Tesco CEO Philip Clarke has said retailers must embrace a strategy of "mass personalisation" as consumers increasingly use new channels to shop.
Speaking to delegates at the World Retail Congress in London, Clarke said retailers need to "harness the power" of consumers' increasing use of the Internet and mobile phones to shop online and social media to decide what to buy.
However, Clarke warned the rise of online and mobile shopping meant consumers could more easily compare prices and were less loyal. Retailers, he said had to develop digital strategies to try to meet the needs of an individual consumer.
"The age-old principle of simply following the customer is not enough to win or retain loyalty," he said. "The need to build a strong, trusted brand is greater than ever. To build that brand, retailers need to understand what smartphones and tablets, combined with customers' quest for ease and simplicity, mean for the consumer. These technologies herald a new era – one of mass personalisation."
He added: "In this new landscape, it is not enough to win new customers. We need to work harder than ever to earn their trust and loyalty. That's where harnessing the power of digital technology comes in. Digital does not just offer smart new ways to shop. It gives us the opportunity for a warmer, more meaningful conversation with our customers, local communities, our colleagues and the suppliers who we work with."
Clarke said Tesco would like to make its Clubcard loyalty scheme more personal, with rewards for meals out or trips to theme parks.
However, he added: "A personalised offer is more than just about offering value and price, or rewarding loyalty in a bespoke way. A personalised offer means retailers need to think and act in a multi-channel way."
Clarke said Tesco, which is battling to revitalise sales in its domestic market, said the retailer had "called time on the old retail space race". He pointed out Tesco was investing in its click-and-collect service in store, including for grocery shopping. The retailer, he said, was rolling out its online service in markets including the Czech Republic and Poland and into Asian cities like Bangkok and Shanghai.
By Christmas, he predicted, one in five online orders in the UK are expected to be made on a mobile device.
