Tesco plans challenge to British Gas

Tesco is hatching plans to sell gas to its 6 million Clubcard customers next year.

The supermarket giant is in secret talks with third-party home service suppliers to poach British Gas customers with the lure of cheap rates.

Sources close to Tesco say the company has held discussions with suppliers in the South-west where British Gas has been in open competition with ten other gas suppliers since the end of April.

“Tesco intends to launch a service across the South once the trial extends to the South-east,” says a source close to Tesco.

It is understood Tesco’s gas venture will be included in the Clubcard Plus scheme, first revealed in Marketing Week (April 19), with gas bills paid through deposit accounts.

The extended trial in Kent, Sussex, Dorset and Avon next April is a preliminary to a national roll-out in April 1998, which will submit British Gas to full competition. It is understood BP and Quadrant Gas – a joint venture between Shell and Esso – will enter the fray.

Tesco is also considering selling electricity and water services to customers. A Tesco spokesman refused to comment.

British Gas has faced tough competition in the South-west trial against ten competitors, including electricity company Sweb, Norweb, Total and Amerada Hess. British Gas is thought to have lost 15 per cent share of the home domestic market to rivals even before the onset of winter.

Meanwhile, British Gas has confirmed that it is examining a possible name change for the company next year. A company spokesman admits that the British Gas name could be replaced. It is understood that design consultancy Coley Porter Bell is working on a redesign.

In a separate move the Data Protection Registrar will rule in six weeks on whether British Gas can use its database for third-party promotions, following revelations by Marketing Week (June 14). The DPR told MW that British Gas’ home movers’ welcome pack was unlawful.

Cover Story, page 44

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