Tesco Personal Finance
Tesco Personal Finance
Over its history, Tesco had become a trusted brand in the UK with a loyal customer base. Meanwhile, the Royal Bank of Scotland had hundreds of years of experience in the industry. Now, as a joint force, the bank’s financial products are marketed through the almost 2000 Tesco stores across the region, and sold at the more than 15,700 Tesco checkouts. If you’re doing your Sunday shopping and all of a sudden decide you need to buy some pet insurance for little Fido, Tesco is the right place for you.
But, Tesco hasn’t just grown to become the success it is today just because of the convenience it might offer its customers. Rather, the company has taken an innovative approach to marketing, particularly in terms of trying to understand their customers. In fact, Money Week calls Tesco’s insights into its customers “second to none in the retail world.” And, all of that is thanks to Dunnhumby, a company that specializes in marketing data, and of which Tesco owns 83 percent.
Dunnhumby has helped Tesco Personal Finance become an expert in tailoring their products to their specific markets. In 1995, the company launched a customer loyalty program, whereby they are given a shopping card and points to redeem at a later time with each purchase. Although this decision was criticized early on by some, being seen as a significant cost to the company, it paid off tenfold.
Each time a customer’s loyalty card is swiped, the data is sent to Dunnhumby, which analyzes it and creates marketing strategies and promotional campaigns based on the information. In fact, it was Dunnhumby that was behind the launch of the hugely successful Tesco.com, which now receives over 20 million visitors each year, as well as the company’s entry into such non-food industries as clothing.
Within the first few months of the program, data was already showing that customers were spending 28 percent more at Tesco and 16 percent less at its main competitors. Other retailers soon followed the company’s loyalty program, but few could match Dunnhumby’s ability to analyze the massive amounts of data that were collected.
The success of Tesco Personal Finance is an example of how knowledge can be utilized by a company to become a significant source of power over its competitors. Thanks to the company’s innovative marketing strategy, it has become one of the top five car insurance companies in the UK, one of the top ten for travel insurance, and the second largest for pet insurance.
Tesco Personal Finance - To learn more about this author, visit Michael Dowson's Website.
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In 1997, the UK’s largest supermarket, Tesco, decided to join forces with the Royal Bank of Scotland, the fifth largest bank in the world. Together, in a fifty-fifty joint venture, Tesco Personal Finance was formed. Since its initial launch those few years ago, it has grown to become the UK’s most successful supermarket bank, with over five million customer accounts, 22 financial products for sale, and more than ₤130 million in annual profits. A unique initiative, Tesco has had a number of industry firsts that stand behind its impressive rise to the top.
Over its history, Tesco had become a trusted brand in the UK with a loyal customer base. Meanwhile, the Royal Bank of Scotland had hundreds of years of experience in the industry. Now, as a joint force, the bank’s financial products are marketed through the almost 2000 Tesco stores across the region, and sold at the more than 15,700 Tesco checkouts. If you’re doing your Sunday shopping and all of a sudden decide you need to buy some pet insurance for little Fido, Tesco is the right place for you.
But, Tesco hasn’t just grown to become the success it is today just because of the convenience it might offer its customers. Rather, the company has taken an innovative approach to marketing, particularly in terms of trying to understand their customers. In fact, Money Week calls Tesco’s insights into its customers “second to none in the retail world.” And, all of that is thanks to Dunnhumby, a company that specializes in marketing data, and of which Tesco owns 83 percent.
Dunnhumby has helped Tesco Personal Finance become an expert in tailoring their products to their specific markets. In 1995, the company launched a customer loyalty program, whereby they are given a shopping card and points to redeem at a later time with each purchase. Although this decision was criticized early on by some, being seen as a significant cost to the company, it paid off tenfold.
Each time a customer’s loyalty card is swiped, the data is sent to Dunnhumby, which analyzes it and creates marketing strategies and promotional campaigns based on the information. In fact, it was Dunnhumby that was behind the launch of the hugely successful Tesco.com, which now receives over 20 million visitors each year, as well as the company’s entry into such non-food industries as clothing.
Within the first few months of the program, data was already showing that customers were spending 28 percent more at Tesco and 16 percent less at its main competitors. Other retailers soon followed the company’s loyalty program, but few could match Dunnhumby’s ability to analyze the massive amounts of data that were collected.
The success of Tesco Personal Finance is an example of how knowledge can be utilized by a company to become a significant source of power over its competitors. Thanks to the company’s innovative marketing strategy, it has become one of the top five car insurance companies in the UK, one of the top ten for travel insurance, and the second largest for pet insurance.
Tesco Personal Finance - To learn more about this author, visit Michael Dowson's Website.
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