FMCG UK Price Comparison (July 2019): AmazonFresh undercutting leading rivals by at least 4.7%

Edge by Ascential has conducted a price comparison analysis matching a minimum of 3,950 branded products from AmazonFresh to Asda, Morrisons, Ocado, Sainsbury’s, Tesco and Waitrose.

The price comparison encompasses the following categories:

• Baby
• Beer, Wines & Spirits
• Grocery (Ambient, Fresh and Frozen Foods and Drinks)
• Health & Beauty
• Home Care (Household Cleaning, Laundry and Pet Care)

The analysis only includes products where there is an exact match and does not include Own Label SKUs. This is a shelf price comparison and therefore does not include multi-buy promotions.

How much cheaper is AmazonFresh really?

On July 1, prices on AmazonFresh were between 4.7% and 14.9% cheaper than its leading rivals. As with previous studies, Asda finished the closest in price, followed by Morrisons with a price difference of 7.1%.

The average price gap from AmazonFresh fell for all retailers since our last analysis in May. The price gap between Sainsbury’s and AmazonFresh experienced the biggest reduction, down from 11.4% on May 1 to 7.3% on July 1, bringing the retailer just behind Morrisons (7.1%) for average price difference from AmazonFresh.

Although AmazonFresh remained the most price-competitive retailer in all categories, the price gap reduced significantly for nearly all retailers in the Beers, Wines & Spirits and Home Care categories.

The price gap from AmazonFresh, however, reduced significantly for all retailers in the Grocery category – the largest category in our analysis. Sainsbury’s saw the most substantial decrease in price gap – down 5.5% - and leapfrogged both Tesco and Morrisons to finish the period with the second-smallest gap in the category.

Overall, the shrinking price gap was the result of an increase in the percentage of price matches between AmazonFresh and its leading rivals (except for Asda)causing a major drop in the percentage of AmazonFresh products with the lowest price in the category.

In the Grocery category specifically, our analysis revealed that the overall average price of the comparable items listed on both May 1 and July 1 increased both on Amazon and the traditional UK grocers. However, Amazon’s overall average price increased between 2.3% and 3.6% while rivals’ prices increased by a minimum of 0.2% (Sainsbury’s) and a maximum of 2.1% (Morrisons).

The increase in Amazon’s average price affected all three key subcategories within Grocery, but was most evident in the Frozen Foods subcategory – the smallest of the three. The rivals’ average price also increased in all three subcategories, except for Sainsbury’s and Waitrose which saw their average price marginally decrease in the Chilled and Frozen Foods subcategories respectively compared to May 1.