Marketing Strategies and Audit for Tesco: A Detailed Report

This report provides a comprehensive analysis of Tesco's marketing strategies, starting with an introduction to marketing principles and a focus on Tesco as a major UK retailer. It includes a detailed marketing audit of Tesco's current business performance, examining its strengths, weaknesses, opportunities, and threats through SWOT and PESTLE analyses. The report explores Tesco's current marketing strategies, emphasizing brand positioning and market reach, and delves into market segmentation techniques, using demographic, psychographic, and environmental factors. The Ansoff matrix is applied to evaluate Tesco's business portfolio, covering market penetration, development, product development, and diversification strategies. The report aims to provide insights into Tesco's marketing practices and their effectiveness in a competitive retail environment, highlighting key strategies to enhance market size and achieve business objectives.

Introduction To Marketing

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK...............................................................................................................................................1
Marketing audit of current business performance.......................................................................1
Research on market segmentation...............................................................................................5
Marketing Strategies...................................................................................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................11

INTRODUCTION
The term marketing is defined as a business function or the set of process that is engaged
in creating, communicating and delivering better value products or services to the customers.
Marketing is managed and followed by customer relationship that results in developing and
accomplishing mutual benefit for business and its stakeholders. This report is written from the
perspective of Tesco and it is one the largest retail organisation among all over the UK.
Supermarket, hypermarket and superstore are different types of stores that is managed and
controlled by authorities of Tesco and its headquarter is situated in England (Fatricia, 2017). This
report highlights on marketing audit of business's current business performance and on the
organisation current marketing strategy and position of organisation in market. Along with this
market segmentation criteria to accomplish company targets will also focused in the report for
enhancing market size of business.
TASK
Marketing audit of current business performance
The term marketing audit is defined as a comprehensive, organised and systematic
analysis of the business to perform business task in an appropriate manner. The main motive of
marketing audit is to perform marketing functions and operations according to the marketing
environment. Internal and external both conditions are identified by management that is leading
business to highlight areas which perform well so the organisational performance and
management both are improved. Along with this marketing audit is defined as the thorough
review of marketing plan, strategies and the focus on current activities which is executed in the
business operations and functions of TESCO (Oh and et, al., 2017). Some reasons are conducted
by the organisation that supports for marketing audit of TESCO and it is mention as follow:
 Increase in marketing activities- With the analysis of marketing activities it is identified
that all business are concerned about execution of their day to day activities that helps to
manage business for accomplishing a long term goal or objective. At the time of
implementing marketing strategy it is identified that long term goals are executed to
achieve goals and objectives of Tesco in an appropriate manner. Marketing audit work
the way or method that is used to execute business successfully by monitoring that
executing steps accomplish TESCO marketing goals in specify period.
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 To check all steps are performed- The term marketing audit helps the management to
explore all marketing activities that are implemented by TESCO to implement and
evaluate business functions in a successful manner. This is also used to evaluate business
activities that helps in accomplish of company objectives with right facts and figures. It
defines opportunity and marketing areas are performed to employ tactics that helps to
achieve more success in market functions and operations.
 To get In-depth information about competition- For the successful marketing an
organisation require in-depth understanding about several concepts that includes market
and target audience (Otter and Wetherly, 2014). With marketing audit there are different
factors are gained that helps in analysing competition factors. Tesco utilise marketing
audit for exploring strength and weakness of competitors that helps to develop strategy in
accomplish of company goals and objectives.
 Reduce money and time in long term plans- With the constant and continue check-in
and the check out of analysing company process. It is easy for organisation to ensure that
there is no waste in the money and time of company to operate company plans.
Marketing audit of Tesco conduct regularly helps to enhance the marketing investment
and it helps in accomplish of company activities which work best for the business plan.
This results that time and money for Tesco is ensured by making activities which
improve benefits for company for long run.
Current marketing strategy of Tesco
With an existing and clear understanding of business plan it is identified that marketing
activities leads an organisation to perform their work at global level by promoting business
actions with an accurate marketing strategy. The existing marketing strategy of TESCO
undertakes the methods of Brand positioning and according to steps of brand positioning
marketing strategy of TESCO position the company brand. Along with this positioning is
transparent and clear which helps to set the mind of consumer towards company products. The
existing aim of organisation is to reach at every aspect of market. This leads TESCO to position
itself as the high-volume low cost retailer. But with the globalisation of business and industries
Tesco analyse that it is important for organisation to promote products with new strategy that
demonstrate new value for company (Gong, Liu and Zhu, 2019). This also refers it helps Tesco
in demonstrating premium range of products. With this positioning, organisation also try to
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establish themselves as a market which helps in managing supermarket that is visited by
everyone for selling different range of products. It leads organisation to increase the number of
customers within the organisation. But for this the first step relates with promoting company
products in order to demonstrate that existing products are valuable and useful for customers.
This also define various persons are engaged in company operations and most of them is focused
towards offering value for satisfying needs and wants of customers in proper manner.
The next phase that relates with marketing strategy of respective organisation relates with
creating and increasing the awareness of brand. Majority of the Tesco departments rely on the
offline promotion that pours millions of investment on billboards, commercial and print
advertisement on company (Kazimierczak and et. al., 2015). The main aim of this activity is to
increase the number of footfalls in TESCO store and supermarket. For satisfying customers
Tesco undertakes aspects that include internal and external environment to promoting company
products in an appropriate manner/
SWOT Analysis
SWOT is conducted by the organisation for identifying the strength and weakness of
organisation. Along with this opportunities and threats of Tesco is also engaged in retail sectors
because various competitors are available that reduce sustainability of organisation.
Strength
 Tesco is the largest retailer that deals in
multiple number of products. This also
aids management to improve their
position in market.
 Tesco operate stores, markets, hyper
markets at a large geographic base.
This helps to manage business at large
area.
Weakness
 Most of the products which are sold by
Tesco only take place in UK. This also
refers that due to weak products base in
international market it is complex to
earn revenue from other areas.
 Supply chain of Tesco is too weak so to
transfer products in international
market is complex to deliver.
Opportunities
 By engaging small-sized retailer in
other country it is easy for organisation
to expand business easily in
international market.
Threats
 ASDA, M&S etc. generates threats for
organisation such as competition at low
price. This generates threat for Tesco
because it impacts on sustainability of
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 With introducing new market segment
Tesco operates its business in rural area
also.
business.
 Small-sized retailer also generate threat
for organisation by managing business
at small and medium level.
PEST Analysis
 Political- This include change or fluctuations that take place in political conditions of a
country. It generated different problems for Tesco such as to restrict company activities
within the country (Pavliuk and Noda, 2020). Tesco operate business in UK and there are
different trade agreements and European integration take place that helps to manage
business with low operational cost.
 Economical- This is related with economic changes that take place in the nation and it
impacts on the buying behaviour of target people. Positive and negative aspects both are
analysed by management of Tesco to formulate right strategy that helps in managing
business as per moderate interest rates. Moreover, TESCO also analyse that UK
individuals dispose their income on profitability of business.
 Social- This relates with behaviour and interest of target individuals that can influence on
decisions of business management. Their are different decisions is managed that helps
Tesco to formulate plans according UK individuals which helps in managing equality and
brand products. Tecso utilise social aspect for enhancing and expanding business at
different locations.
 Technological- This relates with the technological advancements and it support the
organisation for achieving better sustainability and profitability in business. This also
refers that retail industry of UK faced constant technology changes like to use the internet
on the base of online shopping. So by selling and marketing TESCO products with online
and offline platforms it is easy to improve market areas of products (Ji, Li and Xia,
2020).
Ansoff matrix
There are various functions and operations performed by management that is used for
examining overall business portfolio through using Ansoff matrix. Organisation is one of the
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largest retail organisation that operates its business within multiple number of nation. Ansoff
matrix from perspective of organisation is mention as follow:
 Market penetration- With the analysis of market penetration strategy it is identified
that organisation accomplish company growth with the motive of increasing their market
share. Tesco utilise market penetration strategy for developing and enhancing wide range
of products (Bacik, Gavurova and Fedorko, 2015). This also helps to accomplish
competitive edge in market by improving company goodwill in market.
 Market development- According to the strategy of market development, organisation
achieve its growth to involve and engage in market segment. This is done by the
company for expanding their number of operations in other country. It is also used in
managing business which helps to open stores at different nations. This also refers
organisation improve there store numbers for market development.
 Product development- In the strategy of product development an organisation
accomplish business growth by entering into current market segments. This is also
achieved by Tesco through establishing brands which is related with development of
products. This helps in managing retail sector properly by formulating new product
development.
 Diversification- With the analysis of diversification strategy it is identified that Tesco
utilise diversification strategy for improving their products. This helps in diversifying
company products to work with new markets and it helps retailers to expand their new
product into new market. It is a risk related process so Tesco implement this with
formulating an effective business plan.
Research on market segmentation
The term market segmentation is defined as a approach that is used for targeting the
market group for executing the company products and services. The main motive of market
segmentation is to connect and coordinate between groups and it also helps company to analyse
potential number of customers within a particular area (Gopaldas, 2015). Moreover, the elements
of market segmentation is to consider and evaluate all perspective related with product, price,
people and place. It helps for examining the positioning of organisation in an intense competitive
market.
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TESCO
The term Tesco utilise demographic segmentation for targeting the products and services
of organisation in market. This is used by organisation for the effective management that
provides more capability to manage and operate all functions in a smooth manner. This is
completed by the respective organisation to make effective decisions by formulating right and
effective strategy. This is done for managing effective decisions that is used to build better
marketing options and determination for target customers. Moreover, the main purpose of market
segmentation is to analyse the marketing plans and strategies that helps to analyse overall market
size of business (Engelen and Brettel, 2011). Metric's Free market segmentation tool is used for
analysing market size and this helps for demographic, psycho-graphic and environment
conditions for evolving different marketing strategies. It also helps in evolving marketing
strategy that helps to manage company results to achieve sustainability and profitability in
business.
Market segmentation
This refers to the process of classification within a market or consumers that helps in
managing groups which is related with income. Characteristics of individuals are also focused in
the market segmentation process which is useful for managing consumer needs. Further, by
utilising all resources in an effective manner it is easy for organisation to introduce and launch
their product in market. This also help to categorise market at different levels and this directly
helps for analyse needs and preferences of different segments.
Tesco divide market segmentation into two different parts that are mention as follow:
Market segmentation according to age group Tesco is offering their products to different
age group that includes kids, adults, men and women (De Mooij, 2018). Market segmentation is
a beneficial aspect for the organisation that helps to analyse information related with customers
preferences and perspective. For this data based marketing is consider as the marketing technique
that is subjected by organisation for market segmentation. With adopting tactics of data based
marketing manager and accountant of Tesco are able to develop and analyse marketing
conditions which helps for analysing better classification of products. Along with this it is also
used in making areas that determines company structure to grow business in an effective manner.
Market segmentation as per income group- Cost or price are the important factors that
helps in managing market segmentation of Tesco. Moreover, by charging high prices on products
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it is easy to dispose company income that is primarily focused to analyse the perception of
individuals towards price policy of company. It includes four segmentation that are described as
follow:
Demographic- Under this, the whole population is being divided on the basis of various
dimensions such as gender, age, income aspect and many more. This aspect is helpful for Tesco
in examining needs and preferences of their target audience which is dependent on the above
mentioned characteristics (Krishna and Schwarz, 2014). For example Tesco is targetting at
income aspect and trying to placing their product on middle income group as prices of the
company is moderate.
Geographic: Under this market is been divided on the basis of location factor in which
population is targetted on the basis of location. This is helpful for Tesco in order to decide upon
the location which is laced with highest demand. For instance Tesco is mostly targetting over UK
market due to high market demand of premium eatable products.
Psycho-graphic: Under this aspect the whole population is being divided on the basis of
several aspects such as lifestyles, living standard, attitude and many more. For example in India
demand of ethnic cloths are high so this is creating high opportunities for to unleash the market
segment. This is providing high opportunities for Tesco in order to place their business in
different portion of India.
Behavioural: Under this, the whole population is divided on the basis of behavioural
aspects such as buying behaviour, brand loyalty of potential customer and many more. This is
helpful for Tesco in order to supply their products in those areas in which their products are
accepted in wide manner (Fritz, Sohn and Seegebarth, 2017). For example, population of UK is
highly concerned regarding brand so this is giving immense opportunities for Tesco to get
sustainability.
From the above mentioned segmentation the most appropriate segmentation for Tesco is
geographic and psycho-graphic as the company is having major aim to enhance their brand
image and revenue as well.
Reasons of targeting such two market segmentation: Geographic: The pricing strategy of Tesco is moderate so they are proficient to attract
group of middle income.
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 Psycho-graphic: Premium eatable products are highly demanded in UK which is
rendering high opportunities for the company to enhance their sales and profit as well.
Marketing Strategies
Marketing is defined as doing regular efforts so that to satisfy needs and demands of
customer and to promote offerings of the company by adopting various activities such as supply
chain management, promotional tools and many more (Cornwell and Kwak, 2015). For this
marketing strategies are adopted by Tesco in order to put impact on buying behaviour of their
existing and future customer. This is helping them in providing awareness regarding their
business offerings. Some of the adopted strategies are elaborated as under:
Product description:
This is stated as bifurcation of product on the basis of their features, quality and prices so
as to target market population. Tesco is a global retail chain which is dealing in various
segments such as groceries, décor items and many more. The company is covering near about
29% of UK market and they are highly emphasised on innovations in order to attain distinct
competitive edge within marketplace. Tesco is using various promotional tools and tactics for
enhancing brand awareness and equity. They are using TV advertisements and other methods to
advertising their business.
Brand image
It defines the current status of brand. On the other side, brand image is defined as a
perception in the customer's mind for the particular brand that exists in market. Along with this
Tesco position and produce products in an effective manner. This attracts customers towards
products with brand communicators such as packaging, word of mouth publicity and advertising.
Brand image basically affected in a positive manner by enhancing company positions. It also
attain good brand image by selling quality products to all age group with affordable prices.
Selected strategy and objective
In the context of large retail organisation such as Tesco different products is delivered to
the consumers with large variety (Möller and Parvinen, 2015). So to distribute large products at
various place it is essential to analyse distribution channel. Types of some distribution strategy is
mention as follow:
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Indirect distribution- This follow and include way in which manufactures connects with
lower chain of market. In this a product is delivered to customer with help of retailers and by
indirect distribution Tesco is able to reach its products towards customer with effective service.
Direct distribution- Within the direct distribution channel manufactures deliver its
products in an appropriate manner. This also helps Tesco for reducing number of intermediaries
and with use direct distribution channel it is easy to provide all products at huge level within
minimum time period.
Selective distribution- According to the method of selective distribution manufacture
channels enhance its revenue by delivering products that are high in quality. Along with this
Tesco also determine the field in which the products demand is more, it results by providing
products of good quality revenue of organisation is also increased by selling good quality
products at different places.
CONCLUSION
With the analyse of above report it is concluded that this is important for each
organisation to generate marketing audits whether it is small, medium or large. This also helps
the business for completing there work within specific period of time. It also helps for analysing
market situation in order to understand organisation position within the market. With the use of
different tools such as PESTLE, Ansoff's and SWOT are utilised to complete work according to
market strategy. In the last, this is also essential for organisation to identify market segmentation
that helps in identifying and fulfilling needs of customers in selected market segment.
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