A lament that could look like an advert for Tesco but I would ask you all to bear with it……
It is widely known that Tesco established the Supermarket model we now have on a “pile it high and sell it cheap” basis. What is perhaps less widely known is that they had an internal motto of "YCDBSOYA" (You Can't Do Business Sitting On You’re a**e)
Tesco’s true success though over the last 90 years has been their ability to adapt to market demands and customer circumstances to stay ahead of their competition. The “pile it high” has now been replaced as customers seek increased value, increased diversity in the products they buy and the ability to shop wherever they want whenever they want.
In 2002 Tesco stunned the markets by buying 850 convenience shops in the UK. The scale of it allowed them to capture an immediate increase in market share, and as a result they really caught the rest of the industry out.
A little known fact though is the extent of Tesco’s innovative use of technology to improve their business. It was one of the first to build self-service tills and use cameras to reduce queues. It is also widely believed to be the only UK grocery retailer to make a profit from its internet shopping business.
It is this ability to diversify their business and use technology that has given Tesco the edge. I wonder what Tesco’s market share would be now without research into queues or internet shopping? Where would they be without the 850 convenience shops which we all use so often?
My lament is simple really. In Financial Services why do we not embrace technology in the same way as retailing and why is diversity so frowned upon? We are rightly proud of our technology and of the deal we have done with AEGON which enables us to further invest in it to improve our service.
Perhaps if our competitors spent less time frowning on diversity and more time thinking as Tesco do about the customer and not being wedded to the past the industry would move forward in much the same way as grocery shopping has.