Are quantitative analytics the only way to go? the Tesco case.
As Michael Schrage points out in the Harvard Business Review, ‘More than any other retailer of scale, Tesco had committed to customer research, analytics, and loyalty as its marketing and operational edge.’ The Clubcard initiative, and the responsiveness that it enabled throughout the business, was said to be the catalyst that led to Tesco’s 30 percent market share. And Tesco rode the wave for two decades until something changed. While Tesco was busy watching what people did in their supermarkets, they forgot to notice that their customers’ sentiment was shifting. Post—global—?nancial— crisis Tesco was busy giving out points for loyalty, when what customers wanted was the simplicity and transparency of cheaper prices across the board, without the gimmicks and incentives to buy the products the supermarket Wantedto sell that week. As their circumstances and mindsets shifted, UK customers also began forsaking the big weekly shopping trips. Discount stores like Aldi and Lidl started to erode Tesco’s market share as pounds in people’s pockets became more meaningful than points collected on a loyalty card. Clearly, watching what people do is not the same as paying attention to how they feel. The kind of hard data Tesco was collecting didn’t tell the whole story in the context of the changing circumstances that people were managing. The data told Tesco what happened in the store, but that was just a tiny slice of what the customers were living. The data measured the customers’ relationships to the business and the brand, but it cou1dn’t accurately measure how they were feeling in the moment.
No matter what your product is, you are ultimately in the education business. Your customers need to be constantly educated about the many advantages of doing business with you, trained to use your products more effectively, and taught how to make never-ending improvement in their lives.