Marketing Principles Report: Sainsbury's Strategy and Analysis

This report provides a comprehensive analysis of marketing principles, using Sainsbury as a case study. It begins with an introduction to marketing concepts and processes, followed by an examination of Sainsbury's environmental audit using the 5M and PESTEL models. The report delves into Sainsbury's segmentation strategies for a new watch segment, detailing segmentation criteria for sporty and elegant watches, and discusses targeting criteria like differentiated and concentrated targeting. It explores the impact of buyer behavior, including psychological and social factors, and outlines a new positioning strategy for the watch segment. The report further investigates product development for competitive advantage, distribution, pricing, and promotional elements of the marketing mix. It also contrasts B2B vs. B2C and international vs. domestic marketing, culminating in a conclusion that summarizes key findings and references used. The report aims to provide insights into how Sainsbury applies marketing principles to achieve its business objectives.

MARKETING PRINCIPLE

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Concept and Process of Marketing........................................................................................1
1.2 Benefits and Cost of Marketing Orientation..........................................................................2
2.1 Environmental Audit.............................................................................................................4
2.2 Segmentation criteria for watch segment..............................................................................5
2.3 Targeting criteria adopted by Sainsbury................................................................................6
2.4 Impact of buyer's behaviour in different buying situations...................................................6
2.5 New positioning strategy for Watch segment........................................................................7
3.1 Developing Product to Sustain Competitive Advantage.......................................................7
3.2 Distribution Elements............................................................................................................9
3.3 Price Elements.......................................................................................................................9
3.4 Promotional Element...........................................................................................................10
3.5 Extended Marketing Mix.....................................................................................................10
TASK 2..........................................................................................................................................10
4.1 Marketing Mix for Two Different Segment........................................................................10
4.2 B2B vs B2C.........................................................................................................................11
4.3 International vs Domestic Marketing..................................................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

LIST OF FIGURES
Figure 1: Process of Marketing........................................................................................................1
Figure 2: Macro and Micro Environment........................................................................................4
Figure 3: Levels of Product.............................................................................................................8
Figure 4: Ansoff’s Matrix................................................................................................................9

INTRODUCTION
Marketing principle can be define as an idea that been incorporated for incorporating
promotion of the company so that large set of customer can be attracted towards it. Also, it helps
in assessing the needs and wants of the customers, based on which product and marketing
activity is planned. It is of key concern for company due to high competition and easy
availability of substitute products (Churchill and Iacobucci, 2010). Considering this, present
report is prepared for gaining insight about the marketing principles. For this, Sainsbury is taken
into account which is a prominent retail company of the UK. Areas that been incorporated in this
report are concept and process of marketing, approach for segmentation, targeting and
positioning, elements of marketing mix and marketing in different contexts.
TASK 1
1.1 Concept and Process of Marketing
Figure 1: Process of Marketing
Marketing can be defined as an activity of assessing needs and wants of customers and
promoting or selling goods and services to them. Also, it emphasize on conducting marketing
research and advertising in order to meet the demand in effectual manner (Bradley, 2005). In this
regard, marketing process for Sainsbury is discussed underneath:
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Assessing Customer Needs
Developing Customer Centric Marketing
Tactics
Creating Integrated Marketing Program
Developing Relationship with Customers
Attaining Value from Customer

1. Assessing Customer needs: Sainsbury conducts research on regular basis through filling
feedback forms and review from its customers so that they can able to gain information
regarding market place. Also, it helps in gaining idea about the actual needs of customers
so that company can fulfil it in desired manner (Duke and Tucker, 2007).
2. Developing Customer Centric Marketing Tactics: After assessing needs, strategy is
developed by cited company in which it highly emphasizes on customer and their
preferences. Here, strategy with regard to segmentation, targeting, value proposition and
developing profitable relationship with customers is developed.
3. Creating Integrated Marketing Program: After doing segmentation and targeting, it is
required to develop marketing program. At this stage, the company decides upon
marketing mix i.e. product, place, price and promotion so that they can able to attract
large set of customers towards it.
4. Developing Relationship with Customers: Here, Sainsbury focuses on developing
relations with customers so that loyalty can be attained through it and hence they make
repeat purchase. In this regard, cited company offers loyalty cards and regular offers to
existing customers in order to attain their loyalty (Wood, 2008). Also, communication is
made through emails and mobile marketing that helps in developing healthy relations.
5. Attaining Value from Customer: After following all this process, company is able to
develop value by enhancing its sales by meeting needs and wants of different customers.
In addition to it, Sainsbury is also able to meet with the needs of diverse customers by
offering products that are been demanded.
1.2 Benefits and Cost of Marketing Orientation
There are basically, four types of orientation that been discussed below:
 Production: In this, company ignores needs and wants of customers totally and only
emphasize on developing quality and differentiated products.
 Product: It is an orientation in which company develops products by considering the
viewpoint of management and not of customers. It keep product first and then customers.
 Sales: This is the orientation in which main focuses is on boosting the sales volume
irrespective of products and its relevance from that of customer demand. Company does
marketing and sales call for the same (Cravens and Piercy, 2008).
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 Marketing: It is a business models in which company delivers goods or services in
accordance with actual needs and wants of the customers.
Cost of Marketing Orientation
Company need to assess the needs and wants of the customers and for this, research and
review need to be done on regular basis. This includes cost in terms of time, money and efforts.
Further, due to dynamic nature of customers can gets shifted in very less time and hence time
and effort will need to put on regular basis so that current needs can be identified effectively. It is
huge cost for the company that can deviate the company to other path (Aaker, Kumar and Day,
2008). Also, external influences require changes in product on regular basis that certainly
increases the operational cost and hence affects the profitability of company.
Benefits and cost of Marketing Orientation to Sainsbury
There are certain benefits of this particular approaches to cite company. With this,
Sainsbury is able to develop a base of loyal customer from which repeat purchase will attain.
This helps in boosting the sales of the company and certainly aids in rise in profit margin.
Additionally, it helps Sainsbury in attaining marketing advantages by catering the attention of
large customer base. However, cited company need to bear huge cost in terms of expensive
research program and it also consumes time and efforts in gaining results from the research.
Further, deviation in market environment also affects the strategy of mentioned organization.
However, it is evident from both benefits and cost of marketing ordination that selected business
is gaining high support from this approach that certainly surpassing the cost associated to it. It is
also analysed that cost incur in research and review is helping the firm in boosting its efficiency
and share at the marketplace
(Kotler, 2009).
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2.1 Environmental Audit
Figure 2: Macro and Micro Environment
(Source: Rosenbloom and Dimitrova, 2011)
The micro and macro environment of Sainsbury has been described effective using 5m
Model and PESTEL model.
Micro analysis of Sainsbury
Particulars Description
Manpower
The company has adopted a team of well trained employees who are the
key assets of the company. Effective training and development measures
help the employees in developing an edge within the market.
Material
The material procurement, storage and distribution strategy has been
developed to maintain cost effectiveness and quality for the company.
Effective supplier relations contributes highly in cost minimization
Method
The infrastructure and measures of working within the organization are
well developed and advanced which helps in reducing time for packing,
billing or delivering products. The organizational culture is positive and
competitive (Doyle and Stern, 2006).
Machinery
The advanced measures of working help the company in enhancing sales.
Effective online infrastructure has contributed highly in grabbing wide
sales.
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Money
It is the second largest retail unit in the UK market which has established
effective financial position within the market. The company suffered
sales downfall recently due to wide market competition.
Macro analysis
Political Stable government policies and regulating supports business growth and
development of Sainsbury
Economic Economic policies and growth rate of the company are favorable for the
retail growth
Social Consumer needs and preferences are widely changing. Retail consumers
tends to shift widely for attracting offers
Technological Has adopted advanced measures of operations. Has capability to develop
and enhance online infrastructure.
Environmental Changing environmental factors effective the price and availability of
grocery products (McLoughlin and Aaker, 2010).
Legal Sainsbury operates within legal and regulatory framework to enhance sales
of the company.
Summary
STRENGTH
 High market share
 Brand recognition
WEAKNESS
 Falling market sales
 Rising competition
 Low consumer loyalty
OPPORTUNITIES
 Market development
 Development of online infrastructure
THREATS
 Fierce market competition
 New and strong competitors such as
Aldi and Lidl
2.2 Segmentation criteria for watch segment
Sainsbury is a strong retail brand in the UK market. The company has developed
effective brand image and high market share within the competitive market. To enhance the sales
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in this competitive market the company presently is focusing on developing a new product in
order to generate market demand. Sainsbury is launching Watches under TU brand to enhance its
brand within the market. The segmentation for the product will be on two different segments.
The company will produce Sporty watches and elegant watches (Czinkota and Ronkainen, 2012).
The sporty watch section will be focusing on premium level consumers. The elegant watches
however will be specifically focusing on female consumers. The segmentation strategy of the
product will be based on:
Segmentation Product name Analysis
Demographic Elegant watches Will focus on the female segment to develop
effective segmentation measures
Psychographic Sporty watches This strategy focuses on the social class and lifestyles
of the consumers. TU will target focus on High
income consumers as the products will be premium
and high priced.
2.3 Targeting criteria adopted by Sainsbury
Targeting is one of the most effective measure to enhance the sales of the company. This
measures helps the organization in enhancing wide measures of demand and sales. The major
strategies adopted by the companies to target consumers are differentiated, undifferentiated and
concentrated targeting. For the chosen products Sainsbury will adopt following measures. Differentiated targeting: This measures assures that the company focuses on the selected
segment to develop sales within the market. The sporty watches of the company will
focus on premium class consumers. This will help in creating high market demand and
enhance brand image of the company as well (McDonald and Wilson, 2011).
 Concentrated targeting: The elegant watch segment of Sainsbury will specifically focus
the female consumers of UK. This will be a limited target segment for the seller thus
concentrated targeting will helps the company in generating demand from high incomes
female consumers.
2.4 Impact of buyer's behaviour in different buying situations
Consumers are the social group of people who are widely impacted by different factors
existing within the market. Sainsbury researches and developed effective plans to deal with
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buyer behaviour within the market. The factors which influence buyer behaviour within this
competitive market are: Psychological: These are the factors which are influences by the society, class and
perception for the product. The company has manufactured high priced sporty watches to
attract the high income consumers who seek adventure and sporty look. This will help the
company in generating demand by developing positive [perception for the products (Dibb
and Simkin, 2013).
 Social: The social influence is common within female’s buyers who seek products which
are acclaimed, popular but are unique and classy. The elegant watch section will focus on
developing promotional strategies to enhance social factors of buyer's behaviour.
2.5 New positioning strategy for Watch segment
The positioning strategy of the company focuses on enhancing the demand for products
and services developing an effective brand image in the minds of the consumers. In order to
develop an influential and effective brand image in consumer minds Sainsbury will adopt
effective measures for product positioning. This will helps the company in generating wide
market demand within the economy. The sporty watches will be positioned for the premium
category representing class and adventure collectively. This product will be positioned trough
effective packaging and promotional measures to develop demand within the market. On
contrary to this elegant female watches will be positioned for female consumers (Belz and
Peattie, 2009). The company will adopt effective promotion through fashion campaign and brand
endorsement as well. Moreover the upcoming festive season will help in positioning the products
as effective gift as well. These tactics will help the company in generating wide market demand.
3.1 Developing Product to Sustain Competitive Advantage
Product that been selected in watches for two different segment i.e. one for female and
other for high end customers. In this concern, watches will be developed in a manner from which
high value will be delivered to targeted customers. In this regard, core product for female will be
stylish and sporty look watches which will be very much eye catchy. In this, design of dial will
be of different shapes and size that best fit for female of different age group. Also, it will be
attract women that have different liking and preferences. Considering the quality, watches for
this section will possess good quality dial and leather belts which will increase the durability of
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the product. Also, all watches will be shockproof and waterproof. Further, unique design,
customized belts, long time warranty and easy replacement will be feature of this watches. For
branding, advertisement will be conduct on social media so that targeted customers will perceive
as high quality and durable products (Mason, 2007). As far as packaging is concern, watches will
be packed in cane just like of soft drink in order to create distinctive image.
Figure 3: Levels of Product
(Source: Concept Development. 2009. http://qpc.adm.slu.se/SNPD_ver2/page_27.htm)
On the other hand, watches for high end customers will be different and expensive. For
this, watches will be developed from different materials like chromium bronze, gold, silver and
other in order to make it different and to offer an elegant look. Further, it will have fine art and
design in the dial in order to increase its beauty. For offering more elegant look to watches, rare
diamonds and stones will be crafted in it. This will make it different and highly expensive
products that will cater the attention of customs who want to have distinctive personality than
others. Further, celebrity endorsement will be done for branding of such products in which
famous actor and actress can be endorsed by Sainsbury. In addition to it, for increase the value
derives by customers from this product, highly sophisticated packaging will be done. In this
context, rectangular box will be used in which watch will be placed on small cushion (Wilson,
2005).
Ansoff’s Matrix
Considering the product category, product development is been selected for Sainsbury. It
is evident that Sainsbury is having varied types of product but it doesn’t have a watch brand.
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Therefore, it will launch a new set of product i.e. hand watch which will help the company in
boosting its profitability. Also, it will aids the company in competing with prevailing watch
manufacturing firm.
Figure 4: Ansoff’s Matrix
(Source: Mind Tools. 2015)
3.2 Distribution Elements
It is required to distribute the product in a manner so that customer can purchase the same
from their convenient. In this context, direct distribution strategy will be applied by Sainsbury in
which products will be available at the physical store and online store of the company. Beside
this, products for high end customer will be available at other places as well. These will include
showroom of watches, dedicates watch store of Sainsbury and from boutique. By arranging this
distribution strategy for high end customers, attention will be attained by them and hence they
will be buy this product as comparted to other one (Clifton and et.al., 2003). Sainsbury will be
getting benefit of loyalty from their existing customer through which sales of the watch for both
segments will be done.
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