Tesco Marketing in a Global Age: Executive Summary and Analysis

This report provides an executive summary and detailed analysis of Tesco's marketing plan in a global context. It begins with an introduction highlighting the increasing challenges faced by companies in the global market and emphasizes the importance of a well-defined marketing plan. The report then presents a situational analysis, including PESTLE analysis of the external environment and Porter's Five Forces analysis of the internal environment. It covers Tesco's STP (Segmentation, Targeting, and Positioning) strategy, outlines specific marketing objectives, and details proposed strategies, tactics, and action plans to achieve these objectives. The report also includes a discussion of key performance indicators (KPIs) for monitoring and controlling the marketing plan's effectiveness, such as return on investment and sales volume. The report concludes with a summary of findings and recommendations for Tesco's marketing initiatives.

MARKETING
IN
GLOBAL AGE

1
Executive Summary
For ensuring success any firm needs a detailed marketing plan that underlines all the aspects
of marketing. In this report external and internal analysis of Tesco has been provide. It was
found that external environment has become challenging and at the same time the internal
environment has become more competitive. In this report there is illustration of the strategies
they need to have. It was found that company needs to focus on adding more numbers of
technologies in their marketing and reduces their pricing while increasing the numbers of
products that are available under their roof. In this report there will be illustration of the
tactics that they can use to do marketing. It was found that company needs to prices needs to
be on the lower side, promotions needs to be done with the help of technology, they need to
train their employees with technology. In this report action plan has been provided. In the last
section of the report there is illustration of KPIs that acts as control measures. It was found
that return on investments, sales volume are the two major KPIs that can be used in this
regards.
Content

2
s
Introduction...........................................................................................................................................3
Situational analysis................................................................................................................................3
External environment........................................................................................................................3
Internal Environment.........................................................................................................................4
STP of Tesco...........................................................................................................................................5
Objective...............................................................................................................................................7
Strategy.................................................................................................................................................7
Tactics...................................................................................................................................................9
Actions................................................................................................................................................10
Control.................................................................................................................................................12
Conclusion...........................................................................................................................................13
References...........................................................................................................................................14

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Introduction
In all across the globe challenges for the companies are increasing. There are various factors
that have created saturations for the companies in the local market which has direct impact on
their business and their strategies. The increasing competition has become major challenge in
this area. Due to this companies have to make strategies that could help them in ensuring that
they are at the top. Marketing plan plays a very critical role in this regards. Tesco is one of
the biggest supermarkets from Britain (Tescoplc, 2020). It is the third largest retailer in the
world in terms of gross revenue and specialises in groceries. In this report there will be
illustration about the situation that company is facing both internal and external. It also
illustrates the strategies, tactics and action that need to be made by the company to improve
the performance of the company. At last the control measures have been illustrated to put
marketing plan on the line.
Situational analysis
It is critical for the firms to analyse the internal and external environment of the company.
External environment
In order to understand the external environment, the use of PESTLE analysis can be useful.
 Political: The political decisions such as Brexit have created challenges for the
companies (Mollah and Sharif, 2014). This is because the rules related to free trade
across the borders have not been decisions. The negotiations are in process with EU.
This will create challenges such as arrangement of resources from other parts of the
world as new tariff will be set which will increase the prices of products they are
selling.
 Economic: In the time when the global economy is not showing higher growth the
chances that they might face economic challenges. At the same time the economic
challenges due to Corona Virus outbreak on the whole Europe is increasing and in the
coming it is going to affect the global economy in a more severe way. However the
cash balance with the company is huge which will help them in their future
investment plans (Christopher and Peck, 2012).

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 Social: The demand due to Corona Virus and the global economic crisis have been
affected. People are demanding for the products that are of lower cost. The product
quality plays a critical role in the success of the organisation as people are looking for
the high quality products. For example people want as much fresh groceries as they
can have. In UK the numbers of unemployed have also increased which is creating an
opportunity for the company to hire talents at lower cost. On the other hand the
increasing inflation rate will be a challenge for the companies as people will not do
excess purchasing (Armstrong, et al 2018).
 Technological: Technology is widely being used in the supermarket industry. The
online stores have created greater challenge for the business of the brick and mortar
business giants like Tesco (Rust, Moorman and Bhalla, 2010). In order to deal with
this Tesco has also started to make home delivery of item on online delivery. The use
of data technology has also influenced the ways in which the companies are doing
their business as it is helping them in reducing the improper utilisation of resources,
supply chain and logistics.
 Legal: Legalities in different parts of the world have changed and this change in the
legalities will have direct impact on the way the organisations are performing.
Strengthening of consumer protection laws and employment laws will have both
internal and external impact on the company. Already in the past this company has
faced challenges related to the human resource mismanagement (Donnelly, et al
2012).
 Environment: UK’s government have made some strict policies against the misuse of
natural resources and improper handling of the waste that is generated in their
operations. Due to this it is critical for the firms to ensure that they have a plan for the
management of waste management. They will have to reduce the carbon emission
from their stores (Ma, Ding and Hong, 2010).
Internal Environment
For doing internal analysis the use of Porter’s five forces are effective:
 Bargaining power of suppliers: The bargaining power of suppliers is on the lower
side. The reduction in their bargaining power is due to the fact that there are many
suppliers that are available in Europe and Tesco has good relationship with all their

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suppliers (Leeflang, et al 2014). However the bargaining power of the local suppliers
is going to enhance after the Brexit enforcement.
 Bargaining power of consumers: More numbers of online and offline competitors of
Tesco have come up in the market and this has increased the options that are available
with the people. With the help of online technologies people are comparing the
products offered by the competitors and on the basis of it they are choosing what is
best for them (Jüttner, Christopher and Godsell, 2010). This has increased their
bargaining power to go on the higher side.
 Threat of competitors: Competition in the industry has increased intensively. With the
increase in the competition it has become critical for the management of the strategies
and resources so that they can ensure their survival in the long term (Palmer,
Simmons and Mason, 2014). With the competitors like Amazon and Big Baskets the
threat of competition has gone to much higher levels.
 Threat of new entrants: With the amount of the competition that has increased in the
industry and the amount of investment that is required for setting up the whole
business of supermarket the chances of gaining success has reduced (Kotler and
Armstrong, 2010). However there is more chance that new online players might invest
in UK’s retail market. This is making the threats of new entrants to become moderate.
 Threat of substitution: There are large numbers of substitute products that are
available in the market. At the same time there are large numbers of innovations in the
business model and processes are being done (Beckett, 2012). This enhances the
chance of getting substituted. Due to this the threat of substitution has gone on the
higher side.
STP of Tesco
Types of Segmentation Segmentation Criteria Target segment
Geographic Region International and Domestic
Density Semi-Urban and Urban
Demographic Age 19-65
Gender Female and Male
Life-cycle Stage Adults
Income All types of income

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Occupation Unemployed and employed
both
Behavioural Benefits sought Time efficient and cost
efficient people
Degree of loyalty People have both kinds of
loyalty i.e. Switchers and
Hard core loyal.
User Status Regular and potential fast
food eaters
Personality Careless & Easygoing
Psychographic Lifestyle Strugglers and main stream
people
Social Class All the social class
Segmentation
This company has done segmentation of the basis of the four criteria. It is seen that UK has a
large population of people having different traits hence their purchasing behaviour also
differs. However the British people generally spend higher on the quality of items hence
segmentation needs to be done precisely.
Targeting
They have targeted people that are adult especially from the middle class families. They are
many targeting people from semi urban and urban areas. They are targeting people that
sought for time and cost benefits.
Positioning
Tesco has positioned them as the company that supplies high quality items at the lower
prices. They have ensures that their business processes also leads to the same.

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Figure 1: Perceptual map of UK supermarket
Objective
The objective that this company aims to achieve through this marketing plan is to enhance the
sales of their products by 30% while reducing the cost of marketing by 10% by the end of
2021. This objective has been made as the challenges related to competition have increased
and at the same time the financial crisis is increasing.
Strategy
On the basis of the objectives there are certain kinds of strategies that needs to adopted by the
company and at the same time there is a need that certain strategies which are in use are to be
informed. Some of these strategies are:
 Regular upgradation of technology: Technology has empowered the retail industry to
reach at the doorstep of the people. Previously people were reaching to the stores now
the companies are reaching to the customers. In order to ensure that customers are
attached with the company and they make purchase it is critical that firm uses the
technologies such as data technology which will help them in improving the
performance of all the units as data enables the firm to predict what is the need and
what will be the future need (Liu, 2013). Technology also has an impact on the ways
in which companies are doing marketing. Technology is helping the company to

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regularly interact with the people and know what their demand is. It is a time where
regular interaction with people can only help them in ensuring success. This makes it
highly critical for them to regularly innovate their technologies so that they can ensure
their success.
 Relationship management strategy: It is necessary for the companies to manage the
relationship with their customers in order to ensure that they are long time purchaser
of the products. For managing the relationship they must concentrate on developing
those technologies that can help in improving the relationship by managing their
communications with people. In this regards the role of social media technologies
have become very much effective (Gorton, et al 2013). For managing the relationship
Tesco needs to bring more loyal cards for the customers that are their regular
customers. At the same time they can give some kinds of discounts to the people that
live near half kilometres of the stores. This will ensure that these people visit the store
at regular basis. In order to manage their relationship with customers they need to
improve the customer dealing skills of the employees. For this employees need to be
trained on the regular basis.
 Internationalisation strategy: This strategy will help them in gaining invests from all
across the globe which will pump new lives in the projects that Tesco is carrying out.
This will also ensure that new sources of income come with the company which will
reduce the burden on the existing financial base of the company. However while
carrying out this strategy one thing must be noted that which all countries have the
potential to develop their business in the longer term and at the same time which all
countries have good resource base which will help them pumping their business in
United Kingdom (Lancaster and Massingham, 2010).
 Digital marketing strategies: More and more use of digital media as a strategy will
help them in extending their reach in front of the people. Since digital marketing can
be done at lower prices when compared with traditional marketing hence it will help
them in achieving the SMART that they have made for them (Hastings and de
Andrade, 2016). Digital marketing will also ensure that they can change their
marketing as soon as possible and according to the demands of the consumers.
The strategies that need to be made by the company can be understood by Ansoff matrix.
 Market penetration: They need to reduce the prices to attract more new customers and
they need improve their distribution network that can help in reducing their product

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prices. They also need to enhance their promotional methodology by using more
technology in the marketing.
 Product Development: Investing in R & D can help them in adding to new products
that can help in attracting new customers. They can also go into strategic partnership
with other firms that are offering various kinds of products.
 Market development: They can do this by expanding the reach by their supply chain
in different parts of the world which could help in improving the skills that they have.
In order to develop their market they need to do research on consumer behaviour and
accordingly they need to manage their process that can help them in developing their
markets (Felgate and Fearne, 2015).
 Diversification: Company needs to provide more and more options to the people that
can help them in attracting new customers and at the same time retaining those
customers that are already loyal to the firm. Diversification can also be done in terms
of the ways in which they are offering products to the consumers.
The strategies such as regular upgradation of technology, relationship management strategy,
internationalisation strategy and digital marketing strategies are some of the strategies that
will help the company to achieve the Ansoff strategies. Internationalisation strategy will help
in market development. Digital marketing strategy will help in market penetration. On the
other hand relationship management strategy will help in understanding the needs of the
people on the basis of which they can carry on with product development. Upgradation of
technology will help them in improving their processes and do product diversification also.
Tactics
There are different kinds of Tactics that can be used by Tesco to achieve the desired
objectives:
 Products: They need to ensure that in their stores wide variety of products are
available and that too of all the brands. This will ensure that people looking for
different brand products will come to their business unit. They also need to ensure
that product quality is on the higher side.
 Price: There is an increase in the competition and hence the company should continue
their strategy of price leadership. This will also ensure that they can target more and
more segments which will have impact on the customers purchasing intentions.

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 Promotions: They need to choose digital media strategies to promote their products.
At the same time company needs to improve the way in which they are doing
promotion like utilising more innovative mediums and tools for doing promotions
such as customer videos posting about their feeling about the company (Castaldo,
Grosso and Premazzi, 2013). They can also go for promotions with the help of
campaigns that address the corporate sustainability of the companies towards their
stakeholders.
 Place: Company needs to strengthen their stores in such a manner that they are able to
engage as many customers as possible especially on the holidays. There is an
increasing need to improve the business for which they will have to pump more
money on their online retailing so that they can engage with those customers also that
are not living nearby region where there stores are not there.
 People: They have highly trained staff but they need to ensure that their technological
training is done on the regular basis. This is necessary for making the environment
ready.
 Process: They maintain the world standards in their processes however it is critical
that the company adds more technology in their process in order to make the sure that
their processes are consumer friendly. This is necessary for achieving the desired
benefits.
 Physical evidence: This Company needs to ensure that that are providing high quality
products to their customers as it is the only thing that can help them in gaining
success. They need to ensure that they are delivering to the customers what they have
promised them.
Actions
In order to achieve their strategies and tactics action plan is critical.
Milestone Start Date End Date Description
Research about
marketing plan
and market
feasibility
1/5/2020 1/6/2020 Research needs
to be done on the
internal and
external
environmental
factors that can

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impact their
marketing
Suppliers
follow up
2/6/2020 1/7/2020 They need to add
more numbers
suppliers.
Communication
framework
design process
1/6/2020 31/7/2020 Communicational
framework needs
to be designed so
that their
marketing can be
done effectively.
Development of
Printing and
digital
marketing
material
1/8/2020 31/9/2020 All the things
that will be used
in this process
will be designed
in this phase.
Implementation
of marketing
plan
1/10/2020 28/2/2021 The marketing
plan will be
implemented.
Monitoring and
Evaluation
1/2/2021 31/3/2021 On the basis of
the KPIs they
need to monitor
and evaluate the
marketing plan.
Gantt chart
Actions The time required to complete the activities (in years)
Months May
2020
June
202
0
July
202
0
A
u
g
u
st
Se
pte
mb
er
20
O
ct
o
b
er
No
ve
mb
er
20
D
e
c
e
m
J
a
n
u
ar
F
e
b
r
u
M
ar
ch
20