New Tesco boss: CX is far more crucial than marketing

Tesco’s new chief executive Ken Murphy is set to boost customer experience for both the retailer’s burgeoning online operation and instore, after saying these two disciplines are far more important for brand perception “than any marketing communication”.

Speaking at the supermarket’s interim results, Murphy explained: “One of the great lessons that you learn about brand marketing and retail is that greater than 80% of brand perception is driven from the store experience or from the online experience, rather than any marketing communication.

“Really, what we are about is making sure that the customer experience is the best possible experience it can be, and the lion’s share of our marketing effort goes towards either communicating that experience or improving that experience in the store itself.”

He predicted that the dramatic shift to online grocery shopping – which has seen Tesco nearly double the size of its ecommerce business over the last quarter – is “here to stay”.

The supermarket giant saw its online operation grow by 90% across the three months to the end of August, helping it achieve an overall 9% rise in food sales to 16%.

Murphy, who took over from Dave Lewis last week, said this “massive shift online” will be “maintained for the foreseeable future”.

“The profitably of online has improved,” Murphy added. “The average basket size has increased significantly, and our van utilisation has also improved dramatically. Also, one third of our online orders are click and collect.”

Tesco is already ramping up the supermarket loyalty wars with the launch of a new round of “Clubcard Prices”, which sees discounts of up to 50% on hundreds of groceries for Clubcard members.

The deals bonanza was first launched to mark the retail giant’s 100th anniversary – in April last year – when Tesco ran discounts of up to 50% off on selected items. This was repeated just after Christmas with the launch of a huge January sale, with hundreds of deals and special prices for its 19 million Clubcard members.