In the past articles, we have discussed Kroger competitors and competitors of Target and have even mentioned about the marketing strategy of Walmart and what makes it the largest retailer in the world.
But never ever have we written about a company that dominates the UK grocery market with over 28% market share. Tesco is one such brand which from the word “go” has been able to understand their customer needs and adapt themselves with the changing times and needs.
In this article we will talk about the top 5 Competitors of Tesco and why we really think they are worthy of being the competitor.
A British multinational groceries and general merchandiser retailer, Tesco was founded in 1919 by Jack Cohen as a group of market stalls. Its the early 1990s when Tesco started to expand globally and slow grew to 6,500+ shops.
Its not just the groceries and general merchandise that Tesco is know for. The company has diversified into areas such as the retailing of books, clothing, electronics, furniture, toys, petrol, software, financial services, telecoms and internet services.
The above image shows how well and how long Tesco has dominated the grocery market.
So, let’s check out who are the Top 6 competitors of Tesco
WHO ARE THE MAIN COMPETITORS OF TESCO
The first in the list is the competitor which owns close to 15% grocery market share: Asda
Asda Stores Ltd trading as Asda is a British supermarket retailer, founded in 1949 in Leeds, West Yorkshire. The multi-store format chain has a presence of over 604 retail stores out of which 196 are supermarkets.
In 1999, the company got acquired by the retail giant Walmart for 6.7 billion pounds. Asda was the second-largest supermarket chain in Britain between 2003 and 2014 by market share, at which point it fell into third place. Since April 2019 it has regained its second place position, behind Tesco and ahead of Sainsbury’s.
With an aim to become the largest player ( 30% market share) in UK grocery market, ASDA initiated talks of a merger with Sainsbury, which got turned down by CMA due to an increase in price for consumers.
Catering to different customers and their different needs, Tesco operates below different stores at different locations:
Largest of the stores among ASDA chain of stores that offer extended range across food, George and non-food, often supported by concessions such as food service offers, banks, hairdressers and dry cleaners
Most common format among other ASDA stores, ASDA Superstores have Cafe, Pharmacy, Optician, larger George, and non-food offerings in it. Each store is planned specific to each location, tailored to local taste. .
Asda Living stores are dedicated to George and non-food products, offering a range of George Home, Fashion and general merchandise to our customers.
PETROL FILLING STATION:
Our Petrol Filling Stations offer both pay-at-pump and pay-at-kiosk services, as well as a small convenience store that provides customers with a variety of food to go, and travel friendly products.
The player that comes as a strong second in the list of the main competitors of Tesco is Sainsbury. Sainsbury is the third largest grocery player in the UK market and holds close to 16.9% market share, second to ASDA.
In 1995, Tesco overtook Sainsbury’s to become the market leader, and Asda became the second largest in 2003, throning Sainsbury’s to third place till January 2014, when Sainsbury’s regained second place. In April 2019, whilst waiting to merge with rival Asda, Sainsbury’s was again demoted into third place as their rival placed second.
Sainsbury is not just known for its grocery business, it is split into three divisions: Sainsbury’s Supermarkets Ltd (including convenience shops), Sainsbury’s Bank and Sainsbury’s Argos.
Though considered as the highest-quality grocer among its peers, Sainsbury has tweaked its strategy to compete with its competitors on the pricing part.
Having a presence in over 1450 locations, Sainsbury caters to different customer segments with its different store formats like Supermarkets, Sainsbury Cafe, Sainsbury fuel, etc.
Sainsbury Bank and Sainsbury Energy are subsidiaries of Sainsbury which help in ringing the company’s account book.
READ MORE: Check out the marketing strategy of tesco
The third in the list of Tesco competitors is Morrsions. One of the big four brick and mortar grocery retailers in UK, Morrisons holds a market share of close of 10.14% just behind Sainsbury.
Morrison’s operates 514 supermarkets and 150 convenience stores. Despite having a market of a mere 10%, the reason we consider Morrsions to be Tesco’s Competitors is because of its adaptability. To stay relevant in this digital age where customers want everything with a simple tap on their mobile phones, Morrisons is entering into click and collect partnerships with Amazon and Uber Eats.
Morrisons acts as a wholesaler to Amazon, meaning it sells its own products on Amazon’s website. Amazon customers can collect Amazon items and manage returns in Morrison’s stores. This gives Morrison a chance to cross-sell other products to the customers who have walked in to collect the items they ordered through Amazon.
Its not just the in-store customer experience or the store footfalls that the company is aiming to enhance, Morrison is also looking out to engage with companies like UBER EATS and JUST EATS that can help in with the last mile of food fulfillment and ultrafast delivery.
The fourth competitor of Tesco is ALDI, based in germany, the company is the common brand of two German family owned discount supermarket chains with over 10,000 stores in 20 countries. With an aim to become the third largest grocer in US by store count, the company is planning to invest $5.3 billion to re-model it stores and one 800 new ones.
Aldi is planning to expand beyond its core price-conscious customer to sub-urban, middle, upper-middle-class customer segments.
90% of Aldi’s assortment is made up of its own exclusive brands with SimplyNature, Earth Grown, Specially Selected, Never Any!, LiveGFree (gluten-free) and little Journey (baby products) being some of its popular products. Aldi’s exclusive brands offer superior quality at an affordable price and are growing twice as fast as any other category in the store.
Aldi’s has some strong plans that Tesco needs to look out for and for this reason it is definitely one of the main competitors of Tesco.
Last but not the least in the list of Tesco’s competitors is another German global discount retailer – LIDL. The company operates close to 10,000 stores across Europe and the United States.
Touted as a strong competitor capable of giving Walmart, Kroger, Albertsons, etc a run for their money, Lidl has somewhat failed to achieve anything close to a viable long-term business strategy capable of threatening any of the incumbent grocery retailers operating in the U.S.
The company is re-visiting its strategy and is surely going to be back with a bang. Definitely one company that Tesco needs to look out for.C
Find out who are the main competitors of Tesco
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