Tesco's IT-generated competitive advantage

TESCO's success came from the introduction of Clubcard and its diversification through other investments. However, IT played a very important role to derive that success.

First, the point-of-sale technology and the supporting computer systems to handle the Clubcard information managed to process the complicated loyalty scheme, which efficiently resulted an increase of sale within 6 months of the Clubcard introduction.

Second, Tesco kept on spending on IT in order to handle the increasing volume of Clubcard information as the loyal scheme continuing expanding. The case described that Tesco invested in the NCR Teradata data warehouse to provide a 360º-view of its customers.

Third, Tesco also devoted itself in developing online e-grocer through Tesco.com and linking Clubcard with Tesco's banking services. All the diversifications could only be made possible by implementing a sound IT platform. Although not being mentioned in the case, I would suspect that Tesco must have implemented ERP in order to channel information efficiently.