Half of the price cuts introduced for shoppers by supermarket chain Asda in its latest high-profile “Rollback” campaign are just one penny, a new report for grocery industry trade magazine The Grocer found.

Last week the UK’s second biggest supermarket chain announced that it would cut a further 5,000 prices by Easter reaching a total of 12,500 price cuts this year.

The retailer said that this was part of a transparency guarantee for customers to give value they can trust. At the same time it announced it was dropping buy-one-get-one free offers in favour of everyday low pricing.

As the first wave of the new price cuts were introduced this week, The Grocer’s shopping basket survey – comprising several hundred items across 12 categories – found that while a fifth of the Asda items tracked had fallen in price, more than half of the cuts were only of 1p.

The magazine said this was not the case at rival retailers though they did have fewer price cuts week on week.

Conversely, less than one in 10 of the prices that increased at Asda last week only rose by a penny.

Kay Staniland, managing director of promotional consultancy Assosia, said: “Having reported last week that it was dropping bogofs in favour of being transparent in its price cuts, such small cuts could be seen as simply trying to retain the cheapest title rather than passing on any real savings to the consumer.”

A spokeswoman for Asda said: ” While it is fair to say some of our products have come down by a few pennies, overall since the start of the year products reduced in price have come down by 11 per cent on average.”

Published in The Telegraph, 08 March 2009

http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/4958389/Half-of-Asda-price-cuts-worth-just-1p.html

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