In summer, just weeks after posting the worst Tesco performance in decades, Philip Clarke’s three year reign was over. Former Unilever marketer Dave Lewis starts in the top job today, a month ahead of his original October start date. Lewis is the first outsider to do so since Jack Cohen himself began selling groceries in an East London market in 1919.
A fall of 3.8% in sales in the three months to 24 May proved to be the nail in the coffin of Clarke’s failed recovery plan – an expensive £1bn spending spree on store refits and discounter price wars. Last week, as the grocery giant announced Lewis would step in a month early, it issued a shock profit warning, slashing its forecast to between £2.4bn and £2.5bn for the year, down from £2.8bn.
Aldi and Lidl, meanwhile are making dramatic gains in both growth and popularity with Aldi hailed as the number one in terms of public opinion according to the YouGov’s Brand Index mid-year rankings. The people of the UK love these brands and not just because they are cheap – they offer quality and service too. They are chosen out of want, desire and not need.
So where does this leave Mr Lewis and the colossal task of turning around the super tanker that is Tesco?
First off, Dave Lewis knows a thing or two and about brand love. As the outgoing global president of personal care for Unilever, Mr Lewis has a stable of world class brands delighting consumers globally on a daily basis. From the Real Beauty of Dove to the humour of Axe (Lynx), these are brands that really strike a chord and have intimate relationships with devotee consumers and do not deliver just function but so much more.
Secondly, Mr Lewis just happens to also be a turnaround specialist. In his time at Unilever he has changed the fortunes of many business units and regions - so successfully that he was tipped to be the heir apparent to Paul Polman himself, Unilever’s loss in this case is very much Tesco’s gain.
Finally, there appears to be a current trend of sourcing Retail heads from top manufacturers - Lars Olofsson, the former marketing director of Nestlé at Carrefour and ex Heineken boss Marc Bolland at Marks & Spencer. It seems that to win in today’s market an understanding of the brand as well as everything else is key.
So, here are a few brand tips for Mr Lewis he will no doubt be already considering as he starts his summer of reflection and thinking before taking the reins on October 1st.
1. Be Human
Stop being quite so ‘Tesco’ and be more human, approachable and warm. The stores feel cold. The messages functional. It is hard to love a machine, even one as great as Tesco. You need a heart and emotion so that you can connect with people on a deeper level so that they can love you.
2. Listen to your customers
Give them what they want and what makes them happy (not what looks good on paper). Seek to surprise and delight. Stop just hammering the value message, it is old, tired and just doesn’t cut the mustard any more as the world has moved on. Your competitors have and so must you.
3. Be clear about what you stand for
Right now, it is not clear and people are making their own minds up and in this day and age that means they are sharing it too through social media. Whatever you thought you stood for, you’re wrong as you no longer have control of it. You stand for whatever is being said and shared about you. Nip this in the bud before it overtakes your image completely. Break the value paradigm. Value has for so long been a mantra to the business, now, if ever, is the time to let it go because value alone is not enough – there will always be someone who will undercut you…you are so much more than that.
4. Tell a story
Not a broadcast. Right now it feels like Tesco is telling consumers what to do, think and buy. Once you have tackled points 1-3, you have to follow up with a consistent and engaging story, or it will all have been a waste of time. You have a hugely important place in the lives of millions of consumers every day. They need to want to shop with you, not need to.
5. Make the first 100 days count
Retail is a fast moving business and you are only as good as your next set of results. You will have to have an action plan and quickly too, but hold your nerve and don’t be swayed by the daily desire to hit the numbers. Dare to be different, disrupt and deliver.
Whatever happens, it is likely to herald a major change in UK trading strategy. Exciting times for both Mr Lewis and the UK consumer base too. Bring on October.