Price comparisons were once commonplace across the grocery market, but as everyday low prices sweep the sector, they are becoming irrelevant.
A few years back, at the height of the consumer credit woes, discounter emergence and general panic in the sector, retailers went down a path of comparing their prices with everyone else.
Asda was the first out of the blocks with a ground-breaking idea of the Asda Price Guarantee, which remains unchanged to this day.
The Walmart-owned grocer is renowned for being the cheapest in the market – discounters aside – so what impact does it have on customers?
It’s of little surprise that the future of the scheme is under discussion at Asda given the wider challenges the business faces.
Tesco then launched its own comparable scheme, which had to be capped quickly as people figured out that buying six bottles of wine yielded £60 in vouchers.
The scheme also included own label, which opened up a storm about comparable own labels and how they could be compared accurately.
In 2011, Sainsbury’s attempted to cut through the fog with its own scheme around matching brands at both Asda and Tesco.
This was later cut to just Asda at the height of the Tesco woes, with Sainsbury’s citing that Tesco just wasn’t competitive enough to bother comparing against. Strong words.
Morrisons then introduced its Match & More card, which compared against everyone – and then discounters too.
Customers were receiving points on comparable shopping without being clear who was cheaper or more expensive. It was a confusing scheme and has now shifted to a simple loyalty card.
Later in 2015, Tesco fired its first big price salvo under Dave Lewis with a relaunch of its price match scheme, with an industry first of ‘at checkout’ discounts. In other words, if anyone else was cheaper, Tesco gave the discount instantly. It also shifted this scheme to branded lines only – which nullified the own-label arguments.
“The reality with price guarantee schemes is that they have come and gone”
Steve Dresser, Grocery Insight
The reality with price guarantee schemes is that they have come and gone. They were window dressing, almost ignoring the shifts in consumer behaviour and also their conditioning, via the discounters, to everyday low prices.
The comparable own-label battle was one that no one could win, owing to the arguments over price and quality.
As time has gone on, retailers have shifted their tactics and Sainsbury’s has fought hard for a year or so on establishing lower, regular prices and moving from multi-buys.
“The comparable own-label battle was one that no one could win, owing to the arguments over price and quality”
Steve Dresser, Grocery Insight
Sainsbury’s Brand Match has become almost irrelevant given Tesco’s instant discount at the checkout.
Sainsbury’s could have gone that way with its scheme, adding the ability to take the money off the bill or even convert the discounts into Nectar points, but given the perceived lack of customer interest in price matching, it has opted to scrap the scheme altogether and focus on lower prices.
The only concern from a customer viewpoint is that, without the guarantee, is there a risk that higher prices could creep back in?
You’d expect not. The market place is fierce and customers hold the power in any case – they can just take their money and go elsewhere.
As grocers’ investments continue to come down on price, the curtain will continue to come down on their price guarantee schemes.
- Steve Dresser is director of Grocery Insight