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Market Insight

UK retailer Tesco launches Hudl tablet

October 03, 2013


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Tesco, one of the world's largest retailers, has launched its own tablet, the Hudl. The supermarket chain said it had sold 35,000 of the devices in the two days following launch.

The Hudl is being offered for £119 ($189), but can also be bought with just £60 ($95) of Tesco Clubcard vouchers, a considerable saving for members of the retailer's loyalty scheme. The Hudl tablet is currently for sale in 1,000 Tesco supermarkets in the UK and in its online stores.

It runs Google's Android 4.2 OS with some tweaking, principally at an app level, done by Tesco. In contrast to Amazon's full scale repurposing of Android Tesco's changes are more modest. The retailer's key change being an extra onscreen button in the bottom left hand corner which  provides access to Tesco's range of online services including shopping, loyalty card details and banking; Google's own family of Google Play services remain in full.

The Hudl features a 1.5GHz quad-core processor, which generally produces a lag-free experience within individual apps. However, some reviews have complained that the 1GB of memory does create some performance issues when multitasking and transitioning between apps.  The Hudl features a 1440 x 900 display, working out at 243ppi compared to the Nexus 7 with 1900 x 1200 and 323 ppi.

Tesco is not the first of the 'big three' multinational retailers (Walmart, Carrefour, Tesco) to offer its own tablet. In France Carrefour is offering its own Android devices which run a range of Carrefour apps. Both Tesco and Carrefour are positioning their devices in a similar way, prices are similar (Carrefour's prices start at €129 - $175) and the tablets not available outside the retailers respective home markets. This leaves Walmart as the only major retailer without its own tablet. At present the US giant is simply selling devices from other vendors with a product portfolio that focuses on low price models (four of the top five models listed on walmart.com are $79.00).

By offering a device at a competitive price with limited customisation at the app level the UK retailer's tablet strategy is walking the line between two approaches: the classic role of the retailer selling consumer electronics, and a more Amazon-like strategy of offering a fully customised tablet to consumers (often at less than it costs to produce) as a way of getting a shopping cart for future purchases into consumers' homes. If the strategy works, Tesco stands to benefit from learning what it is to be a tablet vendor in its own right and testing users' engagement with its services on the devices while, at the same time, limiting the risks involved (for example, from investing heavily in upfront OS development costs). This measured approach to costs has allowed Tesco to keep the price of the Hudl in check and the low price has likely been key in the device's early success. By contrast, more expensive products, like the Microsoft Surface, have historically struggled to find a niche in the competitive, price-conscious part of the tablet market that is not dominated by the iPad. The challenge for Tesco in the future will be keeping the next generation of Hudl competitive from both a price and hardware perspective while also developing its software capabilities to deliver a shopping cart of its own that is as compelling as Amazon's.

Geography
UK Western Europe
Organization
Carrefour Tesco Walmart
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