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Britain’s Sainsbury’s makes it personal in price battle with rivals By Reuters


© Reuters. FILEPHOTO: A sign for Sainsbury’s was seen at the London supermarket branch on January 8, 2020. REUTERS/Toby Melville

By James Davey

LONDON (Reuters) – British supermarket group Sainsbury’s will offer lower prices to customers using its digital loyalty scheme and self-scanner service, deepening ties with shoppers and cutting costs in the latest wave of innovation to hit the industry.

The supermaket market in Britain has suffered from fierce competition over the past decades.

Sainsbury’s is Britain’s 2nd largest grocery retailer. It said that the Nectar program, which offers tailored discounts through digital channels, was the best for UK supermarkets. However, it also follows other targeted programs by U.S. food retailers.

The loyalty program, where customer spend is converted into points which can be used to purchase products, goes beyond what the usual loyalty system. SmartShop scans are available on smartphones and handsets. This will encourage consumers to use the SmartShop scanner service to save time in the store, which, ultimately, will decrease the amount of staff required to check out.

Sainsbury’s has announced that Nectar App members who are shopping in stores from next Wednesday can access reduced prices on up to ten brands and Sainsbury’s products. The selections will be selected on a week-by-week basis.

However, the Clubcard Prices scheme from Tesco has lower prices on some products for all Clubcard members. The offers, however, aren’t personalized. Co-Op is a smaller retailer that offers discounted prices on fewer products based on customers’ spending habits.

Sainsbury’s chief Marketing Officer Mark Given stated to Reuters that the minimum price drop, called “My Nectar Prices”, would be 10% for each product.

According to Given, customers who are more conscious of their value will likely receive regular discounts on fruits, vegetables, meats, poultry, and other fresh foods. This is the main battleground in fresh food with Aldi or Lidl, which has forced many sectors to reduce prices.

Sainsbury’s will reward loyal customers with discounts on items they buy regularly and offers on products that their data indicates they might be interested in.

Given explained that “improvements in cloud computing, automation mean you can now process genuine unique offers that are personalized to you with greater real-time data,” adding that his team had worked on personalisation algorithms and engines up to five year ago.

These “My Nectar Prices” offers are in addition to the loyalty points offerings already on the app.

GOING DIGITAL

Sainsbury’s now has eight million customers registered with the Nectar digital app and CEO Simon Roberts is targeting 10 million by the end of next year.

This new service should encourage more people to use the SmartShop self-scanning app, which was popularized during the COVID-19 epidemic.

In 2020-21, sales increased 173%. SmartShop was responsible for 30% of all retail sales in grocery stores that had handsets. This is nearly double the level of 2019-20, where 14%.

Sainsbury’s said it would gather feedback from customers before launching “My Nectar prices” online.

Sainsbury’s shares have increased 28% this year due to bid speculation following the Morrisons Takeover Saga. Roberts’ “food-first” strategy has begun to show results.

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Mike Robinson
Mike covers the financial, utilities and biotechnology sectors for Street Register. He has been writing about investment and personal finance topics for almost 12 years. Mike has an MBA in Finance from Wake Forest University.