Morrisons makes price match move

Thursday 02 October 2014

Morrisons has become the first of the big four supermarkets to pledge a price match guarantee against discounters Aldi and Lidl in the latest episode of the ferocious price war.

The Bradford-based retailer, which has more than 500 stores, is launching a new loyalty card scheme which it says will see customers given additional points if their comparable shop would have been cheaper elsewhere.

It is part of a previously-announced plan to invest £1 billion in price cuts over three years as chief executive Dalton Philips battles sliding sales and plunging profits.

Mr Philips said the new Match & More scheme was "the most comprehensive price match and points scheme in the UK".

"Because it price matches the discounters, the Match & More card will provide the ultimate guarantee about Morrisons' value-for-money," he said.

Morrisons said the offer was the first of its kind to provide a price match guarantee against Aldi and Lidl as well as Tesco, Sainsbury's and Asda. It comes after the group said in May that it was lowering prices permanently.

Yesterday, Sainsbury's boss Mike Coupe said the supermarket sector was facing its most turbulent period in three decades amid the price war, as he slashed sales forecasts for the year.

Big name grocers have been forced to respond as Aldi and Lidl have eaten away at their market shares.

Morrisons said its new scheme would work by automatically checking all the products in customers' shopping baskets against a database of thousands of prices collected by independent pricing experts. It said where there are comparable products, these would be price matched against those from Aldi, Lidl, Tesco, Asda and Sainsbury's. If the comparable shop would have been cheaper elsewhere, customers will be given the difference in points on their card.

Customers will have to be part of the loyalty card scheme to benefit. The card launches tomorrow in a phased roll-out which the group said would see them in stores in time for the Christmas season.

The card will also offer additional points on hundreds of products across stores, plus 10 points on every litre of fuel bought at Morrisons petrol stations. Accumulating 5,000 points will entitle shoppers to a £5 voucher at the till.

Morrisons said it also plans to enable customers to turn points into vouchers for leisure activities such as eating out and travelling.

Its introduction of the loyalty card scheme - following pilots earlier this year which saw 40,000 customers sign up - is some years behind its rivals. The retailer has overhauled its antiquated IT infrastructure which Mr Philips admitted last year had made it difficult to plan promotions.

Morrisons made a belated entry into online grocery shopping earlier this year, in a partnership with Ocado. But its efforts have yet to bear fruit on the bottom line, with the group announcing last month that half-year profits had plunged by 51% to £181 million while like-for-like sales slumped 7.4%.