BUMKT5902 Marketing Management Report: Tesco's Customer Value Analysis

This report provides a comprehensive analysis of the UK supermarket industry, with a specific focus on Tesco. It delves into the concepts of customer value and value proposition, exploring how Tesco implements these strategies to attract and retain customers. The report examines Tesco's market position, customer segmentation, and the strategies it employs to deliver value to its customers. It also provides an overview of the competitive landscape, highlighting key players such as Asda, Sainsbury's, and Morrison's. The analysis includes an examination of Tesco's website and its approach to customer engagement. The report concludes with recommendations for enhancing Tesco's customer service and value proposition, aiming to improve its market performance and customer satisfaction. The report also touches upon the role of customer value in the financial success of companies.

Running Head: MARKETING AND MANAGEMENT
Marketing and Management
(Student Name)

MARKETING AND MANAGEMENT i
Executive Summary
Consumers are the key resources of achieving success in the market. Satisfying consumers play a
prominent role in running the business. Most of the companies have adopted customer value and
value proposition to provide them better services that help them to grown in the market with
sustainable manner. Supermarkets in UK has a spread their roots ate wider level. The major
players in UK are Asda, Tesco, Morrison as well as Sainsbury. They have great market share in
the UK with great contribution in the GDP of the company. In the following report there will be
detailed analysis of UK supermarkets in which Tesco will be deeply analyzed and the extent to
which they have adopted customer value and value proposition in their business and the manner
they can enhance their service in more effective and efficient manner.

MARKETING AND MANAGEMENT ii
Table of Contents
Executive Summary.........................................................................................................................1
Introduction......................................................................................................................................4
Aim and Objective.......................................................................................................................4
Customer Value...............................................................................................................................4
Value Proposition............................................................................................................................5
Critical Analysis..............................................................................................................................5
Analysis of UK supermarket...........................................................................................................6
Local Super Market.........................................................................................................................6
Customer Segment and their Value.................................................................................................7
Website Analysis of Tesco..............................................................................................................7
Recommendations............................................................................................................................8
Conclusion.......................................................................................................................................8
References......................................................................................................................................10

MARKETING AND MANAGEMENT 1
Introduction
In the recent, the market is more competitive with more innovative as well as heterogeneous in
its nature. There is larger number of the factors that influences the rapid rise in the supermarkets
across the globe as well as specifically in the United States and United Kingdom. The companies
have adopted various marketing strategies to target their consumers in more effective and
efficient manner. The requirement of consumers as well as sellers is being met exceedingly and
enhances the strong growth in such field. Satisfying needs and wants of the consumers play a
crucial role for the companies therefore; the main aim of the supermarket is to provide the
consumers with their entire requirement without looking to elsewhere (Nurwidayat, Sudarsono,
Pratiwi, and Havity, 2019).
This report provided an elaborate description on the emergence of the concept of supermarkets in
the local as well as global retail industry. Moreover, it also present the information that are based
on various factors that had influenced the rapid growth of the supermarket with the great impact
of supermarket on the components of other chains in the global market and particularly in United
Kingdom. Furthermore, it will be concluded by specifying the impact of consumers on the
demand and sales of supermarkets on all components of their chains and the role of controlling
bodies in UK (Sroka, 2017).
Aim and Objective
The main aim of analyzing such report is to analyze the market base of supermarket in local and
global market and the importance of such supermarkets in the life of consumers. At what level
they would able to satisfy the consumers in effective and efficient manner (Reilly, 2015).
Customer Value
The consumer values have different definitions according to different authors as they are
explained in below points:
 Delivering superior values to the consumers is one of the ongoing concern of the
management in many business markets in the recent as well as the concept of value is
considered as one of the most popular constructs among the business managers as well as
academia. The concept of customer values is widely used in range of disciplines which
include accounting, finance, economics, strategy, marketing as well as production
management (Sadler, and Evans, 2016).
 Customer value of the level of satisfaction among the consumers that they feel after
making the purchases for product or services that is relative to what they must give up to
receive them. the consumers does not only consider the value just in terms spending level
of money but can also give consider the time it takes to obtain a purchased product as
well as interactions with the consumer service personnel. The customer value has several
tiers as well as it is the best thought of hierarchy. Such hierarchy determines the
importance of the services in the mind of consumers in term of the expectations of
consumers as well as does not expect from the experience of purchases (Hsiao, Chang,
and Tang, 2016).

MARKETING AND MANAGEMENT 2
 Customer value is the incremental benefits hat a consumer drives from consuming the
products after paying returns. The term value indicates the significance that a customer
gets from a product or services. It is the difference between the benefits and the cost. The
customer value is depends on three factors which include price, quality and services.
Therefore such three values together form the ‘Customer Value Triad’ (Cook, Andersen,
Combes, Feldman, and Sachdeva, 2018).
Therefore, from the above definitions it can be concluded that every author has different
perspective for Customer Value. However, their end analysis is similar with each other.
Value Proposition
The value proposition has different concept according to different authors as they are explained
in below points:
 Value proposition is the values that can be create from the business by their product or
any services. It affirm that the practical of company for customers. It not only provides
the benefits to the consumers through their products or any services but also include the
attitude with the standpoint to brand for the individuals as well as society. The benefits of
consumers can be finding by the investigation and the brand attitude with the standpoint
to social from the business how to hold the trends of historical (Åkesson, Skålén,
Edvardsson, and Stålhammar, 2016).
 It is one of the promises that are given to the customers for delivering its promised value
as well as a belief from the customer that the right value is experienced. Such value
proposition can be related to overall parts of a company to give the customers what is
promised to them in more effective manner. Creating sustainable value proposition
simply refers to satisfying the customers. It assist the customers to make its decision for
selecting the right product or services that are depending on their values that re being
promised by the organization (Burgoine, Mackenbach, Lakerveld, Forouhi, Griffin,
Brage, Wareham, and Monsivais, 2017).
 Value proposition refers to the business or marketing statement that a company uses to
summarize the reason behind the purchasing of product by the consumers. Such
statement convinces a potential customer that one particular product or services will add
more value or the better way to resolve the issues than other similar offerings will. The
companies uses such statement to target the customers who will benefit most from using
the products of the company that help in maintaining an economic moat (Maguire,
Burgoine, and Monsivais, 2015).
Critical Analysis
Customer value and value proposition, created a vital role towards the financial success of the
firms or companies at greater level. Customer value is one of the key sources to satisfying the
consumers in an effective manner. The health of the exchange transaction has a significant
impact on the overall health as well as success of the business. The company would able to
understand the needs and requirement of their consumers that give an opportunity to the
company to earn maximum profit in such market. Moreover, the value proposition and customer
value provide an effective platform to the company to enhance their sales that created great

MARKETING AND MANAGEMENT 3
success to the financial success of the company at greater level. The company can manage their
financial services in more effective by concentrating on the quality of services that directly
satisfy the need and wants of consumers which are linked with the financial success of the
company in an effective and efficient manner (Felgate, and Fearne, 2015).
Analysis of UK supermarket
The industry of supermarket in UK forms as one of the largest part of the ULK retail industry.
The sales of such country in the year 2007 were approximately $300 billion as well as the
supermarket of UK contribute 8% of the British GDP. As per the market trends as well as
reviews, the impact of supermarket on the consumer values had led the major supermarket to not
only reduce the price but also enhance the quality of the products in order to retain the existing
consumers as well as attract new consumers in more effective manner. the super market in UK
maintain high quality of their services by keeping up their quality high at fair price, through
well-kept rooms as well as attractive ambience to fast services with the friendly staff (Nakamura,
Suhrcke, Jebb, Pechey, Almiron-Roig, and Marteau, 2015).
They ensure all the suppliers in such country have been evaluated by quality attribute system
(QAS) in order to provide high quality of products or services to the consumers. The speed of
suchsupermarkets is moderately high. They are trying to reduce the queues thorough recent the
introduction of self-checkouts, basket tills as well as introduction of newest scan with the pack
system that create the great value to the consumers in an effective manner. The market is majorly
dominating by the four major companies which include, Asda, Tesco, Morrison as well as
Sainsbury. Such giants have already occupied 67.30 % of the market share and in the recent it
rose to 76%. Therefore, such companies provide quality product at reasonable price, fulfilling the
expectations of the consumers for fresh, healthy, sales with tasty food. They also respect the
environment by adopting environmentally friendly packaging in their business (Remnant, and
Adams, 2015).
Local Super Market
One of the most leading companies Tesco has the maximum number of buyers due to the reason
of great value proposition towards the consumers that led to attracting maximum consumers
towards their company in an effective manner. In delivering the value to the consumers, the
company has adopted certain strategies that are explained in below points:
 The company understands the choices of their consumers in more effective manner. They
deliver quality products at reasonable prices that made the consumers more satisfied
towards the company in an efficient manner.
 Tesco is able to identify the customer segments to target them in more effective manner.
They have divided their products according to the age and requirement of the customers
that provide effective services to the consumers in more effective as well as efficient
manner.
 Tesco continuously focus on improving the service quality for the consumers that made
the consumers easier while purchasing products in such supermarket. They have set up
self-check-in and check-out, basket tills facility for their consumers to do their shopping
in more effective and efficient manner (Rihova, Buhalis, Moital, and Gouthro, 2015).

MARKETING AND MANAGEMENT 4
 Tesco was criminated for not promoting itself up to its standard as well as also running
the same type of the initiatives that was running by Sainsbury. Therefore, the company
failed to promote their products or services to their consumers (Cobb, Appel, Franco,
Jones‐Smith, and Anderson, 2015).
Customer Segment and their Value
One of the customer segments that play a vital role in the supermarket and majorly focus by
them is the demographic segment. It is one of the essential segments that have been majorly
focused by the supermarkets in an effective manner. It is the segment in which the consumers are
targeted on the basis of their age, gender, level of income. Therefore, the ages with the range of
14 to 55 prefer to purchase from the supermarkets. They get their entire requirement at one place
that made them more satisfied in the market. The consumers of such segment prefer to buy a
product at reasonable prices without compromising with their quality of products that will make
them more satisfied. Moreover, the consumers also seek for quick services that they wanted to be
provided that can help them to save their time with money from their busy schedule while doing
some shopping (Payne, Frow, and Eggert, 2017).
While targeting the consumers most of the supermarket considers such seeking as the first
priority at certain level. They tried to provide reasonable products at certain level however, for
quality product some of the supermarket charges high prices from their consumers that enhanced
the level of dissatisfaction among them. Furthermore, such supermarkets has huge rush that
created an issues for them to manage such crowd in the billing counter that create the issue of
time consuming for the consumers that made the consumers irritated and prefer to purchase the
products form other stores to ignore such rush or crowed in such places at the peak time
(Chepulis, Mearns, Hill, Crino, Alderton), and Jenner, 2018).
Website Analysis of Tesco
Website is one of the effective tools to target the consumers. Most of the companies use the
sources of websites to provide information about their products in more effective as well as
efficient manner. Tesco is one of the leading supermarkets at the global level. Therefore, they
also sell their products through providing online services. Most of the consumers prefer to
purchase online rather to visit the outlet that helps the company to target those consumers. At
certain level, the company would able to satisfy their consumers however, their services are as
effective as their outlet. Through selling the products through website, the company does not
able to provide healthy and sufficient services that include bugs, quality issues, ignore feedback
that represent that the company ignore the value of consumers that affect the overall performance
of the company at greater level. Moreover, the company would also not deliver their products on
time hat created great issues for the consumers as well as for the company. They do not able to
manage their sell through the process of online that represent that the company lag in managing
their business in the platform of online (Malhotra, Verma, Rishi, and Singh, 2017).
The company provide great discount coupons to their consumers to target them in effective
manner however some of the coupons shows invalid wile ordering product through online, it
does not only consume the time of the consumers but also enhanced the level of dissatisfaction
among them. At certain level they ignore the priority of the consumers that represent the

MARKETING AND MANAGEMENT 5
company lag in creating effectiveness of the customer value at certain level (Beneke, and Carter,
2015).
The company also covers all ranges of products and services with wider range of products that
create value to the consumers. They tried to cover all the products in their website that can help
the company to target all ranges of consumers in more effective and efficient manner (Adewuyi,
2016).
Recommendations
From the above analysis there are certain recommendations that are explained in below points:
 The supermarket need to reconstruct their strength, values as well as belief that is
required to split up their position in the existing market. They are facing huge
competition in the market therefore; it is required for the companies to innovate as well
as improvise in the market to enhance the value of consumers in more effective manner.
 The companies need to identify the issue that is faced by the company to enhance the
customer value and value proposition in the market. The major issues that are faced by
the consumers are waiting in the queue that wasting the time of consumers which create
the issue of dissatisfaction among the consumers. Therefore, the company needs to focus
on such issue and come with some innovative ideas.
 The supermarkets need to enhance their Information Technology system so that the
information can be processed at faster pace as well as the stocks can be reloaded at the
faster rate in an effective manner. The shelf will always stock well as well as the
consumers also keep getting the informed about the available varieties. All such hard
work will make the shopping experience of the consumers more enjoyable and make
them satisfied in more effective and efficient manner.
 As the world faced recession in the global market, therefore, the company should avoid
the price related wars as well as must follow specific price strategy. As the consumers
will t willing to pay the high prices even for the best quality products therefore, the low
pricing should be planned for the quality product.
 Tesco is required to enhance their online shopping services in non-food items so that the
consumers can able to shop online more comfortably.
Conclusion
From the above analysis it can be concluded that customer value and value proposition play a
vital role in the growth and success of business in sustainable manner. Consumers are the main
source of achieving success and growth in the market as they play a prominent role in the
organization. Therefore, satisfying consumer is the key role of the company. Customer value and
value proposition is the process of satisfying the consumers in an effective manner. The
companies use certain tools to value their consumers. In the supermarket of UK, most of the
companies has adopted effective customer value and value proportion in their business hut
delivering quality products at reasonable prices as well as by catering the services in more
effective manner that created the. The supermarket of UK is wider spread and known as the
biggest supermarkets at the global level. One of the leading companies Tesco has adopted
effective value proposition strategies in their business. They cater reasonable prices products to

MARKETING AND MANAGEMENT 6
their consumers with analyzing the issues that majorly faces by the consumers to provide them
effective services and products in more effective manner. The company has also provided self-
checkout service to reduce the waiting queue in their outlet that helped the company in providing
fast services to their consumers in an effective manner. However, while analyzing their website,
the company failed in providing effective services through their websites. They delay in
delivering their products that irritate their consumers and made them dissatisfied at greater level.
Therefore, the company is highly required to focus on their website services that would help
them in creating the customer value and value proposition in their website as well in an more
effective and efficient manner.

MARKETING AND MANAGEMENT 7
References
Adewuyi, A.W. (2016) Ratio Analysis of Tesco Plc Financial Performance between 2010 and
2014 in Comparison to Both Sainsbury and Morrisons. Open Journal of Accounting, 5(03), p.45.
Åkesson, M., Skålén, P., Edvardsson, B. and Stålhammar, A. (2016) Value proposition test-
driving for service innovation: How frontline employees innovate value propositions. Journal of
Service Theory and Practice, 26(3), pp.338-362.
Beneke, J. and Carter, S. (2015) The development of a consumer value proposition of private
label brands and the application thereof in a South African retail context. Journal of Retailing
and consumer services, 25, pp.22-35.
Burgoine, T., Mackenbach, J., Lakerveld, J., Forouhi, N., Griffin, S., Brage, S., Wareham, N. and
Monsivais, P. (2017) Interplay of socioeconomic status and supermarket distance is associated
with excess obesity risk: a UK cross-sectional study. International journal of environmental
research and public health, 14(11), p.1290.
Chepulis, L., Mearns, G., Hill, S., Wu, J.H., Crino, M., Alderton, S. and Jenner, K. (2018) The
nutritional content of supermarket beverages: a cross-sectional analysis of New Zealand,
Australia, Canada and the UK. Public health nutrition, 21(13), pp.2507-2516.
Chowdhury, B.N. (2016) A critical analysis of customer loyalty and customer satisfaction-a case
study on Tesco Club Card(Doctoral dissertation, University of East London).
Cobb, L.K., Appel, L.J., Franco, M., Jones‐Smith, J.C., Nur, A. and Anderson, C.A. (2015) The
relationship of the local food environment with obesity: a systematic review of methods, study
quality, and results. Obesity, 23(7), pp.1331-1344.
Cook, D.A., Andersen, D.K., Combes, J.R., Feldman, D.L. and Sachdeva, A.K. (2018) The value
proposition of simulation-based education. Surgery, 163(4), pp.944-949.
Felgate, M. and Fearne, A. (2015) Analyzing the impact of supermarket promotions: a case study
using Tesco Clubcard data in the UK. In The Sustainable Global Marketplace (pp. 471-475).
Springer, Cham.
Hsiao, C.H., Chang, J.J. and Tang, K.Y. (2016) Exploring the influential factors in continuance
usage of mobile social Apps: Satisfaction, habit, and customer value perspectives. Telematics
and Informatics, 33(2), pp.342-355.
Jangid, H., Singhal, S., Shah, R.R. and Zimmermann, R. (2018) Aspect-Based Financial
Sentiment Analysis using Deep Learning. In Companion of the The Web Conference 2018 on
The Web Conference 2018 (pp. 1961-1966). International World Wide Web Conferences
Steering Committee.

MARKETING AND MANAGEMENT 8
Maguire, E.R., Burgoine, T. and Monsivais, P. (2015) Area deprivation and the food
environment over time: A repeated cross-sectional study on takeaway outlet density and
supermarket presence in Norfolk, UK, 1990–2008. Health & place, 33(4), pp.142-147.
Malhotra, D., Verma, N., Rishi, O.P. and Singh, J. (2017) Intelligent Big Data Analytics:
Adaptive E-Commerce Website Ranking Using Apriori Hadoop–BDAS-Based Cloud
Framework. In Maximizing Business Performance and Efficiency Through Intelligent
Systems (pp. 50-72). IGI Global.
Nakamura, R., Suhrcke, M., Jebb, S.A., Pechey, R., Almiron-Roig, E. and Marteau, T.M. (2015)
Price promotions on healthier compared with less healthy foods: a hierarchical regression
analysis of the impact on sales and social patterning of responses to promotions in Great
Britain. The American journal of clinical nutrition, 101(4), pp.808-816.
Nurwidayat, A., Sudarsono, B., Pratiwi, K. and Havity, M.D. (2019) Implementation of
Information System in Submitting Employees’ Annual Leave at PT. Tesco
Indomaritim. SinkrOn, 3(2), pp.97-103.
Payne, A., Frow, P. and Eggert, A. (2017) The customer value proposition: evolution,
development, and application in marketing. Journal of the Academy of Marketing Science, 45(4),
pp.467-489.
Reilly, P. (2015) Every little helps? YouTube, sousveillance and the ‘anti-Tesco’riot in Stokes
Croft. New Media & Society, 17(5), pp.755-771.
Remnant, J. and Adams, J. (2015) The nutritional content and cost of supermarket ready-meals.
Cross-sectional analysis. Appetite, 92, pp.36-42.
Rihova, I., Buhalis, D., Moital, M. and Gouthro, M.B. (2015) Conceptualising customer‐to‐
customer value co‐creation in tourism. International Journal of Tourism Research, 17(4),
pp.356-363.
Sadler, R. and Evans, R.D. (2016) August. Social Media Strategies in the Retail Sector: Analysis
and Recommendations for Three Multi-National Retailers. In Proceedings of the The 3rd
Multidisciplinary International Social Networks Conference on SocialInformatics 2016, Data
Science 2016 (p. 22). ACM.
Sroka, A. (2017) CRITICAL ANALYSIS OF INTERNATIONAL EXPANSION OF
JERÓNIMO MARTINS SGPS, SA IN CASE OF “VISEGRAD GROUP” COUNTRIES. In VIII
INTERNATIONAL SCIENTIFIC CONFERENCE (p. 103).