LONDON (Reuters) -Asda, Britain's third largest supermarket group, said it would match the prices of discounters Aldi and Lidl on hundreds of comparable grocery products, adopting a similar tactic to bigger rivals Tesco (LON:TSCO) and Sainsbury's.
Asda, owned by brothers Zuber and Mohsin Issa and private equity group TDR Capital, said on Friday it has cut the prices of 287 products, including milk, bread, cheese, fresh meat and fresh fruit and vegetables, by an average of 17% to match whichever discounter has the lowest price.
The new pricing strategy comes after Asda underperformed rivals in 2023 and was a relative laggard over the Christmas period, losing market share, according to industry data.
Market researcher Kantar on Wednesday published data that showed Asda's sales rose 3.4% in the 12 weeks to Dec. 24 year-on-year, while market leader Tesco and No. 2 Sainsbury's had growth of 7.5% and 9.3% respectively.
Tesco and Sainsbury's have credited their Aldi price matching schemes for stemming the flow of shoppers to the discounters, which between them have grabbed a 17% share of Britain's grocery market.
A spokesperson for Aldi said Asda's latest move was a gimmick and that only a tiny proportion of what Asda sells will be price matched.
"The only place you get Aldi prices is at Aldi," the spokesperson said.
A spokesperson for Lidl said the firm was committed to providing "all households access to great food at the lowest prices."
Asda's latest price cuts and reductions on 1,700 products announced by Ocado (LON:OCDO) Retail on Thursday, add to the UK's brighter outlook for food inflation.
Kantar said on Wednesday grocery inflation slowed to 6.7% in December from 9.1% in November, the fastest month-on-month drop that the researcher has recorded and its lowest level since April 2022.