Marketing Communication Stratergy Of Tesco

Brand heritage

Tesco is the largest and most popular supermarket chain in Britain today. They have also branched out into many areas other than groceries as they strive to satisfy their customer's needs in every which way possible. This need to keep their customers happy is of core importance to their brand.

Tesco was founded in 1924 and adopted the strategy of 'pile it high, sell it cheap'; although today's strategy is much more sophisticated than this it does still hold some similarities. They strive to be the best value company in all of the market segments they enter. Over the years Tesco has used a complex marketing strategy in order to successfully communicate this message to their audience.

The Tesco brand is associated with the slogan 'Every Little helps' it has been used for many years now as a marketing tool to communicate to customers what the company stands for. The slogan has penetrated into the minds of the customers through many forms of promotion; the most obvious being their point of sale communication (POS). It can be seen from the moment you reach the car park to the bags you hold as you leave. However, it is not enough to come up with a catchy slogan; it has to be seen to mean something or customers will loose faith.

Over the years Tesco has been responsible for several small revolutions in retailing which have help make it the company it is today. An article by Corporate Watch (2004) states that in 1993 Tesco introduced some of the first own-label goods. The 'value' range captured the mood of the nation after years of recession and also gave meaning to the slogan 'every little helps'.

The most important revolution was the introduction of the Tesco Clubcard in 1995. This sophisticated tool has enabled Tesco to learn important information about its customers which in turn has been used to improve Tesco's marketing strategy. It has helped implement many successful marketing communication campaigns due to heightened awareness of targeting.

The Clubcard

The Clubcard is a highly innovative scheme that is based on the principles of building customer relationships in order to gain loyalty. Customers are given rewards in exchange for vital data that enables Tesco to improve its knowledge about elements of its business such as segmentation and targeting. It can also be used as a tool to evaluate how campaigns or promotions have performed or to analyse how outside influences such as interest rates affects their customers buying behaviour.

It is a very important element for the integration of Tesco's marketing communication strategy. Evidence of this can be seen if we refer to the Integrated Marketing Communications Process Model (appendix fig.1) where by the Clubcard creates a communication loop carrying substantial marketing information back to the sender (Tesco). A report conducted by EBSCOhost states that

'This dependence means there is an information loop, in which a product is developed and perfected according to the tics of the Tesco customers - who will determine its success'.

Although this statement refers to Tesco's products it can also be just as valid when amending marketing communications because the Clubcard is able to collect data that gages customer's reactions to the most up-to-date promotions or campaigns. If a particular campaign is not having the anticipated effect on the customer, all stages of the process can be looked at to see where it may have gone right or wrong.

The concept of the Clubcard started out as a means of creating loyalty amongst customers but after a substantial amount of investment it has become apparent that the most valuable element of the scheme is the insightful segmentation and targeting information that it produces. It enables marketers 'to communicate the right message, in the right way, to the right people, in the right place, at the right time' (Pickton, D & Broderick, A. 2005)

The message and the media

'We talk about Every Little Helps a lot, but it is not just a catchphrase or marketing slogan, it represents everything we stand for. For our customers, it is how we run our businesses from China to Chorley'

This statement acknowledges the fact that 'Every little helps' is a fundamental message in Tesco's marketing communication strategy but it is actually just one of many. For example, other messages include 'one in front', an initiative set up to make sure customers get served at the till as quickly as possible. 'Green Clubcard points' is the message being communicated in one of Tesco's most recent campaigns to help the environment.

The messages are simple to understand so that they appeal to as broad a range of people as possible, especially as Britain's population is growing ever more diverse. Kanaiya Parekh, Tesco's media service manager states that,

'Tesco's strategy is always to deliver relevant messages to our customers during their shopping journey' (2005)

Many different strategies have been adopted in order to communicate these messages to their audience using a varied range of channels, examples of which can be found in fig2 of the appendix. The most evident means of communication is through POS which accounts for most promotional material within a retail, store-based, environment.

Tesco alone has 1,800