Icon College: Marketing Essentials Report - Tesco and Sainsbury's

This report provides a comprehensive analysis of marketing essentials, using Tesco as a case study. It begins with an introduction to marketing and its definition, followed by an examination of the key roles and responsibilities of the marketing function within Tesco, including market research, strategy development, market trend monitoring, and budget management. The report then explores the interrelationship between the marketing function and other organizational functions, such as finance, human resources, production, IT, and customer service. Furthermore, the report includes a comparative analysis of the marketing mix of Tesco and Sainsbury's, highlighting their product, price, place, and promotion strategies. Finally, the report culminates in the development of a marketing plan specifically tailored for Tesco, integrating all the discussed elements to enhance its market performance.

Marketing Essentials

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
LO1..................................................................................................................................................3
P1 Key roles and responsibilities of the marketing function.......................................................3
P2 Interrelationship between marketing in wider organisational function..................................6
Lo2...................................................................................................................................................8
P3 Application of marketing mix................................................................................................8
LO3................................................................................................................................................11
P4 Marketing Plan.....................................................................................................................11
CONCLUSION..............................................................................................................................16
REFERENCES..............................................................................................................................17

INTRODUCTION
Marketing by American marketing association has been defined as activity, set of
institutions, and processes for creating, communicating, delivering and exchanging offerings that
have value for customers, clients, partners and society at large. This definition of marketing
covers wider aspect of marketing including creating and delivering offerings. This reports aims
at discussion essentials of marketing in context of Tesco, British multinational groceries and
general merchandise retailer. Company was founded in 1919 by Jack Cohen and is headquartered
at Hertfordshire, England. Products of the company involve supermarket, hypermarket,
superstore and convenience shop and these products are available at 6800 locations in 10
countries of Europe and Asia. Tesco is third largest retailer on the basis of gross revenues and on
the basis of revenues it is 9th largest retailer in world. This report will discuss about key roles and
responsibilities of marketing function, and this will be followed by discussion about
interrelationship between roles and responsibilities of marketing with other functions of
organisation. Later report will include comparison of marketing mix of Tesco with Sainsbury’s
marketing mix. Lastly report will involve producing a marketing plan for Tesco.
MAIN BODY
LO1
P1 Key roles and responsibilities of the marketing function
Marketing is a function that is very important and several other functions are based on
marketing function. Success of marketing makes an effective contribution in success of overall
organisation (Cacciolatti and Lee, 2016). In order to contribute in organisational success, several
roles and responsibilities are carried out by marketing and these are as follows-
Undertaking market research
This is one of the most important role and responsibility that are played by marketing in
Tesco. As definition of marketing outlines it involves creating products and on the basis of this
element marketing in Tesco undertakes research, in order to identify what customers want and

require. Research also involves identifying target market and ways in which they can be
informed about availability of the products and services of Tesco. Research further helps in
creating and implementing promotional strategy for Tesco. Concerned with market research
Tesco undertakes survey and receive customers’ feedback and on the basis of this develop
different marketing strategies.
Developing marketing strategies
This is another role and responsibility of marketing function within Tesco. Marketing
function is expected to develop marketing strategy of Tesco. Marketing strategy through which
Tesco can achieve organisational as well as marketing objectives. This involves identifying and
recognising requirements of target market and develops strategies through which they can be
provided products and service accordingly. Marketing strategy aims at creating balance between
opportunities of market and organisational objectives and expected market performance.
Monitoring market trends and changes
This is another role and responsibility of marketing and this responsibility and role is
carried out by marketing function within Tesco by tracking trends and changes in market
(Minchin and Alpert, 2017). This means that Tesco operates in a highly complicated and rapidly
changing market environment. In order to ensure success of Tesco in changing market
environment it is important that trends are identified timely and changes in internal environment
are made accordingly. This is responsibility of marketing function to track changes affectively
and stay agile to identify potential threats and opportunities for effective performance of Tesco in
market. This is also important to ensure that Tesco is strong position in competition and is able to
take competitive advantage by effective adaptation of changes in market of Tesco.
Help in improving market performance of Tesco
This is another responsibility of marketing function within Tesco. This role and
responsibility of marketing involves giving suggestions to Tesco about what they should do in
order to improve their performance in marketing. This involves suggestions regarding improving
brand image, market expansion and different suggestions regarding product and service
improvements in Tesco. Improvement in sales processes and customers satisfactions is also part

of this role and responsibility of marketing within Tesco. This involves suggesting creative and
innovative ideas to use in promotions and marketing to positively influence customers.
Managing marketing budget and calculating ROI (Return on Investment)
Budget can be defined as plan that involves how organisation and particular department
in organisation will spend monetary resources that are allotted to them. Marketing department in
Tesco is also allotted budget to carry out marketing activities. This is responsibility of marketing
in which they ensure that they are able to manage activities of marketing within allotted budget
by organisation. They also calculate return on investment, return on investment, this means what
company has gained return on investment what has been made by marketing function on
different activities and actions of marketing (Harrison, 2019). Responsibility of marketing also
involve that they stretch budget and work to make best of available budget.
Coordinating with other organisational functions
This is another responsibility of marketing in which it coordinates with other functions of
organisation. This involves coordinating with sales, production, and finance and HR departments
within Tesco. Coordination with organisational functions facilitates performance and activities of
every function of the organisation. This means that marketing helps production in relation with
quality decisions, HR function with HR required issues and finance regarding finance related
issues.
Contribution in Innovation
This is another responsibility and role of Tesco, innovation has become very important in
order to gain competitive advantage and sustainable growth and performance of Tesco.
Marketing department because undertakes research of market hence has knowledge of what
customer requirements are how they can be fulfilled. This becomes effective basis for innovation
of Tesco and innovation contributes in organisational performance.
Producing material for marketing and promotion
This is another role and responsibility of marketing in Tesco, this role involves creating
material that is to be utilised by Tesco in its promotion and marketing of Tesco. Marketing and

promotions are those activities through which Tesco communicates with target audience
regarding product and service availability of Tesco (Moorman and Day, 2016). Advertising and
promotions involve utilisation of content as message for audience and potential customers.
Marketing function has a responsibility to create material and content for marketing and
promotions.
P2 Interrelationship between marketing in wider organisational function
Wider context of organisation involves several other functional departments within
organisation except marketing. Success of overall organisation depends on success and effective
coordination and interrelationship between different organisational functions. Interrelationship is
way in which two or more functions of organisation are related to each other. As discussed above
marketing has a very important role to play in organisation. This discussed role and
responsibilities are in context of marketing and its role and responsibilities in wider
organisational context of Tesco are as follows-
Marketing and Finance
Finance function in Tesco is concerned with acquisition and utilisation of finance
necessary for efficient operations of organisations. Finance function also involves budgeting of
organisation and its different activities. Marketing and finance are related to each other in Tesco,
this is because finance function of Tesco fulfils monetary requirements of marketing function
within Tesco. Relationship marketing and finance is very important in which marketing gets
budget from finance considering annual requirements of marketing budget of Tesco. This
relationship further involves assistance of finance department regarding cost and return of
marketing function. This way finance function of Tesco facilitates functioning and finance
management of marketing department and allows it to understand impact of marketing
department and its activities on overall financial conditions of Tesco.
Marketing and Human Resources
Human resource function in organisation is concerned with resourcing organisation with
competent and qualified personnel who are able to effectively carry out organisational activities
(Gök and Peker, 2020). Effective functioning of the organisation is mainly dependent on
effective employees who are working on carrying out organisational objectives. Marketing and

human resources are related to each other as human resource requirements and management of
marketing department is carried out by Human resource department of organisation. Human
resource department also undertake activities like compensation management, training and
development and grievance management of employees of marketing function. Assistance of
marketing department is also important for Human resource as they can effectively carry out
planning regarding human resources and other HR activities of Tesco.
Marketing and production
Production function within organisation is responsible for converting raw material and resources
into final goods. This function and marketing function within Tesco are significantly interrelated
(Lin and Lucas, 2018). Interrelationship between marketing and production function in Tesco is
based on sharing of information. Marketing function carry out research regarding required and
desired product and services informed to Production department so that they can work
accordingly and produce products that are required by customers. This involves decisions of
production function regarding quality and quantity of product along with cost of product.
Production department collect information from marketing so that they can focus on required
quality and cost of product by customers and create a balance between prices that Tesco wants to
charge. Relationship of production with Marketing facilitates its decision making but production
is also important for marketing. This means that marketing can utilise information from
production function regarding value of product and on the basis of that they can effectively and
accurately communicate with audience about value and features of product offered by Tesco.
Marketing and Information Technology
Information technology function in Tesco undertakes functions regarding use of Technology in
organisation. Information technology and marketing are significantly related as in recent times
digital marketing has become very important for organisations and Tesco also undertake digital
marketing activities and IT function within organisation facility digital marketing. In Tesco with
help of Information Technology function marketing function can design and implement online
and digital marketing campaigns (Timming, 2020). Another way these two functions are related
as Tesco also undertake E-Commerce services and IT function has very important role in in
effective E-Commerce practices of Tesco. Information technology in Tesco also facilitate and

support activities like market research and creating effective and attractive content for
promotional activities of Tesco.
Marketing and Customer Service
Customer service function in Tesco is concerned with listening to and resolving issues of
customer and ensuring that they are satisfied with products and services of Tesco. Marketing and
customer service functions are related as customer service function is an important source of
information for marketing research. This is because customer service deals with problems and
issues of customers and identification of these issues and problems of customers regarding
products and services of Tesco helps marketing in developing right strategies through which
these problems can be solved and we can enhance customer satisfaction.
Above discussion outlines that marketing department has relationship with several
departments and this relationship and coordination is useful for success and growth of
organisation (Zhou, Mavondo and Saunders, 2019). Discussion outlines that marketing has a
relationship with almost every organisational functions and this relationship is useful for
marketing as well as for other functions within organisation.
Lo2
P3 Application of marketing mix
Marketing Mix Tesco Sainsbury’s

Product
Product refers to offering of the
organisation. Product offered by Tesco
involves supermarket, hypermarket,
superstore and convenience store.
Further offerings of Tesco involve
food, clothing, and electronic
products, furniture, toys and groceries
and other products in general
merchandise (Ibrahim, Alkhawlani
and Al-shaghdari, 2017). In its
offerings Tesco also has its own
brands that are Jack’s, One Stop, F&F,
Booker, Makro, and Premier.
Products of Sainsbury’s include
hypermarket/superstore, supermarket,
convenience shop and forecourt.
Brands of Sainsbury’s involve Argos,
Habitat, nectar and TU. Other than
these, diversified offerings of
Sainsbury’s involve food, dairy
products, bakery products, health and
beauty product, baby products and
household products.
Price
Price strategy adopted by Tesco is low
price strategy. This means that Tesco
attempts to maintain prices as low as
possible and in this price strategy
Tesco also ensures that they can
maintain a standard quality of
products. This price strategy is aimed
at availing cost advantage to
customers and Tesco maintains this
price by means of economies of scale
Tesco produces in higher quantity and
this is why cost of products gets
reduced.
Price strategy of Sainsbury’s is value
based price strategy. Sainsbury’s
focuses on customer retention as well
as quality of product. Kids and basic
range of products are prices relatively
low than competitors of Tesco.
Place Place involves point that connect
seller and buyer with each other.
Tesco has 6800 places in around 10
countries and other than this Tesco
also maintains online channel and
Place of Sainsbury’s are shops in UK.
Its locations also involve convenience
kiosk, self-service check-outs and
several counters for products. Place
of Sainsbury’s also involve online

distribution points (Bahl and Chandra,
2018). This means that Tesco has its
presence on online as well as offline
platforms.
shopping.
Promotion
Promotion refers to those strategies
and actions through which Tesco
communicate with potential customers
a customers. These actions are aimed
at increasing awareness about Tesco
within its target market. In order to
enhance its brand image it utilises its
low price and this is also a competitive
advantage for customers. Promotional
channels that are used by Tesco
involve television advertisement, sales
promotion and also sponsor charitable
events.
Sainsbury’s follows effective
promotional policies in which its
campaigns are launched in
newspaper, radio, television,
billboards and leaflets. It also uses
sales promotion strategy for
promotion to maintain loyalty of
customers. Sainsbury’s also have
launched Nectar Reward Card to
build sales and increase its customer
base.
People
People are highly important for overall
success of organisation. Tesco
employs very effective people and
they are effectively trained and this is
also one of the reasons that it has
excellent sales assistances
significantly responsible for success of
Tesco. In order to motivate employees
Tesco utilises several programs like
colleague privilege card, save as you
earn and buy as you earn. These are
not only to motivate employees but
also contribute in gaining loyalty of
customers.
Sainsbury’s employs well trained
experts and professionals in
organisation. Employees of
Sainsbury’s are aware of consumer
behaviour sensitivity (Steenkamp,
2017). Employee training in
Sainsbury’s is mainly based on
satisfaction of consumers and
fulfilling organisational goals.
Sainsbury’s also employs wide range
of skills within organisation.

Process
Process refers to those activities
through which products and services
are delivered to customers. Effective
processes are very important in
customer satisfaction as well as
organisational effectiveness. Process
of Tesco includes retail processes,
inventory management, supply chain
management and Tesco ensure
effectiveness in its process by speed
billing services to provide ease to
customers.
Sainsbury’s undertake several
processes in order to provide goods
and services to customers. Its services
involve offline and online shopping
experience. In its online services and
click and collect service groceries get
rolled out instantly.
Physical
evidence
Tesco does not spend unnecessary and
more than required amount on
furbishing and elaboration of stores.
But stores of Tesco are clean and
attractive and easy to navigate (Blut,
Teller and Floh, 2018). Products are
well categorised and easy to find and
Tesco also place offers with products
to motivate and encourage customers
to buy more than what they need.
Sainsbury’s market its products using
physical evidence. Sainsbury’s has
different store design that is attractive
and layout of stores is aimed at
addressing various needs of
customers. Store layout and elements
in stores ensures excellent shopping
experienced to customers.
LO3
P4 Marketing Plan
Executive Summary
Marketing plan contains strategy and marketing activities that organisation will carry out
in future in order to achieve their marketing and organisational objectives. Following is a

marketing plan for Tesco that involves objectives and plans and strategies to achieve those
objectives.
Mission
“Creating value for customers to enable them to earn their life everyday”.
Objectives
 To increase market share of Tesco 21
 To reduce operating cost of Tesco by 7% by 2021
 To increase profit margin of Tesco by 10% 2021
 To reduce cost per visit by 15% by 2021
Situation Analysis
SWOT Analysis
Strengths
 Biggest grocery retailer in UK
 Leading market share in UK
 Effective presence in target market and growing number of stores
 Diversified market and product range
 Efficient supply chain network
Weaknesses
 Failed operations in big and key markets
 Fraud trial and accounting standards
 Poor operational performance in specific markets
Opportunities
 Geographical market expansion
 Expansion of Jack’s business
 Online shopping
 Emerging markets

Threats
 Recession
 Brexit impact and influence
 Increasing competition
Segmentation, targeting and positioning
Segmentation
Segmentation of Tesco is based on demographic, psychographic, geographic and behavioural
aspects (Wood and Jobber, 2016). Tesco because is a groceries and general merchandise retailer
it segments all elements of different categories of customer segments.
Targeting
Targeting adopts a differentiated targeting strategy. This strategy allows Tesco to target different
customer segments and also differentiate its products offerings on the basis of different customer
segments.
Positioning
Positioning strategy adopted by Tesco is price based positioning strategy. Tesco offers its
product at low price and this is an important element in positioning of Tesco within its target
market.
Market strategies
Market penetration
This is strategy in which product and market utilised for expansion of Tesco. This
strategy involves expansion of sales and market share within existing markets. Strategies for this
involve sales promotion, price differentiation and extensive promotional strategy.
Market development strategy

This is a strategy in which product utilised are existing but Tesco requires working on
development of market (Loredana, 2017). Market development involves expansion in
geographical markets or in customer segments.
Product development
Product development involves developing products for existing customer segments and
target market. This involves considering innovation and developing new products to offer
existing customers.
Diversification
Diversification involves developing new markets and developing new products to offer in
new markets. This is one of the riskiest strategy.
Strategy that Tesco can adopt is market development. This is because Tesco is one of the
most successful retailers and through this strategy Tesco will expand in geographical segments.
Marketing mix
Product
Product offering of Tesco is groceries, including varieties of food items and other general
merchandise that involves health and beauty products, cloths and other household items that are
available at retail stores.
Price
Price strategy of Tesco is cost based price strategy in which Tesco works in maintaining its cost
as low as possible and along with adopting competitive strategy in certain specific products (Wu
and Li, 2018). This has benefit for both customers as well as Tesco.
Place
Place strategy adopted by offline and online strategy in which products and services of Tesco are
available offline and online through website of Tesco. Tesco has 6800 stores to provide offline
services.

Promotion
Promotion strategy of Tesco involves promotions and advertisements on Television, newspaper
and along with this Tesco can also utilise digital marketing. Digital marketing can allow benefits
in terms of low cost and this will also enable Tesco to effectively target market segments and
increase visibility of Tesco.
People
Tesco has effective employees who are able to make effective and significant contribution in
success of Tesco. Tesco can train these employees to be innovative and creative along with being
customer focused. This will allow Tesco to create a workforce that is overall effective.
Process
Process of Tesco involves retail management, billing, store management, inventory management
and supply chain management (Pogorelova and et,al., 2016). These all processes are aimed at
giving a seamless and effective in-store experience to customers of Tesco.
Physical evidence
Physical evidence of Tesco includes its in-store interior, packaging of products of Tesco. Logo of
Tesco is also an important element of Tesco’s physical products that differentiate it from all
other retailers and its competitors. It has attractive logo that customers can easily recognise.
Monitoring and evaluation
Monitoring is concerned with checking progress of the plan implemented and this is
mainly done by observation and interviewing people involved in marketing plan implementation.
Evaluation of marketing plan involves identifying actual success and results of marketing plan
comparing it with standard performance and results of marketing plan. There are different
measures and strategies through which this can be evaluated. These measures involve-
Calculating ROI
Calculating return on investment is one of the best measures to evaluate success of
marketing plan. This involves identifying return on investment that has been made to implement

marketing plan (Loredana, 2017). This helps in identifying cost involved and profit gained in
exchange of that cost involved.
Key performance indicator
Key performance indicators are those indicators that suggest performance of the
marketing plan. KPI is a measurable value that demonstrates effectiveness of company in
achieving its objectives.
CONCLUSION
On the basis of above discussion, it can be concluded that marketing is an essential
activity and plays a very important role in success of organisation in market as well as in
competitive environment. This report discussed about role and responsibilities of marketing in
organisation’s marketing environment and later it also discussed about role and responsibilities
in wider organisational context. This involves relationship of marketing with other functions of
organisation. Further report discussed about marketing mix of Tesco and compared it with
marketing mix of Sainsbury’s and this outlined that even though both the companies are
operating in retail industry their marketing mix strategies are different from each other. Report
further involved marketing plan for Tesco, this marketing plan involved certain strategies for
marketing and how marketing plan and its success can be measured.

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