Tesco’s Grand Prix-winning IPA Effectiveness Awards paper documents a massive turnaround, says Lucy Aitken.
Tesco’s financials, announced on 7 October, suggest a rare thing right now: a retailer in rude health. Which makes its Grand Prix at the IPA Effectiveness Awards all the more pertinent.
When compared with its 2015 nadir, this particular turnaround story shows the power not just of a stellar campaign – Tesco Food Love Stories – but also an entirely new approach that places customers squarely at the heart of the business.
There is no doubt that similar statements about putting customers first are made in retailers’ board rooms, or annual reports up and down the land. Yet Tesco interrogated what it actually meant to serve customers. Then it acted on it. From simplifying in-store offers so customers could be sure they were receiving value for money to mobilising its workforce to improve on how they served shoppers, it made its entire business run in a more customer-centric way.
Refreshing the comms strategy
The winning paper, From running shops to serving customers: The Tesco turnaround story, by Simon Gregory, Joint Chief Strategy Officer, BBH London, and James Parnum, Partner, MediaCom, is a fascinating chronology of a titanic turnaround. One of the most valuable takeouts is how Tesco rethought its communications planning to start with its owned channels.
When you have more than 2,300 stores, 330,000 employees, 2,500 trucks, 17 million Tesco Clubcard members and a clutch of websites, you can reach over half of the nation before spending so much as a dime on media. In fact, the value of Tesco’s owned media channels was estimated to be worth £147m in annual media value. So this ‘inside out’ approach was not only effective, it was also highly efficient.
Next, extending communications to serving ‘communities’ – both geographic and shared communities of interests and needs (e.g. vegans, new dads, foodies) – and then the national public, showed how to make Tesco’s size work for it, integrating owned, earned and then paid communications.
Finally, harmonising media and creative has served the brand well, enabling long-term brand platforms such as Food Love Stories to exist across paid, owned and earned media channels.
Tesco’s long-standing ‘Every little helps’ slogan had become tired. What’s more, pre-turnaround, people were using it with increasing amounts of sarcasm on social media against the brand. Tesco reframed it by, for instance, offering ‘little helps’ to shoppers – well-targeted offers that reflected their circumstances – such as bulk buys near pay days or meal solutions at the start of the week. What’s more, communications focused on colleagues being helpful in-store by helping them choose school uniforms for their kids or recognising dads on Father’s Day.
This is a powerful reminder that marketers, who can often rush to dispose of whatever’s not working, need to resist the temptation to throw out the baby with the bathwater. Instead of ditching ‘Every little helps’, Tesco found a way to reinvent it that was more pragmatic and customer-centric. In the Learning section of the paper, Gregory and Parnum write: “Restoring ‘Every little helps’ to a promise rather than an endline required a fundamental reparation of customer trust.”
Lockdown love stories
Tesco’s recent robust performance during the pandemic and its agility in adjusting Food Love Stories for lockdown show the retailer’s restored confidence. Alessandra Bellini, Tesco’s Chief Customer Officer, told us in June that “we were really fortunate that we had a long-standing purpose and our advertising platform was well suited for the time.”
This has paid back handsomely for the retailer. Last week, Tesco announced that its first-half profits had risen by more than a quarter as customers bought more food during the pandemic and online orders doubled. Pre-tax profit for the 26 weeks to 29 August was £551m, 28.7% up on 2019, with food sales up 9.2%. Tesco now has a 26.8% market share, according to Kantar, with the next biggest supermarket, Sainsbury’s, at 14.9%.
Reasserting itself against its rivals
Not only is there a decent gap between Tesco and the remaining three of the ‘big four’ (Sainsbury’s, Asda, Morrisons), it has also reasserted itself in the face of the discount players, Aldi and Lidl, that have been squeezing it on price since growing their market share since the last recession. At the same time, it has addressed quality concerns, enabling it to compete with more premium rivals.
Judge Heather Alderson, Global Planning Partner, adam&eveDDB, comments: “‘Every little helps’ is no longer just an advertising line, or a brand idea, it is a way of doing business.” 2020’s Convenor of Judges, Sue Unerman, Chief Transformation Officer, MediaCom, enthuses: “It is a brilliantly written paper about a true transformation journey.”
A reminder that focusing on the fundamentals is key to effectiveness, this case is a must-read.
All 2020 IPA Effectiveness Awards winners are available to read on WARC.com.