Tesco to expand music offer to exploit sales growth: after dominating music chart market, supermarket eyes non-chart arena.(Retail)

Tesco's dominance of the UK supermarket sector is further extending into music, with the retailer now claiming a 20% market share of chart product.

With 1 [pounds sterling] of every 8 [pounds sterling] spent on retail in the UK now going into the tills at Tesco, the chain is aiming to capitalise on this opportunity by expanding music's in-store presence over the coming year in a bid to replicate the success in non-chart product.

Tesco senior music buying manager Alan Hunt puts the company's chart success down to two simple factors: price and accessibility. Tesco has 1,981 stores in the UK, as well as an additional 300 outlets abroad, including Hungary, Poland, Thailand, South Korea and Japan.

Music played a small part in helping the company post record annual results, with pre-tax profits up 17.6% to 1.6bn [pounds sterling] on the back of worldwide sales of 33.6bn [pounds sterling]--up 18.7%. UK supermarkets accounted for 26.9bn [pounds sterling] of that total.

Commenting on the financial results, Hunt says, "Although the monetary figures are huge, Tesco is still very much in the low margin business. We have a margin of about 5% across the entire range of Tesco goods and that includes music."

Hunt says that in the past year Tesco achieved its target of dominating the UK recorded music market in chart product.

"We had a 25%-plus growth rate in the music sector and, according to Millward Brown, our market share of chart music is now up to about 20% in any one week--double what it was two or three years ago," says Hunt. Confidentiality agreements prevent both Millward ...