This case study deals with the successful CRM strategy implemented at Tesco.

1. CASE PRESENTATION
TESCO
THE CRM
CHAMPION

2. TESCO - A MASTER AT CRM
• In 1995, Tesco launched a “loyalty card” scheme in order to retain their
existing customers.
• The data collected through these cards were analyzed with the purpose
of providing personalized services to their loyal customers.
• Tesco mass-customized the magazines to ensure that all its customers
received magazines that consisted of material suited to their lifestyles.
• Tesco became number 1 retailer in 1995.
• In 2003, the company’s market share was 26.7%

3. BACKGROUND NOTE
• The first store was opened in 1929 in Burnt Oak, Edgware.
• By 1930, around 100 stores were operating under the Tesco label.
• In 1948, the first self-service Tesco store was opened in St. Albans.
• Gradually Tesco grew over 400 stores.
• In 1960, Tesco began selling clothing, household goods, fresh foods and
groceries.
• In 1968, Victor Value came under the company’s fold and in 1974 began
operating petrol pumps.

4. BACKGROUND NOTE
• Entered in France in 1994, Hungary and Poland in1995.
• In 1995, joint venture with the Royal Bank of Scotland as ‘Tesco
Personal Finance’.
• In 1996 entered Czech Republic, In 1998 in Northern Ireland and
Thailand.
• In 2000 Tesco established tesco.com and began operations in Taiwan.
• In 2001 Tesco acquired 53% stake in Dunnhumby.
• By mid 2003 Company was operating 2291 stores around the world.

5. CRM – THE TESCO WAY
• Creating value for customers, to
earn their lifetime loyalty
Core
Purpose
• No one tries harder for
customers
• Treat people how we like to be
treated
Core
Value

6. CRM – THE TESCO WAY
• 1993 - Tesco launched the ‘First Class Service’ initiative to improve
customer service.
• 1994 - Launched the ‘One in Front’ scheme to reduce the time
customers had to spend waiting at check-out counters.
• 1995 – Launched the loyalty card scheme to give extra attention to
the top customers (measured by frequency of purchase and amount
spent).
• Tesco began tied up with Dunnhumby and testing of Clubcard
Loyalty Scheme.
• Through this way Co. started collecting the Database of customers
like name, address, dob, e-mail and product preferences.

7. CRM – THE TESCO WAY
• With the help of data mining they analyzed the data and classified
the customers into four broad categories : Premium, Standard,
Potential and Uncommitted.
• Further profiles were created for all the customers on the basis of the
types of products they purchased.
• Special cards were created for students and mothers.
• Special attention given to expectant mothers in the form of personal
shopping assistants.

8. REAPING THE BENEFITS
• Tesco adopted “the rifle shot approach” instead of “the carpet
bombing approach”.
• Due to the captive customer base and the cross-selling
opportunity, the cost of acquiring customers for its financial service
was 50% less.
• Due to the data Tesco was able to offer better services to the
customers.
• Tesco was ensured that the footfalls in its stores did not decline on
account of competitive pressures.

9. REAPING THE BENEFITS
• Tesco developed a totally new
product rage ,”Tesco Finest” for the
high income bracket who are
attracted by rivals.
• Tesco, removed the impulsive
products like candies from off-shelf
still company earned profit.

10. CUSTOMER SERVICE TO CUSTOMER DELIGHT
Four approaches
• Launch better
• Bigger stores
• Competitive prices
• Increase number of products
Price checkers- compare prices
Every customer offered help- instructions to employees
Greetings , offering help and wishing to customers
Operational framework- Eliminate non value added cost
Lean thinking approach

11. CUSTOMER SERVICE TO CUSTOMER DELIGHT
For aspects of strategic goal
• Core UK business- continue service in UK
• Non food business- new areas
• Retailing service
• International business
Launched fixed line telephonic service in UK
45% revenue from non UK operations
Launched Me Time- for Ladies Health spas, luxury gyms, beauty
saloons, designer clothes, cosmetics
Redeem points of cluecards on Me Time
Cut 60 million euros on vast range of products
Listed in Top 10 in top 50 businesses in Europe

12. THANK YOU