Tesco is keeping mum over reports this week it will launch its own tablet computer in time for Christmas.
According to The Times, the “iPad-like device” hopes to take on the likes of Apple and Amazon, whose Kindle Fire tablet has captured around 5% of the UK tablet market since its launch last September. Reports have suggested Tesco’s slate would be dubbed ‘Hudl’, after it trademarked the name in May.
Leaving aside the name (presumably, people are supposed to huddle around a Hudl), and whether or not Tesco takes the plunge this Christmas, such a move would be eminently logical.
Tesco wouldn’t be the first UK supermarket to develop its own tablet. Asda’s £99 Arnova tablet, launched in 2011, didn’t exactly set the world alight. So how could Tesco succeed where Asda did not?
There are two answers – timing and, for want of a better term, services.
Asda was ahead of the game in 2011 – but two years is a long time in the tablet world. A £100 tablet now will be of superior quality to a £100 tablet in 2011 – in terms of graphics, processing power and battery life.
Tablet ownership is also far more widespread – it has doubled in the last year to reach 24% of UK households. People are buying more tablets and finding uses for them. Competitive pricing from the likes of Google, with its Nexus 7 retailing at £159, and Amazon’s Kindle Fire HD, at £130, is driving their rise. Tesco, like Asda, has the reach to put a well-priced tablet in shoppers’ hands – and shoppers may be ready for it.
But it’s not just a matter of timing. The world’s tech giants have long recognised the battle to woo hearts and minds is no longer won on software or hardware – or at least, not on these alone; it’s about services, stupid.
Apple doesn’t want you to leave its walled garden; it wants you to stay locked within its ecosystem of apps, while your data is stored (and mined) on its iCloud. Likewise, Google wants you to use all of its free, world-beating services – from maps to translators to search – while logged into its email and its cloud, where your data is stored (and mined, again).
By making themselves useful – not to say, indispensable – these companies are more likely to keep their customers.
Tesco is no Google – not yet – but it has been banging on long and hard about its shift to being a multichannel retailer, and it has been quietly building up its digital services for some time. These include Blinkbox, which has struck some canny deals to show exclusive content, such as Game of Thrones, and Blinkboxmusic, a Spotify-like streaming service with a surprisingly extensive back catalogue. These are the sort of services Tesco would be funnelling through any own-brand tablet.
“Tablet owners are incredibly loyal to the download store they are first linked to – 92% of Apple customers that download digital video do so via iTunes and Google has also been successful in attracting its tablet users to the Google Play store,” says Kantar Worldpanel’s consumer insight director Fiona Keenan. “While this level of loyalty will be challenging to achieve, Tesco is in a good place to profit from both initial hardware sales and the long-term boost to its digital services.”
Provided such a tablet functioned as well as a Kindle Fire or a Nexus 7 (and doesn’t come slathered in ‘Everyday Value’ branding), Tesco could have a decent stocking filler on its hands. Not indispensable – not yet – but useful, certainly.