Posted: July 20th, 2016

Tesco plc is a well-estabilished supermarket retail brand in the U.K and Ireleand.

Tesco plc is a well-estabilished supermarket retail brand in the U.K and Ireleand. While the company showed strong performance from 2000 to 2013, it has been plagued by issues internal to the company since 2014, that have impacted its brand image, financial transparency and put to question its business model of putting customers at the core.

We conduced both primary and secondary analysis that supports the outline of issues and sccesses that Tesco has faced in the past, as well as defining a path forward for the troubled retailer.

Business Overview (Structure, Products & Operations)

Tesco plc is the fourth largest retailer in the world after Wal-Mart, Carrefour and Home Depot, and the largest supermarket retailer in the UK and Ireland (Retail Economics, 2016).

After struggling in a severe price competition in its British home market in the early 1990s, Tesco was successful in relying on sales of non-food items and international expansion. The strategy was later redefined to a customer centric approach with the core purpose of creating value for their customers to earn their lifetime loyalty (Lankenau, Klein, Wehmeyer, 2004).

Tesco’s loyalty scheme “Clubcard” has become an industry benchmark for customer profiling and client relationship management. Tesco‘s marketing strategy is based on “seeing
customers as individuals”. Central activities are based on customer data collected through the
clubcards. (Tesco plc Strategy Report: 2015).

Tesco has moved beyond online grocery retailing and offered a wide variety of products on their web site, www.tesco.com. “What differentiates tesco.com from other online retailers is the fact that it does not operate its own warehouses, but enables the customer to buy online from their familiar local Tesco store. Each store’s pricing and inventory system is linked directly to tesco.com, so that customers can select from the line of goods with prices they are used to.” (Seybold, 2011).