Impact of Merger on Customer Satisfaction in UK Retail Sector: Sainsbury and Argos

Dissertation

Abstract
In the competitive era, each and every business wants to introduce new product and
service to gain customer satisfaction. Similarly, the present study highlights the importance of
merger within the company in order to gain customer attraction. The current research is based
upon merger on Sainsbury and Argos and its impact upon the customer satisfaction. Therefore,
with the help of qualitative study, scholar collect information which in turn assist to meet the
defined aim and determine the relationship between the merger activity upon customer
satisfaction. Both primary and secondary data collection has been used in order to conduct the
study in precise manner. Moreover, through data analysis section, it can be evaluated that
customers are satisfied with the overall performance of a company and increases their loyalty as
well. Overall, merger activity benefitted customers in order to improve the get effective services
from Sainsbury.

Acknowledgement
I would like to thank the University who offer me an opportunity to study on this topic that
assists me to increase my knowledge.
I would also thank my teachers who are available to solve the queries and assist me to complete
the study effectually.
I am also obliged to my parents who support me economically and non-economically, and last
but not least I thank my friends who always encourage to complete the study.

TABLE OF CONTENTS
CHAPTER 1: INTRODUCTION....................................................................................................6
Background to research topic......................................................................................................6
Background to research organization..........................................................................................6
Research rationale........................................................................................................................7
Research questions.......................................................................................................................7
Research aims and objectives......................................................................................................8
CHAPTER 2: LITERATURE REVIEW.........................................................................................9
2.1 Introduction of literature review............................................................................................9
2.2.1 Concept of customer satisfaction and merger.....................................................................9
2.2.2 Assessing the advantages and drawbacks associated with merger activity......................11
2.2.3 Relationship between merger and customer satisfaction within UK retail sector............13
2.3 Conclusion...........................................................................................................................15
2.4 Literature gap.......................................................................................................................15
CHAPTER 3: METHODOLOGY.................................................................................................17
3.1 Research process..................................................................................................................17
3.2 Research approach...............................................................................................................18
3.3 Research strategy.................................................................................................................18
3.4 Research methodology.........................................................................................................19
3.5 Research instruments/tools..................................................................................................19
3.6 Sampling..............................................................................................................................22

3.6 Ethical implications.............................................................................................................23
CHAPTER 4: FINDINGS.............................................................................................................24
CHAPTER 5: DISCUSSION........................................................................................................34
CHAPTER 6: CONCLUSION, RECOMMENDATIONS AND IMPLICATIONS FOR
FURTHER RESEARCH...............................................................................................................37
Conclusion.................................................................................................................................37
Recommendations......................................................................................................................37
REFERENCES..............................................................................................................................39

Topic: “To investigate the impact of merger on customer satisfaction within UK retail sector:
A Merger of Sainsbury and Argos.
CHAPTER 1: INTRODUCTION
Background to research topic
In UK, retail sector, companies are facing high competition with each other due to the
ever-increasing expectations of customers. There are several retail giants such as Aldi, Lidl,
Tesco, Sainsbury etc which are competing with each other in terms of brand image, customer
and market share. Thus, it is highly required for the firm to come up with innovative
technologies and products so that customer satisfaction can be enhanced. Moreover, satisfied
customer base may result into positive word of mouth publicity and thereby enhancement of both
sales as well as profit. Therefore, companies use different methods in order to improve the
overall brand image at global level as well as attract range of new customers towards it.
Similarly, the current study could also highlights upon how business strategy could benefit
business and grab attention of many customers towards it.
Besides, customer loyalty can be built through evolving high level of satisfaction among
them. Further, satisfied customer base also helps in attracting potential ones from the competitive
business arena. Thus, for limiting competition level and strengthening business operations now
companies are placing high level of emphasis on undertaking merger or acquisition strategy.
Acquisition may be defined as a process when one business unit gains majority of control or
shares in another organization. Through this process, company is easily increases the market
share of a business quickly and sustain its brand image at competitive market. Therefore, the
process will help the company to achieve market synergies as well. Along with this, the present
study could highlight how merger affect the customer satisfaction and this in turn leads to
examine whether there is any direct impact upon the business performance or not.
Background to research organization
This dissertation is based on Sainsbury which possess wide product portfolio containing
grocery, electronics, books, clothing etc. It is the second largest retailer of UK which provides
customers with products at discounted prices. Further, it is also listed on the recognized stock
exchange of London such as FTSE. Also, it has a brand image at global level but during crisis,

company is unable to offer process due to not having any mobile or online offerings. However,
before acquisition, Sainsbury was unable to offer mobile or online shopping experience to the
customers. Hence, in order to build and sustain competitive position Sainsbury took decision in
relation to acquiring Argos. Ion 2016, Argos, a catalogue retailer was acquired by Sainsbury by
paying £1.4 billion (Argos takeover boosts Sainsbury's trading, 2021). Further, supply chain and
logistics management of Argos is highly effectual which helps Sainsbury in getting desired level
of outcome or success.
Research rationale
The main reason behind conducting the current study is to analyze the extent to which
satisfaction level of customers can be raised through the means of merger. This is considered as
issue because due to the rapid changes take place in customer behavior. In order to gain
competitive edge over others Sainsbury is required to meet customers need and expectations to a
great extent. Along with this, now shoppers or customers lay high level of emphasis on choosing
options pertaining to home delivery, click & collect etc. There are several retailers in UK who
acquired other firm involved in home delivery services. Further, it is considered as issue now
because due to COVID-19 preferences of customers shifted on purchasing products through
stores which offer home delivery services. Now, customers do not prefer to shop from physical
store due to having high focus on safety, hygiene etc. Referring all these trends Argos takeover
by Sainsbury was done with the motive to satisfy wants of customers. Moreover, Argos having
wide network who provide customers with amazing online shopping experience (Why Retailers
Should Watch the Proposed Sainsbury’s Argos Takeover with Interest, 2021). Thus, through the
means of thematic perception test technique research could light on enhancement in customer
satisfaction level as result of concerned merger.
Research questions
Q.1 What is the concept of customer satisfaction and merger?
Q.2 Which benefits and drawbacks entice merger activity within UK retail sector?
Q.3 What is the relationship between Sainsbury & Argos merger and customer satisfaction.

Research aims and objectives
Aim: The aim of study is to analyze the impact of merger pertaining to Sainsbury and Argos
on customer satisfaction.
Objectives
 To develop understanding about the concept of customer satisfaction and merger.
 To ascertain benefits and drawbacks associated with merger activity within UK retail
sector.
 To determine relationship between Sainsbury & Argos merger and customer satisfaction.
 To recommend strategies to Sainsbury for enhancing customer satisfaction through
merger activity.