Supermarket price match war escalates as Sainsbury’s takes legal action

The supermarket is asking for a judicial review of the Advertising Standards Authority’s decision in July to reject its complaint about Tesco’s Price Promise scheme, which unlike Sainsbury’s Branch Match compares own brand products if an equivalent is sold by a rival. It believes such a review will take into account “all relevant factors” including ethics, provenance and price.

The move is a reaction to the findings of the ASA’s independent reviewer, Sir Hayden Philips. He said in his review that while Sainsbury’s had made a “persuasive case” that customers place value on provenance and other ethical issues, the ASA had followed the correct process.

Nevertheless, Sainsbury’s continues to argue that Tesco is misleading the public because its own brand products are superior in quality. It highlights examples such as the fact that its “basics” tea is fairtrade where Tesco’s “everyday value” tea is not.

Sainsbury’s commercial director Mike Coupe says: “It’s time to take a stand on behalf of the huge majority of customers who want to make fair comparisons when they shop. Tesco says that whether, for example, a product is Fairtrade or MSC certified is just a ‘minor part’ of a customer’s considerations – especially for value products. We disagree.

“More than ever, customers want to let their values guide them and in price-matching its products with ours, Tesco is – when it sees fit – choosing to ignore factors such as ethical or provenance certification or even country of origin. We think that’s wrong and we’re pretty sure our customers do too.”

Sainsbury’s decision to take legal action marks an escalation of the war between the two supermarkets over their respective price-matching schemes. Sainsbury’s was dealt a blow when the ASA rejected its original complaint in July.

It hit back with a campaign to press its case using the strapline “same price, different values”. However, it has since had one of its Brand Match ads banned by the ASA for being “misleading”.

In response to Sainsbury’s announcement, Tesco claims that its price match scheme offers customers “reassurance” because it covers fresh food and own brand, not just branded goods. It also highlights the differences between the two, including the fact that Price Promise runs online, unlike Brand Match, and customers only have to buy 10 different products to qualify, rather than spend £20 as they do at Sainsbury’s.

Tesco’s UK marketing director David Wood says: “Sainsbury’s argument against Price Promise has been heard and rejected twice already. Tesco Price Promise offers customers reassurance on the price of their whole shop, in store and online, not just the big brand products. When family budgets are under pressure, that is the kind of help customers want and the real question for Sainsbury’s is why they aren’t trying to do the same for their customers.”