From the Archive: Tesco PCs
‘From the Archive’ is the regular column that revisits some of the more interesting retail stories covered over the past 30 years by Glynn Davis for a variety of publications.
This period covers many seismic structural changes in the industry including the emergence of the internet. Alongside the actual stories Glynn will be adding commentary around each of the pieces that will seek to put the articles into context with today’s landscape.
From Retail Week (25 July 1997)
It might sound unusual today but back in 1997 Tesco was investigating giving away desktop PCs to shoppers as a way of fuelling sales at its fledgling online grocery business.
Subscribe to TRBThe front page splash headlined ‘Tesco to offer shoppers PCs’ went down very badly at the time with the company who did not particularly like this story being published. This was undoubtedly driven by the fact Tesco was only at an exploratory stage with the potential initiative.
It did not ultimately come to fruition. This was probably more because online sales moved along healthily without such a give-away rather than it being a fundamentally bad idea. Tesco would undoubtedly have been able to cut a very good deal with one of the leading PC makers at the time had it green-lighted the idea.
As per the story Tesco was clearly talking to IBM at the time and from my recollections HP were also in the mix as a potential partner. Tesco Direct business consultant Paul Arnold is quoted in the article and although he was not on-staff he played an instrumental role at Tesco in the early days of its internet operations.
Before this story was published I’d visited Tesco’s first store for home delivery picking in Osterley, West London, where Arnold showed me around the pioneering set-up. At the time Tesco had to send out, via the postal system, CD ROM’s containing product price files to customers who could then load them onto their PCs and order online using very poor dial-up technology and the services of the Internet Service Providers (ISPs) at the time. The goods would then be dispatched from Osterley to postcodes within London.
You had to be a pretty committed early adopter to go through all this palaver but technology was to move along incredibly fast. Hence the fact that sources in July 1997 were talking about the fact 40% of Tesco sales could be heading online. Arnold rather sensibly suggested these numbers were “over-enthusiastic”.
He was also very prescient with his observations that Tesco was keen to keep its store trade and not have customers desert its superstores and shift their shopping online instead. Today
only a modest 10-15% (depending on which research house you believe) of UK grocery sales are online and the figure remains stubbornly around this level. This won’t bother Tesco or the other grocers because it is still incredibly difficult to make a profit from online grocery. Arnold would no doubt have been surprised in 1997 to believe that this would be the case in 2026.
