Sainsbury Ends Price-Matching Program as U.K. Grocer War Rages

  • Supermarket will replace promotion with lower regular prices
  • Move is part of CEO Coupe's broader effort to reduce offers

J Sainsbury Plc will shutter its price-comparison program after five years, another sign that Chief Executive Officer Mike Coupe is putting his own stamp on the supermarket chain as he approaches his second anniversary in charge.

The British grocer is replacing its so-called “Brand Match” promotion with lower regular prices on products like chicken, bread and cheese, it said in a statement Thursday. The move, effective April 26, is a response to feedback from customers, who wanted clearer, simpler product prices, Sainsbury said.

The shift is the latest volley in a price war that’s raged across the U.K. supermarket sector for several years, as the advance of discounters Aldi and Lidl has forced big supermarkets to mark down goods to stop customers deserting. Eliminating the brand match is part of Coupe’s broader effort to phase out profit-eroding promotions, and distances Sainsbury from market leader Tesco Plc, which in October began offering shoppers discounts at the checkout if their basket was available cheaper at a rival chain.

Former CEO Justin King began the Brand Match campaign in October 2011, ensuring that shoppers didn’t pay more for branded foods such as Coca-Cola and Persil detergent by checking thousands of offers, and delivering a coupon if a competitor’s prices were cheaper. The initial customer response helped Sainsbury deliver a record number of transactions during the Christmas period that year.

Sainsbury’s share of the U.K. supermarket sector was 16.4 percent in March, according to researcher Kantar Worldpanel, compared with 16.1 percent when Brand Match began.

Sainsbury’s shares rose 2.7 percent to 287.3 pence at 10:27 a.m. in London, boosting its gain this year to 11 percent.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE