Can you enter a saturated FCMG market without expanding physical stores and quickly obtain a large market share? This challenge was formulated by Tesco in 2009, when they decided to enter the South Korean market with the Home plus formula. South Korea has a unique culture and with Tesco’s drive to localize their stores, the retailer had to come up with a brilliant idea; combine the tech-orientation of the population and their work ethic to offer an innovative QR Code service.
Tesco (Home plus) had a number of stores in South Korea, but the market was dominated by e-Mart. The challenge Tesco formulated was to obtain a number one position in the FCMG market of South Korea without expanding the number of physical stores. Analyzing the market, Tesco observed the high work ethic of South Koreans, the busy schedules working people had and the inconvenience for people to do their daily groceries.
The QR Code solution
To solve this problem, Tesco reformulated the daily challenge of supermarkets to “get the people to come to your store” into “let the store come to the people“. Tesco (Home plus) decided to get access to high traffic areas in South Korea and present the public with a Virtual QR Code Store. The use of QR Codes around the world has been growing exponentially for the past couple of years and QR Codes have become a familiar part of marketing for the public. The use of QR Codes as a Virtual Shop was however a new experience.
To reach the public the QR Code shopping experience was first published in subways, then on bus stops and public transport high traffic places. The QR Codes in subways was the first try Tesco (Home plus) has made. Although the products on the QR Code displays were virtual, the displays were made to look exactly like the shelves in the stores. By using smart QR Code templates for their virtual shop, Tesco has recreated the shopping experience customers would get in their physical stores. Not only the merchandise was incorporated realistically into the virtual store template, but also the displays and the Tesco branding, so people had the feeling of standing inside a virtual QR Code Tesco store.
The only difference with a real shop, was that instead of a cashier your own smartphone would be used as the cash register. By scanning the QR Codes with your smartphone, anyone could make a purchase in the Tesco (Home plus) virtual shop. The goods are then delivered to the home right after you get home after work. This way, waiting time could be transferred directly to shopping time, saving this precious time from the evenings and weekends, so people can relax more.
In the first phase of the Tesco (Home plus) Virtual QR Code store, around 11.000 people visited the online shop. In the four months after, around 65.000 people had already scanned the QR Code from the virtual store. Furthermore:
- Number of registered members ↑ 76%
- Online sales ↑ 130%
- Homeplus has become No.1 in the online market
- Homeplus is a close No.2 in the offline market
- Only 4 months after launch, QR Code sales were $ 28.000 a week