Scoring Points: How Tesco is Winning Customer Loyalty [Hardcover]

Clive Humby (Author), Terry Hunt (Author), Tim Phillips (Author)

Book Description

ISBN-10: 074943578X | ISBN-13: 978-0749435783 | Publication Date: March 2004

* 10 million shoppers in Britain are active members of Tesco Clubcard, the world's most successful retail loyalty scheme

Editorial Reviews

Review

"Want some pointers on how a well-run supermarket loyalty program should work? Then you might want to pick up a copy of Scoring Points: How Tesco is Winning Customer Loyalty, a new book by Clive Humby and Terry Hunt with Tim Phillilps. The book chronicles the development of the Tesco Clubcard, widely regarded as the world's most successful loyalty operation. Launched in 1995, the program has helped Tesco become the United Kingdom's No.1 retailer, as well as the world's most successful Internet supermarket, one of Europe's fastest-growing financial services companies, and arguably one of the globe's biggest exponents of customer relationship management. Dunnhumby, Humby's firm, developed the Tesco Clubcard and has opened an office in Cincinnati to help Kroger Co. improve its own customer loyalty program."--Richard Turcsik, Supermarket Grocery Business

About the Author

Clive Humby is chairman and founder of leading UK marketing analysts dunhumby, whose blue chip client list includes Tesco, Tesco Personal Finance, BMW, House of Fraser, Centrica, Lever Faberge, Proctor & Gamble and major retailers around the world such as Kroger (US) and Coles Myer (Australia). Clive is also Visiting Professor, Integrated Marketing, at Northwestern Univesity, Chicago.

Terry Hunt is chairman of EHS Brann, the second largest direct marketing agency in Europe with clients that include Tesco, the AA, British Gas, MINI, The Economist, Cadbury's, National Savings, Peugeot and Barclays. As leading specialists in data-driven marketing, CRM, segmentation and customer loyalty, Clive and Terry together have been major influences behind the development, launch and creative management of Tesco Clubcard.

Tim Phillips is a freelance journalist. He has written for The Wall Street Journal Europe, The International Herald Tribune, The Guardian, The Observer, and The Sunday Times about business, the internet and technology. Tim is currently the Managing Editor of Performance Plus Magazine and regularly appears on BBC TV and Radio and Sky News. His books include Scoring Points (Kogan Page).

Product Details

• Hardcover: 276 pages
• Publisher: Kogan Page Business Books (March 2004)
• Language: English
• ISBN-10: 074943578X
• ISBN-13: 978-0749435783
• Product Dimensions: 9.4 x 5.8 x 0.9 inches
• Shipping Weight: 1.5 pounds
• Average Customer Review: 4.1 out of 5 stars  See all reviews (7 customer reviews)
• Amazon Best Sellers Rank: #1,179,676 in Books (See Top 100 in Books)

Customer Reviews

Most Helpful Customer Reviews

9 of 9 people found the following review helpful:

5.0 out of 5 stars Sustaining a Relationship Marketing Idea: Insiders' story, October 8, 2004

By 

Peter Leerskov "The Strategist, www.lace.dk" (Denmark) - See all my reviews
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This review is from: Scoring Points: How Tesco is Winning Customer Loyalty (Hardcover)

It's very seldom that you get to hear the real story behind a relationship-marketing programme. This book provides a brilliant insight into the real world of a successful loyalty programme at Tesco. It is a success story told by insiders (primarily the subcontractors).

The focus is on the Clubcard, but it also contains an interesting chapter on their online shopping success that is created on the basis of many of the same competences that the loyalty card required.

I'd like to put the book into perspective by playing devil's advocate. So what's the downside of a loyalty programme? Three problems usually hinder the success: big investment, internal culture clash, and privacy issues.

1) BIG INVESTMENT. It's expensive to develop the database - and even more expensive to maintain it. Especially the latter point is usually forgotten, while most people haven't yet tried to sustain a loyalty programme. The fact is namely that it eventually always risk running out of steam after the first breathtaking love affair for both the customer and the company.
"Scoring points" has devoted some attention to the development phase, where the Clubcard was "skunk work" without much prestige in the big British retail operation. But I like the second part of maintaining the magic of the relationship even better (because this story is so rarely told). They explain how to keep the loyalty programme alive and kicking for the customers by micro-segmentation, adding financial services, creating multi-channel retailing including the web, and so on to keep the concept fresh. The book also spends a lot of time explaining how the customer data can be used to see trends and also get new understanding of the customers' behaviours that we haven't been able to before.

2) INTERNAL CULTURE CLASH. It's not easy to get everyone in the firm to be oriented towards relationship marketing and make use of the available information. Transaction marketing is usually much easier and less demanding of the organization than real relationship building. "Scoring points" also covers these issues where the competition for resources from the top management is one issue and the relationship to the shop managers and shop assistants is another area. And it doesn't happen overnight - it usually takes several years with constant focus and commitment. The programme had testing phases, and needed many quick wins in several stores to obtain interest from other shop managers. Tesco's lesson in taking the time to make relationship marketing a part of an organization's culture is very valuable - and replicates my experience from other industries.

3) PRIVACY ISSUES. Maybe your customers don't want close relationships. Perhaps your customers even resent knowing that you have collected too much information about them.
In "Scoring points", they tell a story of a wife that complained about condoms that suddenly appeared on her personalized online shopping list, since her husband didn't use them. It turned out that he actually did, but not at home. His fault was that he bought the condoms in a Tesco shop with his loyalty card that was integrated to the web solution. That's how it was shown to his online-shopping wife. So much for privacy... That's an extreme - though real - example. And it's very illuminating for the sensitivity of data that we're dealing with - even when we think we're only selling groceries.

Tesco's story should be required reading for everybody that would like to understand a long-term relationship marketing concept in depth. I find that the real strength of the book is the chapters on how to preserve the programme. This story is often untold.

Peter Leerskov,
MSc in International Business (Marketing & Management) and Graduate Diploma in E-business

6 of 6 people found the following review helpful:

5.0 out of 5 stars Highly Recommended!, March 30, 2005

By 

Rolf Dobelli "getAbstract" (Switzerland) - See all my reviews
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This review is from: Scoring Points: How Tesco is Winning Customer Loyalty (Hardcover)

Marketing experts Clive Humby and Terry Hunt and journalist Tim Phillips explain how British grocer Tesco collected, analyzed and used customer data to become a retail giant. Tesco paired its Clubcard loyalty scheme with jazzy information technology (IT) to set a new standard for knowing your customer. Humby and Hunt, as the collaborators behind Tesco's data-driven transformation, focus on praise, but they don't hide Tesco's early mistakes or skimp on its strategic hand-wringing. Though somewhat dryly written, the book compellingly discusses aspects of loyalty programs that don't get much ink outside the retail trade press. For example, it covers the way Tesco's accumulation of rich customer data forced some painful changes in its corporate culture. The authors also serve a sampling of delicious anecdotes and share Tesco's early difficulty with getting some customers - chiefly students - to join Clubcard. Tesco once gave students at a Q&A focus group some complimentary wine and cheese only to find that they "swiftly drank so much wine that they made little sense to anyone still sober." The book shines when discussing such early efforts by Tesco to micro-segment customers by lifestyle habits, including trying to glean individual personality traits from the contents of each grocery cart. We recommend this case study both as the story of Tesco's gutsy, groundbreaking experiment with IT and as a textbook example of how the Digital Age keeps making it possible for smart, daring businesspeople to rewrite the rules of commerce.

4 of 4 people found the following review helpful:

4.0 out of 5 stars Best of its kind, June 12, 2004

By 

R. Iyer (Buffalo, NY) - See all my reviews
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This review is from: Scoring Points: How Tesco is Winning Customer Loyalty (Hardcover)

This is a well written book with a nice chronological writing style which makes it feel like an adventure . The author manages to avoid speaking marketing jargonese and skimp on technical specifics of how the program was implemented providing ample details of the infrastructural , logistic and IT challenges faced by the loyalty program. Also interesting is the focus on explaining the rationale of every decision Tesco has made and a unbiased assesment of whether it went right or wrong. There is also detailed description of Tesco's ever evolving segmentation strategy.

Also its amazing how Tesco links its Direct Marketing, Internet
Marketing (esp the My Favorites), and tradional store marketing to the card database and also follows the "keep-it-simple-stupid" philosophy. One of the con's of this book it that it often contains quotes from people which do not convey anything and that it really does not cover the loyalty program outside of UK.

Overall this a must read if you really want an insight into how loyalty cards can be much much more than a piece of plastic both to the retailer and the shopper.