Tesco/Homeplus and Unique Promotional Approach

Tesco is clearly innovating in the communications realm. Instead of augmenting the rest of the marketing mix, I would say that their promotional strategy is the most prominent piece of the mix. The use of out-of-home advertising space in a convenient, unexpected location draws the attention of the consumers. The convenience factor the promotional strategy generates allows Tesco to charge premium prices and also places them in the top-of-mind consideration set for traditional grocery shopping as well. I would even say that the communications strategy augments the product offering. While the products aren't different from a traditional grocery store (other than a more limited selection) the added convenience and home delivery sets the product offering apart and provides a point of differentiation from other competitors. Clearly this communications strategy is unique and has been very successful for the company placing them #1 in the online Korean grocery segment and #2 in the traditional grocery market. I'm not sure that the grocery market "pie" is growing as fast as Tesco's rise so a significant portion of this growth is likely stolen market share from other competitors, which is great news for the company.