council on aesthetic grounds just before Christmas. The turbine, Asda’s first and the biggest in the UK grocery sector, was to provide about 75 per cent of the DC’s energy requirements. Asda project manager Mark Orpin said: “We’re working on what the process for an appeal is. We’ve got up to six months to do this and we think we’ve got a strong case.

“We had hoped to get this built in 2008 but, realistically, we’re looking at 2009 at the earliest.”

Asda has submitted a similar application for its Northhampton depot and is close to finalising a bid for a turbine at its Teesport DC in the Northeast.