Noticed in Tesco that the mobile phone rack has shrunk in half for the Xmas season, with digicams filling the space instead. Tesco, as one of the world’s most astute and profitable retailers, generally gets these things right. Which tells us that for all the hype, “convergence” isn’t automatically a given, and when it happens it can be slow. Also doesn’t bode well for mobile as as a hot Xmas item — can you spell “saturated”?
But what’s really interesting is this. There are no 3G phones. Zero. Tesco is unable to articulate a value story in 3G for the everyday UK mobile customer. There’s no benefit to 3G that the consumate marketers at Tesco are able to spin that justifies any premium price or shelf space!
Doesn’t the inability of Tesco to stock and market 3G call into question, just a teeny bit, the strategic nous of those leading the industry to the world of IMS (a.k.a “3G mk 2”)? Actually, it reminds me a bit of yesterday’s post. Note that the O2 tagline is “Internet at the touch of a button”, when it’s anything but! As is the telco way, they’re conflating a service (Web) with connectivity (Internet). If it really was Internet at the touch of a button (any why bother with the button?) we’d all have a superior voice and messaging experience on O2 devices courtesy of Skype, MSN, Yahoo et al. Now that would be something to crow about.
PS - Note to US readers. Tesco is broadly the equivalent of Target, although the focus is more on food in most stores, and the quality of the food is a bit higher than the often mediocre efforts in the US supermarket sector.
Posted by Martin Geddes at 11:47 AMTrackBack URL for this entry:
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Tesco predominately targets the pre-paid market and the 3G handsets on pre-pay are extremely expensive compared to the one's on the Tesco Mobile homepage.
http://www.tescophones.com/
I'm not knocking Tesco, but perhaps they know their customers and these are the cheap voice type rather than fancy features. Tesco sell a lot of pre-paid phones and have over 500k on their JV MVNO with o2. I wonder, if their MVNO has a change of ownership clause?
A more interesting target will be if Vodafone meets its' 10 million customer target.
But, I get you general point 3G is not mass-market yet. Personally, I think we are still in the early-adopter phase. The same as Skype and the rest of the VOIP motley crew :-)
Posted by: at November 1, 2005 12:39 PMTesco can't hold a candle to Sainsbury's!
Seriously, though, its amazaing the brand equity that grocery stores have over there. Do your banking with Tesco? Buy your insurance from Tesco?
Can you imagine a Wal-Mart (or Target) bank in the States?
Posted by: at November 1, 2005 02:30 PMWell, you can have a Wal-Mart Credit Card in the UK - It is from their UK subsid called "Asda"
http://www.asdafinance.com/index.html
Most of the financial products from all the UK Grocers are JV's with Financial Services companies.
The same goes with the branded Mobile Phone Companies (Tesco & Sainsbury have gone the MVNO route), apart from Asda who have Vodafone stores within a store and getting a share of the turnover!!!
I don't think it will be long before Wal-Mart have a MVNO with some-one in the States...
Posted by: at November 1, 2005 08:05 PM