Sainsbury’s is running a nationwide ad campaign to hit back at Tesco's successful defence against complaints its fresh goods and own-label products could be price matched against those of rival supermarkets despite differences in ethical sourcing and provenance.
Sainsbury’s is bringing Tesco’s sourcing into question and contrasting it unfavourably with their own.
Matt Piner, retail analyst at Conlumino, said: "The ruling is a blow to Tesco even though they have ultimately come out to have been judged in the right by the Advertising Standards Authority [ASA].
"At a time when Tesco is desperately trying to move on from the whole horsemeat scandal and point to what they are doing to regain customer trust Sainsbury’s is dragging that up again and bringing Tesco’s sourcing into question and contrasting it unfavourably with their own."
Tesco convinced the ASA that factors including whether a product was Fairtrade or sourced in
Bryan Roberts, retail insights director for Kantar Retail EMEA, said: "Many parts of the ruling are reasonable, but there are a few gaping holes in it on issues like provenance and Fairtrade which need to be addressed.
"I’d argue that there is a difference in Fairtrade versus non-Fairtrade. Also, the ruling that provenance is not an issue for value-led shoppers would seem slightly misguided. I’m sure Tesco’s research is pretty decent, but I’m sure even economically challenged shoppers might want to buy British."
The ASA ruling going in favour of Tesco was not a "huge surprise" to Piner because Sainsbury’s main objection that its products are not like-for-like is a "difficult point to make".
In the long run, Sainsbury’s remains in a strong position, he argues. Asda’s lack of market share gains, despite having a clear lead on price, is proof consumers look at other factors beyond price.
Sainsbury’s avoided chasing price at any cost and have been able to position themselves favourably as a results.
Roberts added: "Some retailers embarked on a race to the bottom in order to keep delivering lower prices – that’s how we ended up with horsemeat in the food chain.
"Others like Sainsbury’s avoided chasing price at any cost and have been able to position themselves favourably as a result."
Store refits and improved products and marketing are driving the Tesco recovery, rather than the Price Promise, argues Roberts.
Out of the woods
However, although Tesco has won the initial Price Promise ruling, it is not yet completely out of the woods, with Morrisons continuing to weigh up the possibility of a formal complaint.
A Morrisons spokesman confirmed the company is still in correspondence with Tesco on a number of points around whether the Price Promise can accurately identify comparable Morrisons products, ahead of a potential complaint to the ASA.
Morrisons is unlikely to drop the issue lightly as it struggles to gain market share despite being unaffected by the horsemeat scandal, with Piner predicting an "ongoing tussle" between the major supermarkets.
Piner said: "Morrisons, probably even more so than Sainsbury’s, feels a bit hard done by because it does have in many ways the most transparent supply chain and invest the most in knowing where its products come from. Yet it hasn’t really seen any uplift at the till or positive backlash from the horsemeat scandal."
Sainsbury’s and Tesco may have recorded respective early victories in the grocery price comparison battleground, but the war is far from over.