Presentation By Alok Ranjan

Introduction• Tesco PLC is a

British multinational grocery and general merchandise retailer headquartered in Welwyn Garden City, Hertfordshire, England, United Kingdom.

• It is the third largest retailer in the world measured by profits and second-largest retailer measured by revenues.

• It has stores in 14 countries across Asia and Europe and is the grocery market leader in the UK.

• Originally a UK grocery retailer, Tesco has diversified geographically since the early 1990s and into areas such as the retailing of books, clothing, electronics, furniture, toys, petrol and software; financial services; telecoms and internet services.

• Initially the company’s driving force was the idea “Pile it high and sell it cheap”.

Issues Faced Initially• Tesco suffered from the reputation of “Pile it

high and sell it cheap”.• Stores were damaged and in need of repair.• Sainsbury was the market leader.• Supply chain was integrated and expensive to

maintain.

So what did they changed?

Complete Transformation

New campaign “Every little help”.Supply chain management was re-aligned.

Distribution centres were re-laid.20 ads in the market.

The TESCO Brand Guarantee Ad from 1990s

All these Organizational, Informational and Process

transformations made Tesco the market leaders by 1995 leaving

behind Sainsbury

Launched Tesco

Clubcards

Tesco Clubcard

• In 1995 Tesco introduced the clubcard in UK.

• It allowed Tesco to really understand its customers.

• It introduced a whole new way to encourage customer loyalty.

• Acted as data gathering tool and build unique “DNA profile” of every customer.

Expansion• Tesco moved beyond

supermarket to “big box” retailing of nonfood

products.• In 2003, the average profit

margin was 9 percent for nonfood products versus 5

percent for food.• Nonfood items earned them 20 percent of their revenue.

• And it also provided additional convenience to customers who wanted to

shop under one roof.

• Tesco continued to diversify its product and service offerings in order to reach more customers:

its own ISP service in 1990s; Tesco Broadband; Tesco Mobile and Tesco Home phone; Tesco

Bank etc.

What’s Next for Tesco

Opening of new storesGoing online for selling the products and

servicesEnter the new high-growth markets in AsiaEntering the other high potential streams

of Products & services

Major Competitors• Wal-mart• Sainsbury• Carrefour

How to get ahead of them?

Customer Database Tesco can use its customer database

effectively to overcome its rivals. It has so far been successful in appealing to everyone with its Tesco-branded price-ranges: “Finest”, “Mid-range” and “Value”. It can continue with the same policy while establishing at the new markets. Tesco should also continue its loyalty clubcard program because it’s a unique way to increase customer loyalty.

Mission statement of TESCO

Creating value for customers, to earn their lifetime loyalty.

VISION STATEMENT

• Our vision is for Tesco to be most highly valued by the customers we serve, the communities in which we operate, our loyal and committed staff and our shareholders; to be a growth company; a modern and innovative company and winning locally, applying our skills globally.

How can Tesco take its customer

loyalty programs to the next

level?

• Tesco can take its customer loyalty program to the next level by concentrating more toward marketing research and linking consumers behavior towards different services. By researching more about their customers behavior and satisfaction, we they can create abetter profile to understand the needs and trends.

Summary• From “Pile it high and sell it cheap”,

Tesco developed a campaign “Every little helps” to build consumer relations.

• Launched Clubcard loyalty program• Diversified geographically into areas like

books, telecom, petrol, insurance, mobiles and internet providers.

• Today largest British retailer and second-largest in the world after Wal-Mart