Tesco is to pilot third party advertising on the sides of lorries leaving its Livingston depot as it seeks new ways to generate revenue by positioning itself as a media owner.
The UK's largest retailer is also undertaking a feasibility study into the use of multimedia digital screens in store. This is in advance of testing instore TV' in three stores from next month.
In a move that illustrates Tesco's commitment to becoming a significant media player, former point of sale manager Bill Pennell was promoted in September to the new role of media manager with a responsibility for revenue generation within the corporate purchasing division.
"It's about creating new communication channels," Pennell said. "There are dozens of new media opportunities from which we can earn money to reinvest into cutting prices."
He said Tesco was not trying to tap into the trade money related to commercial deals. "We are looking at a separate pot of money," he said.
Tesco has appointed Glasgow-based Agripa to handle its truck-side advertising. The pilot kicks off in the third week of February with an eight-week campaign from Icelandair.
The ads are digitally printed 96-sheet posters and cover both the hard and curtain sides of lorries. Pennell said truck-side advertising enabled brand owners to get their message across in advertising blackspots. Space on each truck is expected to cost about £300.
"We are selling defined routes and can work out who sees each truck," said Agripa director David Macauley. "This is a new, sustainable, repetitive business model." There are plans for a national roll out from mid April.
Tesco sees an instore digital advertising network as having the potential to become a compelling marketing tool.
Captive audience specialist Instrument is carrying out the feasibility study, examining issues like customer acceptance, the most appropriate technology for different locations in store, and revenue models. It reports back to Tesco later this month.
"We want to establish a suite of options," said Pennell. "It is a balance between being effective and intrusive. It comes down to whether our customers want it."
Tesco hopes to have third party digital advertising in 100 stores by Christmas and 300 in three years.