Britain's largest supermarket group Tesco had its knuckles rapped by the Advertising Standards Authority (ASA) yesterday [Tuesday] after it was deemed to have made misleading claims that its prices are lower than sector rival Sainsbury's.

Sainsbury's, which is currently the second largest grocer in the UK, lodged two complaints about Tesco's leafleting campaign in May this year. The leaflets showed till receipts comparing prices in the two stores, and suggested that Tesco was between 16% and 13% cheaper than its closest competitor.

Peter Davis, CEO of Sainsbury's, welcomed the ruling, arguing: "Tesco selectively chose products on 'special offer' at Tesco but not at Sainsbury's […] Representative basket comparisons are unreliable, not in the consumer interest and risk bringing our industry into disrepute."

He added: "They deliberately misled customers and have been found out."

The ASA has told Tesco to seek guidance from its Committee of Advertising team if the grocer wants to conduct any similar advertising campaigns.

Tesco responded by insisting that the ruling merely questioned the design of the leaflets, which are no longer being used. and not the claims over price. A spokesperson insisted that the company is "always extremely careful" about price claims and pointed out that Sainsbury had neglected to carry out its threat and lodge a complaint with the ASA over Tesco's claims to be 8% cheaper. 

"I think our customers still realise where we are still cheaper," the group added.