Tesco Customer Service

Table of Content


Although words could not fully express my gratitude for the many people who have inspired, supported, and encouraged me to do my dissertation, I would like to acknowledge a few of those special people here. First, I would like to thank Dr. Joel Barema, Student Director, who supervised this case study and for all the support given to do my studies. I should mention that sometimes he scarified his break time to help me out. I would like to thank the Managers in Tesco Watford Branch who responded to the questionnaire and all the help given me to collect data from their staff.

Further I like to thank all the customers, Tesco staff, friends and relatives who responded to the questionnaire without any hesitation. I also like to thank my researchers who helped me to collect data free of charge. I like to thank my friends Ian and Matina for correcting my dissertation. Last but not least I would like to thank my wife Shirani and my mother in law, Irangani, for checking and correcting my grammar and typing my dissertation. Evaluation of Tesco Customer Service and its effect on the organisation: A case study of Tesco Stores in Watford

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Introduction and Background to the Study

The general purpose of this research investigation is to identify, describe and analyse factors that have an effect on the Tesco organisation regarding customer service retention in Watford. Tesco was started in 1919 by Jack Cohen at East End of London and the first Tesco brand came to the market in 1924. Jack Cohen brought a Tea shipment from T. E Stockwell and Jack used the first three letters of supplier’s name (TES) and first two letters of his name (CO) to make his company name as TESCO.

In 1929 Jack managed to open his first Tesco store in Burnt Oak, Edgware, Middlesex in 1947 and entered into the London Stock Exchange as a Tesco Stores (Holdings) Limited. In 1951 and 1957 Tesco opened their first self-service store in St. Albans and first supermarket in Maldon respectively. In 1987 Tesco managed to take over a supermarket chain with over forty supermarkets of Hillards chain in the north of England for ? 220 million and in 1994 took over the supermarket chain William Low.

To encourage their customers, Tesco introduced a loyalty card system called “Clubcard” in 1995 and a internet shopping service. By 2006 Tesco became the only retailer who made online shopping profitable. In 2001 Tesco enhanced their business globally becoming involved in International grocery retailing business in the United States of America. In 2003 the company was able to enter into the Telecommunication business and in the same year they purchased The. Two Network in Japan. Wikipedia. “Presently it is believed that whatever Tesco’s touch seems to be turn to gold”. Andrew and Geoffrey, 2005). Tesco is the largest retailer in the UK. Their profit exceeds 3billion by global sales and domestic market shares, and became the third largest retailer based on revenue. Wal-Mart and France’s Carrefour came first and second respectively on revenue and Tesco became the second largest based on profit. Tesco specialized in food and drink and it has diversified into many commodity markets such as household goods, electrical and electronic goods, clothing, telecommunications, health, Insurance and finance. Wikipedia.

Reasons for the Chosen Topic

The reasons the researcher has chosen Tesco, Watford branch for part of the researcher’s case study are:

  • The Researcher is living Watford and has easy access to a Tesco store within 15 minutes, walking distance from the researcher’s house. This is very convenient for the researcher to do both, researcher’s shopping and carry out his survey/data/ project.
  • The researcher found Watford has a multicultural population, and has a wide choice of food retailers, such as Tesco, Sainsbury, and ASDA. Watford area also revealed multinational ethnic small-scale groceries.
  • The researcher also found a Tesco Extra to be available for the customers in the same area.

Research Aims / Objectives Tesco is a global growing retail business that is aiming to provide customer’s needs with the best possible price for their customers’ money. Tesco is determined to offer quality products, excellent services and low prices for their customers. The major aim of this study is to examine the effect of existing customer service that reaches Tesco’s aims and the success of the organisation. It will also,

  • determine how customer service is affected on the increase of the profit,
  • he strategy used by supermarket giant Tesco to improve the existing customer service,
  • the effectiveness and outcomes of Tesco’s customer service (within multicultural communities).

Importance of the Study This survey is mainly important to Managers of the Watford Tesco to assess customer’s views and attitudes towards their business and to consider if there are any improvements to be made to their customer service. It also helps them to notify their superiors how they are running the business. This review helps Tesco customers to view and understand about customer service and make a comparison with their view.

This study personally helps the researcher to improve the researcher’s knowledge by readings and findings and understand how to carry out and collect data to enhance the researcher through his Postgraduate Diploma studies. This analysis serves the competitors of Tesco to understand and compare with their customer service and identify if there are any improvements to be made to their customer service. It will also assist academics to do further studies in Tesco customer service.

Scope of the Study

Retail business is a fast growing, competitive business.

In the United Kingdom large supermarkets such as Tesco, ASDA, Sainsbury, Waitrose, Morison are leading the retail sector. Tesco is exceeding their profit by ? 3 billion and this case study is to understand the customer service performance and how it affects the organisation’s success and to determine the customer service of other supermarkets such as ASDA, Morrisons and Sainsbury surrounding Watford.

Limitation of the Study

  • Like many researchers or studies related to customer services, the researcher encountered a number of barriers. Some of which are set out below.
  • The major limitation was the inability on the part of managers to give the right information.
  • Most of the customers refused to go through the questionnaire saying they were too busy.
  • Some customers declined to answer the questionnaire due to language barriers.
  • Some people were rude as they considered it a nuisance.
  • Some customers promised to send the questionnaire by post, but only five people replied out of fifteen.
  • The duration of the research being too short.
  • The lack of funding to enable the researcher to cover a wider area and have a full representative sample.
  • This research was purely an academic one.

The number of words for the dissertation being limited to 10,000.

Structure of the Study

There are five main chapters and chapter one is the Introduction and background to the research, aims/objectives, Importance, Scope, Limitation and structure of the study. Chapter two deals with the review of literature. This discusses summaries from recognized supermarkets and previous research done on customer service. It is important to discuss the methods that will be used in collecting data. These are illustrated in chapter three.

Chapter four deals with the data collected and are presented and analysed with regards to the factors under investigation. Final chapter of this study is Chapter five, reserved for conclusions, findings and necessary recommendations.

Chapter 2 Literature Review

Introduction In the modern world competition is very high in any kind of business. Many companies produce products that are similar and compatible with different benefits to the consumer. Therefore the organisation should provide high quality products and services in order to survive in the retail market.

To drive the organisation in to a peaceable future, achievement of customer satisfaction is the most important objective. To achieve this objective customer service is the bridge to link customers and the company or organisation that produce better products, ideas and services. Their duties include responding to customer inquiries and resolving any problems that they face. Customer service representatives hold millions of jobs among the largest occupations (Occupational outlook handbook 2010-11 edition, US dept of Labor website).

Their duties vary according to the nature of business handled by the organisation. For instance, customer representatives working in a bank handle far different roles to the customer service personnel working in a call centre. In the same field, a person working in an insurance company would mostly handle paper work. Customer service staff working in utility and telecommunication industries has to listen to their customers’ problems such as, over charges for their utility bills or their service problems.

In the retail sector, they often handle returns and providing information about products or helping them to find the goods in their store. Some customer representatives have to handle complains or some questions may be somewhat more difficult and they have to get help from an expert and some of them can be solved according to strict company policies. Most of the organisations have given authority to Customer Service Representatives to solve problems or suggest alternative solutions, reverse erroneous or send replacement products.

Selling products or services are not the duties of the customer service personnel but most of the organisations engage customer service staff to give information about their products and services that help their customers to make decisions about their purchases. Therefore, customer service is highly professional and very important to the organisation as they make most of the decisions on behalf of an organisation. Thereby most of the organisations want to recruit qualified people and require at least a high school diploma holder and computer skills as an added qualification as all the businesses are computerised. Occupational outlook handbook 2010-11 edition, US dept of Labor website). Customer service personnel have to constantly interact with the public. Therefore excellent communication and self-decision making skills, verbal communication and listening skills can be added qualifications for any organisation recruiting for the job. People who are working in this category have to have a good understanding of human nature as some customers could be aggressive and it would be difficult to explain anything to the customers’ as they want to prove their point of view only. Good customer service is the lifeblood of any business. Good customer service is all about bringing customers back. And about sending them away happy – happy enough to pass positive feedback about your business along to others, who may then try the product or service you offer for themselves and in their turn become repeat customers”. Ward, S. The theoretical and empirical reviews of the summaries of previous research on customer service would be discussed in the literature review.

What is Customer Service?

Customer service is a series of activities designed to enhance the level of customer satisfaction – that is, the feeling that a product or service has met the customer expectation. ” Scott (2002) Customer service could be furnished by personnel in a sale and also could be provided on the internet or web pages. A self-service also could be customer service. It could also be said that customer service is a combination of customer service, customer satisfaction, customer focus and customer orientation. Their common aim is to meet customer’s needs and ensure business to fulfil customer’s satisfaction.

Intention of customer service is to build repeat business. If the customers are satisfied with the product and services given by the company they will return to the same company repeatedly to purchase whether the purchase is major or minor. Customer service is the fulfilment of customers’ requirements by the supermarket and shops to meet the customers’ needs and expectations whether the customer is the general public or another business. Evaluating customer satisfaction is very important to improve better, more effective service.

There is a possibility for the effects of customer service in an organisation to be successful or lose the business. If the quality of the product or service could satisfy the customer it will have a positive impact on customer’s willingness to pay. Brand names and their makers also have an impact on the customer to pay more.

What Does Customer Care Really Mean?

If the customer is your relative, friend or an unknown person, whatever their relationship with you they are all seeking high quality products or services delivered in a friendly and efficient manner at a reasonable or appropriate cost.

Thereby customer care is to ensure that you deliver your product or service efficiently and effectively. Knight (1999). Customer care is very important to a business to sustain in the competitive market. Customer care has two characteristics such as delivering customer service and the attitude of employees. If the company wants to implement an effective customer care service, the company should balance between delivering customer service and the attitude of employees Linton (1995). Maslow’s Hierarchy of needs Reece & Walker (2003) refer to: “Maslow’s Hierarchy of Needs (1962) Physiological Needs

Safety Needs Social Needs – Love/Belonging Esteem Needs Self-actualisation Needs”. Reece & Waker (2003) P78 and 79 The theory could be applied to customers and staff in retail sector. To achieve customers’ self-fulfilment, the business has to look into the customer’s expectations through their performance. To gain maximum output from staff the business has to provide motivation and rewards to achieve staff fulfilment. Physiological needs Customers’ main expectations from retailers are to buy their food, drinks and other basic necessities at reasonable prices and at convenient locations.

Customers also expect to be treated courteously, respectfully, and helpfully at the place they shop for their basic needs. Businesses could fulfil customers’ basic needs by supplying fresh, up to date food, a variety of drinks and other necessities at competitive prices. It is essential for an establishment to focus on the physiological needs of the staff to deliver an effective customer service. Employees expect attractive remuneration packages. Reasonable salaries, working hours, holidays and essential breaks from work are employees’ needs to fulfil their basic requirements at work.

Given above are factors relevant to Maslow’s theory of Physiological Needs that apply to customers and staff in retail. Safety needs It is important for businesses to consider the safety of the customers’ in retail. Access to all, i. e. disable access with ramps at entrance is essential. The use of lifts and escalators within the building is expected for the customers’ safety needs. In supermarkets and small businesses must provide safe, clean trolleys and baskets for customers to collect their purchases to carry to the paying tills. The security of the customers’ at a shopping place is vital.

The guarantee of products to the customers from the retailer is supreme. The customers should be provided with the right to return policy of their purchases. Display of products should be unbiased under the merchandise protection system. Thereby giving the customer the right to choose. The appropriate temperature should be maintained not only in the building but also in cold cabinets containing food. Providing electronic surveillance is vital to protect customers in retail establishments. Online shopping has increased and retailers have to ensure a secured web site for customers for purchases.

People must be able to feel comfortable where they shop. Free and convenient car parking is essential for customers to do their shopping. This would be one of the factors customers seek when they plan to shop. In supermarkets and mini-markets the customers count on spacious aisles to move the shopping trolleys comfortably without any obstructions. The aisles must be wide for manual and electric wheelchair users to move without any hindrance. The use of cash back facility is an advantage to the customers that provides convenience of not having to look for cash machines outside.

The convenience of home delivery is becoming quite popular and it is necessary that delivery be on time. Providing an online shopping service has attracted customers to shop in comfort of their own home. The retailers should provide web sites with accurate information for customers to choose the right product. Retail establishments have a duty by their staff to provide secure employment, training and suitable working environments for the safety of staff. Given above are factors relevant to Maslow’s theory of Safety Needs that apply to customers and staff in retail. Love/Belonging – Social Needs

Customers of any age rely on courteous staff when shopping. They expect friendly employees to help them when they are unable to find any product they require. The customers who require the customer service would approach the employee at the counter with unease as the need to either return a product or exchange a product or to seek help is a daunting task. Therefore, employees serving customers at the customer service counter is required to be polite and helpful. Sales promotions add value to the products to attract and motivate customers. Customers’ motivation can fulfil the social need by purchasing products to help them in their daily life.

Customers in any establishments should be treated with respect, after all “Customers comes first” is the key in retail. Managers could arrange social events, team-building events to motivate the staff. This is a way of fulfilling the expectations of social needs of staff. Given above are factors relevant to Maslow’s theory of Love/Belonging-Social Needs that apply to customers and staff in retail. Esteem Customers establish buying habits and frequent shops that cater to their buying need thereby the customers and staff establishes a rapport. The customers feel confident to shop in a place they have established the buying habits.

When customers decide to purchase goods from a company a relationship is automatically built on mutual trust and respect. This trust is the bond that binds the customers and the retailer in business. Retailers that provide loyalty bonus vouchers increase the customers’ satisfaction. Thus satisfied customers are attracted to the retailers and become loyal customers. For staff to gain confidence they could be provided with opportunities for promotion and leadership. These factors show how Maslow’s theory effect customers and staff Esteem. Self-actualisation

When customers are satisfied through safe, secure, trust and honest transaction they will repeatedly visit the particular business. Hence, through customers’ satisfaction business can be launched to a peaceable future. When the staff are satisfied with the basic needs, the social needs, the safety needs and their esteem they are happy at the working establishment. Thus, staff are willing to work long term and provide effective customer service. These factors show how Maslow’s theory effects customers and staff in Self-actualisation.

Why Service Excellence is Important

In the fast growing world population, business and business opportunities are increased with modern technology. Many organisations produce products with competitive prices and more benefits to the consumer. Winning customers is a very difficult task in the competitive business world. Excellent customer service is the best approach to attract customers. “Service excellence has grown in importance in recent years” Clark and Baker (2004). The researcher agrees that in recent years people are aware of the services expected from companies, value for money.

The following reasons may help to improve the customer service. Customers can obtain information about customer rights through Newspapers, Television programmes such as BBC’s ‘watchdog’, customer magazines such as ‘Which’ and many other web sites. Thereby customers’ demand their rights more often. Hence, customer demands have an impact on businesses to offer an excellent service to survive. Various companies produce similar products at competitive prices. Sony, National, Hitachi, Bush are companies producing Television for the market.

Each company offers different benefits to the consumers to compete with their rivals. High-level customer satisfaction and customer retention is a significant impact on the company success through their profits. Most of the successful companies realise those factors and try their best to provide excellent customer service that can change customers’ attitudes, and customer centric approach to the business. Clark and Baker (2004). Most of the successful companies understand the value of their employee’s satisfaction and behaviour that directly affect their business. We want our people to be well managed and to work in an environment that is based on trust and respect. We have learnt over the years that well motivated and managed staff will give customers great service; by giving the people values we create a great place to work and one where great service is delivered”. Tesco(2009) “Most dissatisfied customers do not complain to the company when they receive poor service and that 90% will not return” Clark and Baker (2004) Those customers will talk about the poor service they received with their family and friends instead of complaining.

This message will spread from mouth to mouth and it will damage the image of the company’s customer service. Thus affecting the reputation of the company and profits could fall.

Who Really Delivers Customer Service?

Many companies have left customer service to their small group of employees who are directly dealing with the customer. But it is the responsibility of everyone to look after the customers. Building a right customer service team will help to deliver the highest level of services to the customers. Linton (1995).

Why trust is important Customers are also keen to do business with the companies that they can trust and who they feel will have their interest at heart” Clark and Baker (2004). Trust is very important when dealing in business. If the company were able to win a customer through their trust and loyalty, that customer would be loyal for life and overlook price differences in other companies.

Why do We Measure Customer Satisfaction?

The different methods of measuring customer service to show how it affects the development of customer satisfaction are the seven P’s.

Product, People, Price, Physical Evidence, Place, Processes and Promotion are the seven P’s to determine the customer satisfaction. The seven P’s are the factors that would influence the needs of the customers while minimising cost and time requirement and maximising the impact of the service. 8 Supermarkets and the customer service within the supermarkets Tesco, ASDA, Sainsbury, Waitrose and Morrison are the UK leading retail supermarkets and they offer almost similar customer service with different values.

ASDA has been serving since 1965 which was started by a group of farmers in Yorkshire and became a part of the Wal–Mart family in 1999. They offer 10% lower in price than their main competitors for fresh food, grocery, clothing, home, leisure and entertainment goods. If the customer is not satisfied with the product they can return the product within 28 days and a full refund or replacement is guaranteed. ASDA also offer some facilities to their customers such as; a Brolly Patrol that helps customers with small children, the elderly and those customers who struggle with their shopping load.

A Jumping load service – ASDA has trained their porters to identify and help when a customer’s car breaks down or won’t start in the car park. ASDA has provided smaller, smart shoppers to 175 litre trolleys with child seats and convenient trolleys for the disabled and elderly customers. Braille Guns are used in labelling the products that helps blind customers to identify easily. ASDA tried to introduce a loyalty scheme and was not successful. They understood that it was very expensive and if they introduced the loyalty system they would not be able to keep their prices down as they do now.

They believe customers prefer low prices rather than a gift in the future and cutting down prices through their Rollback Programme is the best way to reward their customer loyalty. Waitrose was founded in 1904. By January 2010 they managed to operate 225 branches across the United Kingdom and by 2007 won the award for the best high street retailer for customer service. They offer services such as Waitrose entertaining products. The service undertakes making food for special occasions. Waitrose also offer home delivery, free glass loan and fish kettle services. Wikipedia, (2009).

Morrison started in 1899 as an egg and butter merchant in Bradford and won the best large retailer disability customer service award in 2000. Morrison has many facilities for their customers. Some of them are extended opening hours at all the stores including weekends, car parking, cash point machine of most major banks, recycling facilities including glass, cans, bottles, paper and textile. A petrol station with comprehensive prices, customer cafe with freshly prepared snacks and hot meals. Baby changing rooms and toilet facilities and free glass loan services are also available at Morrison.

Tesco Vision & Value describe their strategy about ‘every little helps’. They are concerned and care about their people and their customers to run their business from China to Chorley. Tesco has grown gradually. Over time, Tesco has managed to grow from simply selling groceries to everything their customers need. To achieve the target Tesco vision & Value also describes that they are trying harder for customers better than anyone else through understanding customers, giving priority to providing their needs and adding responsibilities to the communities.

Tesco-careers (2009). Tesco has five main objectives to achieve their goals. They are Customer, Finance, People, Operation and Community. This is maintained as the Corporate Steering Wheel. The Corporate Steering Wheel (2009) Throughout all the businesses across the world whether Tesco works in distribution, head office or in stores, Tesco measures it’s performance through the Steering Wheel. This helps to maintain, focus and balance in what counts to run each of Tesco’s businesses successfully, be it wage costs or whether customers can get everything they want.

To earn a lifetime customer loyalty Tesco has enhanced their services, simply selling groceries to providing anything from loans to mobile phones. In addition to that Tesco offers promotions, online services, home delivery facilities and they monitor their loyal customers through their clubcards system. Tesco has planted their image to customers that they can get what they want under one roof. They provide groceries to loans and mobile phones to a multi cultural population. Asian, African, European, or any other ethnic food is available for the particular customer without struggling to find shops to buy their food.

Tesco always offers competitive prices to their customers. Buy one get one free, discount vouchers, variety of goods in competitive prices to suit different levels of income categories are a few examples. Tesco always endeavour to serve their customers with a minimum waiting time by providing more checkout tills and automated checkout tills thus minimizing their long checkout queues. Tesco strategy to motivate their employees to offer excellent customer service to their customers. Tesco says “We can’t expect our people to be happy or to make our customers happy if we don’t look after them”.

Tesco (2009). Staff at Tesco receives benefits and training to enhance the working environment to provide a better customer service. Tesco has pledged that they want Tesco to be a great place to work. They have promised that when people work for them they would: Be treated with respect Have an opportunity to go on Have a manager to help staff Have an interesting job Tesco provides competitive salaries for their staff and they want their staff to be a success. They offer their employees who have been with them for three months or three years to buy Tesco shares.

After working an year, employees are eligible to get a loyalty card which gives 10% discount and clubcard points on most of the Tesco’s products and exclusive discounts on Tesco personal finance and Tesco telecom. To look after the staff’s future Tesco has introduced a pension scheme, discounts for theme park holidays and gym membership. Exclusive discounts from top healthcare companies who are in health care plan. Regular training and job rotation through all the departments to employees to work throughout Tesco and to get an overall knowledge about all the products and services.

Tesco, (2009) 2. 10 Tips for good customer service Excellent customer service could bring more customers to the business. When dealing with customers the following factors will help any business to establish a good customer service. Ward, S.

  • Answering Phone
  • Don’t make promises unless you can keep them
  • Listen to your customer
  • Deal with complaints
  • Be helpful – even if there is no immediate profit
  • Train your staff to be ALWAYS helpful, courteous, and knowledgeable
  • Take the extra step
  • Throw in something extra
  • Improving communication and answering your phone

Most of the problems within the business boil down to two things. They are weak management and poor communication that leads to poor customer service. There are many benefits you can gain from effective communication. Some of them are greater awareness, greater efficiency, information given to staff helps them to perform well and deliver better service and better profitability. Rowson (1988). It is also important to make arrangements to receive the calls when someone wants to contact your organisation. People like to talk to a person rather than listen to a pre-arranged recording.

With modern telecommunication technology call forwarding or an answering service can be arranged as an alternative solution. Rowson (1988).

Don’t make promises unless you can keep them Reliability is the major key factor to build a good relationship between customers and the business and admirable customer service. You have to stick to your word otherwise you should not give any promises. For instance if you say, your washing machine will be delivered on Monday, you must deliver it on Monday. Same as any other promises you make, like client appointments, deadlines etc.

Broken promises will cause annoyance to customers and will not be able to win customers’ faith towards the business. In short customers expect the promises made which encouraged them to part with their money to be honoured. Martin (1998).

Listen to your customers One of the key skills required by customer service personnel when dealing with customers directly is listening. Different types of customers seek help from your business to solve their problems. Some customers know how to tackle their problems and most of the others do not know how to handle the problem and they expect your assistance.

If you do not listen to them properly customers would not be happy about the business, and the result may be you would lose the customer. It is very important to listen to your customer and explain several times if the customer is not in a position to understand and make the customer see the right picture of the solution you suggest. Rowson (2009).

Deal with complaints In a business happy customers return again and again and may tell their friends and families. But unhappy customers never come back and tell ten other people of their bad experience.

In any business you have to expect complaints. Some can be solved and some cannot be solved due to the nature of the problem. Some people make complaints on purpose. You would not be able to satisfy everyone. But your intention should be to satisfy your customers. Therefore, you have to give your prior attention to solve the problem, which help to attract the customer to understand your excellent customer service. Knight (1999). e) Be helpful – even if there’s no immediate profit in it Customer service begins before the sales.

High level of information helps customers to make a right choice. By providing the right level of information, advice, customer service personnel could build a high level of customer satisfaction. Whether the customers buy or not, the products or services, you have to help your customers, although it may not be profitable at the time. Linton (1995). An example of an incident is: One day the researcher took the computer for repair. After the repair the technician who ran the small business charged only for his labour. But the researcher saw that he replaced the computer random access memory.

The researcher asked him why he did not charge for the spare part. He said that it was not a new part and the replacement could be used for a longer time. He could have charged the researcher but he did not. From that day the researcher always go to him and the researcher recommend him to friends too and most of them are his valued customers now.

Train your staff to be ALWAYS helpful, courteous, and knowledgeable In order to provide a good customer service staff should be trained to have skills and confidence. Trained and experience staff is an asset to any organisation.

When considering customer service it is essential to have trained and experienced people. It is important that customer service staff do not use phrases like, ‘I do not know’. This portrays a bad image of the company. The customer service personnel should be trained to serve the customer in the most amiable manner. Rowson (1988).

Take the extra step To be a good customer service personnel you need to give your customer maximum satisfaction. If a customer should ask any questions you have to explain briefly and precisely and keep on explaining until the customer is clear and is satisfied with your answer.

If a customer asks for help to find something do not give the direction but try to show the exact place. Ward, S.

Throw in something extra When in business you have to give away something to attract your customers. It does not have to be a valuable thing. It can be a discount coupon. Some organisations offer points for their store card that could be redeemed for goods or monetary value. Ward, S.

Chapter 3 Methodology


This chapter illustrates the research methodology that will be in the data of existing customer service at Tesco to determine the effect on the organisation’s success.

Purpose of the study The needs of the multicultural population now living in the United Kingdom are increasing considerably. There are many competitors in retail business and some of them are very successful, some of them are just surviving and some of them close down the businesses. But, day by day the Tesco organisation leads the retail market. This study is to evaluate how the Tesco customer service affects it’s success.

Research Instrument

Adequate and reliable data is the success of a research. There are two types of data been collected for this study. They are the primary and secondary data.

The primary is for the purpose of analysis and interpretation was derived from the administration of questionnaires, observation and personal interviews. In order to gather information for this study, the researcher has designed three types of questionnaires. Questionnaires were focused firstly for customers, secondly for Tesco managers and thirdly for Tesco employees. The secondary data was gathered from text books and internet web sites.

Research Approach

Customer questionnaire was designed with 15 questions with multiple choices which surveyed customers’ response to evaluate customer service.

Question 1 to 3 was designed to understand customers shopping pattern. Question 4 to 10 was to review customers’ vision towards staff and overall performance of the Tesco organisation and questions 11 to 15 was to gather customers’ personal information to understand what type of customers shop in Tesco. This study will help the managers of Tesco to review their customer service, free of charge. Therefore, for a manager to spend a little time to answer a questionnaire is not a waste of time. Considering these factors the managers’ questionnaire is designed with open and closed ended questions.

Question 1 to 12 are designed to understand managers’ review towards Tesco staff and their performance and to obtain managers’ comments to improve the Tesco customer service through their experience. Questions 13 to 15 are personal information about managers. Customers always move with the staff when they shop. Therefore, the opinion of staff about customers and the organisation is very important. The third questionnaire was designed for the staff. Questions 1 to 10 are to understand the involvement of staff and the customers, staff training and staff who are willing to work with Tesco.

Questions 11 to 14 are to understand what type of staff Tesco has employed to serve the multicultural population.

Data Collection

To collect data the following methods were used. The researcher used four research helpers to collect data. They were provided with the the questionnaires for data collection. The questionnaires were given to the customers directly. Random samples were taken from the public, relatives and friends. More than 150 questionnaires were distributed among the Tesco customers, the public, relatives and friends. But only 133 responded.

Chapter 4 Introduction

This chapter illustrates the research findings from the data collected through the administration of the questionnaires and information gathered from the internet web sites regarding the Tesco organisation.

Tesco and It’s rapid successes “Tesco is on it’s way to become the dominant leader in the United Kingdom for food retailing market today” Seth and Randall (2005) Understanding their customers’ needs, day by day they enhance their services and open up local stores as Tesco’s Extra to help their customers. Tesco has their branches located globally.

The following table describe how they co) Stamp, G. (2006) Tesco was the first UK business that made ? 2 billion profit which was announced in early 2005. They have continued to rise in the UK’s strong core business in aspects such as, non food, retailing service and progressed internationally too. Tesco constantly focuses on improving customers’ shopping as easy as possible by reducing prices to minimize customers spending, providing convenience small or large stores and bringing simplicity and value to a complicated market. Thereby Tesco manages to enhance their business rapidly.

Tesco’s rapid growth influenced to increase their sales, turnover and the profit. Considering their rapid successes people did not hesitate to invest in the Tesco organisation. Thereby, day-by-day the Tesco market share has gone up * Follows The following table illustrates the behaviour of Tesco share prices in July 2005 to May 2006 Source: London Stock Exchange “Tesco has more than a million grocery customers”. Mari, (2009). Tesco has enhanced their online service by introducing a clothing range to support their financial services. Tesco’s online sales had heightened immensely.

They had launched a new clothing store on line with about 3500 product lines from 20 brands and they are anticipating 10 per cent of clothing sales from on line. The new name derived for Tesco Personal Finance is Tesco Bank. This is a joint venture with Royal Bank of Scotland now entirely owned by Tesco. “Tesco achieves 3bn annual profit” BBC News, (2009). Tesco achieved a successful year and their weekly sales peaked by 1bn per week and in 2009 they made the highest profit in the United Kingdom retail sector. “Tesco’s results today produced a number milestones for the retail giant”. Guardian, (2009). Internationally Tesco has made 51m profit excluding the United States of America, thereby increasing their growth in group trading profits by 45% and sales increase by 51%. Tesco has employed about 469,000 staff globally and in the United Kingdom about 283,000. The most popular loyalty scheme in the UK Tesco growth is evident in the above financial chart from their Annual Report and Financial Statements (2009). They have survived the recession and managed to become the third biggest retailer in the world. BBC news, (2009). By 2010 Tesco rewarded 120 million to over 14 million of their loyal customers to celebrate their fifteenth anniversary of launching the clubcard.

They introduced the clubcard in 1995 for the first time to their customers. Since then Tesco has distributed billions of pounds in vouchers among their customers to shop in Tesco to help millions of families to stretch their budget. After re-launching the club card in 2009, millions of new customers signed up for the clubcard. With modern and latest technology Tesco has introduced the iPhone app that turns the phone into an electronic clubcard that enable customers to scan the phone screen without struggling to search for their card. The new system is to encourage young customers and men who dislike carrying many cards in their wallets.

Press Releases, (2010).

Findings and Analysis of Preliminary Data

The findings and analysis of data was interpreted from the data collected through the administration of the questions. The researcher gathered data from Tesco customers, managers and the staff. Presentation and analysis of preliminary data. Firstly one hundred and fifty (150) questionnaires were distributed among the Tesco customers, general public, relatives and friends. One hundred and thirty three (133) of them responded to the questionnaire. Secondly 25 questionnaires were distributed among the staff.

Then the researcher focussed to gather managers’ points of view towards their customer service, staff and any improvements to be made and 12 managers participated in the survey.

Presentation and Analysis of Customers Preliminary Data

The preliminary data examines customers shopping pattern, customers views towards the Tesco organisation and finally customers personal characteristics.

Customer’s shopping pattern Sixty three percent (63) of customers who responded have been shopping in Tesco for at least five years, 15% for at least three years, 6% for at least two years, 8% for at least one year, and 8% for less than one year.

Customers who have been shopping in Tesco for less than five years were found to be between the age of 18 and 24, and ethnicity from Asia, Africa and Europe. This study revealed that most of the people living in Watford shop at Tesco. Among the customers who responded to the researcher’s questionnaire, 36% shopped at least once a week, 29% shopped at least every two to three days, 20% shopped occasionally, 9% shopped frequently and 6% shopped at least once a month in Tesco. This study revealed the shopping pattern of the people in Watford. From the customers who participated in this survey, most of them shop at other supermarkets as well.

In the process it came to light that 42% of customers who responded do shop at other supermarkets. Out of the remaining 48%, 16% only shopped at Tesco, and 11% shopped at other supermarkets very often, and 26% occasionally and 5% sometimes also shopped at other supermarkets. Customer’s also revealed to the researcher’s interview that Tesco prices were higher when they compared to the other supermarkets. This concluded that the customers do their shopping at other supermarkets due to various reasons such as price, quality, and convenient distance and personal reasons.

Customer’s View Towards the Tesco Organisation

The researcher focuses the study to get customers view towards performance of Tesco employees. There by 98% of customers who responded to the research review that staff were available in time manner and 17%, 49%, 24% 8%, 2% rated Excellent, Good, Average, Fair and Poor, respectively. 98% of customers reviewed that Tesco staff were friendly and polite and offered to help when they shopped at Tesco and 23% say Excellent, 47% rated Good, 20% Average, 8% fair and 2% rated Poor. 99% of the customers who responded admitted that Tesco staff answered their questions. 3% stated as Excellent and 55% as Good. Out of the remaining 13% stated it was Average, 8% stated it was Fair and 1% of the customers rated as Poor. From the customers who responded 37% of customers were very satisfied with the way the staff handled their complaints. 32 % were somewhat satisfied, 23% were neither satisfied nor dissatisfied. 6% were somewhat dissatisfied and 2% were very dissatisfied the way Tesco handled their complaints. However, customers disclosed to the researcher that they were not satisfied with the system Tesco has introduced to make their complaints.

Customer service staff enters the customers’ complaints to the computer using his/her words. Eventually the customers do not know what was entered, as customers are not allowed to look into what was written and the customers have no confidence whether the customers’ complaints conveyed the right picture. Hence the customers are dissatisfied with the way complaints are recorded and most of them do not bother to inform the bad experience they received, instead they look for an alternative by visiting other supermarkets.

From the customers who responded 23% of customers rated Excellent with the staff’s knowledge of the products/services, 40% rated Good, 31% rated Average, 6% rated fair and none of the customers have rated Poor. Considering staff performance, this study revealed that Tesco staff’s performance is very high, discipline and professionalism is beyond question. Staff has been very well trained by the organisation and staff is keen and smart to satisfy their customers more than customers’ expectations. 8% of customers who participated the survey were satisfied with Tesco’s overall customer service and rated 43% as Very Satisfied, 28% as Somewhat Satisfied, 22% Neither Satisfied nor Dissatisfied, 5% Somewhat Dissatisfied and 2% of the customers rated as Very Dissatisfied. This study revealed that Tesco organisation has a wide range of understanding and experience how to face their customers, how to run the business, what their customers need and how to satisfy their customers and it also revealed that they have to improve some part of their customer service.

Series 1 = Responsiveness Series 2 = Professionalism Series 3 = Understanding Customers’ Need Most of the customers who responded were very happy to shop at Tesco and 48. 1%, 43. 6% and 30. 8%, of respondents have rated as very satisfied with the responsiveness, professionalism and understanding their needs, respectively. 34. 6%, 38. 3% and 41. 4% of the customers were Somewhat Satisfied with the responsiveness, professionalism and understanding their needs, respectively. 13. 5%, 13. 5% and 20. 3% of the customers were Neither Satisfied nor Dissatisfied. %, 4. 5% and 4. 5% of the customers were Somewhat Dissatisfied towards Tesco’s responsiveness, professionalism and understanding their needs. 0. 8% and 3% of the customers were Dissatisfied with responsiveness and understanding their needs. None of the customers were Dissatisfied with professionalism.

Personal Characteristics of Customers

The findings have revealed that female customers percentage is higher than male customers who shop at Tesco. From customers who responded to this survey 7% were of the age between 18 and 4, 22% were of the age between 25-34, 30% were of the age between 35 and 44, 17% were of the age between 45 and 54, 14% were of the age between 55 and 64 and 10% were over 65. The researcher’s findings have been that the ages between 35 and 44 are the highest percentage of customers that shop at Tesco. 50% of British people were the highest percentage of customers shopping at Tesco. 25% Asian people shop at Tesco compared to 13% European, 7% African and 5% other nationalities were the percentages of customers shopping at Tesco.

This study revealed that Tesco Watford offer traditional and cultural goods for a multicultural population to attract different cultural customers to their business. Different income level people shop at Tesco and 55% were fulltime workers, 23% were part time workers, 14% were retired people and 5% were students and 3% were unemployed customers among them. From the customer who responded the number of people spending between ? 1 and ? 25 per week at Tesco were 27%. 26% were spending between ? 26 and ? 50, 28% were spending between ? 51 and ? 75, 11% were spending between ? 76 and ? 00 and 8% were spending over ? 100 per week. Therefore the highest number of people spending weekly at Tesco Watford is identified as 28%.

Presentation and Analysis of Managers’ Preliminary Data

The preliminary data examines manager’s view towards their staff and their performance, and manager’s personal characteristics.

Manager’s View Towards Staff and Their Performance

Of the 25% of managers who responded to the researcher’s questionnaire have been working for at least three years in the Tesco Organisation and the rest of the 75% has worked for only about five years in the organisation. 7. 3% of the responded worked as managers for at least two years, 27. 3% for at lease three years and rest of the 45. 4% for at least five years worked as managers. From these managers 25% and 75% have been working at Watford branch for at least three and five years respectively. The researcher understands that if the manager is working for a long time in the store he/she has a broader knowledge of the store and the operations and it will have an impact on the smooth running of that particular store.

The study also reveales that well experienced managers are there to serve their customers and they could solve problems quickly, if any would occur. From the findings the researcher came to the conclusion that managers were satisfied with overall efficiency, knowledge of product/services, handling customer’s complaints and politeness to the customers by the staff. This clearly shows that staff and the managers get on well which helps to build an efficient and effective team working together in Tesco Watford branch. Most of the managers who responded were very happy about their customer service and 58. %, 33. 3% and 33. 3% of respondents have rated very satisfied for responsiveness, professionalism and understanding their needs, respectively and 41. 7%, 66. 7%, 66. 7% rated somewhat satisfied for the same respectively. But none of the managers had rated neither satisfied nor dissatisfied, somewhat satisfied or very dissatisfied. This study revealed that the Tesco organisation has a wide range of understanding and experience in how to face their customers, how to run the business, what their customers need and how to satisfy their customers.

The study also revealed that well trained and experienced staff are available at Tesco to achieve their goals. From the managers who responded to the questionnaire, 58. 3% were male and 41. 7% were females. 41. 7% of the managers were between the age of 25 and 34, 33. 3% were between the age of 35 and 44 and the remaining 25% were between the age of 45 and 54. The ethnicity rated as 33. 3% managers were British, and 16. 7% were European, 41. 7% were Asian and 8. 3% were African.

This study revealed that Tesco was employing staff from different geographical countries to provide their multicultural customers for an excellent service. The preliminary data examines staff’s view towards their customers and the Tesco organisation and staff’s personal characteristics. 8% of the staff who responded to researcher’s questionnaire have been working for at least one year in the Tesco Organisation and 28% for at least two years, 12% for at least three years and rest of the 52% for at least five years. 0% of the respondents have worked solely at Tesco and the rest of the 60% has experience in working in other supermarkets. This determines that the staff work for a relatively lengthy period in the Tesco organisation as Tesco look after their staff with good salaries/wages, rewards and benefits that attract their staff to stay a long time in the organisation.

The study also reveales that well experienced staff are there to serve their customers and staff has a broader knowledge of how to serve Tesco’s customers. 100% of the staff that responded to the questionnaire was dealing with customers directly. 8% were dealing with customers all the time, 4% were dealing with customers frequently, 8% were dealing with customers occasionally. 36% of them handled customers’ complaints and 22. 2% has had bad experiences with customers, 66. 7% has had bad experiences with customers sometimes and 11. 1% has had bad experiences with customers’ very rarely. Most of the staff who responded were very happy about their customer service and 28%, 64% and 4% of respondents rated Excellent, Good and average, respectively. 79. 2% staff said that they had training often and 20. % said that they had training sometimes. The study revealed that staff that worked part time had training sometimes and the rest of them had training often. Majority of the staff accepted that Tesco’s training was useful to carry out their duties. This study revealed that Tesco was trying harder to enhance their staff’s skills to look after their customers. Majority of staff were very satisfied to work in Tesco and 68% respondents rated very satisfied, 20% rated somewhat satisfied and 8% rated neither satisfied nor dissatisfied.

This study revealed that Tesco offered attractive salaries/wages and lots of benefits to keep their staff for long term employment in the organisation and a majority of staff accepted Tesco as a good place to work in. 4. 5. 1 Staff’s personal characteristics From the staff members who responded to the questionnaire, 60% were male and the remaining 40% were females. From the respondents 36% of the staff were British, and 20% were European, 40% were Asian and 4% were African. This study revealed that Tesco employed staff from different geographical countries to provide their multicultural customers for an excellent service.

Chapter 5

Summary, Recommendations and Conclusion – Introduction

In this chapter is the summary of the findings of the study, conclusions on the result of the study and recommendations in line with the main objectives of the study.


This report summarises what customer service is and the effect of how customer service affects the profit of the organisation, Tesco’s strategy to improve existing customer service and Tesco’s effectiveness and outcomes of their customer service within the multicultural communities. This case study is to determine how customer service reaches Tesco’s aims and success of the organisation.

This case study is important to the organisations such as the Tesco organisation and their competitors, customers, academics and personally to the researcher. The scope of the study is to understand Tesco customer service performance and it’s effect on the organisation’s success and to determine customer service in other supermarkets surrounding Watford. The literature review illustrates what customer service is, meaning of customer care, importance of service excellence and trust, measure customer satisfaction and who really deliver customer service.

The literature review also describes supermarkets and customer service within the supermarkets, Tesco’s strategy to motivate employees to provide excellent customer service and tips for good customer service. Research methodology will disclose the purpose of the study to determine how customer service effect the Tesco organisation to become a leading retailer and types of data used and the method of collection of data for this study. The finding and analysing section illustrates Tesco and its rapid successes and analysis of data collected through administration of questionnaires.

Looking at all the factors and the strategy that Tesco has embanked upon, if the organisation can strengthen their technological base and integrate it well with the principles and professional ethics regarding communication in the Tesco Watford branch, the organisation will prove to be very competitive and continue to have a greater market share in the UK.


This study reveals that Tesco’s customer service performance is highly satisfactory, the organisation should consider further improvements to their existing customer service.

This study concluded to make the following recommendations; The study found that many Tesco customers shop at other supermarkets due to various reasons and one of them was the high priced products. Customers also revealed that Tesco Express prices were higher than the larger Tesco supermarkets. It was revealed that customers who shop at Tesco supermarkets could spend less when they purchase the same product as at Tesco Express. These factors could impact on Tesco’s image and change customers buying decisions at Tesco.

Thereby Tesco could consider these factors they could attract new customers into the business and could change their own customers buying decisions at other supermarkets. From the customers who were interviewed by the researcher some of them disclosed that most of the time Tesco’s fruit and vegetables were not up to the standard. Some fruits were mouldy and discoloured and the displayed fruits were dried up and the conditions of the vegetables were the same as well. Customers also noticed that most of the time the meat looked discoloured and not kept in correct temperature.

Good, fresh produce such as fruit, vegetables and meat that looked appetising and appealing could increase customers buying decisions. Thereby if Tesco could make sure to check these products on a regular basis and decaying produce were removed when it started to visibly deteriorate they could increase their sales on these particular products. The researcher arrived at the revelation that Tesco’s staff were performing more than customers’ expectations. But a considerable amount of customers, who were interviewed by the researcher, highlighted that some of the staff were rude, arrogant and aggressive.

Especially when they were answering the phone, they were not professional; they did not listen properly and sometimes they were rude. This study concluded that although Tesco tried hard to change employees’ attitude it was difficult to change some of the employees’ way of thinking. Thereby if the Tesco management could engage suitable people especially in places like answering the phone and checkout tills and customer service desk, Tesco could reduce their customers’ disappointment towards their staff and the organisation. Customers who were interviewed by the researcher disclosed that they were happy about Tesco’s online buying service.

But especially during festival times they had to struggle to get their purchases online. Some customers revealed that what they ordered for Christmas were received one week after Christmas and Tesco did not even bother to inform them that they could not deliver in time. Especially during festivals like Christmas, customers’ disappointment and anger could not be explained. Therefore if Tesco could keep their eye on online deliveries especially during festival seasons they could increase their online sales and achieve online customers highest satisfaction.

From the customers who participated in the researcher’s questionnaire some customers pointed out their view of how Tesco customer service handled their complaints in the customer review web site, www. ciao. co. uk, were not satisfied with the Tesco system. Customers do not have confidence that customer service personal convey the same thing that they want to convey to the management, because customer service staff use the computer to input the complaint in their own words to make the customer’s complaint and customers don’t have the right to look into what they have written.

Customers desire to use their own words to make their complaints and to receive a proper reply from Tesco customer service is what the customers wish. Lake and Hickey (2002, p120) provide three benefits that are valuable to consider. They are, free research, the opportunity to improve broken promises and the chance to recover and create a story. This could be applied by Tesco to look into improving the customers’ existing complaints system, which could satisfy their customers and gather information to improve their customer service.


This research examined the effect of Tesco’s customer service on its sucesses. This study elucidated customers shopping style that varies according to several factors, such as price, background and the number of members in the family, store location, culture and income level of customers. The study also shows that customers have a variety of alternatives and competitive supermarkets to do their shopping. Although Tesco is leading the retail sector, their competitors are also strong and attract customers away from Tesco to their business.

The previous chapter illustrates that Tesco has built an effective, efficient and strong work force, “Tesco Team”, to provide an excellent customer service. In Tesco Watford branch the study also shows that it has achieved a high level of staff performance to serve their customers as cthe ustomers are highly satisfied with the staff performance. Most of the staff and managers working the Tesco Watford branch have been working there for a long time. This helps the Tesco Watford branch to maintain a smooth operation as staff are well trained and experienced.

This study has exposed Tesco’s successful performance as a leading, fast g

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