Clash with the titan

With Tesco?s consumer electronics division rocketing 31 per cent last year, Andrew Wooden speaks to IT buyer Matthew Leeser about the grocery giant?s positioning in the PC sector, and takes a wider look at just how threatened independent retailers really are?
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Laptop sales in particular have been strong for Tesco. What initiatives did Tesco put in place over the past year to attain this growth?

Laptops have undergone significant growth over the past year for Tesco and have been a key factor in our continuing strong growth in the computing and electricals market. New customers to computing have voted with their feet as they have discovered they can achieve much of their home computing needs with a laptop rather than a space-hungry desktop PC.

We have worked hard to try and cut through the techno-jargon to make purchasing decisions simple and ensure customers purchase the right laptop for their needs. Improving our product range, brand mix and price offer has also been key to ensuring we continue to deliver on our promise to create value for customers.

How have software sales been for you during the same period?

As this information is commercially sensitive we are not in a position to discuss it at this stage. However, what we can say is that we are pleased with how our software sales have been going.

What is the chief reason consumers are going to Tesco more and more for PCs and other technology products? What can you offer that other retailers can’t?

We work very hard to ensure we deliver on the trust our customers place with us. Customers always expect great value from Tesco and this is of the utmost importance in all that we do within the computing category.

Customers must have the confidence in what they purchase from us is the right price and right for their needs. I believe we have proved to them time and time again we can compete, and our continued growth demonstrates their confidence in us.

Convenience is also hugely important to our customers. They visit our stores on a weekly basis which means we have the opportunity to talk to them regularly about our offers, range and prices.

However, this also means we have to work hard to make sure our offer is fresh and we constantly provide the value they expect. So, when you combine our convenience with our wide customer base, we have the ability to talk to customers whom in the past may have only considered us for their groceries. But now they can see we offer much more.

Our customers have seen how we have improved our breadth and size of range over the last year and in conjunction with the trust and convenience we offer, Tesco has become an important place to visit when considering a computing purchase.

Will you be looking to boost the floor space you dedicate to PCs, laptops and associated products in the near future, to accommodate any growth you have experienced?

We see great scope for developing our customer offer in the computing category. The market is growing phenomenally quickly and our offer must reflect this and, moreover, our customer expectations.

We are pleased with our success so far, but we are constantly reviewing our plans to ensure we do the right thing by the customer in the ever-changing market conditions.

To this end, we are working hard on how we communicate the product technology to the customer and also effectively communicating the key product benefits. Naturally I can’t divulge our strategy in too much detail other than to say we have some exciting plans ahead.

Dell computers have shot up the sales charts since the products hit retail. Have you noticed increased footfall in Tesco’s PC areas since you started stocking them? How much of a success have they been?

The introduction of key global brands has been an important part of our growth. Our year-on-year performance shows that more customers are now choosing to purchase their computing products from Tesco and our brand offer has been key to this growth, demonstrating real credibility of range.

As I said earlier, customers trust us to get the offer right, and ensuring we have the right brands at the right prices means they will continue to have confidence in what we do. Building strong partnerships with all our key partners will form the basis for continued success.

Do you have any dedicated consumer marketing campaigns in the pipeline to support your PC sales?

As this information is commercially sensitive it’s not something we can discuss at this stage. However, our customers can expect to continue to hear from us about our great value offers and any developments in our range.

In the longer term, what plans do you have to increase Tesco’s market share in the PC and wider technology area in 2009 and beyond?

Our success to date in computing has been underpinned by the core values Tesco maintains. It is crucial we continue to apply this in all that we do in the future.

This means we will continue to offer great value to our customers, improve and develop our ranges in line with customer needs and talk to customers in a way that will help inform and educate them about the technologies on offer.



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