Everyone loves a bargain, especially in a time where money is tight. As a result, supermarkets in the UK are locked into competition with each other to beat rival prices in a bid to attract higher levels of custom to their stores nationwide.
Ocado is the latest online supermarket chain to throw down the gauntlet, entering into a direct price war with the UK’s most popular supermarket brand, Tesco. They intend to beat their rivals in price, and if they fail to do so, customers will be given vouchers worth the difference in price plus one pence which may be redeemed at their next weekly shop.
Customers can compare the prices of the online grocery retailer with those of Tesco using Ocado’s new “On the Go” mobile phone app, which allows them to do their weekly shop on the move. The tool will automatically add up the prices of items from both Ocado and Tesco, including any running promotions from either of the companies, to determine whether customers would have gotten a better price at Tesco.
If it turns out that the online retailer has been beaten in price at the more popular chain, the customer will then receive an email containing a voucher code, provided more than £40 has been spent in the transaction. The voucher is limited to £10, however, and customers have only 14 days to redeem it on the Ocado website during their next shop.
The initiative, known as the Low Price Promise, is a continuation of its previous price match promotion. Ocado felt that it had to step up its game as the original Low Price Promise applied to only 7,000 of the 27,000 products for sale on the company website.
While Ocado have not specifically cited how many items would be included in the updated promotion, a spokesman confirmed that it will include all Ocado own label and Essential Waitrose products. Ocado co-founder Jason Gissing said;
“We have matched Tesco’s prices on branded goods for many years and now with our Low Price Promise we are going one step further by giving customers across the country a money off voucher if we don’t beat Tesco’s prices. As the name says, this is a promise to our customers. Now we won’t just match Tesco’s prices – we’ll beat them.”
Of course, Ocado is by no means the only UK grocery retailer utilising this initiative as a means of drawing custom. Sainsbury’s launched a brand match guarantee last October which, so far, has yielded excellent results for the supermarket chain, while Asda has been operating a Price Guarantee for some time now.
Yet most supermarkets are now introducing price caps on vouchers after Asda was recently revealed to have given one customer over £8,500 in voucher codes in only four weeks. This was because the customer in question had noticed a hole in the Price Guarantee scheme by finding items on offer in other supermarkets.
Tesco also fell foul of this ploy by canny customers, leading to the chain introducing a £10 cap in June this year. Asda’s Price Guarantee is capped at £15, which gives customers the difference plus 10 per cent if their weekly shopping bill amounts to more than they would have paid at Sainsbury’s, Waitrose, Tesco, Morrisons or Ocado.
Do you think pricing promotions such as the voucher system launched by Ocado will encourage more shoppers to use the online store, or do you believe that people would rather have the physical experience of shopping despite the chance to save money over the internet? Did you manage to take advantage of either Tesco or Asda’s pre-capped voucher system by discovering a loophole in the same way the customer mentioned above did?
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