Comparison of Asda and Tesco by 7P's Model

This report compares the marketing strategies of Asda and Tesco using the 7P's model. It analyzes the product offerings, pricing strategies, and more.

Marketing Essentials

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
LO1..................................................................................................................................................4
P1 Roles and responsibility of the marketing function................................................................4
P2 Importance of interrelationship between marketing and functional areas of company..........7
LO2..................................................................................................................................................8
P3 Comparison of two organization by 7P’s model....................................................................8
LO3................................................................................................................................................12
P4 SOSTAC model for Tesco....................................................................................................12
Situational Analysis.................................................................................................................13
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................15

INTRODUCTION
Marketing refers as a set of activities, tactics that is undertakes by the business to
promote selling behaviour of users for it’s product and services. it plays crucial role in the
organization because it influences customer to purchase products and helps company to establish
good brand image in the business market. Marketing is not only part of advertisement and selling
of gods and services but also puts pressure on the competitors. It helps company to achieve high
commercial profitability and expands business in the global market.
To understand significance of market and it’s roles has an example of two companies
such as Asda and Tesco. Asda is a British Multinational retailer company which is located in
Westminster, London. It has wide variety products such as clothing, home accessories and food
products. it operates in various countries and offers it’s product worldwide. Tesco Plc. is a
brinish multinational groceries company which is famous as general merchandise retailer across
the world. it is headquartered in the Welwyn Garden City, England, UK. It also has wide product
line and offers it’s product to the customer across the world. The report provide understanding
about marketing and it’s roles which interrelates with other functional areas of the company.
LO1
P1 Roles and responsibility of the marketing function
Marketing is the process of exchanging goods and services. there are numerous functions of
marketing that plays crucial roles in the market. roles of marketing is described as follows:
Deep market research
It is primary function of the marketing that is important for the company because it helps
to understand customer’s needs and expectation for the product and services.by the deep market
research easy to gather all information about the customer, product position and competitors and
analyses them deeply so that develops effective strategy to meet customer’s objectives and win
competition market effectively (Akbar Omar and Wadood, 2017). In addition, it helps
organization to influence product selling in the business market and builds good brand image in
the customer’s mind.

Marketing planning
It is important role of the marketing that supports organization to achieve it’s goal by
creating marketing plan as per the market demand. There is an example to understand role of
marketing planning such as company has low market share of product whereas marketing
planning helps set goal to influences market share of certain products. it develops platform for
the organization so that it influences demand of the products in the customer through
advertisement efforts. Marketer of the Tesco company can guide sales management how they can
influence selling behaviour of themselves at the workplace and what price can make product
highly demanding in the retail sector (Akbar and et.al., 2017).
Product designing and development
Product feature and it’s development is the major part of product selling. For example,
when product has good feature like colour, quality, taste and others that attracts customer
towards it and encourage them to buy it. There is another example to understand role of product
designing such as when a organization has high quality products but it is unattractive or less
attractive that directly impacts buying behaviour of the customer (Henríquez, 2018). So, it can
interpret product designing is important for marketing product effectively in the business market.
According to the marketer, product design keeps importance in product selling but continuous
development in the existing products assists to take competitive advantage from the rival.
Standardization and grading
Standardization is the process of determination in term of size, quality, design, weight,
colour and raw material etc. that is used while producing specific products, it is important for the
company because when product keeps same weightage and colour texture then it becomes easy
for organization to sale products and minimizes user’s doubt about product quality and colour as
well. While grading is similar to the standardization but product is graded as per their quality.
For example, company produces products and classifies into different categories i.e. A, B and C
that interprets three type qualities such as best, medium and common. This grading system helps
organization and customer as well because when customer requires high quality products then
employee provides A category products to them. Thus, grading system reduces confusion

consequence in the customer’s mind for the product quality. Tesco follows standardization and
grading system to retail it’s products to the different customer as per their requirement.
Packaging and Labelling
It is essential function of the marketing that plays effective role in product safety because
when product is well-packed then it reduces consequences of breakage, damage and destruction
of products through rain, pressure and others. it also supports to lift, handle and conveys products
effectively. On the other hand, labelling is also important for the product because it gives whole
description about it like manufacturing data, schedule, continents, expiry data and others that
gives idea to the company ad customer how much time they can sell or purchase in the market.
Tesco specially focuses on the products packaging and labelling because it supplies its product
worldwide, so in that state, it is essential for the company to keep product in good packaging
along with informative labelling so that customer gets them in good condition (Heroux and
Clark, 2017).
Branding
Branding is important for the product because when a product has own identity then
customer prefer to purchase products to think like it is branded product otherwise, they avoid to
buy non-branded products. That’s why branding is crucial tool of marketing in the business
market.
Customer support service
It is essential part of marketing function because it helps company to build good
relationship with customers. The main goal of the marketing functions is to offer best quality
product or service to customer and handles their complaints (Malhotra, 2018). It is not only
helped to offer quality service to the customer but also offers post sale services to them.
Marketer of the Tesco company offers wide range services such as post-sale service, technical
service, credit facilities and issues handling services to the customer so that enables to earn
lifetime loyalty of them for the brand.
Pricing of the products

It is another essential function of the marketing that is performed by manager to keep
expect it improves purchasing behaviour of the customer in the market. As know price is the
major factor that impacts customer’s buying behaviour as well as selling behaviour of company.
When product price is costly as result declines sales revenue of the products or when price is
lower that influences market share of the product. It helps to gain competitive advantage from
the competitors and influences demand of the product
Promotion & Transportation
These are marketing functions that also plays essential role in the product popularity and
brand image as well. For example, promotion helps to increase awareness in the customer for the
new product and brands then customer prefer to buy advertised products. there are various
promotional tools i.e. advertisement, public relation and others helps to influence demand of the
product effectively. While transportation is important function of the marketing because it helps
marketer to promote company’s product in the business market. The transportation is the main
source to reach customer and offers company’s product on time.
Above mentions roles of marketing helps Tesco to influence brand popularity as well as
leads high sales revenue in the company.
P2 Importance of interrelationship between marketing and functional areas of company
Marketing roles and responsibilities keeps interrelation with different functional areas of
company (Malik, 2019). These relationships support organization to meet it’s long-term and
short-term goals in fewer time. The interrelationship between:
Marketing with Finance department
Finance department of Tesco keeps close interrelationship with marketing department
because both departments has aim to lead economical benefits in the company. Marketing
department is important for the finance department because marketer gives information about all
activities expenses which requires for the product promotion and research purpose. While
finance department helps marketer to give appropriate budget as marketer requirement so that
they can meet company’s objective and improves sales revenue of products as well. Thus, both
departments perform different role in the organization but keeps common goal.

The relationship has some drawbacks as well for example most of the time it happens that
dispute takes place between marketer and finance manager, when marketer needs more funds for
the product advertisement whereas finance manager denies to give more funds except budget
requirement because finance manage has aim to save extra expenditures so that company can
invest this money in right place instead of marketing.
Marketing with HRM department
HRM department is known as heart of the company because they oversee all functions of
the company so that it achieves it’s goal over the time period. Human resource department is
important for the marketing because they recruit skilful employees as per the marketer demand
so that they help marketer to influence sells of product in minimum time. while marketing
department helps company to give realistic feedback about staff performance in the workplace
(Muralidharan. and Raval, 2017). By the feedback, human resource sets strategy to improve
individual’s performance in the workplace. That’s why each department plays close relationship
together and helps company to meet it’s vision on time.
The interrelationship of HRM and marketing has some drawbacks such as when
marketing department is not enabled to analyse individual’s performance in the workplace then
cannot give realistic information to HRM like which skills requires for the marketing perspective
currently as result they unable to recruit suitable talent for the specific job position. As same case
implements for the HRM when they unable to recruit best talent for the marketer post as result
can not achieve desirable outcome in the company.
Marketing with R&D department
The main role of the marketing is to deep research in the market so that easy to gather
informative information like product demands, customer’s perspective for the product and
service, brand positioning and competitor activities etc. helps company to uplift brand position
and market share of the products as well. In addition, marketer analyses all information
strategically and aware R&D department about products and expectation of the customer. While
R&D department improves quilt and features of the product so that marketer can fulfil
customer’s expectation and increase selling infrastructure of the company. Thus, marketing

department and R&D department plays close interrelationship together and helps company to
gain it’s mission in minimum time.
This interrelationship impacts organization negatively in two situations. For example, in
first situation, when marketer gives inefficient information about customer’s attitude for the
product and service, in that situation R&D department unable to understand what type product or
service can meet all customer objective as result does not give that product which leads customer
satisfaction in the market. in other situation when marketer demands for the new product to the
R&D department whereas they unable to give demanded products to the marketer which
improves selling behaviour of sales man as result leads competitive disadvantage in company
(Ottman, 2017).
LO2
P3 Comparison of two organization by 7P’s model
Marketing mix is a marketing tool that is used to differentiate brands and it’s products in
the business market which helps company to achieve it’s goals and objectives over the time. It is
the combination of seven elements such as product, price, place, promotion, people, process and
physical evidence which is used by company to promote it’s products and brand value in the
competitive market. The marketing mix 7P’s model is used for the two organizations i.e. Asda
and Tesco and defines which organization apply this marketing mix strategy effectively.
Attributes Tesco Asda
Product Organization has wide range product
line such as food, clothing, electronics
and financial services etc. it provides
grocery delivery services and free
music download services as well to the
customer that attracts towards brand.
In addition, Tesco offers regional
products such as international cuisine
in ready-made food items and others
Asda is one of the leading
retailer company because it has
wide range product portfolio. It
offers home delivery services to
it’s customers. It has included
unique product and service kit in
which includes drinks, froze
foods, food cupboard, chilled
food, bakery and fresh foods,

so that it can meet each customer’s
demand (Pappas, 2017).
beauty and health, outdoor,
home and entertainment,
paediatric accessories etc.
classified in groceries items.
Clothing, Asda mobile, Asda
money and others also offers by
company to the customer as per
their requirements.
Price Tesco follows low price strategy in the
organization which helps to influence
purchasing behaviour of the company.
The main goal of the company is to
maintain low price as possible without
declining quality of the products that
helps company to keep customer
happy and builds their trust on the
product. later on, company follows
situational pricing strategy that helps
to generate high revenue on the sale
and maintains customer’s satisfaction
(Pater.R. and Cristea, 2018). In the
situational pricing strategy, company
offers club card system to the
customer and allows them to collect
more points for it’s purchasing. Then
the points coverts in term of money at
later phase which they can use for next
purchasing. Price promotional strategy
also follows by company to build loyal
customers along with extra discount.
These strategies help company to
As compared Asda has wide
range product portfolio so it
believes in mass selling.
Therefore, it adapts cheap and
reasonable pricing strategy to
attract large number of
customers. This strategy helps
company to develop large sales
volume and improves high profit
margin on the product. Company
adapts promotional pricing
strategy and provide incentives
and discounts to people on off
season, festivals etc. for
influencing bulk of sales. But
company unable to maintain
product quality or sales low
quality products on low price
that causes it has to face many
criticise from the customer and
reduces brand image as well.

generate high profit margin on these
products.
Place Tesco is mainly headquartered in
England and spreads all over the world
through its subsidiaries. Tesco
generally uses two main channels of
distributions i.e. online and offline.
There has six different form of Tesco
stores which operates through offline
platform and meet’s individual
customer’s objective who does not
prefer buy from Tesco’s big stores.
Apart from this, company offers it’s
own official website www.tesco.com
to the customer so that they can direct
buy products from the site instead of
going in the market.
It is giant retailer that is
headquartered in West
Yorkshire. Asda merges with
Walmart which influence brand
image of the company because
Walmart’s store is 20% bigger
as compared competitors.
Organization has located 32
supercentres and 31 superstores
in 2018 whereas super store
quite smaller as compared
supercentres. Later on company
has opened 26 depots for
supplying non-food range
products in the UK and offers
products such as clothing,
chilled food and carbonated
drinks. Company offer parcel
services to the customer that
leads satisfaction in them for the
product and it’s service (Pike,
2016).
Promotion The main advantage of the Tesco is
that it offers low price products that
attracts customer towards it’s product.
the main goal of the company to
become more demanding brand in the
business market by earning lifetime
loyalty of the company for the brand
As compared, Asda uses
traditional promotional tools
because it believes eye-catching
commercials is more profitable
as compared others. so company
advertises it’s product through
newspaper, radio, leaflets and

and its products, Therefore, company
uses television advertisement,
sponsors charitable events and offers
promotional discount so that easy to
aware customer about products and
it’s discounted prices (Rancati,
Gordiniand Capatina, 2016). Tesco
adapts seasonal promotional strategy
whereas offers like ‘buy one and get
one free’, ‘half price’ etc. these type
promotional helps Tesco to influence
high volume sales in the festival
seasons.
others to attract customer. Asda
uses social media as well to
influence brand image in the
online platform and gets direct
accessibility to attract new
customer effectively. It uses
celebrity endorsement strategy
to build customers trust on the
brand and it’s products. Thus,
company uses various
promotional tools to portray
trustworthy image of brand in
the customer’s mind.
Process The main goal of the Tesco is to keep
its customer happy so it offers high
speed billing facilities to them so it
saves their time. it offers grievance
facilities to the customer and gives
quick response to resolve their issues
by the help of employees.
Asda offers it’s products at
lower and cheap price so that it
can meet each customer’s
budget. Company offers
superstores and supercentres
facilities to the customers which
becomes easy for them to buy
product effectively.
Physical evidence Company does not spend high cost on
it’s infrastructure because it believes
that it is the wastage of money. It
focuses only on product’s physical
appearance which attracts customer to
buy products. it maintains cleanliness
in their stores which makes customer
satisfy for the hygienic perspective.
On the other hand, Asda spends
good funds on it’s infrastructure
which attracts customer towards
brand and makes product more
attractive while purchasing.
Company believes that
infrastructure is the main factor
of attraction for the customer.
People Sales assistants of Tesco are excellent
because they are greatly responsible
Employees of Asda are the main
source of success. Each stores

for Tesco’s success. Company’s
employees are highly competent and
skilful as compared others and always
gives high contribution in making
brand successful.
and centres of company operates
by sales manager who
effectively encourage customer
to buy products and influence
volume of sales as result gives
big contribution to make brand
more demanding in the business
market.

From the above comparison can be analysed that Tesco implements al
elements of marketing mix successfully within business that influences
organization performance as well as market share of the company. For example,
Tesco uses diverse product portfolio strategy in which includes all trendy products
accordingly customer’s needs that helps company to improve purchasing behaviour
of customers. Due to some products like organic groceries and other non-food
items has achieved nearly 30% market share in the UK’s retail market. In addition,
organization uses effective pricing strategy from pricing elements that supports to
influence buying of behaviour customer for the products. Tesco enable to gain high
profit margin on their grocery products. With the promotion element organization
uses effective promotion strategies like seasonal promotional strategy, customer
awareness marketing campaigns and others that helps to build trust of customer on
it’s performance. thus, remaining marketing mix elements helps organization
generate different strategies that influence it’s performance in the retail sector and
profit margin of the company. With numerous strategies of marketing mix
organization achieves it’s objectives within predefined period.
LO3
P4 SOSTAC model for Tesco
It is marketing model that used to create marketing plan. The plan guides the future
action for the company which supports to gain goals and objectives (SHUKLA, 2016). The
SOSTAC model follows by Tesco to prepare marketing plan because company is going to
introduce new product i.e. organic foods. Therefore, it wants to analyse compatibility of product
in the market through the marketing planning. The model contains six stages that are described
as follows:

Situational Analysis
Organization mainly targets youth generation who is more health concern. To target it’s
customer uses demographical segmentation strategy which provides understanding about
individual customer’s perspective for the food and it’s services. To analyse internal and external
environment of the company uses Swot analysis model which helps to analyse it’s weakness and
opportunity in the business market (Wilson, McCabe and Smith, 2018). For example, company
has good market presence due it’s brand positioning and wide product line. So, it become easy
for Tesco to influence volume of sales for the organic foods. The weakness is this it can be costly
so it my possible low-class customer does not prefer to buy. But company will overcome the
issue by offering discount on the product that attracts each customer to buy the product.
organization has opportunity to expand market share of the organic products because it is highly
demanded across the world. The major threat is this Brexit can impact on organization’s sales
profit by influencing taxation on exporting products. Asda and M&S are the major competitor of
the company in term of sales, price, product and services. Tesco employ on two channel of
distributions that has proved successful for the company.
Objectives
 To influence sales revenue of the company
 To improve demand of the new product across the world
 To build strong relationship with potential customer so that in return gain lifetime loyalty
from them for the brand.
Strategy
Tesco uses STP model strategy to target it’s market, customer and products that helps to
gain it’s objective on time. STP model is described as follows
Market segmentation: Organization uses two market demographical and psychographic to target
it’s customer for the new product.
Targeting: Targeting strategy helps to Tesco to target it’s specified customers. The targeted
audience of the Tesco is youngsters because they are more concern for health so they like to
prefer organic food instead of oily and fatty foods (Wirtz and Lovelock, 2016).

Positioning: Organization has good positioning in the business market so it is major strength of
the company.
Tactics
4p’s of Marketing mix
Product: Company offers organic product that is new product of the customer.
Price: The price of the product is not too much high so it’s customer can buy product easily.
Place: Organization uses two distribution of channels i.e. online and offline to promote it’s
product.
Promotion: Digital marketing strategy uses for the new product so that can access customer
effectively. Online voucher code will use to sell it’ new product to the customer.
Email marketing: it is second tactic of the company that will use to aware customer on regular
basis for the new product.
Action
To take in action all above tactics delegates number of tasks to the employee by the HR
of the company. Marketing department specially uses tactics to aware customers about the new
products and describes it’s features (Zahay and et.al., 2019). While human resource oversees all
functional areas action and cross checks marketing plan to measure that all activities are met to
the objective or not. 4P’s model helps company to influence brand image and increases market
share of the company as well. Thus, marketing department enables to meet all predefined
objectives over the time period.
Control
To control all business activities monitors by human resource on personal level and uses
360 feedback strategy to understand effectiveness of all above strategies. Thus, company control
all over the action so that it can maintain sustainable growth in the business market.

CONCLUSION
The report has been concluded roles and responsibilities of marketing functions where
understood marketing functions was crucial for the business because it gave platform for the
product publicity. The brief study gave acknowledgement that marketing function helped
company to build good relationship with it’s customer in the business market. Importance of
interrelationship between marketing and functional areas such as HRM, finance department,
R&D department and others can be concluded in the report. Compare the way in which two
organizations Tesco and Asda applied marketing mix strategy to promoted it’s products and
brand image so that both one could meet it’s objectives has been concluded in the report. The
brief study has summarized marketing plan that comprised aims, objectives, marketing analysis,
strategy and market segmentation and monitoring for Tesco.
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