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Competitive Advantage in UK Retail

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Added on  2020/04/21

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This assignment requires an analysis of the competitive environment within the UK retail sector. Students must identify key factors contributing to competitive advantage for businesses in this market, considering both traditional business strategies and emerging trends like sustainability. The analysis should draw upon relevant academic literature and real-world examples of UK retailers.

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Running head: DISSERTATION
Dissertation
Name of the Student
Name of the University
Author Note

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DISSERTATION 1
Abstract
This is a study, which will evaluate the business policies implemented by ASDA for gaining
competitive advantage in the market. The research will focus on highlighting the online retail
industry in United Kingdom, which is highly competitive in nature. The retail industry in United
Kingdom is highly competitive due to the high growth rate and presence of influential brands in
the market. Thus, the companies will have to use innovation for gaining competitive advantage
in the market and implement strategies to mitigate the threats from the rival companies. Thus, the
study will analyze the competitive strategies used by ASDA in order to identify the additional
strategies, which can be applied in order to become the market leader in that segment. Thus, by
linking with the objectives of the study, it can be seen that the currents strategies of the
organization is not right for the present scenario of the market and they will have to make
amendments. Moreover, they have invested in expansion of their physical retail stores which has
back fired for them and thus, they will have focus on development of the online retail segment of
the organization. Thus, the study has been able to identify the strategies, which are required by
ASDA to improve their market competitiveness and have provided effective strategies.
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DISSERTATION 2
Acknowledgement
By this research, I have experienced best possible learning of my life. By conducting this
research, I have learnt various concepts, models and theories. I first thank to the almighty God.
After that, I want to thank to my supervisor ______________ who is my friend, philosopher and
guide. I also thank my parents for being supportive and accommodative for completing this
research. I want to thank my friends for giving me the moral support while conducting this
research.
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DISSERTATION 3
Table of Content
CHAPTER 1........................................................................................................................7
INTRODUCTION...............................................................................................................7
1.0 Introduction....................................................................................................................7
1.1 Background of ASDA....................................................................................................7
1.2 Background of the research...........................................................................................8
1.3 Aim of the Research....................................................................................................10
1.4 Research Objectives.....................................................................................................10
1.5 Research Question.......................................................................................................10
1.6 Research Limitation.....................................................................................................11
CHAPTER 2......................................................................................................................12
LITERATURE REVIEW..................................................................................................12
2.0 Literature Review........................................................................................................12
CHAPTER 3......................................................................................................................21
RESEARCH METHODOLOGY......................................................................................21
3.0 Research Methodology................................................................................................21
3.1 Research Philosophy....................................................................................................22
3.2 Research Approach......................................................................................................25
3.3 Data collection.............................................................................................................26
3.4 Data Analysis...............................................................................................................26
3.5 Sampling......................................................................................................................27
3.6 Reliability and Validity................................................................................................27
3.7 Ethical consideration...................................................................................................28

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DISSERTATION 4
CHAPTER 4......................................................................................................................29
FINDINGS AND ANALYSIS..........................................................................................29
4.0 Retail trends 2017 in United Kingdom........................................................................29
4.1 ASDA Competitive Strategy.......................................................................................36
CHAPTER 5......................................................................................................................39
CONCLUSION AND RECOMMENDATION................................................................39
5.0 Conclusion...................................................................................................................39
5.1 Recommendation.........................................................................................................40
References..........................................................................................................................41
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DISSERTATION 5
List of Figures
Figure 1..............................................................................................................................14
Figure 2..............................................................................................................................21
Figure 3..............................................................................................................................23
Figure 4..............................................................................................................................24
Figure 5..............................................................................................................................30
Figure 6..............................................................................................................................30
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DISSERTATION 6
List of Table
Table 1...............................................................................................................................32
Table 2...............................................................................................................................33

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Topic: The evaluation of business policies for attaining market competitiveness in the UK online
fresh food sector- a study of ASDA food grocery, UK
CHAPTER 1
INTRODUCTION
1.0 Introduction
This is a study, which will evaluate the business policies implemented by ASDA
for gaining competitive advantage in the market. The research will focus on highlighting the
online retail industry in United Kingdom, which is highly competitive in nature. The retail
industry in United Kingdom is highly competitive due to the high growth rate and presence of
influential brands in the market. Thus, the companies will have to use innovation for gaining
competitive advantage in the market and implement strategies to mitigate the threats from the
rival companies. Thus, the study will analyze the competitive strategies used by ASDA in order
to identify the additional strategies, which can be applied in order to become the market leader in
that segment.
1.1 Background of ASDA
Competitor analysis is a method of identify the strengths and weaknesses of the rival
organization and the chosen organization. The identification of strengths and weaknesses of the
rival companies will facilitate in strategy formulation for marinating their competitive advantage
in the market. Competitor analysis will consist of the macro, micro and the internal analysis of
the organization, which will provide a broader aspect of the strategy that should be implemented
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DISSERTATION 8
for increasing the market share. ASDA is the second biggest company in United Kingdom
market after Tesco and is owned by Wal- Mart (Michalakeas et al. 2015). The growth of ASDA
has been immense in the market because of then cheap prices they can offer due to bulk buying
of Wal-Mart. ASDA has been able to maintain their competitive advantage in the market due to
distinctive edge. This distinctive edge has been realized by maintaining a good reputation in the
market and a good relationship with the suppliers in the market. Innovation plays an important
role in keeping up with the other companies in the market due to the high competitiveness of the
retail industry in the United Kingdom.
1.2 Background of the research
The main unique selling proposition of the organization is to offer products to the
consumers at reasonable price but at the same time maintaining the quality of the product they
are selling. Thus, the organization has been able to identify the target consumer and the products
are customized depending upon the needs of the consumers (Wood and McCarthy 2014).
Economies of scale are one of the main advantages of the organization as they can products from
Wal Mart at cheaper prices that are the reason for their exponential growth in the market.
However, it is still not the market leader and it lagging behind Tesco. Moreover, Sainsbury’s
who was being ASDA has been able to gain competitive advantage over them and has been able
to acquire more market share than the other companies in the market have. Thus, the
organization will have to continue using innovation in the products process so that they can keep
on increasing their market share and competitive advantage.
When comparing the prices of ASDA with other companies in the market it can be said
that it can provide the products at cheaper prices but none of the products are of premium
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DISSERTATION 9
quality. Thus, the study will try to find ways to improve the quality of the product they are
offering to the consumers in the market and at the same time by maintaining economics of scale,
which is one of the major factor for their distinctive edge. The organization has been using other
strategies, which will add value to the products they are offering to the consumers in the market,
which includes various schemes and programs (Young et al. 2017). Thus, the organization can
use this as a unique selling proposition the United Kingdom retail industry as the market is
saturated. ASDA organizes lots of events to attract the consumers and one such instance is the
movie drive where the consumers were allowed to watch movies at cheaper prices than the
market and the organization was able to sell products like hot dogs.
The use of online media is another factor for maintaining the competitive advantage and
the organization has been able to gain popularity due to the use of social media and online
platform for selling of their products. Moreover, the organization has been able to provide this
service as prices lower than any other organization in the market, which suggest that the supply
chain is very efficient. Thus, the use of vertical integration is constantly improving the supply
chain procedures. However, these processes are the standard processes in most of the
organizations in the United Kingdom who are top companies in the sector (Haleem and Jehangir
2017). Thus, this research will identify the new strategies, which ASDA can implement by
maintaining the core structure, goals and objectives of the organization. Moreover, it has been
earlier mentioned that the other formable competitors are making their move so the organization
will have to use in innovation to, maintain their long-term sustainability in the market. The
consumer perspectives the United Kingdom is also different as there are lot of consumers who
prefer to buy products from the British companies. Thus, the organization will have to careful
about choosing their target market, as they will not be able to change the perception of these

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DISSERTATION 10
consumers. In order to do that ASDA will have to make changes to the products they are offering
so that they offer something new to these sets of consumers (Lan and Dobson 2017).
1.3 Aim of the Research
To discuss the policy/policies that ASDA food Grocery can undertake to ensure and
maintain its market competitiveness in the UK Online Food Grocery sector.
1.4 Research Objectives
To present constructively policies that can aid organizations to attain market
competitiveness within the UK Online Food Grocery sector.
To discuss ASDA Food’s present policy/policies that ensure its current market position
within the UK Online Food Grocery sector.
To highlight additional policy/policies that can be adopted by ASDA to ensure
continuous market competitiveness in the UK Online Food Grocery sector.
To develop and present viable options on how the highlighted policy/policies can be
implemented by ASDA.
1.5 Research Question
Explain various approaches to attaining market competitiveness in the UK Online Food
Grocery sector.
What method of approach is ASDA presently adopting to compete within the UK Online
Food Grocery sector?
How can ASDA enhance and sustain its market competitiveness in the UK Online Food
Grocery sector?
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DISSERTATION 11
1.6 Research Limitation
The research is based on secondary analysis of data so no new findings will be gained
from the study. Thus, only the perspective of different researchers will used to identify suitable
strategy. The study will consist of mono method and the implementation of a mixed method
would have produced a better result and had given a different dimension to the study.
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DISSERTATION 12
CHAPTER 2
LITERATURE REVIEW
2.0 Literature Review
Competitive advantage is the essential aspect for the sustainability of a company and
without competitive advantage, an organization will not be able to retain their existing
consumers and attract new consumers. According to Forssell and Lankoski (2017), stability in
maintaining the consumer base in the organization is essential for generating steady revenue
streams. Liquidity is one of the most important aspects of maintaining the infrastructure and
increasing the profit margin is the only way of attaining more liquidity in the market. As stated
by West, Ford and Ibrahim (2015), Liquidity is crucial for research and development of new
products and thus, helps in innovation of the business model of the organization. On the contrary,
Liao, Rice and Lu (2015) states that liquidity is not the only way of attaining competitive
advantage in the market and capital adequacy is not the only way of attaining a effective
workforce in the organization. Employee turnover rate is important for maintaining the
competitiveness in the market and effective organizational culture is important for maintaining
the quality of the workforce. However, according to Laszlo and Zhexembayeva (2017),
profitability is the key to creating new processes and make continuous change in the
organizational procedures. Thus, most of researchers provide different ways of managing
competitive advantage but they agree to one fact that competitive advantage is important for
maintaining the sustainability of the organization.

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Globalization has affected the business of the global organization and most of the
companies are struggling to maintain their competitive advantage in the market. The other
companies can easily replicate the new strategies incorporated by one organization and so it is
necessary to spend more amounts of resources on improving the business model by incorporating
innovation. This will facilitate in maintaining competitive advantage in the market but it is tough
for companies to keep on upgrading their business processes (McGrath 2013). Moreover, the
economic barriers to entry in the market has diminished due to the advent of globalization and
thus, the organization will have to keep on resetting their profit curve by developing new
products in the market. Moreover, the retail industry in the United Kingdom is saturated so it is
difficult to attain competitive advantage in conventional methods. Market saturation does not
mean that the market is dead but it means that the demand in the market is high due to the
presence of large number of competitors where no company has a clear edge over the other
(Hinterhuber 2013). The figure below suggests that as the growth in this market is rapid niche
marketing is the only way of attaining competitive advantage in the market. Thus, identifying the
needs and wants of the consumers are important factors for understanding the products that will
have to be developed to gain competitive advantage in the market. As stated by Yu, Ramanathan
and Nath (2014), market segmentation, targeting and position of the product is the key to
achieving the specified consumers that the organization caters. However, there are occasions
where there is no room for innovation in product improvement as the basic need and want has
been already been satisfied. Thus, the organization will have to use other ways such as
improvement in the quality of the product they are offering and incorporation of eco friendly
products of the development of the product.
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DISSERTATION 14
On the contrary, Inman and Nikolova (2017) states, that even though the market
saturation level is high, there is no stagnancy in the demand of the products. Thus, the
organization will have to tap on to the recent market tends which will facilitate in creating new
market segments which can be capitalized by changing the products in the market. However,
only acquiring information out the recent trends in the market is not enough and the companies
will have to make sure that they are able to implement these changes in to their business model
and make changes to the inventory. As stated by Nishitani and Itoh (2016), the use of the latest
technology and integration of the latest application in the organization is not the solution to
gaining competitive advantage in the market. This suggests that it is important to understand the
implications of the market trends on the organization and how the counter measures should be
processed by the organizations. On the contrary, as stated by Walsh and Dodds (2017), adding
value to the products is the most effective and smart way of gaining competitive advantage in the
market. Thus, using rewards to acquire and hold on to the existing consumers is a strategy, which
is applied by most of the companies in the market. According to (Kotabe and Kothari 2016),
relevancy and focus on making improvements is the basic of gaining competitive advantage in
the saturated market.
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DISSERTATION 15
Figure 1
(Source: Velásquez and Meunier 2017)
According to Strohmeier (2013), the buying power of the consumers has a lot of impact
on the business of the organization as they have the option of choosing the products from the
varied options available in the market. Thus, consumer loyalty is one of the things that the
organization will have to focus on in order to generate stable revenue from the market. Thus, as
the power of the consumers are high, it is essential to indentify the needs of the consumers and at
the same time is essential understanding the factors which is will affecting the purchasing
decision of the consumers. Thus, understanding the landscape of demand is the first essential
factor for gaining competitive advantage in the market, the next essential factor is selection of

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DISSERTATION 16
the competitive space and the final step includes defining and creating of competitive advantage
in the market.
Thus, instead of focusing on the brand, the organization will have to focus on identifying
the needs and desires of the consumers in the market. Thus, along with the principle needs of the
consumers in the market it is important to identify the market differentiators. Thus, the adjacent
factors associated with the organization is important for providing the consumers with better
experience and added value to the products and the service offered by the industry (Opresnik and
Taisch 2015). In some instances, these factors are not directly proportional to the basic needs and
wants of the consumers that suggest that location of a store can affect the sales of the products
offered by the organization. Similarly, the availability of less amount of parking space could also
be a reason for decrease in sales. Thus, it can be seen that the requirements added to the basic
needs is important for maintaining the long-term sustainability of the organization.
The analysis of the demand landscape identification of the perspective of the consumers
is important, as the expectation of the company regarding a particular product can be different
from that of the consumers in the market. Thus, the organization will have to draw the consumer
perception map for the various target market segments. The customer perception map will
consist of demographic factor such as income, ethnicity, gender and age so the organization will
have to make use of their intuitions to select the target segment for the market (Lee et al. 2015).
Thus, this will consist of use of statistical tools such as multi dimensional scaling and factor
analysis for grouping the factors and reducing the number of adjacent variables. Thus, it will be
easier for the organization to understanding the perception of the consumers about a particular
product in the market. Thus, the organization will be able to gain insights on the new products in
the market and the various competitors. Thus, the organization will have to draw perception map
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DISSERTATION 17
for each of the target segment and products offered by the organization. The organizations will
have to identify the target segment, which is receiving the maximum amount of value for the
consumers in the market. However, in order to do so a conjoint analysis will have to be executed
which will include selection of the relevant product attributes and providing the consumers with
relevant options from which they can choose the product (Rothaermel 2016). These attributes
will be provided ranking by the respondents to identify the key attributes which have higher level
of priority for the consumers. Thus, utility values will be provided to each of the attributes along
with the alternatives and can be considered the output from the different tradeoffs. Thus, the
organization can use the combination of the factor for the development of the products based on
the utility points. Thus, the organization can develop products based on the attributes but the
balance between the cost and benefit will change from time to time due to change in the market
trends. Thus, this evaluation process is a continuous process, which keeps on evaluating the
perception of the consumers to identify the changes required to maintain the competitive
advantage in the market (Dowling 2016). Thus, the quality aspirations of the products are never
static and dynamic in nature as there is always change in the business environment due to the
competitive shifts and technological factors.
According to Ramanathan et al. (2017), the organization are unique because of the
processes, people and the structure of the organization. The workforce of the organization is one
of the most important factors for gaining competitive advantage in the market. However, the
processes play an integral part in gaining competitive advantage but in a saturated market, the
processes followed by most of the organizations are almost same. Moreover, it is easy to
duplicate the process and procedures can be easily duplicated in a saturated market. Thus, the
service and quality of the product provided by the organization is the basis for the evaluation of
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DISSERTATION 18
the image of the brand. Therefore, if the expectation and requirements of the consumers are met
by the product or service offered then in order to realize the functional benefits the organization
will have to use delivery processes, which are transformational and well designed. However, the
main factor is identification of the perception of the consumer towards the product and its ability
to satisfy the need generation among the consumers (Thompson and McLarney 2017). The
originality and innovativeness of the product is a secondary factor as there are many methods of
achieving the same result. However, the most optimal method will have to be selected so that it
can increase the efficiency of the organizational procedures. Thus, the organization can gain
competitive advantage in terms of functionality and cost of the organization.
According to Walton, Petrovici and Fearne (2017), the companies will have to understand
the fact that the consumer buy value, which is a function of price and quality, and do not buy
service or product. The price of a particular product is dependent on various factors such as
market size, production cost and competitive actions. Moreover, the organization will have to
understand the perception of the consumers about the offerings so that they can make
modifications depending upon the changes required. As stated by Fernie and Sparks (2014), the
value provided to the consumers by the organization is the factor for gaining competitive
advantage in the market. However, this is a debatable topic and various researchers do not agree,
as there are many researchers that prefer the perspective of the manager to identify the ways of
competitive advantage in the market. The managerial perspective states that the excessive profit
margin gained through resources and attributes can be considered as competitive advantage for
the organization. However, from the perspective of the consumers, if the consumers are able to
generate value for the consumers at a higher rate than the competitors in the market are, then it
can be considered competitive advantage for the organization.

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However, creating competitive advantage is tough in a saturated market where the most
of the competitors are providing the consumers with similar kind of product. Thus, it may seem
that delivering product having high level of quality and competitive pricing is the basis of the
gaining competitive advantage. However, the emergence of globalization has changed the
competitive scenario and it is not enough to use product orientation to gain competitive
advantage in the market. Thus, market orientation is needed for the organization to gain
competitive advantage in the market and heavy focus will have to be on marketing of the
products offered by the organization. Competitive strategy can be developed by keeping the
resources and goals of the organization in align with the needs of the consumers (Wilson 2015).
The time horizon of the strategies will depend on the type of the objective and strategic planning
has a long-time period as it consists of maintenance of the resources of the organization. The
classical approach of creating competitive advantage for the organization includes the factors
such as structure, conduct and performance and is known as the SCP model (Parnell 2013). This
model will consist of the three elements, one is the structure of the market, second is the conduct
of the organization the market and the third is the performance of the organization within that
particular market. The concept suggests that the change in the structure of the organization will
affect the performance and the conduct of the organization. In the same way, the change in the
conduct of the organization will affect the performance of the organization. on the contrary,
Hirsch and Schiefer (2016) states, that the change in the performance and conduct of the
organization will have impact on the market structure. Thus, there is limitation to this approach
and the main assumption of the approach states that power in the market is directly proportional
to the profitability of the organization. However, these factors are only applicable for the
homogenous market in the industry that suggests that this theory will not be applicable for
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DISSERTATION 20
heterogeneous industries. According to this principle, the structure of the industry acts as a
barrier to the new entrants in the market. However, globalization has changed this factor and in
saturated market there are no entry barriers at all but sustainability in the market is tough due to
the high market growth and increase in the buying power of the consumers (Christensen 2013).
The theory of economic states that increase in the competition in the market will decrease the
profit of the organization in the market. This happens as the companies tend to decrease the price
of the product they offer due to the increase in the competition so that they can increase the sales
volume. Thus, the saturation level causes the profit to become zero and so the companies in the
industry keep on using innovation to launch new product in the market (Hoskisson et al. 2017).
However, it does not take time for other companies in the market to replicate the products they
are offering. However, launching a new product causes dilemma, as they have to gain the
attention of the consumers so that they can acquire more number of consumers form the market.
Thus, the expectation of the consumers is important and the companies will have to identify it if
they want to gain loyalty of the consumers in the market.
The literature review has discussed the market competitiveness of various types and the
factors that are important for gaining competitive advantage in the market and maintaining their
long-term sustainability in the market. However, the retail industry in United Kingdom is
saturated and identification of essential factor, which will be effective in providing competitive
advantage in the present market scenario, is limited. Moreover, as the competition in the market
is intense due to the presence global giants of the industry, unique strategies will have to be
implemented. Thus, this study will identify the strategies which can be implemented by ASDA
and regain their competitive advantage in the market.
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DISSERTATION 21
CHAPTER 3
RESEARCH METHODOLOGY
3.0 Research Methodology
This particular chapter of this study would be addressing and describing the different
research methods, research designs and research approaches that are generally put to use in any
research work. The research methodology plays a largely significant role in this study and in any
research study since the adoption of the appropriate methodology is very critical for any kind of
study. Nevertheless, just the identification alone is not critical for the study – even the effecting
and application of the different methods and techniques would be vital in the accomplishment of
the anticipated objective of the study. The validation for the selection of every methods and
techniques in this study have been provided, along with their negatives and positives. As
specified by Flick (2015), the methodology framework would be comprised of different
assumptions that are fixed and would be engaged for carrying out the study. One of the most
important part of this study is its research methodology as it would be helpful in fulfilling its
objectives and aims. Yet, creating the research methodology in a way in which it could be put to
use for reproducing same results like other studies with same topic and objectives is important.

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Figure 2
Source: (Flick 2015)
3.1 Research Philosophy
The research philosophy would be comprised of the different sources, development and
nature of knowledge. In this particular study it might seem like the knowledge construction is
concentrated and acute for this study. However, generally four forms of philosophies get
employed in different business and academic research work. These four philosophies are namely
positivism, post positivism, interpretivism and realism (Sekaran and Bougie 2016). Positivism is
considered as being the rejection of metaphysics in which the study objectives are the
classification and definition of the phenomenon that gets experienced. This philosophy would be
helpful in the disclosure of the concealed truths from different facts and observations. The
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DISSERTATION 23
observation scope thus gets increased and attainment of factual knowledge gets facilitated (Collis
and Hussey 2013). Post positivism is a form of research philosophy that opposes all positivism
doctrines. In this philosophy it is believed that there exists no difference between everyday life
thinking and the scientific way of thinking. Both these processes are same, with just a slight
difference in degree (Myers 2013). In the research philosophy of interpretivism, human interest
is included by the interpretation of the study elements. In accordance with this philosophy, social
construction is considered as the foundation of admittance to reality that is comprised of shared
meanings, languages and instruments. This philosophy is most commonly employed for the
accumulation of different research approaches like constructivism, phenomenology and
hermeneutics (Bryman and Bell 2015). Realism is based on the concept that reality is liberated
from the human mind and makes use of scientific approaches for the expansion of knowledge. It
can be of two kinds, critical realism and direct realism (Zikmund et al. 2013). Critical realism
states that personal senses do not have the capacity of efficiently portraying the actual world, as
senses and images might be deceptive. On the contrary, direct realism makes use of the
individual senses of humans for portraying the world. In this particular study, positivism can be
seen as being the most appropriate and therefore it is going to be selected research philosophy.
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DISSERTATION 24
Figure 3
Source: (Zikmund et al. 2013)
Justification for the selection of positivism
In the present study, positivism has been decided upon to be the research
philosophy as that would be helpful in the extraction of the actual concealed truths from the
different facts which would get available for the analysis. Additionally, this research philosophy
would better the observation of the study and therefore for the analysis of the research topic,
descriptive study method can be employed. The existent theories in the present study field and
hypothesis testing can also be contained within the research topic.

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DISSERTATION 25
3.2 Research Approach
On this research study, hypothesis testing would employ a huge impact as it is facilitating
in the distinction made between the inductive and deductive approach. The different assumptions
that has been conducted in this research can get validation by means of deductive approach. On
the other hand, inductive approach gets employed at the time of construction of new theories and
generalisations. Deductive approach started with the construction of study hypothesis, which
needs validation, whereas inductive approach would get employed for the implementation of the
research questions for the construction of new theories (Hair 2015). Yet, in this field of study,
the deductive approach gets decided as being the study approach, since in this scenario the
existent theories need to get formulated.
Figure 4
Source: (Hair 2015)
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DISSERTATION 26
Justification for the selection of deductive approach
In this particular study, hypothesis testing would be employed for validating the existing
theories, which justifies the suitability of the deductive approach for this study. Therefore, the
implementation of the deductive approach in the present field of study can contain within the
scientific approach. Hence, the deductive approach would be helpful for drawing of conclusion
of the study, founded on the facts and no novel theories are constructed, making the inductive
approach get rejected.
3.3 Data collection
The data collection method that will be used for the study is the secondary analysis of the
data. The study will use mono method for the analysis which means that the study will include
only one type of method for analysis. The secondary analysis of data will consist of thematic
analysis and case study analysis (Best and Kahn 2016). The thematic analysis will create themes
based on the objectives of the study and will be backed by quantitative data from various
journals, peer reviewed journals and articles. The study will take 10 peer reviewed journal for the
identification of various competitive factors which should be used by the organization. The case
study analysis will present cases of various organization to identify the strategies which will be
useful for the chosen organization.
3.4 Data Analysis
The analysis will consist of themes, which will be evaluated based on the objectives that
has been formed. The themes will present relevant data based on each of the objectives which
will include the quantitative data of other journals and articles. These data will be used for
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DISSERTATION 27
validating the existing theories, which has been discussed in the study. The case study analysis
will present cases of various companies that will present instances of competitive strategies
applied by other companies in similar market scenario (Vaismoradi, Turunen and Bondas 2013).
Moreover, it will present instances of market competition in saturated market which will help to
provide a different dimension to the study.
3.5 Sampling
Sampling is used for selection of the population sample in primary analysis as the overall
size of the population is huge. Sampling is used for primary collection of data but in this scenario
secondary analysis of data is used and thus, sampling is not required in this study (Neuman and
Robson 2014). However, in this study sampling can be used for randomly selecting the articles
and the peer reviewed journals but it is not a necessity.
3.6 Reliability and Validity
The ability of an instrument to draw similar conclusion in similar research topics is
known as reliability of the study. According to LoBiondo-Wood and Haber (2014), high level of
reliability will define the positive outcome of the study. On the other hand, the fulfillment of all
the needs of study methods during the development of the findings is known as validity of the
study. As stated by Noble and Smith (2015), maintaining the validity of the data is one of the
essential requirement of the study. the use of appropriate method for collection of the secondary
data and understanding of the data can be defined as validity of the data. Thus, in this study
efforts has been made to keep the validity and reliability of the data to be high.

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DISSERTATION 28
3.7 Ethical consideration
One of the most significant aspect of the study is maintenance of the ethical ground in
business and academic research. Thus, in this study, all the data that has been presented are
authentic and have not been manipulated according to the needs of the study. The data has been
collected from peer reviewed journals and articles and no doctoral articles have been used.
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DISSERTATION 29
CHAPTER 4
FINDINGS AND ANALYSIS
4.0 Retail trends 2017 in United Kingdom
Retail industry in the United Kingdom has faced the biggest challenge in the past decade
due to tightening of the consumer economy. The inflation rate has kept on increasing, growth in
wages have slowed down which means that the disposable income of the consumers have
decreased significantly. Thus, the trading conditions have become even tougher for the
companies in the market and on top of that, the market is saturated. Thus, the level of
competition among the companies has increased significantly due to the presence of the global
leaders in the market. Moreover, BREXIT has affected the retail industry significantly, which
has led to development of cost pressure and the market is driven by factors such as rising cost of
staffs, increment in business rate, rise in the commodity and fuel prices and increase in cost of
pension (Agr.gc.ca 2016). United Kingdom’s exit from the European Union has been noted as a
perfect storm and so the retailers will maintain a balance between the changes and the increase in
costs along with finding opportunities of gaining competitive advantage in the market. Thus,
being consumer centric is the only option the organizations have if they want to maintain their
share in the market.
Thus, based on the current trend in the United Kingdom retail industry there are certain
factors, which have to be taken in to consideration if they want to gain competitive advantage in
the market. The first factor is pricing, dynamic pricing will facilitate in making real time
adjustments. The retailers are competing based on variety, convenience and speed; moreover, it
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DISSERTATION 30
can be seen that the buying decision of the consumers are not dependent on the price of then
product. A survey conducted on this suggests that 48% of the population chose convenience over
any other factor as the reason for shopping from the online medium (Agr.gc.ca 2016). However,
on a wider aspect it can be seen that the consumers are low price of the products are still
dominating the buying decision of the consumers in the market. The findings of the survey
shows that 59% of the respondents’ buying decision is based on the price of the product, 35% of
the shopper generally compare prices indifferent sites and 38% of the consumer commences their
start on Amazon. Brand loyalty is another factor, which will, influence the purchasing decision
of the consumers; most of the consumers in United Kingdom are loyal to their respective brands.
Thus, this will act in advantage of the organization those have a bigger consumer base. However,
it will be problem for the organizations, which are trying to acquire new consumers form the
market. Technology is another important factor, which will be crucial for the organizations for
gaining competitive advantage from the market. The market in United Kingdom is saturated so
use of innovation is another factor (Walton, Petrovici and Fearne 2017). However, the
organization will have keep on introducing new products in the market, as the product life cycle
of each of the products will be less. Thus, continuous innovation is necessary for the increasing
the sales volumes from the products and thus, the timing of product launch are very important.
Thus, the focus will be on increasing the sales volume in a short time base and innovation in
product development is a key to this strategy.

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DISSERTATION 31
Figure 5
(Source: Agr.gc.ca 2016)
Figure 6
(Source: Agr.gc.ca 2016)
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DISSERTATION 32
Thus, from the above tow pictures it can be seen that ASDA is third largest organization
in terms of its market share and revenue generation. Thus, as the there are many well-known
organizations in the same market, it will tough for the organization to compete with other big
giants in the industry. The presence Tesco and Sainsbury has been in the United Kingdom
industry for a long time and they have loyal consumer base. Thus, the organization will have to
make use of suitable strategy to gain competitive advantage in the market. ASDA, being a
subsidiary of Wal-Mart can provide the consumers with cheap products in the market (Walton,
Petrovici and Fearne 2017). Thus, the organization will have to make sure that they use
aggressive marketing strategy to penetrate further in to the market. However, their strategy of
providing the consumers with lesser quality products at cheaper prices has been disadvantageous
to them and their strategy has backfired. Moreover, they are facing steep competition from
companies such as ALDI who are using backward integration to decrease their operation cost to
provide the consumers with quality products at cheaper prices.
Online grocery shopping market has increased rapidly and large numbers of consumers
are making use of this strategy to gain more consumers. The digital era has dawned upon the
United Kingdom market and Tesco is the market leader in terms of online retail grocery sales.
Thus, the current trend shows that the consumers are opting for online shopping options due to
convenience. ASDA has 15% of share in the online market and very dependent on the consumers
who have a low disposable income in the market (Metzger 2014). Sainsbury’s has similar market
share as that of ASDA, they are using optimization of the online infrastructure in order to
develop dark stores, expanding delivery system and starting new pick up points. Thus, in order to
maintain their competitive advantage digital marketing has to be incorporated in to their business
model. In terms of market share, Tesco and Sainsbury’s are the main rivals of ASDA. However,
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DISSERTATION 33
in terms of strategy and target consumer ALDI and LIDL are strong competitors as they are
using similar strategy to gain market share. Mo0reoevr, ALDI has been rapidly expanding and
using aggressive marketing strategy to gain competitive advantage in the market.
U.K. Ecommerce and EGrocery
Figures (2014), GBP Billion/(US$ billion)
Ecommerce market size (billion GBP) 45/(69.5 US$)
Ecommerce market as a % of the total retail
market
13.5%
Grocery retail market size (billion GBP) 174.5/(268.5 US$)
Online grocery retail market size (billion GBP) 7.7/(11.9 US$)
Online grocery retail market as % of the total
retail market
4.4%
Penetration of online grocery shopping (% of
total population)
25%
Table 1
(Source: Agr.gc.ca 2016)
Moreover, ALDI and LIDL are the fastest growing organizations in this sector, which are
rapidly, increasing their market share due to the cheap products they are able to offer to the
consumers in the market. ASDA is facing biggest competition form these companies as they are
the substitutes for ASDA and they operate in the same market segment. Moreover, they are
catering to the same market segment and thus, the company will have to change their market

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DISSERTATION 34
segmentation if they want to compete with the market leaders and mitigate all the threats (Mena
et al. 2014). However, due to the change in the economic scenario in United Kingdom, the
market trends have changed significantly. The downturn of the economy has caused the general
population to become conscious about cost of products. However, this does not mean that the
consumers will comprise with the quality of the products offered by the supermarket. Thus, this
shows that product quality is very important for organizations that are trying to maintain their
sustainability in the market.
Total retail format sales 538.75 billion
Total retail format sales per capita 8,296
Food retail format sales 287.61 billion
Food retail format sales per capita 4,429
Total consumer spending 1,789.42 billion
Total consumer spending per capita 27,556
Total grocery spending 27,895 billion
Total grocery spending per capita 4,296
Non grocery spending 796.39 billion
Non grocery spending per capita 12,264
Table 2
(Source: Agr.gc.ca 2016)
The above table is showing the market size and spending on an annual basis in the
organization. This shows that market costs are increasing and the income of the consumers are
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DISSERTATION 35
becoming much more restricted. Thus, the organization using expansion of their physical stores
as a strategy will have to rethink their position in order to reduce the cost structure of the
organization. Moreover, the growth in online retail sales has affected the physical stores, as more
consumers prefer to buy form online market. Thus, it can be said the attractiveness of the
hypermarkets are decreasing day by day (Barratt 2016). Thus, majority of the organization are
extending their market offerings by using the extra space. They are reallocating space to ready
meals and food service, as they tend to provide more profit to the organizations. Moreover, they
are restructuring the non-food space to those products that are more profitable; thus, the
organization is trying to make optimum sue of their existing resources to increase their sales
volume, which in turn will increase the profit margin. The surge in online shopping will affect
the grocery and fresh food market segment significantly and many organizations will face
immense problems in maintaining their long-term sustainability.
The consumer trends suggest that more consumers are opting for the online option to buy
staple products. Thus, it is seen that there is growth in the current sales in the online segment and
the sales in physical grocery segment is decreasing. Moreover, the sale of the non food items in
the grocery stores are decreasing rapidly which is the sole reason that the various supermarkets
are changing their store space to replace non food items to more profitable products. Moreover,
due to the financial the consumers are focused on buying products from the discounters such as
ALDI (Vu 2016). Thus, the economic instability has changed the perception of the consumers
and benefit freeze has affected their perception. The benefits that the population used to receive
from the government has been frozen which has immensely decreased the disposable income of
the consumers.
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DISSERTATION 36
4.1 ASDA Competitive Strategy
The analyses of secondary data and market trends have presented the organization with
various issues. The retail market in United Kingdom is saturated which suggest that ASDA will
face immense competition from the market. Thus, implementation of innovation in to the
business model is one way of gaining competitive advantage in the market (Peker et al. 2017).
Moreover, instead of increasing focusing increasing the life cycle of the products the
organization will have to focus on re branding and launching of new products. Thus, the
organization will be able to increase their sales volumes significantly for a shorter period.
The perceptions of the consumers have changed significantly due to economic downfall
in United Kingdom. The consumers are buying good quality products at cheaper prices. Thus,
the organizations providing discounts to the consumers are gaining market share and
experiencing rapid growth. Moreover, the growth of the online retail market is high and so
ASDA will have to focus on digital marketing and increase their online business. Thus, they
have to focus on convenience of the consumers and provide them addition services in order to
maintain their consumer base. Thus, emphasis on digital marketing will be a key strategy for
increasing their share in the market, as online retail stores are acting as a substitute for the
grocery and fresh food sectors. Thus, ASDA will have to expand their online business and spent
resources instead of expanding their physical outlets. Thus, repositioning of their long terms
goals will essential due to the changing trends in the market (Vu 2016).
The quality of the products offered is essential for marinating their competitive
advantage. However, the quality of products offered by the organization is lower than Tesco and
Sainsbury’ who are the biggest competitors for the organization. Thus, ASDA will have to use
backward and vertical integration to reduce the cost in supply chain to improve the quality of the

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DISSERTATION 37
products they are offering. Moreover, as Wal-Mart is the parent company of ASDA, it can
acquire products at cheaper prices and maintain the quality of the good they are offering. The
sales of non-food items have decreased significantly, which suggest that ASDA will have to
restructure their store space to display products that are more popular so that the sales volume
increases. Thus, ASDA will have to analyze the market thoroughly to identify the recent market
trends and identify the popular products.
Analysis
Thus, from the findings of the study it can be said that ASDA is facing immense pressure
from both ends of the market. The market leaders are exerting pressure by expanding their online
and the discounters are providing products at cheaper prices and growing at rapid rate. Thus,
ASDA will have to use quality control measures to improve the quality of the products they are
offering to the consumers in the market. The organization will have to change their
segmentation, position and targeting in the market. Thus, dividing the consumers in to different
segments and catering to them according to their basic need is a suitable strategy. The
segmentation will have to be based on their disposable income and their specific needs. Thus,
customization of the product will be the new product strategy and they should not use
standardization. Thus, mitigating the needs of the consumers will facilitate in increasing the
consumer base of the organization.
Moreover, instead of competing with other companies in the market the organization will
have to create a niche market for them, which will be their loyal consumer base. Thus, ASDA
will have to develop a blue ocean strategy, which will be based on unique selling proposition and
innovation used in a product. However, implementation of the blue ocean strategy is tough and
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DISSERTATION 38
as market is saturated, it is easier to duplicate the products of other companies. Thus, product
innovation is essential which will enable them to launch products at regular intervals to boost
sales volume in short a span. However, marketing of the product is a key element in this strategy,
as message needs to be conveyed to all the target consumers. Thus, the organization will have to
use aggressive marketing strategy, which will include the use of digital marketing. Digital
marketing will include the promotion of the products of the organization on social media and
micro blogging websites. Thus, the organization will be able to penetrate further in to the market.
Moreover, they will have to host promotional events and provide additional facilities to the
consumers, which will be complementary for the consumers such as large parking space, play
zone for kids.
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DISSERTATION 39
CHAPTER 5
CONCLUSION AND RECOMMENDATION
5.0 Conclusion
Thus, it can be concluded from the study that there is ASDA being one of the top
companies in this segment has been facing issues regarding the quality of the product they are
offering and decrease in sales of the non-food items. Moreover, the immense growth in the
online retail market is one of the biggest concerns, which may threaten the sustainability of the
organization. This is because of the fact that online medium are convenient for the consumers
and thus, it is acting as a substitute segment for the grocery and fresh food sector. Thus, ASDA
will have to use innovative strategies to improve their cost structure and increase their revenue
streams. The implementation of innovation in to the business model of the organization has the
potential of providing them with competitive advantage. Moreover, the strategies that has been
discussed in the previous chapter is instrumental in gaining competitive advantage in a tough
market. The operating environment of the organization is challenging so in order to increase
share in the market effective and innovative strategy is important. However, due to the saturation
in the market setting long term goals will be meaningless and will not be feasible for the
organization. Thus, by setting short-term goals ASDA will be able to increase their revenue
streams for a short amount of period. Thus, continuous monitoring and changing of strategy will
be the key characteristic of the business policy. Thus, by linking with the objectives of the study,
it can be seen that the currents strategies of the organization is not right for the present scenario
of the market and they will have to make amendments. Moreover, they have invested in

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DISSERTATION 40
expansion of their physical retail stores which has back fired for them and thus, they will have
focus on development of the online retail segment of the organization. Thus, the study has been
able to identify the strategies, which are required by ASDA to improve their market
competitiveness and have provided effective strategies.
5.1 Recommendation
Thus, it is recommended ASDA should focus on the marketing aspect and product
innovation of the organization. This may include the use of digital marketing strategy to improve
their market penetration and increase their consumer base. The organization will have to
incorporate corporate social responsibility in to the business model of the organization and create
triple bottom. This will enable them to improve their brand image and it is seen that organization
that are involved in social media activities have better revenues. Moreover, instead on focusing
on physical stores, the organization should focus on online retail outlets as the growth in this
high. Thus, online retailing will facilitate in improving the consumer base for the physical stores.
The organization will have to develop effective Customer Experience Management Systems,
which will continuously monitor the experience of the consumers. Thus, improving the overall
quality of the customer experience will increase the repeat purchasing of the organization. Thus,
the organization will be able to increase their consumer base and maintain their long-term
sustainability. Workforce of any organization is important for gaining competitive advantage so
the organization will have to improve the quality of their workforce. This will include training
and development program and hiring of efficient and skilled employees. Moreover, the
organization should continuously monitor the performance and strategies of rival organization so
that they can take counter measures and initiatives to maintain their competitive advantage.
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DISSERTATION 41
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