Unbound Edition. Meaningful conversations about brand, from Davis Brand Capital.

Tesco: Let the Store Come to the People

QR codes have become ubiquitous and so has the term digital strategy. Both are often treated by businesses as “silver bullets” without much understanding how to leverage either. QR codes, in particular, have been reduced to gadget status with little meaning but to annoy the consumer. Tesco’s efforts in South Korea, on the other hand, are a prime example of a well thought-out growth strategy based on digital tools, including QR codes.

Tesco’s recent effort – or Home Plus, as they refer to themselves in South Korea – is worthy of mention on a number of levels:

  1. It doesn’t distinguish between online and offline: Much has been said about online and offline converging and consumers no longer making a distinction. This is one of the best executed efforts, based on a sound understanding of the South Korean consumer.
  2. It provides instant and tangible benefits: Consumers tend to support brands that provide a utility. Think Progressive’s rate comparisons and Nike Plus. The former provides comparative rates with a few clicks, the latter empowers runners worldwide. Tesco taps that same idea by turning a weekly chore into a time-saving activity while waiting for the next subway.
  3. It doesn’t treat the initiative as a mere marketing campaign: Yes, it certainly is that, but the retailer understands the larger business implications of this effort – valuable data from consumers who just opted to engage with Tesco.

How will Tesco blend this effort with its more traditional brick and mortar stores? Hard to tell at this juncture, but if recent moves of big box U.S. retailers, such as Wal-Mart, are any indication, they may well become smaller and offer a more specialized assortment. In any case, they are following the digital challenge as expressed by MIT Media Lab’s Joichi Ito: “In fact, it is now usually cheaper to just try something than to sit around and try to figure out whether to try something. The product map is now often more complex and more expensive to create than trying to figure it out as you go.”


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