Tesco expands own brands, focuses on webshop

Tesco’s strategy for the near future include a focus on its own-level brands and the conquest of online markets in the 14 countries the group is active in. Its CEO Philip Clarke announced that the world’s third-largest retailer had seen its online sales grow 15% last year.
Today Tesco only has web shops in the UK, Ireland and South-Korea. Clarke announced he wants to make Tesco “an outstanding international retailer, in stores and online”. To spread his view, the new CEO – replacing Sir Terry Leahy who was CEO for over 14 years – has scheduled meetings with all of Tesco’s over 5000 senior managers.
The new brands should create an added value, building on current examples like F+F (clothing), Technika (consumer electronics) or Go Cook (kitchen goods). The aim is to start own brands in fields as distinct as pharmacology and apparel. “When people develop higher levels of disposable income, they want to treat themselves”, Clarke told Reuters. “They do not want to just buy Tesco Value shower gel, they want to have something in their bathroom that looks like it is a brand. So we create brands.” Clarke also mentions that in any field, Tesco’s own brands should embrace a rigorous definition of sustainability.
New markets, such as finance and telecom, should enhance Tesco’s performance on its home market, and should afterwards be internationalised. The British Tesco stores could use some help from these new programs, because of the tough circumstances they are facing. High fuel prices, high taxes and the fear for massive job cuts under the new Cameron government have led to a mediocre year for Tesco standards.
“Our strategy has worked fine for over a decade, but now we need to adapt to the new situation.” said Clarke.  “In short, this is “a change of gear, not a change of direction.”