Tesco’s new chief executive Dave Lewis will need to bring to an understanding of how to reconnect customers with the retailer’s brand.

Tesco’s new chief executive Dave Lewis will need to bring to an understanding of how to reconnect customers with the retailer’s brand.

History may well judge departing Tesco boss Philip Clarke more sympathetically than the news of his imminent exit following a profit warning this week would suggest.

The grocery chief has overseen one of the most traumatic periods in the annals of the country’s largest retailer, which continues to lose market share at home while also struggling to realign its business overseas.

Yet as many have pointed out, he inherited a business with its foundations undermined by years of under-investment in the core UK operation, which combined with structural changes in the market to create a
perfect storm. Throughout his brief and turbulent reign, Clarke has proven to be a retailer with a strong operational vision and a fighter with the courage to take brave decisions.

Difficult overseas markets have been exited, the senior management team he leaves is unrecognisable from the one he inherited from predecessor Sir Terry Leahy and the building blocks are in place to ensure the Tesco is among the vanguard of retailers fit for the digital age.

Yet for all those attributes, the strategy has failed to translate into results. Perhaps under the circumstances, whoever had led Tesco through this period was doomed to fail in this respect given the headwinds. Yet Tesco cannot blame its woes entirely on external challenges.

“The distance that has grown between Tesco and its customers is the most disappointing aspect of its decline”

Chris Brook-Carter, editor-in-chief, Retail Week

For a brand that built so much of its success on the consumer insight it leveraged from Clubcard, the distance that has grown between Tesco and its customers is the most disappointing aspect of its decline.

Incoming chief Dave Lewis’s background as a FMCG man with no retail experience has sparked much debate already – on the one hand raising concerns he will lack the operational nous to lead a turnaround and on the other high hopes he can fight and win in price-sensitive markets and mount a fightback against the discounters.

What Tesco chairman Sir Richard Broadbent will be hoping is that Lewis is equipped to bring to the table an understanding of how to reconnect customers with the Tesco brand, which has been caught in no man’s land
as the market polarised.

Lewis has a lot to address, not least Tesco’s pricing architecture and the future of big-box stores, but as Justin King found when he joined Sainsbury’s, the specifics of any strategy will not fall into place if there isn’t a strong brand to build from. A brand that is loved from within the company as well as outside.

  • Chris Brook-Carter, editor-in-chief, Retail Week