Tesco has praised the strength of its brand perception and customer value proposition in helping it gain market share and return to positive volume growth in 2023.
Spearheaded by the continually robust performance of its Clubcard loyalty offering, the grocery giant’s ability to take customers off of its competitors has been in part credited to a range of marketing initiatives.
Across the board, the retailer saw its reported profits more than double in 2023, with pre-tax profits jumping 159% to £2.29bn in the 12 months to 29 February, up from £882m in 2022.
As a result of the ongoing cost-of-living crisis, Tesco’s customer messaging has been laser focused on pricing of late, with initiatives such as Aldi Price Match, Low Everyday Prices and Clubcard Prices seeing it cut prices on more than 4,000 products.
This has in turn helped grow customer perception of the quality of its products, with sales of Tesco Finest now exceeding £2 billion.
By aggressively targeting loyalty growth, Tesco has been able to expand Clubcard take-up to over 22m UK households (up 6.2% on 2022), with 16.3m individuals now using the Tesco app.
A personalised digital journey has also been a key factor in the retailer’s success over the last 12 months, having significantly grown its personalisation offering with 289m personalised coupons issued to 7.6m customers in 2023.
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With ‘Clubcard Unpacked’ shopper insight now reaching over 17m customers, up from 9m last year, the loyalty offering has become crucial in growing Tesco’s ability to understand and react to is customers’ want and needs.
By leveraging these insights, Tesco, in partnership with Dunnhumby, has been able to create a sophisticated digital platform with more than 17,000 campaigns delivered in the year. The grocer has also grown its retail media presence with more than 2,000 in-store connected screens now delivered.
“This strong performance reflects the hard work of colleagues across the whole Tesco Group, and their commitment to serving our customers. Customers are choosing to shop more at Tesco, which is reflected in growing market share as they respond to the improvements we’ve made to the value and quality of our products,” Tesco CEO, Ken Murphy said.
“Inflationary pressures have lessened substantially, however we are conscious that things are still difficult for many customers, so we have worked hard to reduce prices and have now been the cheapest full-line grocer for well over a year.”
