Asda has upped the ante in the battle for the non food pound, according to latest results from The Grocer 33’s Non Food Report. The quarterly basket survey of 33 non food items, including clothing, reveals that despite Tesco matching it for price on 19 products, Asda is cheaper by almost £2.00. The cost of Asda’s 33-item basket is £184.42, versus Tesco’s at £186.19, compared with £187.15 and £187.55 respectively in our previous survey.
Since the last survey, Asda has reduced prices on a number of key items, including its cheapest standard umbrella, blank CD-R and wooden spoon. It is also marginally cheaper than Tesco for a selection of goods across all four bathroom, electrical, home-office and chart sections covered.
However, despite its current second-placed position, analysts expect to see a particularly muscular price-led stance from Tesco this year, along with a reinforced value message, as it attempts to set itself apart from its rivals. A spokeswoman for Tesco says: “Price remains important for us, and we will continue to buy well and invest this in
retail prices. We will be extending our ranges in all electrical departments - both with own label products and with support from the major brands.”
Further comparison with the last survey also reveals the potential behind Sainsbury’s cost-cutting clout. Once again it has made the largest number of price reductions to the items on our survey. However, the report also reveals a hike in prices for some of the clothing items on our list.
Over the past three months, the total cost of Sainsbury’s basket excluding clothing has been slashed to £183.16 - that’s £12.88 cheaper than it was in the last survey, and currently only £16.49 more expensive than Asda. It has reduced prices on 10 of the 33 items on our list, and at £17.99 it is also selling the cheapest DVD player of the four.
Morrisons is once again in fourth place. The retailer, which does not stock a comprehensive clothing line, totted up a basket price of £194.49.
As with the previous report, we have selected the four chart items for our list in order to provide a more accurate like-for-like.
Need for Speed Most Wanted, The Strokes - First Impressions of Earth, The Undomestic Goddess by Sophie Kinsella and Wedding Crashers are the PS2 game, CD album, paperback and DVD selected this time around.
Chart items such as these played a critical role in boosting sales over the festive period. However, according to Tesco and Asda, the electrical category put in the strongest performance.
Asda spokesman Dominic Burch says: “This past December we sold slightly more than 75,000 MP3 players. Compared with the same period last year, this is a massive 9,000% uplift.”
As predicted in the last report, DVD prices at Asda, Sainsbury and Tesco fell over the Christmas period, as did the cost of many other electrical home entertainment items on the list, such as single-use cameras and blank CD-Rs.
Comparison with the first ever Non Food Report on August 6 shows just how far the top four have come in their development of non food retailing.
Ranges have been deepened, premium lines added and price points lowered.
And now it seems that the supermarkets have cleared yet another key hurdle - that of consumer confidence.
“Consumers no longer see non food as a sideline to groceries. The likes of Tesco and Asda have now become destinations for non food in their own rights,” says Richard Caines, analyst at Mintel.
Nick Ladding, analyst at Verdict Research, adds: “The major supermarkets have gone to great lengths over the past few months to provide a much more credible and trusted offer. Consumer confidence in buying non food at supermarkets has never been higher.”
The training of staff to offer specialist advice has been hugely instrumental in nurturing consumer trust and, ominously for the high street, is putting supermarkets on an increasingly even keel with the specialists.
A Tesco spokeswoman says: “We recognise the increasing need for specialist knowledge within our stores to inform customers about features and benefits of the product. We now have dedicated section managers for electrical who receive regular training updates in line with technology changes.
“In addition we have improved the point-of-sale material in-store to communicate product information