Sainsbury in Talks to License Brand Match Technology Overseas

J Sainsbury Plc (SBRY), the U.K.’s third- largest grocer, said it’s in talks with U.S. and South American retailers about licensing the technology behind Brand Match, a price promise that has fueled sales outperformance.

The supermarket chain is in contact “with several international retailers” located in the regions, group development director Luke Jensen told Bloomberg News by e-mail.

Sainsbury Chief Executive Officer Justin King has hailed October’s introduction of Brand Match as changing customer perceptions about the supermarket chain’s prices. The program ensures shoppers don’t pay more for branded goods such as Coca- Cola and Persil detergent than at competitors by checking more than 14,000 goods including offers and promotions at the point of sale. Customers get a coupon if rivals are cheaper.

“It’s really helping us convince our customers as to the reality of our price position,” King said on May 9.

Sainsbury’s sales rose 5.4 percent in the 12 weeks ended April 15, exceeding market growth of 5 percent, according to Kantar Worldpanel. Its share of the grocery market was steady at 16.6 percent, which King said was the highest for a decade.

According to Sainsbury, the proportion of customers who think it sells brands at the same price as other supermarkets has risen to 80 percent from 68 percent since the initial trial of Brand Match in August 2011. The grocer issues millions of coupons a week to customers under the program, with more than half showing customers that their shopping basket was cheaper than it would have been at larger competitors Tesco Plc (TSCO) and Wal- Mart Stores Inc.’s Asda, the retailer said.

Tesco has been cutting prices through its Big Price Drop campaign on essential items, while Asda has a similar offer to Sainsbury though customers must check their own receipts online and are then issued with a voucher to redeem in stores.

Sainsbury declined to identify the retailers it is in talks with over licensing the technology.

To contact the reporter on this story: Sarah Shannon in London at sshannon4@bloomberg.net.

To contact the editor responsible for this story: Sara Marley at smarley1@bloomberg.net

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