Developing Marketing Strategies for Tesco: A Detailed Analysis

This report provides a detailed analysis of Tesco's marketing strategy, focusing on the development of marketing strategies, particularly within the context of the UK supermarket industry. It begins with an executive summary and introduction, highlighting the importance of marketing plans for organizational success. The main body of the report explores various marketing models, such as the Ansoff matrix and the 4Ps of the marketing mix (Product, Price, Place, and Promotion), in the context of Tesco's operations. The report delves into Tesco's market development strategy, emphasizing its potential for increasing market share and profitability. Furthermore, it discusses the importance of the marketing mix, covering product development, pricing strategies, distribution channels, and promotional activities. The report also examines the consumer-driven strategy, including market segmentation based on demographic, psychographic, and behavioral factors. The report aims to provide recommendations that can help the organization work better and build marketing tactics that are beneficial for it. The report concludes with a summary of the findings and recommendations for Tesco's marketing approach.

Assessment

Table of Contents
INTRODUCTION...........................................................................................................................5
MAIN BODY ..................................................................................................................................5
Developing marketing strategy....................................................................................................5
Marketing Mix 4ps.......................................................................................................................6
Developing marketing strategy....................................................................................................6
Discussing the consumer driven strategy.....................................................................................9
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

Executive Summary.
In this assessment it has discussion of the segmentation, targeting and positioning and
have explained its role in building marketing strategies. It also has recommendations that can
help organisation to work better and build marketing tactics that is beneficial for it. The
assessment have brief explanation on marketing mix 7ps and also it has the STP marketing
system in detail and how it will help Tesco in choosing the right strategy.

INTRODUCTION
Marketing plan is defined as one of those essential documents that helped marketers to
gain the attention of potential customers and retain existing for longer. It is one of those
important elements that organizations can use to reach desire outcomes, no matter which
company it was and how it works. This document lay out the marketing attempts of a venture
that tend to run their business and manage the same in effective manner. In the recent time,
effective marketing plan contribute to increase or improve organizational performance. The
current assignment will be based on TESCO, which falls under the category of leading
supermarket in the UK. The study will explain the development of marketing strategy in the
context of certain issues, such as product, marketing and management. The objective of current
marketing plan is to improve the market growth and share of chosen supermarket. Their aim of
this plan is to improve profitability and progress of company from 2022-2025. The study will
justify discussion of marketing mix in term of analysing organization based on 4ps. Furthermore,
the report will clarify analysis based on segmentation, targetting, positioning and differentiation
separately.
MAIN BODY
Developing marketing strategy.
There are different types of models and approaches accessible in the world that
organizations utilized for purpose of developing their marketing strategies. In case of TESCO,
management may prefer to apply and consider Ansoff marketing growth tactic, which enable
organization to be creative as possible as it can. The main motive behind using a strategy is to
increase market share and profitability as well as growth of supermarket. Britain food retail
industry is one of the most profitable businesses in the nation. The marketplace is currently
dominated by the one of the leading grocery stores in country Tesco. Tesco is the biggest food
retailer in the entire UK with the market stock of around 28.2%. It is the leader of the four large
grocers that is Sainsbury's, Asda and Morrisons. Market development is the best Ansoff matrix
strategy, as it may enable organization to increase profitability and generate a lot of revenue
more than last few years or months. According to current tactic, Tesco and its management may
take step to move forward in term of foreign market expansion, which drive the attention of
company toward improving product quality. It is important and beneficial for firm to select and

use this strategy, which in return provide desire outcomes in term of generating unpredictable
revenue that contribute to gain competitive advantages in bulk.
Along with other benefits, this tactic encompasses key advantages in form of providing
organization chance to promote venture and its products globally, by selecting a particular
foreign market, where it may take initiative to enter or expand business appropriately. Market
development is the best tactic because it may allow TESCO and its stakeholders to take pleasure
of creasing market share and growth as well, which is not that easy for any organization to do
that appropriately and effectively. This tactic is better and effective in form of providing key
chances that firm may grab effectively and appropriately by developing appropriate plans and
tactics that aid to reach desire outcomes. This marketing tactic may drive the attention and
concentration of marketers toward promoting venture in the whole world, with good utilization
of excellent resources, such as advanced digital technologies that play significant role in growth
and success of organizations.
Marketing Mix 4ps
The marketing mix means the strategies that helps in satisfying the customers needs and
position offers distinctly in the mind of the audience. It haves 4ps Product, Price, Place and
promotion, an additional three elements that helps in gathering the demand of marketing
services, People, Process and physical Evidence.
Developing marketing strategy.
Product
This refers to what is the organisation producing and developing it so that it can meet the
necessity of the customers. For instance Tesco needs to meet its customers wants and their needs
by launching the right product with the bundle of the benefits which is better than the last one.
As customer's needs changes now and then. Competitor races ahead by introduction of new
products. So it is necessary for Tesco to improve their offers and creating the brand-new variant
of present products or by introducing brand-new products itself. While improving the product
ensuring that adding up new guarantees, warranties. Tesco sale a broad variety of products

including food, clothing, stationary, cosmetics, electronics, financial services etc. With ever
prospering product lines, it provides to every achievable demand of customer. It sells products
from outstanding brands in nearly every product line. It has its personal products too such as
everyday value, Tesco lotus, Tesco value and the F&F clothing are some of the Tesco's own
brands. However, it is a worth acknowledgement that the availableness of the range product
collection depends on the kind of retail store customers visit.
Price
This is the only income making component of the mix. All other marketing activities
demonstrate expenditure (Altay, Okumuş, and Adıgüzel Mercangöz, 2022). Develop habit of
continuously checking on the prices of the products and compares them to the other competitors
prices. It is important to maintain the prices of the products so that it has the appropriate rates
according to the current market. Sometimes Tesco needs to lower its price and other time it can
be appropriate to increase price. Many companies founded that profit of definite production.
Increasing the prices of the product Tesco may suffer proportion of their buyers. Sometimes
there is necessity to change the polices of the organisation. By launching interesting offers and
discounts like Including gifts with the product or buy one get one free offers can attract the
customers.
During the pandemic Tesco decreased their product costs but with its powerful
distribution chains managed to keep the stocks of the goods full. Even when the delivering
difficulty were all over the industry. Tesco and Sainsbury's managed to become the largest
stakeholders holding 42.3 percent of the market jointly. Along the backmost the post-Brexit.
Unpredictability and growing economic process, buyers behaviour changed in the favour of the
cheap choices like Aldi and Lidl. This resulted in the Price war in the market and grocery store
had to decrease their prices. Tesco's Aldi price matching movement was introduced in the march
last year. In order to pull in the customers in their outlets rather than Aldi andLidl. It has its
reputation in market because of its worth, low-level cost, and for the client centred. Tesco's gross
revenue in the past six months was around British 27.3 billion pound and net profit margin was
107 per cent to 1.1 billion pound sterling.
Place

It is very important to know that where to sell the products and services. There are
various means and places where businesses can trade. It can be anywhere like a website or social
media, catalogue, or physical stores. Sometimes change of a place can lead to speedy gain in
sales (Das and et.al 2021). Tesco needs to ensure that they are in right location where their
customers can easily reach them. The Tesco needs to be in the commercial area which is
crowded with people. Like much other merchandising, Tesco uses two primary channels of
distribution that is to say online and offline. It has nearly 7000 offline shop all over the world.
The offline stores of Tesco is the six different kind. For instance Tesco express, Tesco Extra,
Tesco metro, Tesco compact, Tesco Home plus and Tesco superstore. The online enterprise of
the establishment is called Tesco direct this displays that Tesco uses various channels available
to reach out to its buyers.
Promotion
The third and most essential is the promotion of the product. It creates knowingness of
the product and its brand in market. Promotional scheme works on several steps. The promotion
can be done by several means like advertisement, content marketing, direct marketing. Tesco
needs to advertise more and outspread the increasing knowing of its brand. This increases the
sales and generate income. Tesco needs to advertise more by creating unique content of ads that
have catchy jingle line. The creative content of ads will attract customer's. Tesco has a strong
brand image which helps its promotional activities important. The troupe uses television,
newspaper, and different media outlets to take its content to its customers.
According to Nielsen Adlntel Tesco is the largest spender in traditional advertising in the
Great Britain grocery retail industry. It spent over 80.8 million British Sterling Pounds in the
year 2019. Which is a lot higher than the previous year of 2018 amount spent on publicity. In
component to advertising, Tesco uses other forms of promotion for instance it often provides buy
one get one free offers for some products. It has a loyalty card as well Tesco Club-card
individual get points each time they shop which they can redeem to get discounts. They often get
personalised discounts and offers as well.

Discussing the consumer driven strategy
Segmentation
Segmentation is the process of disjunctive customers in the different part founded on
definite characteristics. This helps Tesco in targeting the abstraction of respective people who
they want to sale their product reported to their prospective needs and welfare. The segmentation
is based on the customers specifications. Products and services offered by Tesco and other
enterprise cannot be fascinating to all people in equivalent terms, because variation in needs and
wants among people. Therefore, business organization do engage in market segmentation and
targeting practices. It can be specified that market segmentation is based on the specifically
actual thought that the market for a product is not consistent to its needs and wants. In simple
terms, market segmentation is dividing people members into groups according to their needs,
wants and other criteria and processing products and services that intent to fulfill needs and
wants of particular groups. Segmentation can be separated into geographic, demographic,
psycho-graphics and behavioural bases.
The segmentation points are as follows:-
Demographic
Demographic segmentation is dividing the collective marketplace into smaller segments
and groups based on the gender, income, occupation, age, life cycle stage, ethnicity, religion and
generation. As the good of Tesco provide an ace value proposition, it should separate the
customers based on the two chief demographic criteria income of the potential customer and life
cycle stages. One of the most widely utilized demographic segmentation structure in United
States by various marketers is PRIZM.
Psycho-graphics
In the marketing world, lifestyle directed interests, activities and persuasion are classified
under psycho-graphics variables. Tesco can exercise psycho-graphics segmentation to split the
likely customer into assorted section based on personality characteristic, leisure activities,
hobbies, buying patterns, consumption opinions, opinion on social issues and numerous concept.

Psycho-graphics segmentation is impressive because people characteristic based on single life
experience and growing up situation.
Lifestyle traits.
This data base shows that what is the lifestyle is of the buyers. Choices in the day to day
life. For example hobbies, entertainment preferences and non work activities.
Behaviour
Behavioural segmentation divides buyers into groups based on their attitudes, product
cognition, product uses and other responses to a product. Many marketing experts consider that
behaviour uncertain are a good starting point to build user segments. For instance for some
service freemium framework is a far more impressive segmentation scheme than geographic,
demographic or psycho-graphics. The behaviour segmentation assist the Tesco to centring on
primal characteristic and provide the consumers with attribute that they are more likely to use.
Constant action leads higher customer gratification rates and high net promoter valuation.
Tesco needs to choose the demographic segmentation as it will help in knowing about
buyers age, gender, education and profession. Different ages and gender can help them in
identifying that which product is best to target the person according to their age, gender,
education, profession.
Targeting-
After finding of different consumer segments within the market, Tesco needs to target a
particular marketplace. The choice of target market is dependent on ten critical factors. Financial
resources to target a special segment does the Tesco have marketing ability, functional skills and
financial resources to target a particular segment of customers. Organization mission, vision, and
the customer segment suitable is the targeting consistent with the vision, mission, ethos, values
and strategic fit of the Tesco. Regulatory and other entry obstruction are there any regulatory and
technological roadblock that Tesco will face if it decides to enter the market. Competition in the
target segment: What is the level of competition in the target segment. If the competition is
furious then there is less probability of sustainable amount in prolonged terms.
The financial return prospective of the target market- Tesco needs to determine whether the
segment it is planning to target can be financially profitable. of

Existence of appropriate collaborators to market successfully to the target market- is
there decent structure accessible to target definite customer segment. For instance everyone
cognize that there is an environment conscious segment in auto-mobile industry who can pay
premium prices for electric vehicles, but none of the leading auto players successfully capable to
target that segment because there was no collaborator's system. Tesco became successful by
building that ecosystem. Organization's relation strengths and weakness to market successfully to
the target marketplace. Segment constitution beauty presence of center infrastructure to market
successful to the target marketplace. Product life cycle phase it is extremely relevant in the
global scenario where the product life cycle is at different level based on social, economic,
regulatory and political reasons. Tesco needs to find out at what level of the product life cycle
the target part is. Organizational technical ability to give to a particular consumer segment in the
retail grocery industry.
Positioning
Positioning of a product refer dealing with respective elements of marketing mix in order
to pull in target customer segment in the most efficient way. Tesco uses a broad range of
positioning scheme in order to pull in target customer segment. Functional positioning is
connected with enhanced range and quality of functionalities of product and services. For
instance, Tesco sells its Tesco the finest range of products through functional positioning.
Consequently, the quality of this range of good is serving as the chief element of publicity for
chosen customer segment. Products sold through functional positioning are mostly more costly
compared to Tesco's basic range of products. Since higher quality and enhanced functionality can
only be achieved for extra costs. Price positioning is applied by Tesco in relation to a broad
range of its own brand products consider its 19-230 18.5 inch widescreen HD ready LCD TV.
The company employs price positioning in order to pull in particular buyers segment that are
more obsessed with the price of the product or a service compared to other element of marketing
mix.
Experiential positioning as the name implies associate to the supplying of receptive or
cognitive input to buyers. Tesco uses experiential positioning primarily to target its buyers for its
well-being and beauty range of products. Multi segment positioning is an alternate type of
positioning utilized to target respective segments at the same time with different products. Tesco

makes an extensive use of multi-segment positioning. To use the same example above. While
Tesco Technika TV is positioned to target purchaser segment that is highly cost alert, the grocery
store chains also sells Samsung 48 inch Smart curved Wi-Fi built in LED TV with free view HD
to target a various customers segment. Who is willing to give more for more superior product.
There are additional positioning strategies used by Tesco such as user positioning, product class
positioning, competitor positioning etc. However, all of these methods can be specific as
different variations of four broad positioning methods that is discussed.
CONCLUSION
As per the above assessment it has been concluded that organisation develops marketing
strategies using the Ansoff matrix and STP in order to survive and to be best in the industry.
Moreover, it has shown the role of marketing mix 4ps that helps Tesco in knowing several
aspects of the market like price, product, people, promotion and what is going on in market and
how they can work. It also highlighted the importance of the segmentation of different categories
that helps them in targeting the right audience for their products and also positioning of their
products to right customers.