Tesco: keeping wine trade in growth?

26 January, 2007

Last year saw Dan Jago replace the outgoing Mark Murphy as head of the Tesco BWS team and crowned the most powerful man in drinks retailing. Having completed a crash course in Tesco philosophy, Jago is now equipped to start imposing his considerable personality on the business - but with the retailer comfortably dominating the marketplace, his "to do" list is not as pressing as those of his rivals.

It's often claimed that, without Tesco's strong performance, the wine trade would be in decline, and with sales up by just under 9 per cent it's a statement that stacks up. Beer was up 11.5 per cent and spirits 8.2 per cent in value terms. The Wine Club now has 550,000 members and more than 4,000 of them turned up at fairs in London and Manchester.

Fine wine is getting more attention. A £1 million investment has resulted in 50 boutique wines and exclusive parcels appearing in special fixtures in some 200 stores - given Jago's wine trade background, it's reasonable to expect Tesco to persist in this arena with some enthusiasm.

Tesco outperformed its rivals at Christmas and the scene is apparently set for a year of further inroads into the market share of its competitors.

"We've got a category review in August and a lot of work we're doing leads towards that," says Jago. "Tesco as a business is making sure we're able to cover off all the changing needs of customers. Things like rosé and cider where change has been big. Also fine wine."

But Tesco is likely to rule out grand-scale BWS makeovers or the introduction of specialist in-store advisers.

"We'll always trial things to see if ­consumers like them. The biggest challenge is to help consumers find what they want, which is not about having wooden floors and low lighting. I think our customers have said that they don't like having someone waiting in the aisles to pounce on them and tell them they don't understand what they want. The advice is actually not that important to them."

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