Tesco's Marketing Strategy: Segmentation and International Markets

This report analyzes Tesco's marketing strategies, focusing on segmenting the consumer market in the UK for diet chips, targeting both older and younger demographics with tailored marketing mixes. It contrasts Business-to-Business (B2B) and Business-to-Consumer (B2C) marketing approaches, highlighting differences in drivers, positioning, and price sensitivity. Furthermore, the report distinguishes between domestic and international marketing, emphasizing the impact of political factors, competition intensity, control over marketing activities, and management abilities. The analysis covers product, price, place, and promotion strategies, providing a comprehensive overview of marketing principles and their practical application in diverse market environments. Desklib provides a platform to access similar solved assignments and study resources.

Managing Principles
TASK 2

4.1 Marketing mix for two different
segment in consumer market
Marketing mix can be defined as a combination of four
input such as product, price, place and promotion
which constitutes core of a company's marketing
system. It plays an important role in the achievement
of organizational goals and objectives. Company is
planning to introduce diet chips in UK market. In this,
Tesco can segment its customer base on the basis if
their age such as young and old customers. For this
segment marketing mix develop by Tesco are as
follows:

Continued....
Marketing mix for old people:
• Product: Core product which Tesco is going to
introduce diet chips. In the present scenario, old age
and young people prefers to consume diet chips
which place positive impact upon their health. Thus,
by making focus upon such people company can
attain success in the competitive business arena.
• Price: Price has significant impact upon the old age
people. Tesco sets competitive prices for diet chips
which helps them in attracting the more customers of
UK.

Continued....
Place: To provide convenience to customers Tesco
provide home delivery services to its customers. It
helps company in influencing more customer.
Promotion: Word of mouth publicity plays a vital
role in attract more customer so organization needs to
make focus on providing quality and cost effective
services to customers.

Continued....
Marketing mix for high social status people:
Product: Main product for high class customers are
quality and innovative services. Besides this, ambiance
and proper arrangement of merchandise also act as a
product which provides convenience to customers.
Price: Tesco set skimming pricing facility for high
social status people because they usually compare
price with the q1uality of product.

Continued....
• Place: Tesco will offer diet chips through their all the
retail stores which are situated in UK. In addition to
this, company will also offer such chips through its
online store which also offers convenience to its
customer base.
• Promotion: Tesco undertakes social media
advertisement to develop the awareness among the
young and old people about the diet chips which are
offered by them. Moreover, people spend their lots
of time on social networking sites. Hence, it is the
best way through which company can maximize its
sales and profitability aspects.

4.2 Difference between B2B and B2C
market
• Meaning: Business to business market refers to those
in which firm sell its product or services to industrial
customers rather than others. In this, industrial
customers make use of such raw material to produce
the finished goods. On contrary to this, in B2C
market Tesco sells its product directly to the end user
without involving any intermediary.
Drivers matters: In B2B market Tesco provides
deeper insight to the customers about product, price,
place, quality dimensions. In contrast to this, in B2C
market company only provides information
according to the needs, wants and desire of the

Continued....
Positioning: Tesco uses price and quality dimension to
positioned itself in B2B market as against to competitors. On
the other hand, in B2C market firm make focus on brand
endorsement strategy to positioned itself which helps it in
attracting more customers.
Price sensitive: Customers are more sensitive in relation to
the prices in B2B market. Where as B2C consumer segment
make more focus on quality, features and benefit in
comparison to price.

4.3 Difference between domestic and
international marketing
Domestic marketing: When company market its
product and services at local level or boundaries then it
is known as domestic marketing.
International marketing: In contrast to domestic
marketing, when company makes international
marketing strategies and policies to market its product
and services outside the local boundaries then it is
known as international marketing.

Continued....
 Political factors: In domestic market political
factors has no significant impact upon the
business operation of the firm. On contrary to
this, political aspects such as tax policy, tariffs
etc. closely affects the business policies and
strategies of the company.
 Intense of competition: Company who wants to
enter in international market to make more profit
faces high level of competition. In contrast to
this, company faces low level of competition due
to the strategies and policies of competitors are
known.

Continued....
• Control upon marketing activities: In the domestic
market it is very easy for the company to make control
upon the marketing activities as compared to
international market. In international marketing
environment company faces many difficulties in relation
to the marketing activities such as political, legal, social
and economic.
• Management abilities: In home country, business unit
requires management skills and abilities to execute their
business functions and activities in an efficient manner.
Whereas manager of the firm requires high level skills
for the implementation of their plan and strategies in
international market as compared to domestic market.

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