Tesco axes 24 hour stores; blames rise of internet shopping

01/02/2016

Tesco is to end 24-hour trading in 70 of its stores due to the growth of online shopping which has meant that certain shops had few customers during the night.

The closures will affect 76 stores in the UK, which will now trade from 6am to midnight Monday to Saturday.

Tesco blamed reduced late-night demand and a rise in internet shopping for the move.

A Tesco spokesman said: “The move to reduce hours means more Tesco colleague time will be freed up to replenish products on the shelves overnight. It will mean better availability of products and better-looking stores when they open their doors to customers each morning.”

Asda is the only other supermarket chain with 24-hour opening.

Analysis- Ecommerce now calling the shots

Iain Devine, Commercial Director at digital commerce consultancy Salmon, said: “This news from Tesco that it is to end 24-hour trade in 70 of its stores is an interesting move, but unsurprising as we see online sales channels grow. Mobile and online shopping are no longer just part of the ‘multichannel’ mix but the focus of it.
“As more and more consumers use online services to streamline their lives, it is essential retailers provide a multi-channel offer that meets the demands of modern customers, who easily switch channels to get something done. After all, consumers respect and return to brands that make their busy lives easier, fitting in rather than adding on.”
“Clever thinking and smart technology is crucial to understanding the wants and needs of consumers which is what we are seeing from Tesco in this move. As the power of social commerce continues to grow, retailers must ensure they have a robust ecommerce strategy in place to cater to growing user demand. Those that lag behind from fear of change must combat this to ensure they have an exceptional online offering to deliver true competitive advantage and future-proof their business.”

The customer experience and established retail practices

Terry Hunter, UK Managing Director at Astound Commerce, said: “As Tesco’s latest approach has shown, it’s no longer enough for retailers to focus their efforts entirely on either the in store or online experience. This is especially true when you consider that consumers no longer shop exclusively on the high street or via a retailer's website – it’s become a mixture of the two. In 2016, therefore, retailers must strive to build a consistent, high quality, and fluid experience across all interactions between brand and customer, wherever those interactions take place.

“Tesco’s plan to reduce the number of stores that are open 24 hours, in order to improve the overall experience by addressing stock levels and making changes overnight, is a prime example of how established retail practices are being adapted in the face of online growth and changes to consumer shopping habits. It’s also further evidence of how traditional thinking in terms of established lines between different sales channels has become out-dated.

“The reality is that the retail game has changed, and this change has been driven by omnichannel. Retailers are now faced with increasingly complex multi-channel commerce requirements, which are being fuelled by heightened expectations from consumers for more flexibility and control over their shopping habits. Despite the steady rise of online sales in recent years, however, in today’s omnichannel environment it’s still important for retailers to maintain a physical presence to drive overall growth – even if, in Tesco's case, those stores are no longer open 24 hours.”

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