The way that we shop for food is undoubtedly a crucial consideration in the cost of living crisis.
Some Cabinet ministers have slightly patronisingly suggested shoppers should perhaps consider value ranges from our supermarket of choice, as if that hadn’t occurred to anyone before.
But no matter where you shop, getting more for your money is a huge concern, not least because the latest figures from the Office for National Statistics show that food is at its highest level since 2013.
So it’s notable that one of the big high street supermarket names has launched a new price-matching scheme, with a difference.
Matching bargains
Asda has confirmed the launch of a new price-matching scheme with Home Bargains, the high street store known for offering essentials at a knockdown price.
The price match scheme covers more than 100 branded items, which cover items across health and beauty, household goods and groceries, with brands included in the scheme such as Colgate, Garnier, Surf and Huggies.
Asda shoppers will be able to spot the items included in the promotion as there are labels stating ‘Home Bargains price match’ on the shelves, while the logo will also appear for relevant items if you’re shopping online.
You can also check the full list on Asda’s website, with the included items updated each week.
Price matching
It’s not unusual for supermarkets to launch price-matching schemes.
Both Tesco and Sainsbury’s have launched schemes over the past couple of years, linking the pricing of certain products with what you would pay if you shopped in Aldi.
The selling point is pretty straightforward; you know that if you head to a deep discounter, like Aldi or Lidl, then you’ll be paying pretty much the cheapest prices around.
And for shoppers looking to save every penny they can, the knowledge that they will cut the overall cost of their shop by moving to a cheaper rival is a powerful one.
But with a price-match scheme, you can demonstrate to your customers that you recognise how important getting a bargain is to them, and ensure that they won’t spend any more for the items included in the scheme if they shop with you.
The idea is that matching the prices of the deep discounters, the shoppers are more likely to stick with you than go ahead with switching to a less costly rival.
What’s unusual about this latest scheme though is that Asda isn’t aligning its prices with a supermarket peer, but instead with a high street discounter like Home Bargains.
It’s moving that sense of competition away from strictly food; clearly Asda realises that the cost of items like washing powder and toothpaste is just as important when we choose where to do our shopping as chicken, fish and potatoes.
Competing on price
Asda is evidently well aware of its need to go further on price cuts in order to compete.
It recently launched a ‘Dropped and Locked’ campaign, where it is cutting the prices of 100 essential items and pledging to keep them at this lower price point until the end of the year.
This comes alongside the launch of a new ‘Just Essentials’ range of 300 low-priced essential items, replacing its existing Smart Price range.
There is a pretty clear message here; Asda knows that in order to retain its existing customer base and even attract new shoppers, it needs to stand out when it comes to providing value.
This is particularly notable given it already has a reputation as being more budget-friendly than big-name supermarkets like Tesco and Sainsbury’s.
It’s a well-earned reputation too ‒ the consumer champions at Which? monitor the cost of typical shopping baskets at all of the main supermarkets each month, and Asda is ALWAYS the cheapest among the big names.
The trouble is that, when Which? includes the likes of Aldi and Lidl in its calculations, Asda drops off the pace.
And this may be why supermarket shoppers are starting to turn away from the store. Data from Kantar WorldPanel shows that Asda’s market share since the start of 2021 has dropped from 14.6% to 14.1%.
By comparison, both Aldi and Lidl have seen decent growth, of 1.4% and 0.7% respectively.
If they ‒ and other big supermarkets ‒ want to fight back then they will need to take a much more active approach to revamping their pricing to support households that need to count every penny.