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Main Topic: Chinese Shoppers in Tesco

Hosts: James Stanworth , Clyde Warden

James and Clyde were out in Shanghai and debating where to go. Clyde said, "Hey, you know there is a Tesco around the corner from here. We should go take a look." James responded, "Ah, I'm getting tired of seeing TESCO. They all look the same. We've seen it all." Having seen a lot of Tesco and talked about it in Show 12, we were in for a big surprise. In this episode, James and Clyde go shopping at Tesco in Shanghai and report back their surprising findings.

Tesco entered China in 2004 in a partnership with Ting Hsin International Corporation. Now in a 90:10% partnership arrangement they have 58 stores all centered on the East coast of China. Rather than the hyper sterile environment of what we saw in Tesco Taiwan, this store has crowded sale signs right up at the entry. Tesco has localized much more in Shanghai then they ever did in Taiwan. Inside, there is a large fresh section, and check out the photo of the fish that got away (photo 19). Lots of ready to eat at the back of the store, drawing shoppers in past all the specials. Overall, the store feels smaller--not the giant Walmart space, but the more local corner supermarket offering some convenience, some fresh, and a ready to eat. This may be a niche Tesco aims to fill as this rapidly expanding market matures.

Tesco exited the Taiwan market in 2005 turning over more than 2000 employees to Carrefour.

Catch show 72 on Walmart in Shanghai.

The contrast between Taiwan and China is massive. . . it reveals a huge journey.

The Show:

Length: 30 minutes. Download MP3 14.13MB (Right click->Save As).


Show Links:

Bottom Line:

  • Tesco's Taiwan efforts were highly Western; Shanghai is starkly different.
  • Tesco is aiming at the mainstream customer... not like in Taiwan where it was more about Tesco.
  • They create a comfortable, inviting, servicescape for locals--no money wasted on Westernized idealized retail spaces.
  • In Taiwan there was a strong sense of don't touch just put in the basket and go.
  • The Shanghai store invites participation.
  • The store's retail space is flexibility to shift configuration for local festivals etc.
  • They have adopted local consumers' values--especially when it comes to comfort levels.
  • MSense of crowding and the store being in process, rather than sterile, helps shoppers feel comfortable.
  • The Tesco store brand is prominent on the shelves.
Category: Podcasts

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