Strategic Marketing Report: Sainsbury's Organic Food Initiatives

This report provides a comprehensive analysis of Sainsbury's strategic marketing strategy, specifically focusing on the introduction of organic food products. It begins with an introduction to strategic management and its application within Sainsbury's, highlighting the importance of understanding consumer needs and market trends. The main body of the report delves into a product/service description, followed by a detailed market evaluation, assessing the competitive landscape and consumer behavior in the UK retail sector. It then explores segmentation, targeting, and positioning strategies, examining how Sainsbury's identifies and caters to specific consumer groups. The report further analyzes the marketing mix, including product, pricing, promotion, and distribution strategies. Finally, it addresses implementation issues, such as internal marketing and coordination between departments. The report concludes with a summary of the findings, emphasizing the importance of strategic marketing in enhancing Sainsbury's competitive advantage and profit margins.

STRATEGIC
MARKETING

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Part 1 Introduction and product/service description....................................................................3
Part 2 Market evaluation..............................................................................................................4
Part 3 Segmentation, Targeting and Positioning.........................................................................6
Part 4 Marketing mix of Sainsbury..............................................................................................8
Part 5 Implementation issues.....................................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES................................................................................................................................1

INTRODUCTION
Strategic management is the procedure through which a company differentiates itself from
their competitive firms by focusing on strengths and opportunities in order to provide better
services and values to the consumers. It is a long term approach and a business plan with
fundamental goals of achieving sustainable competitive advantages by understanding the
requirements and desires of customers. Strategic marketing helps the organization to streamline
their products and services that provide profit margin to the firm because it starts with SWOT
analysis of the consumers and existing market trends (Sabattin, J., 2020).
Sainsbury is the second largest chain of supermarkets available in United Kingdom.
Company provides employment to overall 145,000 employees all around the world. It is the
largest food retailer with over 600 supermarkets and 800 stores operating (Ansoff, R., 2018).
This report will describe the topic of product or service description, its evaluation and STP
of the new introductory product by the Sainsbury within the market place in order to enhance
their profit margin in front of their competitors. Apart from this, the study will also highlight the
concept of marketing mix along with implementation issues in order to coordination among
different departments and the role of internal marketing.
MAIN BODY
Part 1 Introduction and product/service description
Sainsbury is the public limited company which is registered under the London stock
exchange. It is the leading UK food retailer company and provides major turnover of the
organization. Establishment gives employment to various people and thus it becomes the major
player of the economy. The company is famous for its high quality and services apart from its
pricing strategies. Business strategies refer to different activities carried out by an organization at
different level of its growth and expansion plan. The strategy acts as a guide for the business in
order to reach its target (Kuznetsovd, V.P., 2017). A successful business strategy is will design
and plan all the activities required to be carried out in order to reach the organizational goals in
successful manner. In this report the business strategy that has been applied by Sainsbury in
order to attain advantages for their firm are introduction of organic food items in their stores in
order to expand their business activities and enhance their profit maximization within the
competitive world.

In order to run or start their business strategy in an effective way, company follows several
strategies for the introduction of new and innovative organic products, through these products
enter into the new market, strategy for business growth and its products marketing strategy in
order to achieve desired outcome. Currently, people became more aware about their health and
products offered by various companies. Customers take complete analysis of products as well as
services that has been offered by any organization. So, in order to give advantage to their
consumers as well as potential customers, company adopts strategies by introducing organic food
products within the market space in order to attract more and more customers towards their
business strategies which provide ultimate profit to their firm (Sainsbury, D., 2020). For such
activities company have to offer certain products for instance raisin filled oatmeal or raspberry
filled oat meals which are healthy as well as differentiate its product from their other competitors
which will automatically attracts the attention of consumers and helps to build new potential
consumers. In this whole report an analysis of business strategy of an organization is required to
be carried out.
Part 2 Market evaluation
Sainsbury is the largest retail industry service provider to the United Kingdom economy
which has generated £395billion retail sales all around the year and a total of £319,000 retail
business. The UK industry is very much enriched and vast with many of the successful retailers.
According to the evaluation, it has been analysed that retail sector is the most rising and
competitive sector of the country. Morrison has over 60% of the total market share combined and
over the past many years a slow but consistent strategic shift has been taken place within the UK
(Alves, H., 2019). In total there was a direct impact on the customers buying behaviour over
many years considers the market development and share. The industry as well as the Morrison is
running through some significant factors and among those important factors the changes in the
customers behaviour is the most prominent. Some other major factors which affects the industry
as a whole are Brexit effect, wages, customer spending, competition as well as advancement if
technological changes which force the organization to take necessary changes among their
business activities.
Over the past decade, Sainsbury faces decline in overall sales with the lowest revenue
generation and for the betterment of the firm, company take necessary actions in order to

overcome from such kind of losses. So, organization needs to work on its business models in
serious manner and thus have to improve their current strategy in order to get better results in
their near future terms. Thus, the company produces or introducing organic food items is one of
the most important actions that have been taken by Sainsbury.
The Sainsbury offers jobs opportunities to various people living in UK through which
company was able to generate sales volume of around £124 Billion in sales. But the tradition has
been changes along with the introduction of various other competitive firms in the similar sector
such as ASDA, Wal-Mart, Tesco and many others (Dullaert, W.E., 2018). Wal-mart entrance
into the UK retail sector and their low pricing retailing concept sparked a full scale food pricing
wars as each and every company was embarked upon gaining immediate market share that
enhances the growth opportunities for the firms. This particular development represents less
desirable market situations for Sainsbury which at the time of the introduction by Wal-mart was
number two in the UK market behind Tesco. Other companies were work upon their strategies of
providing discounts or on their pricing strategies in order to fail the business strategies of
Sainsbury. Another important factor in order to decrease the market share is the low store traffic
by Tesco, Asda as well as Morrison which provides them the opportunity to stock non-food
items and thus make their locations more convenient for one stop shopping. At that point of time
Tesco was the number one retailer, then ASDA, after that Sainsbury manages to stand in
between all of them and the last one was occupied by Morrison in terms of sales.
Recently, the situation arises all over the world has raised or even changed the mindset of
many consumers as they are more and more aware about the risks of not caring for themselves.
Thus, this health crisis arises a demand or consumption of organic food products, which are food
items that are produced through environmental friendly food agriculture method and that have
not been artificially altered (Klieb, L., 2019). Therefore in order to fulfil the demand of organic
food products by the company, they follow certain measures which produce necessary products
that are produced in a way that respects the soil, conserve its nutrients, avoid usage of chemical
in the products and also has been certified according to ecological accreditation. The
consumption of such kind of food items protects not only the health of the customers but that of
the farmers and workers that are involved in the production process by avoiding continuous
exposure of chemical products. From majority of studies it has been analysed that consumers are
now more willing to pay for the organic food items rather than focusing on the price strategy

which was earlier existent in the market space. Consumer behaviour is the massive push behind
various strategies that has been taken by the firm in order to achieve competitive advantages over
other brands. Consumer buying behaviour is the strategy that facilitates any company to
manufacture products according to consumer requirements so that the clients are able to take
decisions regarding new services or products offered by the firms in order to use their services.
After complete analysis of market trends, Sainsbury comes to the conclusion of introducing
organic food items into the market space in order to get attention from consumers as well as get
competitive advantages. And for the enhancement of this, company have to follow various
measures in order to take technological advancements which fulfils all sections of the consumer
buying behaviour.
At the time of introduction of organic products within the market space, company faces
certain challenges such as:
 The founders of Sainsbury realized that there is high cost involved in the
production of organic food items.
 The numbers of consumers who are ready to purchase organic food items at the
cost which are offered by Sainsbury are less as most of the consumers prefer
organic products are occasional buyers.
 The customers segment is lower than other offered products make the organization
to think over their advertising strategies as it consist of expensive costs and thus
also enhances the cost of the product in later terms.
However, there are certain opportunities which helps the Sainsbury to make the target of offering
organic food products become successful in the market space are:
 Growth in village or remote areas enhances the customer base for the Sainsbury.
 Opening of new and innovative market trends with the adoption of advanced
technology in order to promote the usage of organic food products in the
competitive world.
 New trends in consumer behaviour due to enhancement of awareness about
organic food items help the organization to meet the requirements and desires of
consumers.

Part 3 Segmentation, Targeting and Positioning
In order to evaluate the base of segmentation that has been utilized at the time of
introduction of organic food items within the market space of UK, the Sainsbury identify
segmentation on the basis of certain factors in order to understand the specific buying behaviour
of customers. The requirements, expectations and buying behaviour of consumers are dependent
upon mult.ple factors which include age, income, gender, values, lifestyle of customers, etc.
With the help of segmentation technique Sainsbury can slender down the large as well as
diversified audience into specific groups (Camilleri, M.A., 2018). It is the most common method
in order to obtain consumer information that has been utilized in order to create groups which
shared common characteristics. After analysing the unique buying behaviour of consumers and
getting the survey of required information, Sainsbury divide the market into small homogeneous
groups’ after exploring the demographic, geographic, psychographic as well as behavioural
characteristics of consumers. Sainsbury utilizes market segmentation to develop effective
marketing strategies before introducing organic food items in their offerings to their customers.
With the help of geographic segmentation, company is able to divide market according to
various geographic areas such as country, city or region. In demographic segmentation,
Sainsbury divide market according to demographic characteristics which include age, gender,
ethnicity and income of customers which identifies their spending behaviour upon certain
products that has been offered by the company. Company also acts according to consumers
buying pattern for instance usage of product frequency, benefits produced, occasional usage of
goods and brand loyalty by different users. Using of psychographic segmentation by firm
resulting in creating customers diversification according to their lifestyle of living and
expenditure, interests in the products, attitudes, values as well as individuality.
Sainsbury combined all necessary as well as different segmented strategies in order to
more specify targeting their clients appropriately. After division of large diversified customer
market into different smaller groups with standardized characteristics, Sainsbury wisely choose
the target market according to the requirements and expectations that matches the company’s
resources as well as capabilities. The targeting has been done by the firm after evaluating
commercial growth and attractiveness of different segments depending upon their characteristics,
resources, growth and capabilities (Kalam, K.K., 2020). After segmentation and choosing the
right target market, Sainsbury requires setting clear positioning statement that helps to built a

positive image of the offered products i.e. organic food items in the consumer’s mind. In order to
develop their efficient position within the mind of consumers, Sainsbury follows certain
measures to develop effective positioning strategy are:
 The comparison among the communication and messaging strategy with Sainsbury
competitors will reveal the potential areas that could be addressed with targeted
positioning messages (Kaul, D., 2019).
 Sainsbury analyse their strengths and weaknesses and work accordingly in order to
make advantages.
 Analyse position of competitors and then evaluate own position in the market place
helps the organization to work accordingly.
 With the proper surveys, company analyse their position in different market and
develop their position statement in order to obtain desired outcome.
 Usage of results to make necessary adjustments in the brand positioning.
Part 4 Marketing mix of Sainsbury
Sainsbury is a retail brand that associated with lifestyle of consumers. It is a public limited
company and has been ranked as the second largest super market chain in United Kingdom
occupying 18% of the total market share (Raewf, M., 2018). Marketing mix of Sainsbury
analyses the brand which covers 4 traditional P’s as well as newly introduced 3 more P’s which
explains the Sainsbury marketing strategy. There are several marketing strategies that help the
organization to market their organic product within the market space are innovative products and
services, marketing investment, customer experiences towards that innovative product, etc.
which helped the establishment to grow further. Marketing strategies helps the organization to
achieve goals and objectives of the firm. Marketing mix includes 7 P’s which are:
 Product: Sainsbury offers wide range of products and services to their different
consumers under its marketing mix product strategy. In addition to focusing on
innovation and quality management, Sainsbury also looks after introducing organic
products which helps to enhance the profit margin of the company and also enhancing the
range of the products offered by the firm. Sainsbury has two formats which are local
convenience stores and supermarket through which organization offers more than 30,000
products to their consumers out of which more than 20% are belongs to their own

produced brands which are different from basics like stationary, toiletries, etc. (Pomering,
A., 2017). Company offer organic ready to eat food products which are different range
and premium quality bakery products. Organic range has been included which are
produced organically grown food products in order to bring out natural flavours
completely. FreeFrom range organic food products for those who are allergic to dairy,
wheat, etc. Apart from this, Sainsbury uses biodegradable packaging made from potatoes
and sells its own label organic fruits in biodegradable trays.
 Price: Sainsbury offers their pricing strategy is based upon providing the consumers “the
value for money” and also maintains the product quality and effective services in order to
ensure customer retention as well as preparation of potential consumers. Company offer
organic food products at competitive prices instead of price cutting policy as the latter
provides a gain in market share for short span of time only. In order to position the
organic product into the market space, Sainsbury prepares good usage of price
discrimination policy. This is the reason that company obtain premium price as the
organization position itself in the high-end market place. Establishment offers value for
money products to their customers in order to satisfy their requirements along with the
effective pricing strategy. This covers and describes the pricing strategy in the marketing
mix of Sainsbury.
 Place: Sainsbury recently have approximately 560 supermarkets and 720 convenience
stores out of which there are certain stores i.e. around 50 stores that are open 24x7 and
the others are open till mid-night on weekends. Moreover, it offers home delivery service
and online order facility to their consumers through company website along with phone
calls as well. In order to provide services to their consumers effectively Sainsbury
contracted with distribution to specialists like DHL, NFT, etc. At present, company has
13 regional distribution centres and 2 national distribution centres for the distribution of
organic food items and other items as well (Winston, E.M., 2017).
 Promotion: In order to attract attention of consumers and build its brand image
efficiently, Sainsbury make good usage of above the line as well as below the line
promotional strategies. Company also utilize celebrity endorsements in their advertising
strategies in order to aware consumers about organic items and its advantages in the life
of consumers in today’s situation. Under above the line promotion, organization uses

broadcast media such as television, radio, newspaper, etc. in order to communicate its
corporate image with their potential consumers. Under below the line promotion,
organization uses sales promotion, packaging as well as database marketing. In order to
attract more customers, company offers reward cards which helped consumers to earn
points on their purchase made at the store and they are able to redeem them at their next
purchase. Company also distribute templates which provide awareness about organic
food items and their advantages in the life of consumers which also helps consumers to
target their customer segment. Also, to promote image in public, establishment operates
community services as well as environmental responsibilities.
 People: Sainsbury has good mixture of well trained experts as well as professionals who
are aware about the sensitivity of consumer behaviour. For organization, their customers
are at their first and foremost preference and thus new joiners are trained on the
workplace in order to satisfy consumers’ requirements along with fulfilment of
organizational goals (Deshmukh, R.B., 2018).
 Process: Sainsbury offers online services to their consumers which is very convenient
with just one click and collect services where groceries get rolled out almost
instantaneously. It has also made changes in its pricing and delivery slots which has
raised customers’ loyalty towards the organization. In order to address changing needs of
consumers and is thoroughly selecting the location for its new stores which exclusively
offer organic food items to its customers.
 Physical evidence: Sainsbury has an effective strategy in order to market their products
and services with the help of physical evidence. Company has different and various store
designs and layouts addressing various requirements of customers. Organization offers
excellent quality of baskets and trolleys to ensure efficient shopping experiences. The
layouts of the stores are impressive in order to attract attention of consumers and makes
shopping convenient.
Part 5 Implementation issues
In order to adopt strategies while introducing organic food products into the market space the
coordination among different departments are highly important. Coordination can never be
achieved by force or imposed by authority. Achieving coordination through orders is a pointless

exercise. Sometimes it becomes difficult for employees to understand objectives of the new
strategies that have been prepared in order to start new and innovative functions that enhance the
profit margin of the firm. It is highly important in order to understand the expectations and
requirements of organizational new intervention. Improper division of work also creates
differences among individuals. Such as if the tasks are not differentiated and assigned properly
within teams according to ones skills as well as talents, and then it will be quite difficult to
coordinate the activities of enterprise. Poor communication also affects the flow of work within
the organization. In this the role of internal marketing department plays vital function within the
company as they provides complete distribution of knowledge to their team mates as well as
other employees working for the same project but in different departments also able to
understand the strategy effectively (Mahmoud, T.O., 2018). The resource which is extremely
important at the time of adopting any kind of changes within the working of the organization is
their employees. Without employees, firm are unable to adopt changes and enhances profit
maximization of the establishment. Highly skilled employees are extremely required to
implement strategy through which company introduces organic food item for their customers.
With the implementation of great marketing tactics that shoe organic or bio products which are
able to meet requirements as well as expectations of customers. The marketing managers are
efficient enough to promote organic food items and their advantages to different consumers in
order to attract attention of them towards their brand. In order to start business in organic
products, employees are able to handle certain guidelines that have been prepared for selling as
well as producing organic items. Highly skilled and talented employees help the organization to
run their marketing strategy regarding introduction of organic food items appropriately and thus
attract attention of consumers in most efficient manner which will ultimately helps the
organization to achieve their desired goal.
CONCLUSION
From the above report it has been concluded that in order to enhance profit margin of the
firm, company needs to adopt various strategies in order to innovative products as well as
introduction of new products to achieve desired outcome. In this report, Sainsbury follows
strategy through which company introduces organic food products into the market and for this
different analysis has been takes place in order to make this strategy successful for the firm.

Company adopts segmentation, targeting as well as positioning in order to analyse market
conditions and demand within the market space. Marketing mix also has been done to describe
the strategy in efficient manner. And at the end of the study, this also describes certain
implementation issues which have been faced by Sainsbury while adopting organic food items
marketing strategy.