Marketing Management Analysis of Sainsbury: PESTEL, Micro and Competitive Analysis

This report provides a detailed analysis of Sainsbury, the UK's second-largest supermarket chain, using PESTEL, micro, and competitive analysis. It includes an overview of the company, a macro analysis of the market, and a SWOT analysis. The report also covers the micro-environmental factors, competitive analysis, and recommendations for the company.

Principal of marketing
Management

Contents
Contents...........................................................................................................................................2
INTRODUCTION...........................................................................................................................1
MAIN BODY..................................................................................................................................1
Company background: Analysis of current market.....................................................................1
PESTEL analysis:........................................................................................................................2
Micro analysis..............................................................................................................................5
Competitive analysis....................................................................................................................6
SWOT analysis............................................................................................................................8
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................12

INTRODUCTION
Marketing management can be described as ways which helps business in order to finding out
various opportunities occur in the market place which are profitability for business and also
satisfying customers. It is one of consumer-oriented approach that helps business in order to find
out various services that will satisfy needs of consumer and also helps to meet the needs and
expectations of consumers. This project report includes analysation of Sainsbury which is a UK
based organisation which is considered as second largest supermarket chain in the UK. it has
acquired around 14.9% share in the supermarkets share in the UK. It was founded in the year
1869 in the UK by John James. It is an organisation that has around 1428 shops at different
locations. It is a large organisation which has employed around 1800000 employees in their
organisation. This project report includes analysis of the current market of Sainsbury (Alonso-
Garcia, and et. al., 2022). It also includes a macro analysis of the company to identify factors that
create threats and opportunities. Micro analysis is also included in this project report which helps
to identify factors like company, suppliers, marketing intermediaries, customers and others. It
also conducts competitive analysis which help business to identify the strategies of competitors.
Moreover, it consists of a SWOT analysis which allows the business to identify threat and
opportunities in the marketplace.
MAIN BODY
Company background: Analysis of current market
Salisbury is one of the UK-based largest supermarkets which is offering different types of
products and services in the marketplace. It is getting growth and success on basis of its
competitive strategies. It has different stores under its name and provides different types of
products. It is operating in the market of UK. it is one of the developed countries which is
creating different opportunities and threats for businesses operating in this country. By operating
different types of services in the UK, Sainsbury is able to take advantage of political stability. It
can also adopt access to different types of valuable resources of the company, technologies and
other factors. It is essential for businesses in order to improve the quality of products and
services. It provides a competitive advantage to businesses and also helps them to get a
competitive advantage for them.
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PESTEL analysis:
PESTEL analysis is one of the analysis which is used by businesses for purpose of identification
of different factors that create influence over the business. Sainsbury is also using these tools for
their business in order to identify various opportunities and threats in business. These factors
identified by businesses include political regulations, economic conditions, social factors,
environmental regulations, legal requirements and others. All these factors create both
opportunities and threats for purpose of business (Centobelli, Cerchione, and Ertz,2020). An
explanation of some of these factors in the context of Sainsbury is mentioned below:
Political Factor:
It is one of the important factors which consists of different political rules and regulations for
business. Sainsbury is one of the UK-based organisation which is operating at the international
level. In order to be successful, they need to follow all the rules and regulation of UK
government.
Opportunity: Operating business in the UK create different types of opportunities for business
of Sainsbury as the government of the UK is providing support to business operating in that
country (Chaney, 2019). International business creates different opportunities for a country and
in order to promote these businesses, the government of the UK offers support to these
businesses.
Threat: In the UK, there are different political factors that create problems for the business of
Sainsbury. Brexit is one of the political factors which creates impact over business of Sainsbury
and according to this, England will not a part of European Union. Due to this, there is increase in
Import rates which will also increase the pricing of the product. It makes it difficult for them
company to compete in the marketplace and customer also shift to other brands. Relationships
between England and Qatar also create a threat for the business of Sainsbury as the major largest
shareholders of this organisation are from Qatar. Political issues among these countries bring
down the market share of the company.
Economic Factor:
Economic factors are those which are linked with broader economic concepts and also express
financial nature of the person. Sainsbury is one of the organisation which contribute to economic
development in many ways. It is creating employment opportunity to people live in this country
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and also paying tax. Any increase and decrease in factors like interest rate, inflation, employment
rate as well as exchange rate create impact over cost of Sainsbury.
Opportunity: UK has the most developed economy which create opportunity for business of
Sainsbury. It provide different resources to Sainsbury in the UK and managers of company does
not needs to purchase these resources from other country. It will saves the cost of the company
from purchasing resources to another country. UK also had skilled labour which create
opportunity for Sainsbury to hire talented employees from that country which will provide
competitive advantage to the company (Chohan, 2018).
Threat: There are various threats occur of economic factor for business of Sainsbury. It is one of
the organisation which is using road based transport for purpose of shipping of products in the
UK. Due to this, rise in petrol and diesel will also results in increase in cost of the company and
as a result, price of produce also increased. There is one of factor that also create impact for
business of Sainsbury like higher expectation of salary among workers. It create impact over cost
of the Sainsbury as in order to meet these expectation of workers, they needs to increase salary of
these workers.
Social Factor:
It is one of the important factor which identify evolutions and shift in ways in which
shareholders are approaching to life and also create an impact over commercial activities. There
are various social factors in the UK that create an impact on the business of Sainsbury. These
factors include increasing health awareness, change in expectations of the consumer, change in
buying behaviour of consumers and others (Erb, and Hautbois, 2018).
Opportunity: Social factors also create opportunity for business of Sainsbury as there is
increase in purchasing people of UK. It allow people of UK to spend money over offering of
company. It is one of the important factor for business which will increase income of people.
Threat: Main source of revenue of Sainsbury is earned by selling fast food items to customers.
There is increasing health awareness among people of the UK which create threat for business of
Sainsbury as they are selling fast food which is not healthy food. In order to deal with this
scenario, Sainsbury needs to add healthy options to their menu like salads, organic food dish,
organic shakes and others. It is a trend in the global market which occur due to the outbreak of
covid-19. It creates an impact over fast food selling companies and due to this trend, there are
also changes that occur in behaviour of the consumer.
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Technology Factor:
It is one of the important factor which is linked with technology and these technology are
changed significantly. These technological factors create impact over business as it helps
business for purpose of differentiating is service from other factors. Sainsbury is implementing
various technology in their organisation which provides opportunity for business. It provides
convenience to customers which is important for business in order to satisfy customers and also
enhance experience of customers.
Opportunity: Sainsbury is planning to implement an automated check-out system in their stores
which is important for purpose of their stores (Ferrer-Rosell, and et. al., 2021). It is important for
their business as it allows them for purpose of enhancing the experience of customers and also
helps to reduce the time for checking out. This organisation has also introduced its e-commerce
stores which consist people friendly approaches in business. It helps businesses for purpose of
improving the experience of customers.
Threat: Sainsbury is also facing threat in the marketplace as with the advancement of
technology, there is increasing threat of data breaching in the organisation. It creates a threat of
revealing of private information of the company to its competitors. Adoption of advance
technology in business also results in increased cost of the company which increase the prices of
products.
Legal Factor:
Legal factors are one of the important factors for business which take place from changes
occurring in the regulatory environment (Fidel, Schlesinger, and Emilo, 2018). Sainsbury is one
of the reputed organisations which is following different types of laws and legislation in that
country. It creates a significant impact on the image of the company.
Opportunity: Legal factors create an impact over decision making of Sainsbury as it allows
them to make decisions which are allowed in the UK. It is important for purpose of controlling
the action of the company and allow them to follow all the regulations. On basis of it, company
is making changes in their organisation in a systematic manner and also build a positive image of
organisation.
Threat: Sainsbury is also facing threat from Legal factors as following all rules and regulation
cause delay in decision making of the company. It does not allow the company to take advantage
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of the first mover opportunity. Following different types of laws and regulation in business also
results in increasing cost of the company.
Environmental Factor:
It is one of the factor which are related to environmental safety, pollution, climate condition and
other factors. It is a factor which recognise changes in the physical environment of a country.
Sainsbury is one of well reputed organisation which is considering different types of laws and
legislation in their organisation (Hossain, and et. al., 2020).
Opportunity: Sainsbury is one of the organisation which is considering different types of
environmental conditions in their organisation. There is also increasing environmental awareness
in UK which creates an opportunity for purpose of the business of Sainsbury. It is a result of the
climate change movement which allows the company to control the negative impact of business
on the environment.
Threat: It is a factor which also creates a threat for purpose of business. Sainsbury has adopted
all the rules and regulations of the environment in their organisation which will increase the cost
of the company.
Micro analysis
Micro environment factors refers to those environment which include direct contact of company
with different factors and also it affect routine activities of business in straight manner. This
analysis consist factors which has close relationship with the company (Le Feuvre, and et. al.,
2021). Sainsbury is using this tool for purpose of identifying problem occur in business due to
influence of these factors. Explanation of different component of micro environment analysis are
mentioned below:
Company: In an organisation, there are a different departments in the business including
finance, top management, human resource management, human resource management,
operation, research and development and others. All these are considered by Sainsbury at the
time of designing various marketing plans and also designing strategies. It is essential for
marketing managers of Sainsbury to consider these departments at time of making the decisions
and also developing strategies for the company.
Customers: It is considered as one of the most important components in the micro analysis. It is
important as it allows the company to deliver network values to customers and also aims to build
strong relationships with them. Sainsbury is one of the organisation which is focusing on
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developing good relationships with customers and also focusing on increasing the loyalty of
customers with different members.
Suppliers: There are different suppliers which are providing different types of supplies to
business. These people are playing an important role for the business as it provide them a higher
quality of material, machinery and equipment which is important for improving the quality of
products and services. Sainsbury has different suppliers in the market which allow them to
access to high quality of materials. It is important for them in order to enhance the experience of
customers and also to compete with different players in the marketplace (Peevski, 2022).
Marketing intermediaries: It is playing an important role for purpose of delivery of a value
network. It is also including different individuals which assist companies for purpose of sales
and distribution of various goods and services, promotion of different products and others.
Sainsbury is not including much intermediaries in their organisation in order to reduce cost of the
company.
Publics: Public refers to those people who are interested for purpose of purchase of products.
These people have actual interest in products and service of the company which creates an
impact of the ability of the organisation for the attainment of objectives. Sainsbury considers
different public like government, media, financial institution, local people, internal public and
others.
Competitive analysis
The frequent manner of the competitive analysis is directly linked with the manner of
identifying the managerial competitors marketing plan of action market share business pricing
plan of action in as well as culture that involve consumer base and their reviews as well
(Singaraju, and Niininen, 2021). It is the strategic managerial framework that will support the
respective business of management evaluate present and potential competitors and of a both
offensive and as well defensive fan of action to determine the frequent term of opportunities and
as well as threats as in an effective and as well as an efficient manner. Their respective
management also faces competition from their challengers in the field of marketplace. As the
respective business of management of the Sainsbury are facing several sort of the challenging
situation it is essential section for the business of management to create unique valley preposition
that differentiate brand from another competitive as in an effective and as well as an efficient
manner. By valuating the manner of competitor’s plan of action the business of management can
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create their own plans and as well as programs that offers competitive benefits to the business of
management as in an effective and as well as an efficient manner. As there are several sort of the
sections that are followed by the respective management in the procedure of evaluating the
competitors like presenting the sector, identify the competitors determine and as well as mention
the consumer desires which are effectively and as well as suitably termed to their level of the
advantages for the business of management. On the other side, as it is important to maintain and
effective brand value by their target it audience by which it will be effective for the respective
business of management to sustain in the field of market place as in an effective and as well as
an efficient manner (Siyara, 2019). It in an effective and as well as a frequent timeline of the
strength in terms of their competitors ranking situation of the fundamental success factor by
offering waiting then each computer that are frequently retail on the basis of fundamental success
factors as in an effective and as well as an efficient manner. By managing the suitably dealing in
the business it will be easy for the leaders and as well as the leaders of the business of
management to operate their company in the field of the market place for longer period of the
time.
In this business usually analyse the rivals which are operating their business in the competitive
market. This is the approach which leads to retain and compete in the business in the large
market. In consideration to Sainsbury, there are various companies which are operating their
business in retailing sector which are describe below.
Tesco is among the leading competitor in the UK market, it is the British multinational
company which is operating in groceries and general merchandise. The company is
headquartered is in Welwyn garden city, England. They are the third largest company by gross
revenue. They have shops in five nations across the Europe and is the market leader of groceries
in the United Kingdom. Tesco has diversified into various areas such as retiling of services,
telecoms and internet services. Tesco repositioned itself from being a downmarket to the high-
volume low-cost retailer, attempting to attract the large group of customer in the target market.
Tesco is listed on the London Stock Exchange and it is constituent of the FTSE 100 index. They
have expanded their business globally since the early 1990s with the operation in 11 countries
and ensuring batter brand image to the large market. It is the main consideration of the company
to have the good brand image by which they can compete with its rivals. They are ensuring good
public relation so that they can ensure the good brand image in the target market.
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ASDA is a multinational groceries supermarket chain which rank number 2 in United
Kingdom in market share. They sell various numbers of products in their supermarkets which
originally were situated in south England but over the years the expanded their market coverage
with over 61 supermarkets. ASDA is known for providing quality products to its customers at
minimal prices. Hence this was the main reason behind evolution of Asda from
supermarkets. Today all over United Kingdom Asda not only sells its groceries but now have
converted into entrainment centre when customers can play games, experience technology etc.
The company is established in 1949 by Peter and Fred Asquith sir. Asda is also known
with its own range of clothing known as George that was created and trialled in selected in stores
1989 and they are officially launched in the business and the main supermarket estate in 1990.
They are ensuring the quality fashionable clothing at the affordable prices by which they can
serve their customer with better pace and maintain good brand image in the target market. This
help them to have the higher working of the company and be the leading company in the
retailing sector.
SWOT analysis
It is one of analysis that is used by the company to identify different types of strengths of
company which helps them to take advantage of opportunities that occur in the marketplace. It
also helps businesses for identification of weakness and threat which create problems for the
survival of the business. In order to overcome of these components, business managers of
Sainsbury need to develop various strategies (Sulifoa, 2020). Explanation of some of these
strategies in the context of Sainsbury is mentioned below:
Strength:
Right Expansion: Sainsbury is one of the organisation which is started as small grocery stores
where there is the limited range of products. It is dealing with brand expansion for purpose of
convenience of stores. It is also dealing with the categorisation of different needs of consumers.
Business Philosophy: Sainsbury is one of the organisation which is helping consumers for
purpose of following as well as sustaining lower-cost strategies. These strategies help business
for purpose of attracting as well as retaining customers. It is increasing brand loyalty and also it
consist retailers which are dependent on each other.
Opportunity to deal with different types of customer: There are different types of consumers
who purchase products from retailer stores. Sainsbury is offering products for all types of
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consumers. It is creating values for the economy segment and expensive products of it creating
values for high-income people.
Innovation promotion strategies: There are different types of innovation strategies to be
adopted by the business of Sainsbury. It is important in order to promote innovation in their
organisation which helps them to overcome of competition (Susan, and Shuba, 2018).
Weakness:
Brand switching: There are different types of risks to be faced by the business of Sainsbury
related to switching of cost of the company. It is offering different types of loyalty program as
well as promotion but still company is facing faiure for retaining the customer.
Low margins: There is increasing competition in retail market which create problem for
business of Sainsbury. It increase the risk for company and also make it difficult for them to
attract number of customers towards business. In order to compete in the market, Sainsbury
needs to reduce their margins in the marketplace as it helps business for purpose of keeping
prices down of their products.
Growing costs: There is increasing cost of Sainsbury in the marketplace. These cost of the
company is related to procurement cost which is spending over the enhancement of the
experience of customers and also for differentiating products of company from other players.
Sainsbury is also spending money on technology which offer convenience to the customers. It
also results in increasing cost of the company (Wongkitrungrueng, Dehouche, and Assarut,
2020).
Opportunity:
Growth in village: There are different types of growth opportunities occur in the marketplace.
In previous time, branded products are not used in rural areas but now time has changes.
Sainsbury can also get growth opportunities in the marketplace which allow them to expand its
reach to rural areas.
24*7 service: Sainsbury is an organisation that is adopting self checkouts in their organisation. It
is one of the organisation which can offer its service 24 hours as day that provide a competitive
advantage to business. It is also essential for business in order to increase its sales and also allow
them to make the checkout process more easier.
Latest trends: Sainsbury is one of the large organisation which is developing the large network
in the UK. It is witnessing for different opportunities for the company as it helps them to develop
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an additional profit and also to earn more income. There are different types of trends in the UK
that can be adopted by Sainsbury in their organisation which helps them for purpose of
diversification of risk present in the marketplace.
Threat:
Increased competition: There is increasing competition in the marketplace which creates threat
for the business of Sainsbury. It is essential for the business of Sainsbury to consider these
factors and develop strategies to overcome of these factors. There are different competitors occur
in the marketplace which are competing with Sainsbury. These competitors includes Aldi, Asda,
Lidl and others.
Covid-19 pandemic: It is creating a threat for businesses of Sainsbury as in the year 220, there
are different countries in different parts of world announces lockdown and due to which
Sainsbury also needs to close their business. Due to this, the annual income and revenue of the
firm has been decreased. Due to this, customers have shifted to local stores due to which the
company has lost many of their loyal customers (Wu, and et. al., 2021).
From above mentioned discussion, it can be analyse that Sainsbury is facing various threats the
in the market due to increasing competition and covid-19 pandemic. It create problem for
business and also does not allow them for purpose of increasing marketing share of business. IN
order to overcome of these threats, business needs to develop different types of strategies. It
allow business for purpose of accessing to different types of opportunities in the marketplace. It
is also important for business to effectively compete with other players in the marketplace.
CONCLUSION
From above mentioned project report, it can be concluded that marketing management is one of
important components which helps businesses to develop effective strategies. It is essential for
an organisation as it assist them for purpose of identifying different strategies required to
overcome of competition and also for differentiating products of company from others. A firm
conduct micro analysis which them to identify factors that are present inside the organization and
allow business to make changes to overcome of these factors. Business also consider macro
analysis factor which helps them for purpose of identification of factors that create an impact
over their operation. These factors are present outside the business and also create a serious
impact over offering of the company. It is also important for a business to consider competitor
analysis in their organisation. It is essential for them in order to identify various competitors in
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business and also identify strategies adopted by them. SWOT analysis is one of the important
analysis used by firm for purpose of identifying weakness and threats of a company and making
efforts to overcome of it. It allows them to take advantage of different types of opportunities
occur in the marketplace.
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