Unit 2- Marketing Essentials

This report discusses the marketing mix differences and marketing plan of Tesco. It compares the different marketing strategies used by Tesco and other organizations. It also evaluates the effectiveness of Tesco's marketing plan. The report includes an analysis of Tesco's SMART objectives, PESTLE analysis, STP framework, and SWOT analysis. It provides insights into Tesco's product, pricing, place, promotion, and process strategies.

Unit 2- Marketing Essentials

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Task2:...............................................................................................................................................3
P3: Marketing Mix Differences...................................................................................................3
P4: Marketing plan of Tesco........................................................................................................5
REFERENCES................................................................................................................................1

INTRODUCTION
Marketing is the complete set of activities which are done by organizations in order to
sell and promote their products at the consumer side. Tesco is chosen for evaluation in this
report. Tesco is one of the largest retailer of UK which is having many branches across the
globe. Company provides wide range of products groceries, merchandise and electronic items to
its customers. The following report will compare the different marketing mix used by different
organizations for achieving their organizational goals. Evaluation of marketing plan will also be
done in following report. In addition to that critical evaluation of marketing mix is also done in
this report.
MAIN BODY
Task2:
P3: Marketing Mix Differences
Marketing mix is the set of activities by which a company tries to promote its brand in
the marketplace.
Marketing Mix Tesco Sainsbury
Product -Tesco provided wide range of groceries,
electronic items and sports items to their
customers. By fulfilling these
requirements of customers Tesco
improves the brand value in front of their
customers which will increase their
loyalty towards organization (Baker and
Magnini, 2016).
-Tesco provides several ready-made
products to its customers and with that
they also provide customization options to
their customers based on their
requirements.
-Sainsbury provide several
household products to its
buyers which includes
products like, groceries,
clothing options, electronics
and other hardware equipment.
-Sainsbury provide wide range
of items based on customer
requirements. So they can
improve brand value and
increase customer loyalty.
Price -In terms of pricing context Tesco uses
competitive pricing, for special products
-Sainsbury uses mixed pricing
strategy which include

in which products are priced
comparatively lesser than market
competitors (Addison, 2019). By this
strategy company manages to increase its
customer count.
-Tesco mainly uses cost leadership in their
majority of products, by doing, so they
provide high quality products at low
pricing. This strategy enables them to
maintain customer loyalty towards them.
economy pricing and premium
pricing. With this it provides
high quality products at
affordable price to their
customers and also manages to
get good economic growth.
-Sainsbury changes its pricing
tactics with context to
changing market trends, this
allows them to maintain good
economic position.
Place -Tesco uses two different supply channels
management (SCM), which are through
online websites and other is through retail
shops situated all over country.
-In terms of channel management, Tesco
uses omni channel distribution system
where customer can choose between
online and off-line types of services for
efficiently accessing their products.
-Logistic management is a part of SCM
which is related to transporting product
from development side to consumption
side. Tesco has developed lean
management system for increasing
efficiency of SCM.
-To improve its transportation
facilities Sainsbury uses IT to
gather real time data during
transportation and then with
the help of Paragon software
system improves their
efficiency.
-Sainsbury uses all-or-nothing
logistic approach for their
products in which they have
upgraded their supply channel
management.
Promotion -Tesco make sure that they follow
integrated communication which means
that all types of communications by
-Sainsbury is having a wide
range of products to show
case, therefore its promotions

company must convey a common message
to customers.
-Tesco uses advertisements like social
media, TV advertisements and radios. By
which they try to attract wide range of
customers towards them, so they can
increase their customer count.
are not effective to convey an
integrated message.
-For advertisements Sainsbury
uses social media platforms
like, YouTube, Facebook and
other methods like TV, radio
and newspaper advertisements.
People -Tesco has made several efforts in
improving their customer interface and
make sure that employees with high skills,
attitude and behaviour are selected for the
post because it has a direct impact on
deciding customer loyalty.
-Role of Support personnel requires
candidates with special skills, so they can
understand the issues which they are
facing with the organization and then can
provide solutions to them.
-Sainsbury provides special
training to its employees, so
they can effectively
communicate with customer.
-Sainsbury provides role
dedicated training to its
employees, so they can
efficiently understand the
issues which customers are
facing.
Physical Evidence Tesco pays high interest in providing high
quality of products and services at an
affordable pricing that's why their stores
contain less number of tangible items. But
at the same time, its stores are customized
in such a way that customers can
efficiently find the products of their
requirements and with high quality
services provided within store they make
sure customers are buying more than their
list of items.
Sainsbury has a wide variety
of tangible items at their
offline stores where they
implement creative marketing
techniques to increase their
customer count.
-Sainsbury is also having
online platforms where their
customers can buy their
products (Larson and Draper,
2018).

P4: Marketing plan of Tesco
Executive Summary
Marketing plan of Tesco is analysed in this report, which include SMART objectives
through which company can set their targets. STP is also discussed by which Tesco can identify
its targetted audience. Evaluation of marketing mix is also used in this report through which
organization can improve its working and goal achieving capabilities.
SMART objectives of Tesco
1. To grow organizational sales by 5% by opening 2 new branches within 5 years.
2. To improve employees working capabilities by 10% by providing them sufficient training
with 1.5 years.
PESTLE
PESTLE analysis is a tool which is used by marketers to analyse the effect of macro
environment (external environment) on their organization. It contains six points which are as
following.
Political-
Political uncertainties within country makes a direct impact on Tesco's economic growth.
Recent example of this is the events of Brexit where UK's decision of leaving EU has increased
company’s expenditures because company has to pay taxes in areas which were freely available
before Brexit (Berkowitz, 2016). Since Tesco is a multinational organization, therefore political
instabilities between countries also affects company’s operation in that region. Since Tesco is
retailer therefore political influence on other organizations will also affect availability of
products at Tesco.
Economical-
Economic condition of country makes a considerable impact on Tesco's economic growth
because high unemployment rate and high taxes will decrease company's sales. Reason behind
this is that customers will focus their buying to products of lower pricing. Therefore, Tesco has
to update its pricing structure as per the economic condition of UK, for motivating its customers
to increase their buying. Relaxations given by governments will also make an impact on
organizational working, but in this case company's performance can be improved.
Social-

In present condition customers are changing the ways of buying products. For example,
customers prefer buying items in bulk quantity and customers are showing high interest in one
stop shopping due to their busy lifestyle. Tesco has increased the quantity of non-food items
because of their increasing popularity among customers and with that several organizational
changes have also being made so customers can efficiently buy the product of their need.
Through these efforts company tries to attract customers who prefer trendy items, these changes
in product will increase organizational expenditures.
Technological-
Customer prefer to use technological advancements in the present time, this can be
observed in increasing popularity of online shopping and digital payment (Cooper, 2020).
Therefore, Tesco has provided online buying portal for their customer where they can buy
products as per their requirement, and they have also provided contactless payment to their
customer. In present condition of COVID-19, company has to implement several advancements
to improve their sales.
Legal-
Tesco is a multinational organization therefore, it has to follow local for efficient
operation and changes in governmental laws will have a direct impact on company's performance
(Blythe and Martin, 2019). For example, company has to follow equality law in which both men
and women have to paid equally and if company violates that law then it has to pay fine. This
will limit company from using Skinner's motivational theory for motivating its employees.
Environmental-
As per governmental regulations company has to make its efforts regarding climate
change, so Tesco has introduced several ways by which they reduce the carbon footprint
(Henríquez, 2018). By doing so company can make its positive image in front of buyers which
will increase their sales. But on the other hand this has increased company's expenditures and
will reduce their profit margin.
STP
STP is an three layer framework which is used to do market segmentation of buyers on
several factors, it is used organization to identify their targetted audience. Following is the STP
of tesco.
Segmentation-

Tesco uses different types of segmentation which are as following. Geographical,
Demographic and Psycho-graphic. In geographic segmentation, Tesco provide items for
customers of different ages in rural and urban areas of UK as well as 13 other countries. For
demographic segmentation, company provide products for customers of all ages and genders
irrespective of occupation and education because organization uses low and medium pricing. In
Psycho-graphic segmentation, company is able to attract customers of different lifestyle and
personality.
Targetting-
Tesco uses mass market targeting strategies in which customers are attracted irrespective
of market segmentation. In this company focuses on specific needs of customer of different
segments and their strategy such that they are able to attract wide range of customers (Gupta and
Nair, 2020). Therefore Tesco doesn't concentrate its working on one segment, but it tries to get
as many customers as they can.
Positioning-
Tesco has positioned itself as one of the cheapest retailer of UK by which it has increased
its customer count and with the help of loyalty programs it has managed to increase the
customers' loyalty towards organization. Tesco has established a positive organizational image in
front of their buyers by being UK's top retailer.
SWOT
SWOT analysis is a strategic planning tool which is used to identify internal and external
environment of organization, which is further added in organizational planning for improving
their performance. Following is the SWOT analysis of Tesco.
Strengths-
Tesco is one of the largest retailers around the globe and leading retailer in UK which is
having around 26.6% of the market share. Tesco is having around 6,800 stores in many countries
and makes a sales of around £56.5 billion in 2019 (Rahman, 2020). Diversification and wide
product range, to fulfil the requirement of wide range of customers.

Weakness-
Tesco has to face failure in several countries which indicates the company has failed to
understand oversea market. Tesco has to face some serious penalties for misrepresenting profit
and false accounting declaration (Business Strategy Hub, 2019). The Low profit margin has
limited company's economic growth and with that company is also facing low performance
issues in many states.
Opportunities-
Tesco should put more efforts in expanding the market share of Jack's stores by which it
can attract new customer towards its discount stores. Tesco should increase its collaboration with
other engaging companies, so they can provide rare items to their customers which will increase
customers engagement with organization. Although Tesco is providing wide range of products to
their customers but it should introduce new brands into its stores so customer engagement can be
increased.
Threats-
Brexit Referendum, has increased company's expenditures because it has to pay taxes in
the areas which were freely available before the events of Brexit (Chinn, 2017). This expansion
in expenditures will force company to increase pricing on goods which will lead to decrement in
sales. Tesco is facing tough competition with other supermarket giants like Sainsbury, Morrisons
and other competitors which affect company's economic growth.
Marketing Mix (7P)
Product-
Tesco should upgrade their products according to the latest market trends, so they can
attract new customers towards them. Company is currently concentrating their efforts only
limited segments, i.e. clothing and groceries, therefore it should put more efforts on showcasing
other products as well (Muralidharan and Raval, 2017). So they can improve their sales. Tesco
should also provide new and rare products to their customers, so they can increase their profit
sale.
Price-
Tesco uses competitive pricing for its products, so they can increase their customer count
but on the other hand it has also limited their profit margin. Therefore, company should use new

creative discount offers and should also implement other pricing strategy such as psychological
pricing to attract other buyers and with that it would also be able to increase their profit margin.
Place-
Tesco is currently having two marketing channels for selling its products which are,
online website and physical stores. But since social media users are increasing day by day,
therefore company should also develop its marketing page where they can sell and promote their
products through social media also this will increase their sales.
Promotion-
Tesco currently uses traditional marketing strategy like, newspaper, TV advertisements
and radio advertisement to attract new customers toward them. But company should advertise
through social media platforms like, YouTube, Facebook and Twitter for promoting themselves.
These platforms are much cheaper in pricing than traditional methods but on the other hand are
more effective than traditional methods.
Process-
Tesco is increasing its involvement in various sectors through which they can attract
more customers towards them and for that they must improve their behind the stage working. By
improving its retail services Tesco can make sure that their clients are receiving products in an
must faster way.
People-
Tesco's current workforce is able provide their services to company's clients who are
physically available but since company is shifting its efforts in attracting customer through
online platforms as well (Haywood, 2019). Therefore organization must provide training to their
employees, so they can provide their high level services to online customers also which will be
beneficial for organizational goals.
Physical Evidence-
Tesco provide distinct colour packaging in their products, through which is very simple
for customer to identify the product of their needs. So to improve their performance on ground
level company should also take feedbacks from their customers, so they can improve their
working. Tesco can also implement these feedbacks in their online portals, so it can be become
more user-friendly.

Budget
The estimated amount for marketing plan will be - £150,000/-
Monitoring and evaluation
Monitoring and evaluation is used to evaluate the performance of organization with
respect to Return Of Investment. ROI is a financial tool used to evaluate the benefits which
investors will be having from their investment in company (Nirschl and Steinberg, 2018). With
proper implementation ROI if Tesco is expected to increase by 5% within 1 financial year. There
are several Key Performance Indicators through which company's overall performance in context
of organizational goals can be evaluated. Following are the different types of KPI.
Revenue growth- In this the overall sales is measured and then compared with the expected
growth ratio of organization by which Tesco can evaluate its performance. Tesco's annual
revenue amount is expected to increase by 10% within 1.5 financial year.
(Nirschl and Steinberg, 2018)
(Paurva, 2019)
Return of investment is the measure of net profit and cost of investment benefits. High ROI
indicates that the high gains can be achieved through particular investment. KPI is Key
Performance Indicators are the set quantities which is used to measure company's overall
performance of organization . KPI uses several performance indicators which are used to identify
company's performance on right path. Revenue growth is one of the widely used KPI. For this
the expected growth is compared to actual growth of organization. Through this company can
evaluate their performance by the verifying progress with expected growth . Income source, in

this company's income is analysed be the revenue collection per client and service is analysed
and compared with expected revenue growth. Then their difference is used to identify company's
performance.

REFERENCES
Books and journals
Baker, M.A. and Magnini, V.P., 2016. The evolution of services marketing, hospitality
marketing and building the constituency model for hospitality marketing. International
Journal of Contemporary Hospitality Management.
Berkowitz, E.N., 2016. Essentials of health care marketing. Jones & Bartlett Learning.
Blythe, J. and Martin, J., 2019. Essentials of marketing. Pearson UK.
Chinn, E.R., 2017. Essentials of Branded Event Marketing(Doctoral dissertation, University of
Oregon).
Cooper, C., 2020. Essentials of tourism. SAGE Publications Limited.
Gupta, C.B. and Nair, R., 2020. Marketing Management, CB Gupta & N. Rajan Nair. Sultan
Chand & Sons.
Haywood, M., 2019. Brand essentials. Professional Beauty, (Mar/Apr 2019). p.78.
Henríquez, F.A.G., 2018. Destination marketing essentials (2. Anuario Turismo y Sociedad,
(23). pp.275-278.
Kuntonbutr, S., 2019. Book Review: Essentials of Marketing. RMUTT Global Business
Accounting and Finance Review. 2(1).
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Muralidharan, K. and Raval, N., 2017. Six Sigma marketing and productivity improvement. A
Quarterly Journal of the National Productivity Council. 58(1). pp.107-114.
Nirschl, M. and Steinberg, L., 2018. Einstieg in das Influencer Marketing. Springer Fachmedien
Wiesbaden.
Paurva, S., 2019. Essentials of marketing research.
Online
Addison, Marketing Mix Tesco, 2019 [Online]. Available through:
<https://www.essay48.com/term-paper/13685-Tesco-Marketing-Mix>
Business Strategy Hub, Tesco SWOT analysis, 2019 [Online]. Available through:
<https://bstrategyhub.com/tesco-swot-analysis-2019swot-analysis-of-tesco/>
MBA skool, Tesco PESTLE analysis, 2020 [Online]. Available through:
<https://www.mbaskool.com/pestle-analysis/companies/18023-tesco.html>
Rahman, M., SWOT analysis of Tesco, 2020 [Online]. Available through:
<https://howandwhat.net/swot-analysis-tesco-tesco-swot-analysis/>
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