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Tesco CRM Strategy Analysis

Tesco was founded by Jack Cohen in 1919 from market stall in Londons East End. Over the years, as the retailing market has transformed, their business has grown and developed, giving an answer to new opportunities and initiating many enhancements. Now these are working in 14 countries surrounding the world with employing more than 500, 000 employees. (TESCO PLC)

In May 2002, Tesco exposed its first store in Malaysia is at Puchong. The opening of Tesco changed the buyer demand, also helped bring new requirements in the retail trade. To be efficient and competitive with the outcome of benefiting Malaysian consumers, it has encouraged both large and small retailers to become more productive and competitive. (Basic INFORMATION ON Tesco Malaysia)

In order to assist in Malaysian, Tesco provides a complete one-stop shopping for their needs, including fresh food to groceries, from household needs to attire. Tesco carriers a complete of 86, 000 lines of products including more than 1, 300 Tesco branded items. (Basic Info About Tesco Malaysia)

2. 0 THE PROBLEM Research of Tesco

To formulate a CRM strategy, we use SWOT analysis to investigate the situation analysis of Tesco. SWOT stands for Strengths, Weaknesses, Opportunities, and Risks.

The advantages of Tesco are it includes a robust retail brand which it includes given as the winner at the entire year 2008 by World Retail Prizes. THE PLANET Retail Awards understand some truly gifted and highly progressive retailers, it creates the make of Tesco more value and attractive. (Worldretailawards) Besides that, Tesco have wide selection of products and makes all products in each of Tesco branches. Tesco will take good thing about the economies of scale which buy the goods in mass from suppliers. Therefore, it also means that Tesco has provided the cheapest prices to consumer and gain competitive advantages with others store in same industry such as Large, Jusco, etc. Tesco also creating devotion deals such as Membership credit card and in the other side also created their loyal customers with their brand. (Tesco SWOT analysis)

Tesco is big company with large selection of products. However, Tesco has its weaknesses. Tesco's finance profit was influenced by bad debts form bank cards and too many homeowners' insurance statements because the merchandise not in good condition and management difficult to control so many products. (tesco Swot analysis) Besides, obstacles to entry new market apart from food sector such as literature. In catalogs industry Tesco are facing road blocks because there is companies that focusing on books industry offering better service and also have more loyalty customers such as MPH. Besides that, Tesco lack of experience and experience to offer phone services to customers and it may leads to bad debts. (Tesco SWOT evaluation)

There are extensive opportunities for Tesco. The grow of Tesco in the web market and catalogue shopping will expand the use of technology; which can satisfy the customers' demanded to know the merchandise details in Tesco even the deals. It can even be develop additional services to understands and gratify the consumers needs and wishes such as general market trends, staff attitude evaluation. Besides that, Tesco can also enhance the queuing system that reduces the client waiting time and energy to pay. Effectively use of Clubcard database to targeted desired band of customer.

Tesco also faces many dangers. Tesco make an effort to be the number one leader in low cost market, it means that it will becomes the prospective of competition. Tesco has strong competitive market with others hypermarket such as Large. Nowadays Giant can even overcome down Tesco with provided the cheapest price to customers. Also there is a growing public matter about small outlets or smaller retailer are disappearing due to the expansion of hypermarkets makes the tiny sellers cannot survive on the market. (CRM and ebusiness strategies of Tesco)

Based on the SWOT examination, there are a few improvements to be able to comprehend the consumers' needs and wishes. The main problems consist of the client service, and customer can take too long time for you to queue for repayment.

Besides, the chance of Tesco that happen to be effectively use of Clubcard database to target desired group of customer to let them enjoy more great things about being a member than an ordinary customer.

3. 0 The Segmentation and Customer Profile

Tesco currently performs 43 Tesco and Tesco Extra store. Tesco service providers total of 86, 000 lines of products. Therefore, Tesco has different aim for segment with the several products. The next data are demonstrating the target segment and the sales size of Target Section of Tesco.

The Target Section of Tesco


Distinctive Attribute


They go to Tesco during the campaign season.

White Collar

Like to shopping at a clean, comfortable, and workable environment.


They go Tesco together with their whole members of the family.


They make their business health supplement product from Tesco.

In this concentrate on segment, housewife is occupying 25% of sales. Housewife is the person who already married with the age between 27 and 50. They do not work after get committed, plus they do not throw away cash. Therefore, this band of segment will only go Tesco through the promotion season. Each goes to Tesco is usually buy groceries.

Another target segment is white training collar who are occupying 13% of sales. White collar's age group is between 21 and 35. They can be officer, and their working hour is from 8am until 6pm. It really is too late for them to go moist market after work. Therefore, they choose going Tesco, also because of they prefer to shopping at a clean, comfortable, and manageable environment. This make them to feel relax after work. They go to Tesco is usually buy groceries, stationary, and digital products.

The next goal segment is family who are occupying 37% of sales. This band of segment is a little family member with the customers of spouses and children. They like to go Tesco together because this can help them to boost their relationships with each other. They go to Tesco is usually buy groceries, gadgets, furniture, and electronic digital products.

The last target segment is stores who are occupying 25% of sales. They have got their own business, and have strong economical capacity. The store normally can make their business supplement product from Tesco, because Tesco have wholesales with cheap. This can make them far more convenient and reduce the expenditure on business.

4. 0 The CRM Objective

The first CRM objective is to increase customer's satisfaction by giving better customer service. Tesco has received many negative feedbacks from the customers due to the bad attitude and lack of understanding of the Tesco's personnel. Therefore, Tesco provides training with their staffs, make sure that the staffs can help customers when they needed. Also, Tesco will have a customer service counter to provide those customers who need help.

Another CRM goal is to maintain long-term romance with customer and enhance customer devotion. Customer may become a membership through the use of Clubcard. The purpose of Clubcard is to let customer to accumulate details when consumer at Tesco, and redeem some particular products or voucher utilizing the things. However, if compare with Tesco's rival, Clubcard member struggling to get some good benefits, for example, cash voucher, when their birthday. Furthermore, Tesco's competitor will execute a account day occasionally, therefore the customer can enjoy the lowest price for all the items in this day. All of these account benefits are what Clubcard member unable to enjoy.

The last aim is to increase efficiency, speed up the queuing process and enhance the customer journey. Tesco always received claims that the check-out counters hanging around time is too much time. Therefore, Tesco will build in multiple check-out counters. When there are not much of customers, a few of the check-out counters will close, and two cashiers will continue to work in the same counter-top to serve customers. When a queue is more than three customers, then the other check-out counters will open for the customers, so that the customer no need to queue so long.

5. 0 The CRM Plan to Achieve Objective

To increase customer's satisfaction, communication is very important. Tesco provides training with their staff to learn all the merchandise knowledge and the communication skill when communicate with their customer. Tesco can develop new CRM software to boost their customer handling in call centre. This system allows customer services staff to manage and helps customers with any question they face when buying any technology product online or from Tesco store. Besides that, this technique allows the store to give responses to customers and log customer's connections through the phone or email.

Individual customer information must be used to develop a long-term marriage. Understanding their customers was the key to customer marriage and loyalty. Tesco can add their Tesco Clubcard with their customers, become Tesco Clubcard users can get many offer and benefits such as, accumulate points when they purchase in Tesco, while get enough factors may use the details to redeem any product they want. Besides that, become Tesco Clubcard member can get voucher at some period time or get reduced on certain item. Besides that, when Tesco performed out any occasions, Clubcard members have the priority to really know what the function and any campaign. All this can help Tesco to increase their customer's devotion.

What customers want is efficiency to help them save lots of time. Customers dislike to wait, Tesco always having the problem of check-out counters holding out time too much time. To solve this problem, Tesco can start more check-out counters when the clients gets more and it make the queue time will not be so long. Besides that, Tesco can develop new software for their customers to work with their telephone to pay what they would like to buy which customers can download the Tesco apps from internet through mobile phone, when there exists too much customer to queue for pay, they can start the apps and while shopping while check the product club code they choose and then use credit card to pay online. Online paying is much easier and efficiency nowadays. Tesco will open extra check-out counters simply for the clients who are paying online, therefore the customers who use online paying simply need to go the counter and suggest to them the web receipt and the cashier can help them to load up all the products.

6. 0 The Analysis Methods to Evaluate the Effectiveness of the Strategies

First, Tesco can accumulate customer's responses through giving out comment cards. The goal of offering comment credit cards to customers is to let Tesco's management has learned what the client dissatisfied, what they complaint about, and what fundamentally customers needs and desires to make improvement to preserve the long term human relationships with customers.

Another analysis method which is time management system, using by Tesco that goal is to evaluate the holding out time of customer until they make the repayment. For example, the receipt directed at each customer possessed the function of record down enough time in order to allow customer understand how long they have been waited and at the same time Tesco can evaluate the customer longing time whether shorten or have to be improving.

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