Marketing Principles Report: Sainsbury's Marketing Analysis - 2024

This report provides a comprehensive analysis of Sainsbury's marketing strategies, encompassing various aspects of marketing principles. It begins with an introduction to marketing, defining its core activities and emphasizing the importance of the marketing mix (product, price, place, and promotion) and the additional elements of service marketing mix (people, process, and physical evidence). The report then delves into Sainsbury's market segmentation, targeting strategies, and positioning strategies, particularly focusing on the company's approach to customized designer clothes. It also explores the impact of buying behavior on marketing activities and outlines marketing mixes for different customer segments. Furthermore, the report discusses the differences between international and domestic marketing, examines key micro and macro environmental factors influencing Sainsbury's operations, and identifies the company's competitive advantages. Finally, it outlines the key elements of the marketing process that should be followed during foreign expansion. The report concludes with a summary of the key findings and recommendations for Sainsbury's marketing strategies.

MARKETING
PRINCIPLES
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TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
a) The main activities covered by marketing...............................................................................3
b) Concept of marketing orientation highlighting its cost and benefits.......................................3
c) Discussing the importance of each one of the four Ps of product marketing mix ..................4
d) Importance of additional Ps of service marketing mix ..........................................................6
TASK 2............................................................................................................................................7
a) Segmentation criteria that can be used by Sainsbury in different market for its offerings......7
b) Targeting strategies for Sainsbury ..........................................................................................8
c) New positioning strategy for customized designer clothes of Sainsbury................................9
e) Buying behavior and its impact on its marketing activities...................................................10
f) Marketing mix for two different segments in customer markets...........................................10
TASK 3..........................................................................................................................................11
a) Difference between international and domestic marketing ..................................................11
b) The key micro environmental factors that should be consider while expanding
internationally ...........................................................................................................................11
c) Describing the macro factors that must be considered by company .....................................12
d) The competitive advantages available to Sainsbury .............................................................13
e) Key elements of marketing process that must be followed while foreign expansion ...........13
CONCLUSION .............................................................................................................................14
REFERENCES .............................................................................................................................15
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INTRODUCTION
Marketing includes different processes that are associated with determining the
customer’s need, preferences as well as likes and accordingly offering products or services to
them. Marketing can also be regarded as a mode of communication between the potential
customers and the organization. Marketing principles are focused on four key elements including
product, price, place and promotion (Goi, 2009). In the present report, different aspects of
marketing will be studied in the context of Sainsbury. It is a leading supermarket chain and
grocery retailer of UK. In this report, various macro and micro factors that can impact the
operations of company will be highlighted. Further, new positioning strategy for Sainsbury’s
clothing products will also be devised.
TASK 1
a) The main activities covered by marketingDescribed below are the key activities covered by
marketing process of Sainsbury:
 Sales promotion: Company can use the technique of sales promotion to attract more and
more customers. In this respect, coupons, offers and discounts can be used.
 Targeting: Business is also defined target markets when they carry out their marketing
activities. This includes the process defining targeted customers among various people in
the market (Bearden, 2006).
 Segmentation: It refers to dividing total market on the basis of various factors such as
demographic, behavioral, psychographic etc. It helps in reaching the customers in the
best manner.
 Positioning: It helps in building distinct position of company in the market as compared
to its rivals (Kotler and Armstrong, 2010).
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b) Concept of marketing orientation highlighting its cost and benefits
Marketing orientation is a business approach based on offering products and services that
are designed as per the customer specifications, needs and preferences. It is a customer centered
approach which ensures maximum customer satisfaction (Henley, Raffin and Caemmerer, 2013).
It further helps Sainsbury in retaining customers along with ensuring brand loyalty and repetitive
purchase from them. However, marketing orientation involves various costs and benefits which
are as follows:
Benefits
 Customer focused: Marketing orientation focuses on the unsatisfied needs of customers
and assists in fulfilling them. Therefore, customers feel valued as company takes
consideration of their needs, likes, desires etc. This enhances their satisfaction level and
build brand love among them (Element of marketing process, 2015). Constant improvement: Marketing orientation stimulates Sainsbury in making
consistent modifications in its products and services to meet the needs of customers in the
best manner.
Costs
 Research cost: To ascertain the needs of customers, company has to invest large funds in
research and development projects, purchase expensive technical infrastructure to obtain
customer and market data etc. (Caemmerer, 2009).
 External impacts: Due to intense competition, retail industry is getting restricted in the
respect of growth opportunities. This further provides little return from the expenditure
done in marketing orientation program (Carlson and Manktelow, 2013). Thereafter, poor
techniques and non-relevant customer information can affect marketer’s efficiency to get
market intelligence resulting into high priced business decisions.
c) Discussing the importance of each one of the four Ps of product marketing mix The
significance of 4Ps of product marketing mix are explained as follows:
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 Products: Sainsbury offers wide range of products involving food items, grocery, TU
clothing, digital equipment, frozen edibles etc to satisfy different needs of customers. In
addition to this, modifications in offerings are done as per the customer requirements and
market demand. Company ensures consistency in quality of product, ethical and
innovative offerings etc. to avoid dissatisfaction among customers (Ferguson and
Hlavinka, 2007).
 Price: The success of product depends upon the price charged by the entity for its
offerings. Therefore, customer can get value for the money paid by him/her. The pricing
policy of Sainsbury aims at recovering the production cost, advertisement and
distribution expense etc. Company adopts competitive pricing for most of retail products
where prices are charged as per the rival’s policy (Gönül and Carter, 2012). However, for
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its new offerings, organization can use price skimming which focuses on charging high at
start and lowers it with time.
 Place: It means the distribution channel adopted by organization for offering range of
products. At present, Sainsbury is operating in more than 1300 locations through its chain
stores. The long distribution network helps company in offering services to the customers
in convenient locations. It provides its services in around 55 countries. Further, to ensure
more convenience to its customers, company has also started home delivery, online
distribution etc. (Lancaster and Massingham, 2010). The favorable location helps in
boosting sales, increasing consumer satisfaction level and connecting with brand easily.
 Promotion: It is an effective approach that helps company in transmitting the value of
brand to target customers. With the aid of impelling promotional techniques, company
keeps its customers informed about wide range of products, discounts etc. that are offered
by it. Promotion plays an important role in inducing customers to make repetitive
purchase and thus helps in increasing the revenue of business (Hartline and Ferrell,
2010). For promoting its services, Sainsbury uses means like, advertisement in television,
newspapers, billboards, online promotion, mobile apps etc. However, contrasting
promotional technique is used for targeting different set of customers.
d) Importance of additional Ps of service marketing mix
Additional elements of service marketing mix refer to people, process and physical
evidence associated with different service offerings of Sainsbury. Importance of these elements
can be explained as follows:
 People: Quality of services also depends upon those who are offering it. Therefore, the
sales of services depends upon the competencies and skills of employees. Sainsbury gives
proper training and development to its human resources so they can provide the best
service to customers (Brady, 2010). In addition to this, communication and inter personal
skills of employees are improved on the constant basis.
 Process: It refers to manner in which services are offered to the final consumers in order
to develop positive perception in the mind of them. For example, sales personnel
welcome customers in store with the smile on their face and greetings for the day.
Therefore, needs of consumers are identified before offering services.
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 Physical evidence: It provides distinctive feature to the services offered by company. It
refers to physical appearance of the stores that is an important factor which stimulates
individuals to visit store and buy different products as well as services (Bradley, 2013). In
this respect, Sainsbury showcases its product in an attractive manner; hence, there is
ambient lightning, uniformly dressed employees and good music. It induces customers to
visit store frequently.
TASK 2
a) Segmentation criteria that can be used by Sainsbury in different market for its offerings
Market segmentation is a business strategy that assists company in dividing the total
market into small sets of customers, businesses or regions having alike needs, preferences and
priorities. On the basis of this, company prepares effective strategies to target such segments
(Brady, 2010). Segmentation criteria helps Sainsbury in reaching at various domestic and
international customers which is further explained as follows:
SUITABILITY Sainsbury decides that market intended for entering is suitable or not.
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Therefore, it must have profitable opportunities.
MEASURABILITY It assists company in determining the market size which should be
large to conform to the resources and efforts required to target them.
Therefore, buying capacity of customers can be measured.
ACCESSIBILITYTarget segments can be easily approached and served with the aid of
communication and distribution network like television ad, billboards, online portals (Hartline
and Ferrell, 2010).
ACTIONABILITY It helps company in designing attractive strategy that will help in
serving the segments effectively.
On the basis of the aforementioned criteria, Sainsbury can select two segments having
maximum marketing potentiality. Like, company is planning to offer fashion apparels to its
customers; therefore segmentation can be done on the basis of following factors: Demographic factor: It helps organization in dividing the market on the basis of age,
gender, occupation, income and other socio-economic factors. Sainsbury can offer its
customized clothes to girls of age 16-26 who like to wear trendy and fashionable clothes
(Lancaster and Massingham, 2010). Here, the product will be of premium class but
pricing will be low as compared to rivals.
 Psychographic factors: Marketers of Sainsbury can divide the market as per the
personality, lifestyle, attitude etc. of the customers. They are those individuals who prefer
latest and branded clothes that are part of their status symbol (Gönül and Carter, 2012).
Therefore, company can charge high prices for offering custom made designer clothes.
To attract customers of psychographic segment, celebrity endorsement can be used.
b) Targeting strategies for Sainsbury
Targeting strategies help company in identifying the customers and deciding to whom
they want to offer their products. Following are the different targeting strategies that can be
considered by the company:
Types Explanation
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DIFFERENTIATED This strategy helps company in using different
marketing tools for various segments.
UNDIFFERENTIATED
With this strategy, company can target the
entire market with the same marketing tool.
CONCENTRATED
It is an effective strategy that assists business
in concentrating on niche market with low
number of customers but, with the availability
of ample number of marketing opportunities
(Ferguson and Hlavinka, 2007).
Here, Sainsbury can use differentiated strategy to reach customers with diverse
marketing requirements. For example, to target customers of demographic segment, company
can focus on price. Therefore, company can offer non-branded clothing products to middle
income customers. To target them, Sainsbury can use lost cost marketing technique like, online
portals, radio ads, magazine and newspapers (Carlson and Manktelow, 2013). Thereafter, to
target high end customers in psychographic factor, company can link its brand with status
symbol. Also, it can use celebrity endorsement as well as fashion shows to attract customers who
are interested in trendy and designer apparels.
c) New positioning strategy for customized designer clothes of Sainsbury
Company can use following positioning strategy that will provide different image to its
brand as compared to its competitors.
 Price positioning: Sainsbury can offer products of premium class at lower price than its
competitors. To induce middle class customers to buy slightly high priced and branded
products, promotional tools can be used such as buy 2 get 1 one free offer, discount
coupons etc. Psychological pricing can be used by company like offering apparel at £99
than £100 to increase its sales (Fanq and Zou, 2009).
 Benefit positioning: Company can use the product attributes and advantage of buying
them as a tool in order to encourage its sales. Sainsbury can highlight that its clothing
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products are customized in its marketing campaign. Also, quality of product, fast services
etc. can be highlighted.
e) Buying behavior and its impact on its marketing activities
Buyer behavior includes so many factors that impact the potential customer to buy the
products and services offered by Sainsbury. However, different buyers behave differently in
various situations and it directly affects the marketing campaign of organization. In this respect,
psychographic customers make purchase if the product is high priced as well as branded.
Therefore, marketers of Sainsbury can link the price of its products with their status symbol.
Hence, sales of product can be encouraged (Saunders and et.al., 2004). Likewise, it can attract
middle class customers who make purchase when product falls in their budget. Therefore,
company can use sales, discounts and other offers that can be marketed through posters, social
media promotions etc. With this aspect, company can induce medium class customers to
purchase branded clothes offered by it. Likewise, young girls like to visit shopping malls;
therefore company can develop branded stores (Sicotte, Drouin and Delerue, 2012). Thereafter,
with the increasing online shopping trend, Sainsbury can offer customized clothes.
f) Marketing mix for two different segments in customer markets
Company can use different marketing mix for demographic and psychographic segments.
It is explained as follows:
Marketing Mix for Demographic SegmentHere, customer can be divided as per their income
level.
 Product: Sainsbury can provide tailor-made designer clothes to its customers. Quality of
such product must be kept good so as to sustain market reputation and maintain brand
image.
 Price: Company can keep prices lower as compared to its rivals in order to get
maximum market share. Therefore, competitive pricing policy can be considered by the
organization (Rosenbloom and Dimitrova, 2011).
 Place: Sainsbury can open its dedicated stores in convenient locations so maximum
customers can avail the services. Brand stores can develop near tourist destination,
reputed shopping malls, airports etc.
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 Promotion: Effective promotion can be done by the organization to generate awareness
among customers. Since, products are not highly priced; therefore low pricing promotion
like, social media, newspaper, poster etc. can be used.
Marketing Mix for Psychographic Segment
 Product: The product should be made as per the latest trends, customer’s needs and
desires etc. Superior quality of product must be ensured to maintain the brand image.
 Price: In this segment, customers are not worried much about prices, so, to survive in the
market, competition price skimming policy can be adopted by Sainsbury (Goi, 2009).
 Place: Company can offer its customized designer clothes through its brand stores. This
will also build brand recognition. Along with this, e-commerce stores can be used by
business.
 Promotion: Organization can use celebrity endorsement, fashion shows, sponsorship
programs, engine optimization, and point of sale publicity to attract its high end
customers.
TASK 3
a) Difference between international and domestic marketing
International Marketing Domestic Marketing
It refers to marketing done by company beyond
the national boundaries such as in the foreign
market.
It means the marketing functions performed
within the domestic nation such as UK.
It is more risky and complex. It is easy and less risky
It needs more financial investment It needs less fiscal resources.
Political factors play a crucial role in business
functioning
There is less involvement of political factors in
business operations.
Organization has to face competition at
international level; therefore it requires
different strategies.
There is less competition at global level;
therefore normal business tactics can be used.
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b) The key micro environmental factors that should be consider while expanding internationally
Micro factors are those elements which are available inside the organization that can
impact its performance. These are as follows:
 Customers: Changes in customer’s needs and desires can affect the sales of company in
a different manner. Customers may shift to the competitor’s product and reduce the sales
of company. Customers are the lifeblood for Sainsbury; therefore they must be kept
satisfied. They must get value for the money paid. Along with this, they would be served
with innovative and ethical products in order to retain them in future (Bearden, 2006).
 Competitors: Marketing actions of rival company have direct impact on the operations
of organization. For instance, sales and other discounts in rival organizations like Tesco,
Next Plc can induce customers of Sainsbury to purchase products of rival brand.
Therefore, company should consider strategies of its competitors to keep and edge over
them.
 Government: Government of the country can have direct and strong impact on the
operations of Sainsbury. Different laws, regulations and policies are laid down by UK
government and EU that must be followed by company to avoid legal consequences
(Kotler and Armstrong, 2010).
c) Describing the macro factors that must be considered by company
Macro factors are those elements which are available outside to the organization and
impact its operational activities.
 Political factors: In order to operate smoothly in the domestic and international markets,
regulations of political parties must be considered. Therefore, company should generate
employment for local citizens, pay tax on time and ensure sustainable development to
retain the interest of different political parties.
 Economic factors: Economic constituents can affect the performance of company so
these must be considered. It involves GDP, interest rate, bank rate, disposable income etc.
(Bearden, 2006). At present, interest rate of UK is 0.5% which is very low that means,
company can approach domestic banks for availing loans for foreign expansion.
Likewise, increase in disposable income in target nation leads to maximize in marketing
opportunities for branded products of Sainsbury.
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