Both grocery store chains are lowering their prices to levels found at discount chains.
Dominick's announced it's cutting prices on some items by as much as 30 percent.
Dominick's fired the latest shot in what some see as its smoldering price war with jewel for cash strapped shoppers.
"Jewel's doesn't have the kind of food that Dominick's has," said Ruby Petereson, Dominick's shopper.
The new price reduction program by Chicago's #2 grocer promises new lower prices on thousands of items marked by yellow shelf tags. There will also continue to be additional savings with the Dominick's Fresh Values card.
"It's our customers telling us, you know, budgets are stretched in this economy and they want everyday prices that they can depend on every day," said Don Keprta, Dominick's division president.
The move comes some four months after Dominick's rival jewel began its big relief price cut campaign in its 185 stories which according to a store spokesperson is obviously working because the variety of value-driven product lines, and weekly sales promotions, provides a wide range of savings opportunities for shoppers.
"I never go to Dominick's ever. So, no, i wouldn't jump ship," said Christina Fox, Jewel shopper.
Both Jewel and Dominick's are still trying to hold on to leading shares of the $12 billion local market. Their attempts have been affected in recent years by the aggressive expansion of big box stores like Wal-Mart and discount supermarket chain Aldi's which opened one of several new prototype stores on Thursday.
"It's more of a cleaner look. I like the colors, I like everything about it," said Anthony Brown, Aldi's shopper.
Industry experts say the recent price cuts are significant because it shows neither chain wants to lose customers. Bob Golden of food service research firm Technomics says shoppers could ultimately be the big winner as the rivalry continues.
"Price is going to be much more important in the equation. For the foreseeable future until our economy really turns around," said Golden.
About a year ago Dominick's did cut prices on roughly 5,000 items. This new price cut campaign is going to remain in effect at 81 Dominick's stores throughout the area as they try to not only keep customers but also get new ones.