Competition is so tough in the retail sector that companies are taking the gloves off. Tesco and Lidl are arguing about circles.
New Mobility
Competition is so tough in the retail sector that companies are taking the gloves off.
Tesco and Lidl are arguing about circles. In fact they are arguing about intellectual property, after Lidl claimed that Tesco’s Clubcard Prices yellow roundel was too similar to its own corporate logo. The case went to the High Court.
Lidl won, Tesco appealed, Lidl won again. Tesco must now replace its yellow circles with something else. Watch this space to see what they choose.
Meanwhile, Sainsbury’s has reported Aldi to the Advertising Standards Authority. Aldi ran ads last December claiming that, after a Which? price comparison, it was ‘The home of Britain’s cheapest Christmas dinner.’
Sainsbury’s complaint was based on several factors. It claimed that Aldi’s use of the comparison was misleading, that claims – including a direct price comparison to Sainsbury’s – could not be easily verified by any interested consumers, and that Aldi’s claim that its prices were locked to 2022 levels was not accurate.
The ASA agreed with Sainsbury’s on all three counts, delivering a smack on the knuckles with a ruler to Aldi.
Briefly, the ASA pointed out that Which? hadn’t said that Aldi was the home of Britain’s cheapest Christmas dinner. The consumer title had awarded an equal ‘Budget-friendly Christmas dinner’ award to both Aldi and Lidl (though Aldi was 4p cheaper). It was noted that the Aldi price lock didn’t apply to all of the products in Aldi’s ad, or in the original price comparison, and the chance for consumers to verify Aldi’s claims was on a different page of the four page advertisement to the actual claims.
But what is really interesting for those outside the companies involved is just how high the stakes are in food retail right now. These arguments are signs of companies fighting hard in a truly competitive market.
Sainsbury’s has been working hard to resist the high speed growth of the discounters, and was the only ‘full choice’ supermarket to actually grow volume sales over the Christmas period, such is the speed of progress from Aldi and Lidl.
Tactics such as Tesco’s Clubcard Prices are essentially another mechanism to fight back against the discounters, hence Lidl’s spirited defence of its logo.
This almost certainly won’t be the end of the fighting. With inflation still making value for money a key supermarket battleground, there will be plenty more to scuffle about in the future.
