Sainsbury’s has a “reasonable” chance of success in its fight against Tesco Price Promise, despite failing on two previous attempts, commercial director Mike Coupe has claimed.
The retailer revealed this week it was taking the Advertising Standards Authority’s adjudication over the price comparison scheme to a judicial review. It claims Tesco’s own-label comparisons do not take factors such as provenance and ethics into account.
The judicial review process examines the lawfulness of a decision or action taken by a public body.
Story of a price war
October 2011: Sainsbury’s rolls out Brand Match nationwide. The scheme gives shoppers a voucher at the till if their branded shop is more expensive than at Asda or Tesco.
March 2013: Tesco launches Price Promise, which gives a shopper a voucher at the till if their shop is more expensive than at Asda, Morrisons or Sainsbury’s.
July 2013: The ASA rejects Sainsbury’s complaint over a regional Price promise press ad. Sainsbury’s launches a ‘Same Price, Different Values’ campaign.
August 2013: Sainsbury’s launches an appeal with the ASA.
October 2013: The ASA’s independent reviewer rejects appeal, prompting Sainsbury’s to launch a judicial review.
The ASA followed the Committee of Advertising Practice (CAP) Code to clear Price Promise. The Code requires advertisers to compare goods which meet the “same need or intended purposes”. It said the ‘same need’ test had been met because “food such as meat, eggs or fish were interchangeable and intended for the same purpose”.
However, Coupe said: “Not all own-label products are created equal. We have pages and pages of comparisons that we don’t think are reasonable. It literally covers hundreds of products. Possibly into the thousands.”
Sainsbury’s would not reveal the likely legal costs associated with the judicial review, only insisting it “was worth spending the money on”, but experts predicted it could run to between £100,000 and £150,000.
The retailer’s head of legal, Nick Grant, said it was the first time it had used the judicial review process outside property issues.
“It is a fairly straightforward process. It is largely done on paper in the High Court. It will probably be a day’s hearing,” he added.
However, analysts at Shore Capital cautioned the process could backfire. “This move throws down the gauntlet to Tesco to show that its price-matching mechanism is robust enough to withstand even greater scrutiny,” said analyst Darren Shirley.
“Tesco has already exposed that Sainsbury’s Brand Match only applies to proprietary brands. This point is going to be highlighted again and again and it is a demonstrable deficiency of Brand Match, something that we believe Sainsbury’s has done well to mask to date.”
But branding experts praised the move. “Any price comparisons which will influence consumer buying decisions should be 100% like-for-like or not at all. Sainsbury’s have a fair point and one they should keep fighting for,” said Claire Nuttall, a founding partner at Thrive.
Blog: Fair’s fair