Monday, November 14, 2011

Supermarket Price Matches

In these difficult economic times it is not surprising that the supermarkets are upping the game when competing against each other.  The latest weapon appears to be price matching.  So far I have seen two ways of doing this.

With Asda, after shopping you have to visit their website, enter some details from your receipt and if using their rules your shopping would have been cheaper in their competitors then they give you a voucher to use when you next shop with them.

So far so good and after an initial problem whereby they failed to make it clear that it only applied to grocery items it seems to be working.  I even managed to get one of these vouchers after getting a basket of shopping in which they considered there were enough (minimum of eight) comparable items.

There is of course the issue of comparable items and these are quite often branded items, which you may not buy, especially if buying on a budget.  The other issue of course is that you have to take action to get your voucher by visiting  the website, printing off the voucher and then taking it and the original till receipt with you when wish to redeem it (looks like they are at least valid for a month though).

Sainsbury's have now taken up the idea, but they make it simpler in that they do the sums for you at the checkout.  Here when you finish the process the till prints the voucher for you.  I think they do however only offer this on branded goods and not on own brand so perhaps even less chance of meeting the criteria if you shop to a budget.

Why don't they just reduce their prices to match their competitors so there is no need for all this messing around?  I can think of two simple reasons immediately and I am sure my readers can come up with many more.

The one the supermarkets will quote is the frequently changing prices will be difficult to manage in terms of shelf edge pricing tickets having to be regularly updated.  This is a bit of a cop out because I have encountered issues in all the major supermarkets where the shelf edge price is at odds with the till price due to an error or oversight.  This is also easy to address with technology.  It has been some years now since I met electronic shelf edge pricing in a retail organisation I worked with which meant that the price displayed on the shelf was driven from the same data as the tills.  This also simplifies the introduction of special offers etc.

The second, and the one that they won't tell you is that there will be two groups of customers who help fund this. 

Customers whose basket of goods doesn't meet the criteria for the price match and therefore they pay the higher price, which earns revenue that would not be there if the price was kept in line, and customers who qualify for the price match and either do not check (in the case of Asda) or do not redeem their vouchers.

These two groups will help cover the costs of the scheme.

As a footnote, sometimes I shop in Asda when it would cost more in fuel to go to my usual store.  Every time that I have met the criteria for the price guarantee it turns out that my usual store (Tesco) would have been cheaper!  Therefore I qualify for the voucher (and use it).

This means I revisit the more expensive store to use my voucher - crafty marketing eh?

At least I am reassured that my choice of Tesco for my major shop is the right one for me. 

Legal disclaimer: Choice of supermarket is personal and for my profile and in this area Tesco is the best choice. Other supermarkets are available.

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