Tesco 2010 Annual Report Download - page 28

26 Tesco PLC Annual Report and Financial Statements 2010
Retailing
Services
continued
Growing sales
and profits
tesco.com
Our online businesses – including
dotcom grocery and Direct – delivered
another strong performance, achieving
a 14% increase in sales with profits
rising 26% to £136m.
In a little over a decade we have built
a substantial profitable business that
has sales of £2.1bn and employs
20,000 people. Our website is the
third most visited retail website in the
UK and last year our online grocery
business delivered over a billion items.
The number of active customers
in our online grocery business has
grown to over one million and basket
size has increased. Record levels of
availability and innovations such as
price matching on substitutions are
improving the customer experience
and helping to reduce the number
of lapsed customers and calls to the
service centre. We are reducing costs
and carbon emissions by improving
fuel consumption per order by 10%
for the second year running through
implementing new technology to
improve driving and routing efficiency.
Tesco Direct extends the reach of our
non-food offer to customers via the
internet, by phone and catalogues.
Customers can choose to have goods
delivered to their home or they can
pick them up at one of our 261 in-
store Direct desks. Tesco Direct had
another good year making good
progress on its customer service offer,
growing sales by 28% and continuing
on its path towards profitability.
Tesco Telecoms
Profit from our telecoms business
grew, driven primarily by Tesco
Mobile, which achieved a 14%
increase in customer numbers – to
more than two million – in a declining
pre-pay phone market. Tesco Mobile
also successfully entered the ‘pay
monthly’ market this year with
innovative tariffs and generous credit
rewards, picking up the ‘best tariff’
accolade at the 2009 Mobile Choice
Awards. Tesco Mobile remained the
number one pay-as-you-go operator
for customer satisfaction throughout
2009. In December 2009, Tesco
Mobile broadend its appeal further by
becoming only the third UK operator
to offer the iPhone, for which sales
have been encouraging.
We have made good progress in
rolling out our in-store Phone Shops
with 105 open at year end and a
further 100 planned by the end of
this year. The Phone Shops are
transforming our ability to sell
products that require an assisted sale
– particularly contract mobile phones.
Also in 2009 we signed a wholesale
broadband agreement with Cable
& Wireless, which will enable us
to relaunch our broadband offer
to customers in 2010 with higher
bandwidth speeds and lower prices.
dunnhumby
This year marks dunnhumby’s 20th
anniversary. In addition to supporting
Tesco’s Clubcard in seven countries
around the world, dunnhumby serves
other retailers and manufacturers in
26 international markets; in fact Tesco
now represents only around 15% of
its sales.
dunnhumby is growing fast – with
profits up 28% in the year – helped
by new engagements in the United
States (Macy’s), Canada (Metro) and
Colombia (Exito). dunnhumby now
touches the lives of over 350 million
consumers through its client
relationships.
Tesco Mobile
No. 1 for customer
satisfaction
Source: Customer Service Index
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Telecoms