Analysis of Customer Relationship Management in Retail: Asda & Tesco

This report undertakes a comparative analysis of Customer Relationship Management (CRM) practices within the retail sector, specifically focusing on two major players in the United Kingdom: Asda and Tesco. The study begins with an introduction outlining the significance of CRM in today's competitive retail landscape, emphasizing its role in enhancing customer satisfaction, increasing profitability, and retaining customers. A comprehensive literature review explores the evolution of customer concepts, the definition and various aspects of CRM, technological considerations, and strategic planning for CRM deployment. The research methodology section details the research onion framework, research philosophy, approach, design, and data collection methods, including the use of secondary data. The report then presents a data analysis and discussion, comparing the CRM strategies of Asda and Tesco, followed by a conclusion summarizing the key findings, recommendations for improvement, and limitations of the study. The overall aim is to provide insights into how CRM impacts customer satisfaction and business performance in the retail industry.

Running head: COMPARISON OF CUSTOMER RELATIONSHIP MANAGEMENT IN
THE RETAIL SECTOR: CASE OF ASDA AND TESCO
Comparison of Customer Relationship Management in the Retail Sector: Case of Asda and
Tesco
Name of the Student:
Name of the University:
Author’s Note:

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Abstract
This paper deals with the CRM practices that are implemented in the retail sector in
United Kingdom and a comparison is undertaken with respect to the two organizations Tesco
and Asda. The main motive of every organization has been to earn additional profit and that
is only possible if the firms are able to retain their existing customers and bring in new and
potential customers in their customers base. Therefore, customer relationship management is
a customer based organizational strategy with the aim of increasing their profitability,
customer satisfaction and revenue.
There have been various products that have developed for the past few years and the
rise in the competition has led to the construction of new and innovative plans among the
researchers. It has been observed that customer relationship management has been one of the
main plans that have been established by various retail organizations in order to understand
the requirements of their customers and establish new and improved plans so that the
grievances of the customers can be resolved.
The analyses of the data that are gathered from the secondary sources with respect to
the two firms have effective CRM practices and therefore they have a good base of
customers. The retail sector has significant use of CRM and this system is essential in order
to create loyalty and satisfaction among the customers.

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Table of Contents
Chapter 1: Introduction..............................................................................................................4
1.1 Background of the paper..................................................................................................5
1.2 Problem Statement...........................................................................................................6
1.3 Research Objectives.........................................................................................................6
1.4 Research Questions..........................................................................................................7
1.5 Research Significance......................................................................................................7
1.6 Organization of the paper.................................................................................................7
Chapter 2: Literature Review.....................................................................................................9
2.1 Customer Concept............................................................................................................9
2.2 Customer Relationship Management...............................................................................9
2.3 Aspects of CRM.............................................................................................................12
2.4 Technological Consideration in the Implementation of the CRM strategy...................12
2.5 Strategy for the introduction of CRM............................................................................13
2.6 Planning for CRM deployment......................................................................................13
2.7 CRM in Tesco and Asda................................................................................................14
Chapter 3: Research Methodology...........................................................................................16
3.1 Introduction....................................................................................................................16
3.2 Research Onion..............................................................................................................16
3.3 Research Philosophy......................................................................................................16
3.4 Research Approach........................................................................................................17
3.5 Research Design.............................................................................................................18

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3.6 Data Collection...............................................................................................................18
3.8 Secondary Data..............................................................................................................19
3.9 Sampling Method...........................................................................................................20
3.10 Data Analysis Plan.......................................................................................................20
3.11 GAANT Chart..............................................................................................................21
Chapter 4: Data Analysis and Discussion:...............................................................................22
Chapter 5: Conclusion Recommendation and Future Work....................................................31
5.1 Conclusion......................................................................................................................31
5.2 Recommendations:.........................................................................................................32
5.3 Limitations of Study/Scope of Study:............................................................................36
Reference List and Bibliography.............................................................................................37

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Chapter 1: Introduction
With the advent of the new century the firms operating in the retail sector had to
undertake various infrastructural transformations as they required reorganizing their present
production methods. This alteration of the retail sector was the main reason for the
technological and organizational developments that led to the production of new and
innovative products and services that would improve the lifestyle of human beings. The
introduction of these innovative products are main factors for the rise in the competitive
forces that was doubled by the internationalization phase and leading to an increased number
of mergers and acquisitions among the firms. It has been observed that the main motive of
every organization has been to earn additional profit and that is only possible if the firms are
able to retain their existing customers and bring in new and potential customers in their
customers base(Zhang, van Doornand Leeflang 2014). Therefore, customer relationship
management is a customer based organizational strategy with the aim of increasing their
profitability, customer satisfaction and revenue. The mechanisms that are inclusive of this
purpose of the business are the storage, capture and evaluation of the customers along with
the internal process information. The functions that assist this aim of the business are
marketing, sales, customer service, professional development and compensation. The
technologies that assist the customer relationship management initiative must be included as a
segment of the strategy that is customer centric(Fernie 2014). There have been various CRM
initiatives that have failed as they were restricted to the installation of the software without
aligning the software with the strategies that are customer centric. This is the first chapter of
the paper and therefore it establishes an outline of the general structure of the study that
includes the problem statement, the research objectives, hypothesis and the research
questions that will be helpful for the completing the study.

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1.1 Background of the paper
The advent of competition with the retail industry has expanded at a rapid rate over
the past few years in United Kingdom. This has mainly been due to the outcome of retail
industry being one of the most significant sectors globally. The desire for new and improved
products and services has revolutionised the retail industry as the organizations are focused
on manufacturing new and improved techniques that will enhance their revenue and will even
restore their customer base.
There have been various products that have developed for the past few years and the
rise in the competition has led to the construction of new and innovative plans among the
researchers. It has been observed that customer relationship management has been one of the
main plans that have been established by various retail organizations in order to understand
the requirements of their customers and establish new and improved plans so that the
grievances of the customers can be resolved(Armstronget al. 2014). It is the main function of
the firms to resolve the complaints of the customers and the firms who resolve these
problems faster are the ones who are more competitive in the market.
Due to the rising patterns globally, retail sector firms have expanded their business
worldwide and have established competition within the retail sector. Therefore, as a remedy
customer relationship management has become a mechanism for every firm in order to utilize
the competitive edge over one another. The creation of customer satisfaction and value is at
the very core of the modern era of marketing practice and thinking. The organizations that
have an image for giving out increased level of customer satisfaction with respect to doing
things in an effective manner than their rivals have been observed as having a better customer
relationship management(Sutton-Brady, Kamvouniasand Taylor 2015). Therefore, the
employees functioning in these firms have knowledge about the connection among their jobs
and the level of customer satisfaction.

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The comparison of the customer relationship management can be very well
understood by undertaking a comparison among Tesco and Asda, two of the renowned retail
organization that functions in United Kingdom. It has been observed that the two firms are
very competitive and there are very less differences among their operational strategies.
Therefore, understanding their customer relationship management will be helpful in
understanding the CRM in the retail sector in United Kingdom.
1.2 Problem Statement
With the advent of higher extent of competition in the retail industry, the firms have
tried to influence the consumers with the help of quality products and a variety of products,
even though it has been observed that there has been loss of some customers due to the
variations in their preferences, tastes etc. It has been observed that even though there have
been attraction of new customers but most of their customers have the habit of purchasing
various products from different firms. It is due to this factor that the firms are continuously
trying to improve their product quality and prices so that the customers are attracted towards
their products(Carlson, O’Cassand Ahrholdt 2015). The maintenance of the quality of the
product is influential for the restoring the satisfaction level of the customers. Therefore, it is
important that CRM is maintained by every organization in order to maintain their
competitive edge and retain their customer base. It is therefore due to this factor that analysis
of the CRM initiatives of Tesco and Asda is undertaken in order to undertaken what impact
CRM has in the retail sector.
1.3 Research Objectives
This paper is being constructed in order to gain an idea about customer relationship
could have an impact on the level of customer satisfaction by using Tesco and Asda in United
Kingdom as a case study. The distinct objectives and aims of the papers were to investigate
the following:

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 To discover the Customer Relationship Management practices of Tesco and Asda
 To investigate the degree of customer satisfaction of the CRM practices in the
chosen region
 To suggest the significant factors that is in association to the CRM practices for
the customer satisfaction in the retail sector.
1.4 Research Questions
The research questions with respect to the research objectives are discussed as follows:
Q1. How does the customer observe the degree of CRM practices in Tesco and Asda?
Q2. How do the customers rate the degree of customer satisfaction in Tesco and Asda?
Q3. How the staffs of Tesco and Asda do observe the effect of CRM practices with respect to
the customer satisfaction?
Q4. Do the consumers have any recommendations in enhancing the CRM practices in Tesco
and Asda?
1.5 Research Significance
The undertaking of the research will be influential for the retention of consumers and
a development in the customer satisfaction understanding with the help of advanced
technologies with respect to CRM and product and service qualities. The paper will disclose
the level of CRM and its impact on Tesco and Asda while functioning in the economy.
1.6 Organization of the paper
The paper is structured in a precise manner with the introduction chapter providing an
insight over the topic. Chapter 2 of the paper comprises of the literature review where the
analysis and the outcomes gained by other researchers with respect to this theme are
discussed. Chapter 3 comprises of the research methodology that discusses about the

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structure that is required to be followed in order to analyze the data. Chapter 4 undertakes the
data analysis and discusses over the topic and finally the last chapter is the conclusion where
the summary and the end result of the paper is discussed.

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Chapter 2: Literature Review
The review of literature helps the researcher to recognise the differences and the
similarities among the previous and the current studies along with the probable contributions
to the paper that is being constructed. This segment of the paper analyses the precise and the
associated literature of the paper and then connects it with the present paper. It is inclusive of:
2.1 Customer Concept
The idea of customers and for that matter the consumers have grown up along with
time. The philosophies with respect to the customers have transformed with the help of the
manufacturing concept time to the communal marketing period concept. Conversely, with
respect to this understanding regarding the changes in the consumers has mainly been due the
knowledge that the consumers play a significant role in the firm. Before the year 1960, it was
predicted that the customers consumed everything that was manufactured and there were no
crucial ingredient in the production strategy(Soet al. 2016). The vital issue came into
existence with the advent of globalization and liberalization. In the mean time, the
organizations have understood that it is economical to sustain their existing customers rather
than trying to bring in new customers. Therefore, the CRM practice has been granted with so
much importance by most of the firms in the present economy.
2.2 Customer Relationship Management
Customer Relationship Management (CRM) is an innovative term that is looked upon
when consumer preference is explained in the modern firms,. CRM is the strategy of the
business that looks to gain knowledge, manage, predict and customize the requirements of the
firm’s potential and current customers. In the current competitive environment, the
discovering and maintain the customers is more complex. It is even economical to maintain
the existing customers that to look for new customers. It is due to this effect that the idea of
CRM has been constructed as a strategic method for the organizations to move ahead with the

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retention of the customers in systematized manner. It has been observed that CRM is more
than a electronically constructed software, but is business strategy that puts the customers at
the core of the business of the firms. The organizations that are performing properly in the
market have gained knowledge about the association of a satisfied customer and establishing
a long term profitable and sustainable strategies.
According to Zakariaet al.(2014), a flourishing CRM introduction will permit the
sales and marketing employees, the customer service to have a holistic outlook for their every
customer. This process in theory will help the organizations to make informed decisions and
establish cross selling and opportunities for up selling, computing marketing efficiencies and
deliver customized customer care. In the last few years, the word has expanded to surround a
more strategic process and the investment has been in billions of dollars globally in the CRM
practices and the services that have followed.
As explained by Juan Dinget al.(2014), a significant indicator of flourishing CRM is
the satisfaction level of the customers because in the long run, the customers who not
satisfied may switch towards another firm. The advantages that derive out of the satisfied
customers are on the other hand manifold. Frowet al. (2014) have given out instances that
stronger competitive situation of the firms with the availability of the satisfied customer leads
to the higher profits and market share. Therefore, customer satisfaction is a significant aspect
of the business associations and a tool of a successful relationship among the management
operations. The role performed by the customers in any organization is known properly and
thus cannot be over highlighted. It has been acknowledged that constructing a good relation
with the customers is important for the maintenance of customer loyalty. Hingley,
Lindgreenand Grant(2015) identified this statement by explaining that customer loyalty is
significant to the achievement of the firms and that the customer loyalty is an asset that is

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competitive in nature and is a way of expanding the retention of customers with the help of
collaborative and secured relationship among the sellers and the buyers.
A CRM that is successful always initiates with a business strategy, which influences
the transformations in the firms and their method of work that is assisted by the technologies.
The key issue here is the philosophy that is customer related that touches every aspect and
significantly every individual in the organization(Baker 2014). From the management to the
employees lay focus on the satisfaction of the customers and thereby create a mechanism that
motivates the functions of an organization. The organizations look to restructure their CRM
strategies from time to time in order to stay updated with the changing customer and desire
and time.
There exist a wide variety of CRM process that are very complex to simple. A simple
CRM can be the utilisation of a contact management software to a spreadsheet to keep notice
of the interactions with the customers. The most efficient method on the other hand is in need
of a comprehensive effort from the side of the organization in order to influence and retain
customers with the integration of the individuals, technologies, policies and methodological
strategies. They are in need of a cross functional method as no individual business unit can
efficiently carry out CRM on their own(Huang, and Rundle-Thiele 2014).
In the current years, the technologies of CRM have become easier to access and are
even economical for smaller firms as the technological solutions have become applicable at a
faster rate. There are a range of options that are available with the help of online and web
applications that does not need the purchase of software or their installation. However, a
subscription fee is only paid by the firms for its use. There are many small organizations that
make use of CRM technologies in steps that mainly initiates with the automation of sales