The reign of Tesco: the grocer needs to make the right move in order to be king of the high street
The recent drop in Tesco’s group profits puts them yet again in a pretty tight spot. Tesco UK managing director Chris Bush’s plans to reignite the flames of loyalty that shoppers had for Tesco got me thinking. What they really need to go after is community. Along with the other c word, convenience, it’s a big one on the high street and in retail more broadly.
David Atkinson
Talking recently to Retail Week Bush said, “We’ve got to turn Tesco from a brand that is used to a brand that is chosen.” It’s blindingly obvious why the grocer has become a default choice; it has so many stores as to be totally ubiquitous. You’d be hard pressed not to have a Tesco locally in some guise. Tesco has become all things to all men – selling everything from electronics to entertainment, alongside food, clothing and much more. And like Starbucks, over the years Tesco has been pretty much demonised, accused of homogenising the high street and slowly but surely contributing to the closure of independents, and more recently chains such as Woolworth’s, Comet and HMV as it eats into other categories.
Yet when it comes to convenience, Tesco is king and wears its functional mantle well. We all need convenience in our lives and the abundance of Tesco Metros that have taken over from failing shops is testament to this.
But back to where we started. The British public loves to talk of community, even if it’s only lip service. There is an outcry when well-loved names look set to disappear forever. But that same public is often short on action. Cue the multiples. Retailers such as Tesco are in a prime position to bring broken communities all over Britain back together again, by following the example of the British bastion that is the local corner shop. Build a real attachment with your local community; provide them with truly localised services and added value. That way you’re bound to win hearts and minds.
A quick look at what’s happening in another sector in another part of Europe sees local newspapers in Scandinavia, especially Norway, setting an excellent example. The titles that are surviving are those that are focusing first and foremost on their local communities. It’s very much about the old cliché, think local. Or to use that cooler term, it’s all about hyper-locality, don’t you know.
Tesco’s multi-channel presence (national, regional and local) means that its message has to be unified, but the local store could well be a useful starting point for Chris Bush’s ‘chosen not default’ ambition. If Tesco can make a success of its local positioning, then it could stand a chance of retaining its grocery crown. Long live the king.
David Atkinson is a founding partner of integrated marketing agency Space