Tesco's Brand Management Strategies: A Critical Analysis

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BRAND MANAGEMENT [MERIT]

BRAND MANAGEMENT [MERIT]
Table of Contents
Introduction...................................................................................................................... 2
LO1.................................................................................................................................. 2
P1 Elucidating the prominence of branding as a marketing device and its emergence in
business practice............................................................................................................. 2
P2 Analyzing components of brand strategy manage and build brand equity..................4
M1 Assessing brands management over time using theories, concepts and models......5
M2 Applying appropriate and validated organizational context........................................7
LO2.................................................................................................................................. 8
P3 Examining strategies of brand hierarchy, portfolio management, and brand equity
management.................................................................................................................... 8
M3 Critically evaluating portfolio management, brand equity and brand hierarchies using
theories, frameworks, and models...................................................................................9
LO3................................................................................................................................ 11
P4 Evaluation of brands and managing collaboratively in the formation of partnership
worldwide....................................................................................................................... 11
M4 Critical evaluation done on the different techniques to leverage an extension of
brands............................................................................................................................ 12
LO4................................................................................................................................ 13
P5 Evaluation of different techniques for measuring and managing brand value..........13
M5 Evaluation for the application of measuring and managing for developing an
enduring brand...............................................................................................................14
D1 Critically analyzing branding within an organization.................................................15
Conclusion..................................................................................................................... 15
Reference list................................................................................................................. 17
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Introduction
The survival of a company depends on how well the management team has been able
to develop marketing strategies for the firm. In such a case, brand management is a
very significant tool that is used by business organizations to plan and to analyze the
image through, which the said brand will be perceived in the international and national
market. Tesco plc has been managing its branding techniques successful for the last
100 hundred years since its initiation in the year 1919. However, for a British
multinational company such as Tesco, reviewing and concentrating further on their
branding methods is significant for their sustenance. This paper aims to provide just that
through elaborate exercises.
LO1
P1 Elucidating the prominence of branding as a marketing device and
its emergence in business practice
The term brand specifically means the name, the term, the symbol, and design or the
various other features, which can be associated with the product or the service that a
seller is offering, which is distinct in its own way (Atwal and Williams, 2017). There is a
legal term that can also be used on behalf of the term brand, which is a trademark. It
can identify a single good or service that the seller is providing or all of it. The company
Tesco has grown for over 100 years and in the present market, it comes in the third
amongst all the retailers of the world in terms of gross revenue. The company is the
retailer of general merchandise and groceries that conducts business all over the world
but has its headquarters in Welwyn Garden City, Hertfordshire in England, United
Kingdom (Atwal and Williams, 2017).
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Figure 1: Storefront of Tesco
(Source: Atwal and Williams, 2017)
Branding for a company such as Tesco is significant to not only leave an impression
that is memorable on the consumers but also to state what the expectations of the
customers are proper. A company so old needs to be able to sustain in the
contemporary world of competition and for that, the company has to impart a positive
influence and improve the awareness of the clients regarding the business (Atwal and
Williams, 2017). It plays the following role.
 It helps the company to improve the current reputation of the firm in the
international market.
 It can also help in winning investments and when a brand name is strong it will
not only improve the value of the business but will provide better leverage too.
This leads to the generation of future companies, which is how Tesco was able to
become a multinational entity.
 The brand makes way for referral business as it makes a positive impression on
consumers and increases their dependability on the firm (Rauschnabel et al.,
2016).
 The concept of branding can also help to boost aspects such as employee
satisfaction and pride as well. Pride increases motivation and reinforce brand
value.
 The trust in the marketplace can be built too.
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 The advertising efforts that the brand puts in can be elevated through branding
(Rauschnabel et al., 2016).
The need for branding is required to ensure that a brand is not perceived only as a:
 Name
 Logo
 Business card, brochure or sign
 Website
 General concept but a reality.
The need for branding is to provide an easy choice to people as they have little time to
invest. Branding differentiates products in a market where offerings have features and
quality that are similar. Branding enhances trust as well (Rauschnabel et al., 2016). It
has emerged as people have numerous options in the modern day, which creates easy
distractions for consumers. It shows people that the company not only cares about their
needs but the products are built based on their requirements too. A number of other
aspects are present as well that has led to the inclusion of branding in the business
industry, and they are:
 To increase credibility
 Companies need to prove that they are an established firm in the market.
 To provide a sense of perfect stability (Lee et al., 2017).
 Companies can comply with the standards and expectations of the people.
 Firms such as Tesco have to improve business value and branding enhances it.
P2 Analyzing components of brand strategy manage and build brand
equity
The marketers of the company Tesco needs to establish their brand in the forefront of
the business industry so that they are the first ones to come to the minds of consumers
while they are out to purchase (Lee et al., 2017). An equity model that is well structured
is useful to achieve a position that is positive. The brand Tesco has a number of
appropriate strategies that have helped them to build proper brand equity. However,
there are various components that are significant for further success and needs to be
implemented within the firm. These have been categorized as:
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 Brand loyalty is the reflection of the attachment of the customers to the brand or
the company in a competitive market (Veloutsou and Guzman, 2017). The
concept can offer a competitive advantage in terms of quality, prices as well as
the reputation of purchasing for the consumer. It has a reduced level of
marketing costs, trade leverage, higher profit and better opportunity to attract
customers.
 Brand awareness ensures that consumers have a clear concept of what the
company is about. The consumers are aware of the existence of the firm and
they can recognize it too (Pappu and Christodoulides, 2017). Branding strategies
further ensure that the company dominates the minds of the customers.
 It enhances quality and as soon as the consumers are able to perceive or
attribute quality with a brand it gives the customers a reason to buy from that
brand. This is how Tesco has worked for so many years as people find quality in
their brand image, which has built trusts and provided sustainable equity of the
brand.
 The aspect of brand association is unique as it provides the consumers to
process as well as to retrieve information relative to the brand in question (Pappu
and Christodoulides, 2017). Stronger and better associations enhance
meaningfulness, which will ensure that the brand is a favorite of the consumers.
 Proprietary assets help Tesco to achieve competitive advantage as well as
protection over a period of many years. This includes properties such as
established relations, patents, trademarks and intellectual properties too
(Veloutsou and Guzman, 2017).
M1 Assessing brands management over time using theories,
concepts, and models
The concept of branding is associated with the proper application of a number of
theories and ideas that helps an organization such as Tesco to improve their brand
position and ensures that they are able to provide the required goods and services to
their target consumers (Ertimur and Coskuner-Balli, 2015). These theories or concepts,
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BRAND MANAGEMENT [MERIT]
when applied to the right company and at the right time, will ensure influential prospects
of advertising and marketing too. These aspects are discussed below:
 The concept of branding in order to create a brand name, image perception as
well as equity of the brand as a whole or of certain specific products.
 The perception of the brand, which strategically starts from an exposure that
leads to attention from the market. This moves on the awareness of the clients
and the retention of the customers ensuring success and profit (Ertimur and
Coskuner-Balli, 2015).
 Brand equity is significant to endow added value to all the products that the
company is ready to offer. It is a very important and crucial intangible asset for
the firm.
 Marketing communication is the key to improve branding.
 Consumer behavior has to be judged and analyzed to evaluate what products
are proper for a specific target market.
 Decision making property of the consumer is a dominating factor and concept
too.
 Buying behavior analysis enhances marketing strategies. There are a number of
types of decision making of the consumers, namely routine response
programmed behavior, extensive decision making and limited decision making
(Ertimur and Coskuner-Balli, 2015).
Along with the concepts and the theories to improve the properties of branding, there is
a proper model that was developed by Kevin Lane Keller that is known as Keller’s
Brand Equity Model or Customer-Based Brand Equity (CBBE) Model. The model is
rather simple and states that a company has to shape the way customers feel and think
about the products of the firm if they want to build a successful company (Du and
Bendixen, 2015). Proper kinds of experiences have to be an attribute of the company so
that the clients have positive and specific types of opinions, feelings, perceptions,
thoughts, and beliefs. There are four steps to the model, which are:
 Identity
 Meaning
 Response
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 Relationships
Figure 2: Keller’s Model
(Source: Du and Bendixen, 2015)
M2 Applying appropriate and validated the organizational context
A TESCO is a multinational company established in the year 1974 with a view to
exploring the brand awareness and simplifying solution for purchasing process
expanding its brand value covering a larger part of the world. The strong brand value
and is a key factor in providing long term relations with worldwide customer and
enhancing the performance which creates differentiation from other competitors like
other multinational company in the same domain. The added advantages of TESCO lie
in its customer perspective, which creates reducing in perceived risk of purchasing
(Roper, 2016). The strong brand not only creates functional benefits but also act as
symbolic devices. The representation of different characteristics, values, and traits add
value to the branding. The shopping of retailers become easy and the shopping
becomes more joyful in the aspects of the purchaser. The strong brand of TESCO acts
as a platform, which creates an image of merchandise categories. The internal
structuring of retail branding which revolves around on the number of offers on a certain
brand is certainly the other name of Brand Architecture. Within the brand hierarchy,
TESCO has different brand levels and act as one of the corporate brand worldwide.
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LO2
P3 Examining strategies of brand hierarchy, portfolio management,
and brand equity management
Brand hierarchy can be defined as the summary of the branding strategies that the
company Tesco takes by the display of the nature and the number of the distinctive and
the common elements of the brand across all the products owned by the firm that leads
to a reveal in the explicit ordering of the elements of the brand (Du and Bendixen,
2015). The notion can be built on the with the realization that any product sold by the
company can be presented or branded in various ways but that depends on the existing
as well as the new elements of other brands and the way in which it can be combined to
prepare one product. There are various elements and different levels to this strategy
and they represent the hierarchy from a higher level to a lower level.
 Corporate
 Range brand
 Individual brand
 Modifier
Portfolio management is another strategy of advertising and marketing (Burmann et al.,
2017). It is the science and arts of the market decisions regarding the investment policy
and mix, investment matching to objectives or goals, allocation of an asset for institution
and individuals and lastly, balancing the risk prospect against the performance of the
company. The strategies simply refer to all the approaches, which have been applied in
order to provide portfolio management that is efficient and to generate to the returns
that are possibly the highest but the risk rates that are the lowest (Burmann et al.,
2017). Two specific strategies of it are:
 Active portfolio management strategies that make investments that are precise
for the notion of outperforming the index of invest benchmark. Stock selection is
done through either the top down or the bottom up approach.
 Passive portfolio management strategy is an economic or financial strategy of
investment where the investor invests without a fixed strategy involving
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forecasting. Stock selection is either through efficient market theory or through
indexing theory (Burmann et al., 2017).
Brand equity management is responsible for the development of the brand and the
following four factors have to be high for the strategy to work.
1. The notion of differentiation to be enhanced to ensure more purchasing by the
consumers.
2. Knowledge about the brand has to be delivered to the customers in a clear way
through proper promotional campaigns and effective advertisement. Educating
the market is significant in the modern market (Zhang, 2015).
3. Relevance defines the aspect that a brand presents when it is able to meet the
needs and the demands of the market in which it conducts business.
4. Esteem is a kind of feedback that shows the level of respect that the consumers
display for the specific brand. High equity is guaranteed by high amounts of
respect (Zhang, 2015).
M3 Critically evaluating portfolio management, brand equity and
brand hierarchies using theories, frameworks, and models
The term brand equity as defined by David Aaker states that it is a set of liabilities and
assets that can be linked to the brand in question, which either subtracts or adds value
from the product or the service provided by the brand (Zhang, 2015). There are five
distinct components to this model known as the Aaker’s Brand Equity Model:
 Brand loyalty induced with trade leverage, the response time of the competitive
threats, reduced costs and the attraction of new customers.
 Brand awareness involving association anchors, substantiality, consideration of
the consumer and familiarity.
 Perceived quality is regarded with the brand position, quality, brand extension
numbers, price and wider availability aspects (Bravo et al., 2017).
 Brand association includes information retrieval, attitude, brand association
numbers and drive purchasing.
 Proprietary assets.
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Figure 3: Aaker’s Brand Equity Model
(Source: Zhang, 2015)
There are four stages that are incorporated with the process of portfolio management.
These are:
1. Prepare
2. Plan
3. Execute
4. Harvest
Figure 4: Framework of the portfolio management process
(Source: Bravo et al., 2017)
There is a further categorization of the process to prepare a proper framework for the
effective operational aspect of the process (Bravo et al., 2017). These include the
following:
 Identification of the goals of greatest value.
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 Evaluation of the most significant works
 Selection of the terms of benefits and costs
 Prioritization
 Balancing the prioritized aspects in a proper component mix that aligns with the
strategic plan of the business as well as supports it in the best possible way ( Lin,
2015)
 Authorization of the funding request
 Activation of the new additional work
 Reporting of the steps and reviewing
 Strategic change if and when necessary.
The theory of hierarchy-of-effects is an advanced one that ensures the sale of an item
through a persuasive message of advertising that is well developed as well and has
been incorporated to improve brand awareness with time (Lin, 2015). There are some
steps to it.
 The stage of knowledge and awareness where a consumer knows in detail about
the product and the way in which the data is processed by their cognitive senses.
 The stage of liking and preference, which highlights the feelings of the customer.
 The stage of purchase or conviction, which is made upon the actions taken by
the customer. Advertisements help this stage by building and maintaining trust
levels and popularity standards too (Lin, 2015).
LO3
P4 Evaluation of brands and managing collaboratively in the
formation of partnership worldwide
Every company dreams to have a brand name and image for developing successfully in
creating a huge customer relation. TESCO collaboratively creates a partnership both
globally and an internal level of creating a strong report of customer dominance. Several
factors that create the complexity of interdependent issues globally, faces challenges in
facing the world in a complex way. The interconnection of that collaboration is
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