Marketing Essentials: Comparing Marketing Mix Strategies of Tesco and Aldi

This report compares the ways in which Tesco and Aldi implement the marketing mix to achieve their goals and objectives. It also explains a basic marketing plan for Tesco.

Marketing Essentials
Table of Contents

INTRODUCTION...........................................................................................................................1
TASK 2............................................................................................................................................1
P3 Compare the ways in which different organisations apply the marketing mix to the
marketing planning process to achieve business objectives.......................................................1
TASK 3...........................................................................................................................................4
P4 Produce and evaluate a basic marketing plan for an organisation.........................................4
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Marketing can be defined as a group of activities through which organisations or brands
create or develop interest among the customers for their products and services (Allen, 2016).
These activities can be advertising, promoting, distributing sample products etc. All these
activities help the help in making the customers aware of the company's products. The
organization chosen for this report is Tesco which is a multinational British merchandise retail
brand headquartered in England, United Kingdom. The company was founded in 1919 and is
leader in the groceries market in UK. This report compares the ways in which Tesco and one of
its competitors, Aldi implement the marketing mix to achieve their goals and objectives. The
reports also explains a basic marketing plan for the company.
TASK 2
P3 Compare the ways in which different organisations apply the marketing mix to the marketing
planning process to achieve business objectives
Marketing mix is a tool that integrates several number of components in order to
strengthen a brand and therefore help sell its products (Duffett, 2017). It comprises of 7Ps
namely- Product, Price, Place, Promotion, People, Physical Evidence and Process. Tesco, being a
market leader was designed to primarily fulfil the customers' needs and wants. Aldi, is the
chosen competitor of the brand. A list of comparison of the various ways in which both these
organizations apply the concept of marketing mix to their planning process in order to achieve
goals and objectives is described below -
Marketing Mix Tesco Aldi
Product
Tesco offers a variety of
products to the customers to
choose from. The products
range from food, clothings etc.
The never ending product line
in their offline store, but also
online is able to fulfil every
need of the customers. There
Aldi is a Germany based
competitor to Tesco that offers
food products at affordable
prices and are of similar quality
that is offered by other brands.
The products that are sold by
Aldi are sourced from limited
suppliers which the company
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are products offered from
various brands, international
cuisine and other things that
don't leave the customers
lacking when it comes to
choosing different products
(Folinas and Fotiadis, 2017).
The company offers its own
products too.
then brands as its own and sells
at affordable rates in the market.
The products are less expensive
as compared to the prices of
products offered at the
supermarkets. Besides food
products, Aldi also sells fruits
and vegetables, electronics etc.
Price
Tesco aims at providing the best
of quality products without
compromising on the quality of
products. Opting for low price
strategy against its competitors
has made it possible for the
company to become the market
leader it is today. Tesco has
continued to maintain lowest
prices for its products.
Aldi has a strong customer base
as it offers products at cheaper
rates and the quality of its
products that isn't available with
the competitors. Also, the
company uses the strategy of
unit pricing for the groceries
making it easier for he
customers to compare.
Place
Tesco is headquartered in
England having operations
worldwide. The company
mainly uses two channels for
the distribution of its products
and services namely. Tesco has
six different kinds of offline
stores. The online channel of
distribution is the company's
official website.
The company has a total of 8000
stores spread across 18 countries
worldwide. The stores have a
very simple layout and the cost
of products very minimal. The
company purchases raw
materials from the suppliers in
bulk and then stores them in its
local warehouse (Hamlin,
Knight and Cuthbert, 2016).
Tesco makes use of different Aldi invests a insignificant
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Promotion
strategies like television
advertisements, offers discounts
to its customers at regular
intervals, sponsors events etc. to
promote its products. All the
advertisements of the company
focus on the low prices of its
products (Horton, 2019).
amount of money in promoting
itself. It only offers “Super
Buys” offers that change every
week. This is informed through
a weekly newsletter which is
either handed over to the
customers or sent them through
mail or via newspaper.
People
Tesco has an excellent staff
appointed as sales assistants
appointed at their stores who
contribute to the overall
branding and success of the
company. As a result, the
employees are proficient and
also offered good salary for
their contribution to the
company.
Aldi is slightly behind its
competitors when it comes to
providing customer service as
the employees don't usually
assist the customers. This is
because the company has a very
thoughtful store layout wherein
everything is put into various
sections that can be located
easily (Karnaukhova and
Polyanskaya, 2016).
Process
The process in context to Tesco
refers to keeping the customers
as a primary focus by providing
quick billing services and easy
access to the products placed in
the stores online as well as
offline. Tesco does it by
appointing proficient staff and
paying its primary focus on any
complaints from the customers'
end and therefore addressing
Having a thoughtfully put store
layout helps the customers in
locating the products themselves
which reduces the need for Aldi
to appoint more employees. The
company only offers products
from popular brands in the
market that helps in avoiding
confusion among the customers.
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them.
Physical Evidence
Tesco doesn't spend much time
in elaborating its stores and has
clean yet attractive stores that
have all the products placed
according to different categories
and are easy to locate. Offers
are also placed in a manner that
more customers are attracted.
Aldi is a brand that is
recognized globally for having
the most uncomplicated
business processes. Over 85% of
the products available at the
stores are from the brand itself
and the rest from well known
brands.
TASK 3
P4 Produce and evaluate a basic marketing plan for an organisation
A marketing plan can be defined as a document that figures out the advertising strategy
that an organization will have to implement in order to reach its target market, goals and
objectives (Kayabasi and Mtetwa, 2016). A marketing plan usually consists of an analysis of
situation which includes SWOT, PEST analysis, a forecast of the sales of the company etc.
Having a marketing plan helps organisations to plan various activities that happen within the
premises and thereby improve their overall performance in an effective manner.
Executive Summary
Having a marketing plan is like having a blueprint or an outline of all the marketing and
advertising efforts for the future (Kotoua and Ilkan, 2017). This assists the companies in
carefully planning and defining that are involved in the final accomplishment of goals and
objectives within the specified time. Therefore, it is very essential for Tesco to have a marketing
plan as the company is planning to open offline stores in San Marino, Europe. The marketing
plan for the company is explained below -
Objectives
 To open offline stores in San Marino in the coming 2 years in order to increase its
customer base.
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 To implement different promotional strategies in order to increase its overall sales and
profitability ratio by 25% in the next 3 years.
Situation (SWOT)
The situation of Tesco is described below -
 Strengths – Tesco is the leading supermarket and grocery retailer in the United Kingdom
and dominates the Britain market (Ottman, 2017). The company is recognized worldwide
with having a presence in approximately 14 countries and uses the latest technology to
amplify its customers' overall shopping experience at the company's stores. The goodwill
of the company will help it establish offline stores in San Marino and attract potential
customers.
 Weaknesses – The company has not been successful in countries like Japan and the US
as its failed operations forced it to shut down its stories in both the countries. With a lot
of competition posed by existing players in San Marino can hamper the company's
process of achieving its goals and objectives in the specified time period.
 Opportunities – Tesco ha recently launched a new discount store, Jacks which is proved
out to be successful. The company has an opportunity to launch this business in San
Marino and can compete with the brands already operating in
San Marino. This can prove to be a profitable move for Tesco. If the company has any
second thoughts regarding this, it can opt for opening a joint venture wherein a local
brand could be of help.
 Threats – With Britain not being a part of the European Union any more, the trade deals
have can pose a threat to Tesco (Pappas, 2017). There is a significant rise in the raw
material as well as labour costs lately, this can also pose a threat to the company for
establishing stores in San Marino. Also, different countries have different government
regulations. Some of them can work in favour of the company while some can prove out
to be threats.
Strategy
Different strategies that Tesco can opt for are -
 Segmentation – This is the first stage where the company segments the market based on
various aspects like age, gender, population etc. Tesco is planning to launch a new offline
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store. Therefore, it will have to consider all these elements and accordingly formulate the
strategies.
 Targetting – Once the segmentation is done, a target market is to be created wherein, the
company will target people having medium to high levels of disposable income so that
they are able to purchase its products through offline stores.
 Positioning – Positioning refers to creating a brand image and positioning it in the minds
of people so that they are able to recognize the brand anytime, anywhere. Tesco is a
widely recognized and a popular brand. Therefore, it can make use of various channels
like television, newspapers, magazines etc. to position itself in the minds of consumers.
Action Plan
The action plan of Tesco made based on the 4Ps is described below -
 Product – The company deals with a wide segment of products with groceries and
general merchandise being the main categories (Perreault, 2018). There are no new
product offered in the offline stores as similar products are available online as well.
 Price – The pricing of the products in the offline stores should be affordable as all
customers are not comfortable with buying products online. Therefore, products should
be priced at rates that are not heavy on the pocket.
 Place – Tesco is planning to open an offline store in San Marino as this will enable the
customers to buy products that they need instantly. This will also give them a chance to
but and try on products and check them.
 Promotion – In order to promote itself, Tesco will have to opt for carrying out
promotions through social media and its website as this will enable the customers to
navigate through the products and also getting information of what the company is
planning to come up with.
Forecasts
It is essential for Tesco to forecast its plans before launching the store to remain aware of
various aspects like availability of resources in that area and also requirement of funds (Pooler,
2018). For this, the company should prepare a proper budget which is explained below -
PARTICULARS Amount(£)
Trainer 200, 000
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Equipments 400000
Marketing 50,000
Safety measures 50,000
Total 700000
Control
This is the last stage of making a marketing plan where proper control has to be
maintained as any mistake in the marketing plan can lead to a rise in problems in the future
(Allen, 2016). A benchmark and standards should be set in order to get the tasks completed on
time. Tesco should set goals and objectives that it desires to achieve and should therefore work
towards achieving them in order to gain a competitive advantage.
CONCLUSION
From the above report, it can be concluded that, there are various aspects that a company
needs to work upon in order to achieve its objectives. Various strategies should be opted by
organisations in order to gain a competitive advantage and stand out in the market against their
competitors. Also, different organisations implement the concept of marketing mix in different
ways to attain their specific goals. A marketing plan can be prepared by the companies that
includes various components like situation analysis, action plan, forecasts and control. The
company should revise and update it on a regular basis to sustain itself in a highly dynamic
environment.
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REFERENCES
Books & Journals
Allen, M., 2016. Essentials of publishing qualitative research. Routledge.
Duffett, R.G., 2017. Influence of social media marketing communications on young consumers’
attitudes. Young Consumers. 18(1). pp.19-39.
Folinas, D. and Fotiadis, T., 2017. Marketing and Supply Chain Management: A Systemic
Approach. Routledge.
Hamlin, R., Knight, J. and Cuthbert, R., 2016. Niche marketing and farm diversification
processes: Insights from New Zealand and Canada. Renewable Agriculture and Food
Systems. 31(1). pp.86-98.
Horton, D., 2019. Potatoes: Production, marketing, and programs for developing countries.
CRC Press.
Karnaukhova, N. A. and Polyanskaya, E. V., 2016. Communication and reputation as essentials
for the positioning of an organization. AI & society. 31(3). pp.371-379.
Kayabasi, A. and Mtetwa, T., 2016. Impact of marketing effectiveness and capabilities, and
export market orientation on export performance: Evidence from Turkey. European
Business Review. 28(5). pp.532-559.
Kotoua, S. and Ilkan, M., 2017. Tourism destination marketing and information technology in
Ghana. Journal of destination marketing & management. 6(2). pp.127-135.
Ottman, J., 2017. The new rules of green marketing: Strategies, tools, and inspiration for
sustainable branding. Routledge.
Pappas, N., 2017. Effect of marketing activities, benefits, risks, confusion due to over-choice,
price, quality and consumer trust on online tourism purchasing. Journal of Marketing
Communications. 23(2). pp.195-218.
Perreault, W. D., 2018. Essentials of marketing. New York: Mc Graw Hill.
Pooler, J. A., 2018. Demographic targeting: the essential role of population groups in retail
marketing. Routledge.
Online
ALDI Marketing Mix (4Ps) Strategy. 2019. [Online]. Available Through:
<https://www.mbaskool.com/marketing-mix/services/16807-aldi.html>.
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