Tesco CEO Philip Clarke was admirably frank yesterday when asked what the biggest problem was in being at the helm of the retail titan.
“Being able to keep up the pace,” he replied. Amid the latest frenzy of media attention following yesterday’s 3.7% fall in like-for-like UK sales, it was easy to see why.
Tesco is fighting battles on a staggering number of fronts. Clarke’s not entirely glamorous invitation for journalists to “come and visit Slough” – the latest Extra store to launch this week with new restaurants and food layouts – to see how Tesco is on course to transform 600 stores this year, alluded to just one of those in question.
The problem is the disruption caused by the store refresh programme has been sucking money from the sales figures, as has the other big policy shift of recent months: the move towards what Clarke called “deep price cuts” (previously he referred to it as “sharpening” prices). Those price cuts will be the focus of a new UK ad campaign Tesco launches this week as it seeks to convince customers it is “much more competitive” than in the past.
With this week’s figures from Kantar Worldpanel showing its share had slipped from 30.5% to 29%, the stakes are pretty high.
To combat these problems, Clarke unveiled a new marketing structure earlier this week, while plans are afoot for the launch of a new current account, a digital Clubcard, and an electronic wallet.
And while Tesco may have the likes of Aldi, Tesco, Asda and Morrisons in mind when it comes to the price war, in the digital battle it has opened yet another front, squarely aimed at Amazon, with this week’s announcement that House of Fraser had joined its third-party online marketplace. The ecommerce site has been relaunched to allow Tesco to use its delivery might and growing click & collect service to gets its online business back to what it hopes will be double-digit growth, following a bit of a blip after Christmas.
The man helping Phil Clarke keep up the pace – in the UK, at least – is Tesco’s UK managing director Chris Bush. Next week, he’ll be swapping one hot seat for another, when he joins The Grocer as guest editor. It’s a great chance for our readers to quiz him on Tesco’s strategy on some of the areas above, or the many others in which the retailer is doing battle.
If you have questions for Chris Bush, be sure to let us know in the comments below.
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