Tesco 2011 Annual Report Download - page 20

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To grow the UK core
In our market-leading UK business, we have delivered
a solid performance by keeping our focus on the
customer, providing them with great value, choice
and service.
Clubcard
Clubcard is our unique customer loyalty programme – our way of saying
‘thank you’ to our customers. It is now more popular than ever before,
with active membership of over 15 million customers, compared to
13million at the start of 2008/9. Customers who say they would prefer
a Tesco to open in their area rather than a competitor store cite
Clubcard as the main reason.
Clubcard continues to be a significant driver of growth for our business
and ensures that our customer base continues to demonstrate
considerably higher levels of loyalty than our competitors. For most
of 2010, Clubcard was the number one reason behind customers
switching to us for their weekly shop.
Customers have responded well to our new and up-weighted Clubcard
initiatives. Three million customers participated in the Big Clubcard
Voucher Exchange promotions held in August and November, which
provided new ways to get more value from vouchers through category-
specific deals. We have seen 60% growth in Rewards through our
Partner Reward Scheme as customers recognise that Clubcard is about
more than just earning money-off vouchers and that they can use
points as currency in other areas of their lives.
£44.6bn
UK sales
£2.5bn
Trading profit
6.1%
Trading margin
3.8%
Trading profit up
5.5%
Sales up
Introduction and market context
The UK economy is in recovery but consumers have been under
pressure this year due to a combination of high petrol prices, food
and utility inflation and, more recently, the VAT increase. As a result,
we’re experiencing a period of unusually subdued industry growth.
Excluding petrol, like-for-like growth in the industry has been
significantly lower than last year.
Against this backdrop, our UK business has delivered a solid
performance. Total UK sales were £44.6 billion, growing by 5.5%,
which was ahead of the market. UK trading profit increased by
3.8% or by 6.4% before the effects of our sale and leaseback
programme; principally the additional rents incurred.
16
—
TESCO PLC Annual Report and Financial Statements 2011
BUSINESS REVIEW
Growing the UK core