British supermarket chain Tesco should put innovation, in the form of data, back at the centre of its business, a leading FMCG marketing expert has told ESM.
Innovation used to be what Tesco did best, said Ian Humphris, joint managing director at Life, an advertising agency with FMCG clients such as Danone, Dr. Oetker, Molson Coors, Nestlé and PepsiCo.
Humphris believes that Tesco "should have known better" than to divert its attention to hunting for quick-win solutions, such as opening coffee shops and restaurants in store.
As Dave Lewis settles into the biggest retail job in the UK this October, replacing Tesco's chief executive, Philip Clarke, it’s no understatement to say that he’ll have to hit the ground running.
"The facts speak for themselves: Tesco's worst sales decline in 20 years, one million fewer customers a week, and £1 billion committed to a turnaround that doesn’t seem to be working," said Humphris.
He told ESM, "The big question is: what is the former Unilever marketer going to do to turn around a brand that was once a flagship of British success, but that now seems to flail from one solution to the next: trendy coffee shops, family-friendly restaurants, community spaces for yoga?"
Humphris continued, "Tesco's database holds more information on the UK population than anybody else, bar the government. By divining this data, it should be able to put innovation back at the centre of its business."
According to Humphris, innovation used to be what Tesco did best -- bringing online shopping to the masses, reinventing loyalty cards, creating varied product ranges that served different consumer groups, and giving consumer banking a facelift.
"In recent years, it seems to have lost its innovative spirit and lost its way. While Amazon promises us drone delivery in the next couple of years and the Amazon Fire could reshape shopping, Tesco’s 'Every Little Helps' line seems small beer in comparison," he said.
It is time for Britain’s biggest retailer to start thinking big again, putting innovation at the centre of what it does.
The next five years will see massive changes in retail, as technology changes the shopping experience beyond all recognition.
Tesco should be leading these changes and forcing its competitors to pay heed, Humphris said.
"It's got the data. It's hopefully got the leader. Now it needs to show that it’s got the vision," he concluded.
© 2014 European Supermarket Magazine
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