Asda price guarantee 'threw rivals'

Asda highlighted further signs of sales momentum today as it claimed its price guarantee initiative had "ruffled" the feathers of rivals.











The UK's second biggest supermarket chain said like-for-like sales increased by 1.6% in the final quarter of 2010 after it revamped its own label ranges and introduced a guarantee in April that its prices would be cheaper than those of its rivals.



Since it improved its price guarantee in January by pledging to sell groceries at least 10% cheaper than its major rivals, the scheme had been used by 800,000 customers.



Asda's sales performance in the final quarter of 2010 was helped by a "good Christmas" for the group as it bounces back after six months of declining sales in the first and second quarters of its financial year.



Last year it relaunched its mid-tier own label range as Chosen By You and revamped its Extra Special premium range after chief executive Andy Clarke, who took over in May, admitted it had not focused enough on the quality of its food.



Asda today announced it would launch another 2,000 products under the Chosen By You range, bringing the total to 5,000, and said Extra Special was now the fastest growing premium range of its supermarket rivals.



The supermarket, which has 386 stores in the UK, does not announce profits figures but claimed they grew ahead of sales.



Asda also announced a new premium homeware brand today called Elegant Living, which was sourced with American parent company Walmart and will be 30% cheaper than its rivals.



Mr Clarke said he was "pleased with the progress we've made in the last six months".



He said: "The Asda Price Guarantee is a game changer - our customers are starting to use it more.



"The renewed focus on everyday low pricing underpinned by the Asda Price Guarantee has got our rivals a little ruffled.



"We have enhanced the quality of our products at no extra cost to our customers."



Asda was reprimanded for its original price guarantee adverts by the Advertising Standards Authority following complaints from rivals Morrisons and Tesco.



Morrisons and Tesco complained that the ads were misleading for suggesting that Asda was generally cheaper than themselves and Sainsbury's argued that there were significant exclusions from the price comparison.



Asda also warned that consumer confidence is facing a "perfect storm" because of rising prices and the Government's cutbacks.



Mr Clarke added: "People are very worried about things like unemployment and the change in the public sector jobs will start to generate a different level of confidence and job security is right up there in customers' minds. Confidence will become even more challenging this year."



He was confident that Asda would continue to be Britain's second biggest grocer and dismissed industry figures that showed its share of the grocery market was overtaken by Sainsbury's in December as "a blip".



Asda announced it will share out a £26.9 million bonus pool among its staff as it said full-year profits grew ahead of sales.



The performance contributed towards a 14% leap in full-year profits at Walmart, which reported net income of 16.4 billion US dollars (£10.1 billion), helped by a 27% surge in the fourth quarter.



Asda's performance compares well with its "big four" competitors over the Christmas season, with bigger rival Tesco reporting a sales rise of 0.6% including VAT in its six-week festive period.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Tax Assistant

Negotiable: Recruitment Genius: A Tax Assistant is required to join a leading ...

Recruitment Genius: Outbound Sales Executive - OTE £25,000

£16000 - £25000 per annum: Recruitment Genius: This is an exciting opportunity...

Ashdown Group: Java Developer / J2EE Developer - Watford - £45,000 - £47,000

£45000 - £47000 per annum + bonus + benefits: Ashdown Group: Java Developer / ...

Ashdown Group: Marketing Product Manager - (Financial Services) - SW London

£35000 - £38000 per annum + Benefits: Ashdown Group: Marketing Manager - Marke...

Day In a Page

Iraq invasion 2003: The bloody warnings six wise men gave to Tony Blair as he prepared to launch poorly planned campaign

What the six wise men told Tony Blair

Months before the invasion of Iraq in 2003, experts sought to warn the PM about his plans. Here, four of them recall that day
25 years of The Independent on Sunday: The stories, the writers and the changes over the last quarter of a century

25 years of The Independent on Sunday

The stories, the writers and the changes over the last quarter of a century
Homeless Veterans appeal: 'Really caring is a dangerous emotion in this kind of work'

Homeless Veterans appeal

As head of The Soldiers' Charity, Martin Rutledge has to temper compassion with realism. He tells Chris Green how his Army career prepared him
Wu-Tang Clan and The Sexual Objects offer fans a chance to own the only copies of their latest albums

Smash hit go under the hammer

It's nice to pick up a new record once in a while, but the purchasers of two latest releases can go a step further - by buying the only copy
Geeks who rocked the world: Documentary looks back at origins of the computer-games industry

The geeks who rocked the world

A new documentary looks back at origins of the computer-games industry
Belle & Sebastian interview: Stuart Murdoch reveals how the band is taking a new direction

Belle & Sebastian is taking a new direction

Twenty years ago, Belle & Sebastian was a fey indie band from Glasgow. It still is – except today, as prime mover Stuart Murdoch admits, it has a global cult following, from Hollywood to South Korea
America: Land of the free, home of the political dynasty

America: Land of the free, home of the political dynasty

These days in the US things are pretty much stuck where they are, both in politics and society at large, says Rupert Cornwell
A graphic history of US civil rights – in comic book form

A graphic history of US civil rights – in comic book form

A veteran of the Fifties campaigns is inspiring a new generation of activists
Winston Churchill: the enigma of a British hero

Winston Churchill: the enigma of a British hero

A C Benson called him 'a horrid little fellow', George Orwell would have shot him, but what a giant he seems now, says DJ Taylor
Growing mussels: Precious freshwater shellfish are thriving in a unique green project

Growing mussels

Precious freshwater shellfish are thriving in a unique green project
Diana Krall: The jazz singer on being friends with Elton John, outer space and skiing in Dubai

Diana Krall interview

The jazz singer on being friends with Elton John, outer space and skiing in Dubai
Pinstriped for action: A glimpse of what the very rich man will be wearing this winter

Pinstriped for action

A glimpse of what the very rich man will be wearing this winter
Russell T Davies & Ben Cook: 'Our friendship flourished online. You can share some very revelatory moments at four in the morning…'

Russell T Davies & Ben Cook: How we met

'Our friendship flourished online. You can share some very revelatory moments at four in the morning…'
Bill Granger recipes: Our chef serves up his favourite Japanese dishes

Bill Granger's Japanese recipes

Stock up on mirin, soy and miso and you have the makings of everyday Japanese cuisine
Michael Calvin: How we need more Eric Cantonas to knock some sense into us

Michael Calvin's Last Word

How we need more Eric Cantonas to knock some sense into us