Key Trends and Advantages of Digital Technology in Managing Virtual Business of Tesco

This document discusses the key trends and advantages of digital technology in managing the virtual business of Tesco in the global environment. It explores how digital technology enhances productivity, reaches wider markets, and promotes rapid growth. The document also discusses the impact of collaborations and strategic alliances through digital technologies and the various e-commerce principles that Tesco can apply for their electronic business platform.

DIGITAL BUSINESS

Table of Contents
INTRODUCTION.................................................................................................................................3
TASK....................................................................................................................................................3
EXPLAIN THE VARIOUS KEY TRENDS AND ADVANTAGES OF DIGITAL TECHNOLOGY
THAT CAN BE IN MANAGING VIRTUAL BUSINESS OF TESCO IN GLOBAL
ENVIRONMENT..............................................................................................................................3
EXPLAIN THE VARIOUS DIGITAL BUSINESS MODELS IN THE CONTEXT OF VARIOUS
KEY ISSUES LIKE ETHICS AND CYBER SECURITY IN THE GLOBAL ENVIRONMENT OF
TESCO..............................................................................................................................................3
EXPLAIN THE IMPACT OF VARIOUS COLLABORATIONS AND STRATEGIC ALLIANCES
THROUGH THE MODE OF DIGITAL TECHNOLOGIES FOR TESCO......................................5
EXPLAIN THE VARIOUS E COMMERCE PRINCIPLES THAT COULD BE APPLIED BY
TESCO FOR THEIR ELECTRONIC BUSINESS PLATFORM......................................................6
CONCLUSIONS...................................................................................................................................7
REFERENCES......................................................................................................................................9

INTRODUCTION
Digital businesses are dependent upon the technology in order to grow and expand the
business operations. The concept of digital business helps in increasing productivity while
improving the customer experience and the business intelligence. Every business has their
different concept of shifting to the mode of digital business. The digital business tends to add
value to the skills and experiences of the customer. The digital businesses provide higher
revenues and better performance to the various enterprises that cannot be achieved through
the traditional mode of businesses (Berger and et.al., 2021).
Tesco is UK based Multinational Corporation that deals in groceries and general
merchandises. The headquarters of Tesco is situated in Hertfordshire, England. The
organization was established in the year 1919 and opted for expanding through the mode of
digital platform in the year 2001. The study revolves around the digital business of Tesco and
explains the various advantages, collaborations and the principles followed by Tesco (Di
Vaio and et.al., 2021).
TASK
EXPLAIN THE VARIOUS KEY TRENDS AND ADVANTAGES OF DIGITAL
TECHNOLOGY THAT CAN BE IN MANAGING VIRTUAL BUSINESS OF TESCO IN
GLOBAL ENVIRONMENT.
The various trends and advantages of digital technology that enhances or facilitates
the virtual mode of business of Tesco in the global environment are discussed below-
 Easy to access markets- The online market portals have facilitated in providing a
better and easy mode of reaching the customers. The online mode helps the
entrepreneur to reach the market through various online platforms and sell their
products to any part of the globe at any time. This promotes the various sellers to have
a reach towards the market (Dornberger and Schwaferts, 2021 Geringer, 2021).
 Decrease in overheads- The online mode of business decreases the need for the
various expenses that have been needed to explore the market through offline mode.
The online mode of business eliminates the needs for a physical retail outlet that saves
a lot of cost in owning and maintaining the outlet place. This also eliminates the needs
to hire staff in order to deal with the customers. The online mode of business can use
those funds and invest into some better marketing techniques in order to attract
customers towards their business.
 Potential for rapid growth- The digital mode of businesses allow the organization to
have an experience a rapid growth in their business as compared to the traditional
constraints. The online mode of business could excel with the help of various digital
marketing tools that can be used in order to attract customers and have wide customer
base in order to increase the sales (Härting and et.al., 2021).
 Widens the market- The online mode of business provides a wider platform or market
to sell and buy the products and services. Unlike the traditional offline mode, the
business is not limited to a geographical extent. The online mode facilitates to explore

the business with the customers who belong to various geographical location and a
diverse culture. This allows the business to sell the products beyond the local
customers and also there is a probability that the products are more in demand at the
other locations of the world as compared to the local surroundings. This would help in
responding to a wider market by offering the web services in various popular
languages of the world (Hiteva and Foxon, 2021).
 Customer intelligence- Customer intelligence is referred to the skills of using various
online marketing tools in order to target various customers. The term is also used for
the facilities like website analysis tools that provide an insight related to the needs of
the customers that can be addressed by the sellers in order to gain a competitive
advantage. A feedback from the customer’s side can be helpful in order to enhance
the experience by taking various measures to deal with the customers. These online
marketing tools are an asset for the various e commerce platforms and can be adopted
in order to capture the market.
EXPLAIN THE VARIOUS DIGITAL BUSINESS MODELS IN THE CONTEXT OF
VARIOUS KEY ISSUES LIKE ETHICS AND CYBER SECURITY IN THE GLOBAL
ENVIRONMENT OF TESCO.
There are various issues that are faced by the business model of Tesco in regard to
cyber security and ethics. The various key issues are discussed below-
 Management of delivery cost- Cost plays an important factor in profit earning of the
organization or the venture. If the costs are higher the profits tend to be low and in
case of lower cost the organization enjoys higher profits. Though in the situation of
increasing costs, the organization must make changes in the prices as well to sustain
the operational existence. The motive of the organization must be to control the cost
of production through various technological advancements in order to maintain higher
profits. The organization can switch to economies of scale in order to produce more
so that the cost of production of each unit comes down.
 Maintenance of desirable appeal and assortment- There are so many organizations
that are providing the online commerce facilities and also most of them deal in same
products too. Hence the level of competition is huge and it is difficult to make a
standard impact upon the potential customers in the market. So it is a big challenge
for Tesco. The organizations who have managed to gain the competitive advantage
can have a potential to withstand the competition in the market in the coming future.
The customers are likely to turn towards the online stores that tend to offer a value for
money in terms of goods and commodities. The value for money can be delivered by
supplying the goods at low or affordable prices by providing with a better quality of
products to the customers. The case can be adverse too, if an organization provides a
special kind of service and charge higher for their products can also create a desirable
appeal in the industry through the focused differentiation strategy (Jafari-Sadeghi and
et.al., 2021).

 Product returns- The customers when shopping through offline mode have an
opportunity to check out the products before buying and hence they are not addressed
with the opportunity of returning the product until and unless the product has an
attached warranty or guarantee. But in the case of online mode of shopping the
customers are not blessed with an opportunity to have a physical checkout of the
product. They are just provided with the virtual description of the product and their
buying decision relies on the images, product description and the reviews. So the
online market stores provide the customers with an opportunity for easy returns within
a specified limit. Thus the product returns have a negative impact upon the revenue of
Tesco and further affects the profit as well.
 Building product and customer loyalty- Customer retention is quite important for the
online organization portals in order to sustain in the market. For this purpose the
organization needs to build product and customer loyalty for their products and
organization. It is challenge for the online comer portal of tesco as the customers are
free to choose any platform for their product shopping so the organization needs to
attract various customers through the means of digital marketing. These strategies
must be implied in order to gain the competitive advantage to attract the customers.
Even though the customers are buying the products through the websites, it cannot be
termed that the customers are loyal. They could have been buying just due to efforts
made through the digital marketing. Hence it is a challenge for Tesco to have a loyal
customer base (Park and et.al., 2021).
 Unpredictable Customer behavior- the changing or the dynamic consumer behavior is
a challenge for the Tesco as a retailer. Consumers have different choices when it
comes to purchasing groceries in online market. There are various customers that do
not trust upon the online source of market and thus prefer offline markets for
purchasing goods. Also there are few customers who are quite selective when it
comes to online shopping. These customers opt to buy only some products through
online markets while for the rest of the products they prefer offline markets. These
kinds of trend act as a challenge as they limit the expansion and growth of the various
online markets. This kind of behaviour of the customers as changing behaviour limits
the long term strategy planning of the organizations.
 Competition- Competition has an ability to shape the business organizations in a
better way. It is very important for the organizations to have a competitive advantage.
Only in this situation the organizations are capable of achieving the market share in
the economy against their competitors. The market or the industry can change at any
point of time and thus it is the competitive advantage that allows the organizations to
sustain in the market. Though Tesco has a huge market share in the online business
but the increasing competition can still hinder the market share and revenue of Tesco
(Perkin and Abraham, 2021).

EXPLAIN THE IMPACT OF VARIOUS COLLABORATIONS AND STRATEGIC
ALLIANCES THROUGH THE MODE OF DIGITAL TECHNOLOGIES FOR TESCO.
The collaborations and strategic alliances have a huge impact upon the businesses.
The impact of strategic alliance and collaboration upon the business models of Tesco is
explained below-
Effect of Collaboration
 Adaptability- Adaptability can be referred to a process of being adaptable with the
progressions happening in the association. It is significant for individuals to know
about the objectives and be set up to confront the unfavorable circumstances in the
association or the business.
 Wider market- the collaboration of two organizations lead to a wider market for the
organization as the organization now has a customer base of two or more
organizations as a total, which have collaborated successfully. The organizations
which have collaborated can take it as an opportunity to capture the target markets
and the market share.
 Critical thinking- Everyone deals with an issue in the association identified with the
issues that emerge on an everyday premise. The critical thinking helps in adapting up
to the issues. The critical thinking can be made more powerful and effective to have
joint efforts to work the business effectively (Sanchez-Segura and et.al., 2021).
 Expertise dividing- The joint effort between the associations permits a capacity to
share the best of the abilities. The joint effort works with sharing of the abilities that
can be demonstrated useful for the association to manage the progressions in the
association. The joint or the combined efforts of various organizations help in
building better relationships by complementing skills to each other.
 Cultural diversity- The collaboration among the organizations can develop cultural
diversity in the business. This way the organizations can easily deal with the various
segments belonging to the different culture. This will boost the market share and the
expansion of the business in the various areas to attract the customers. The cultural
diversity will help in understanding the various cultures and can look for an
opportunity to expand as per the needs of the people who belong to a specific culture.
 Open communication- Collaboration works with open correspondence among the
associations. The open correspondence is a cycle of imparting thoughts to the friends
to empower cooperation among the representatives. These frequently lead to
advancement in the group and further improve the representative spirit. The
communication is enhanced among the organization due to the collaboration (Van
Looy, 2021).
 Commitment- The commitment among the association invigorates inspiration at the
working environment. The commitment is regularly framed in the association with the
assistance of cooperation which brings about better relations among the people of the
association. The collaboration takes place after an agreement or a contract which
requires a commitment between the organizations to operate together successfully.

Effect of strategic alliances
 Provide ease of entry and exit- The business that includes minimal expense spending
plan or capital for building up a business lead to ease in the section method of the
business. The organizations that are not capable of entering a market solely can take
help of strategic alliances to enter a specific market (Wichmann, Wißotzki and
Sandkuhl, 2021).
 Reduces risk- The strategic alliance between two successful organizations will reduce
the risk of organization as it will get shared among them.
 Competitive environment gets better- The progressions in aggressive environment can
be handled with the assistance of building up the innovative norms in the association.
It would prompt stand the opposition in the most conspicuous manner.
 Enhances customer base- The strategic alliance will attract the customers towards the
alliance and the customer base of the individual businesses will add up to the
customer base of the alliance.
 Improves productivity- The danger and cost dividing between the individual
additionally works with progress. The strategic alliance may lead to a better
productivity of the organization. The organization may perform better and the cost of
production might reduce due to the strategic alliance among the various organizations
for a successful business model.
EXPLAIN THE VARIOUS E COMMERCE PRINCIPLES THAT COULD BE APPLIED
BY TESCO FOR THEIR ELECTRONIC BUSINESS PLATFORM.
There are various e commerce principles that can be adopted by Tesco in order to
enhance the online business of Tesco. The principles that can be or that are followed by
Tesco Online are discusses below-
 User friendliness- The online websites that facilitate the customers to buy and sell the
products must be easy to navigate. The website must be easy to flip through the
products and search for the suitable products in the organization. The websites must
allow the customers with the suitable information regarding the products which
include a proper job description as in to facilitate the customers to avoid confusion
during buying (Gabrielsson and et.al., 2021).
 Unique designs- The organizations must provide the website with attractive designs in
order to stand in competition with their competitors. The online mode is full of
various buying alternatives hence the organizations must use some creativity for their
websites. The effective designs will allow the customers to have an interest in the
website and browse repetitively. The design must be attractive as well as professional.
 Security-The customers who buy from the online web site or portals look for the
safety and security features that can be provided from the organization’s side. The
confidential information like the customer’s personal details and the financial details
must be kept safe and secure and build a trust that they won’t be shared with the third
person. The payment gateway must be safe to ensure safe and smooth payment or else

this could hinder the sales of the organization (Wißotzki, Sandkuhl, and Wichmann,
2021).
 Responsive technology- There are various seller associated with the online selling
platform that tend to use high level HTML coding along with the huge files and large
size images. They tend to use it in order to give an enhanced look to the websites and
improve the quality but this also leads to decreasing the speed of loading a web page
of the website. This can be time taking and the website could be neglected if the
customers are impatient.
 Identify the target audience- The organizations must well define their audience that is
their potential customers and then accordingly they must design the website and serve
them accordingly. Identifying the target audience will allow the organization to
understand the needs as per the target group. This way the customers can be provided
with the products that they are looking for and this would lead in developing the trust
of the customers towards the websites.
 Search column- The websites must be enabled with a search option for the customers.
The search option will lead to saving of the customer’s time and directly moving on to
the products that they are looking for. As this would avoid the hectic process of going
through the various items that may seem boring and time wasting to the customers. So
it is important for the websites to introduce a search bar option for the customers.
 Product description- The organizations must provide a product description which is
efficient and true about the products listed on the websites. The product description
must be such that it should be conveying even the minimalistic information that is
material for the customers. The effective product description could lead to motivation
of the customers to buy a specific product. As the products on online platform lack
physical touch, product description is the only way to convey about the product to the
customers. This will develop a trust of customers upon the website and the
organization.
 Minimalistic layout- The website must have a simple lay out which means the website
must focus on the minimal designs and avoid the designs and features that are of no
use. The simplicity must be the key. The organization must choose an appropriate and
ideal colour and design for the layout to convince the customers.
CONCLUSIONS
It very well may be closed from the above report that digital business have been of
incredible importance and are administering the market in the different ventures. Digital
businesses have been the need of great importance and have caught immense piece of the pie
because of their different advantages. The investigation spins around the digital business of
Tesco. The examination comprises of the advantages and the patterns in the advanced
business that influences the activities of Tesco. The report further comprises of different
standards in setting of digital business. The report centers around the parts of joint effort and
key arranging that have an effect upon the digital business. The examination involves a basic
assessment of the morals that should be followed at Tesco.

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