Tesco, Britain's biggest retailer, will next month abandon a price-matching scheme which gave shoppers instant reductions on branded goods at the till, saying its focus is on lower regular prices.
Tesco said on Monday that by cutting prices it had made the scheme redundant.
All of Britain's big four grocers - Tesco, Sainsbury's , Walmart's Asda and Morrisons have been trying to narrow the price gap with German discounters Aldi and Lidl which have won market share from them over the last decade.
Tesco said it "Brand Guarantee" scheme, launched with much fanfare in 2015, will cease on July 16.
The scheme offered Tesco customers a price match on branded goods when they bought 10 or more items, including at least one eligible branded product, in larger stores or online, with the difference refunded at the checkout. Prices were compared with Sainsbury's, Asda and Morrisons.
"As a result of our continued investment in simpler, lower everyday prices, fewer than one in eight transactions today receives any refund at all," Tesco said.
"At the same time, a majority of customers now tell us they would prefer lower everyday prices instead."
Tesco said that in the last month it has cut the price of over 260 products, such as bacon, orange juice and chopped tomatoes, by between 10 and 50 percent.
Planned Cuts On Products
It said it planned cuts on "dozens" more products over the next two weeks.
Shares in Tesco have increased 56 percent over the last year as its trading has outperformed rivals and investors have warmed to its purchase of wholesaler Booker.
Sainsbury's, which in April agreed a £7.3 billion ($9.7 billion) takeover of Asda, scrapped a similar "Brand Match" scheme in 2016.
Sainsbury's/Asda have said combining will enable prices to be lowered by about 10 percent "on many of the products customers buy regularly."
News by Reuters, edited by Donna Ahern. Click subscribe to sign up for the Checkout print edition.