Marketing Plan for Tesco: Analysis of Situation, SWOT, PESTEL

This report presents a comprehensive marketing analysis of Tesco plc., a major retail company. The analysis begins with an introduction to Tesco, followed by a situation analysis that examines its financial performance, mission statement, and core competencies. The report includes an in-depth SWOT analysis, identifying Tesco's strengths, weaknesses, opportunities, and threats. Furthermore, it includes a PESTEL analysis to assess the political, economic, social, technological, environmental, and legal factors impacting Tesco's operations. The report also explores market and competitor analysis, including major competitors and their strategies, customer analysis and portfolio analysis. The conclusion summarizes the key findings and implications for Tesco's future marketing strategies. References are included to support the analysis.

Running head: MARKETING PLANNING
MARKETING PLANNING
Name of the student:
Name of the university:
Author Note:

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Table of Contents
Introduction:...............................................................................................................................2
Discussion:.................................................................................................................................2
Part – 1.......................................................................................................................................2
1. Situation analysis............................................................................................................2
2. Industry and Environmental Analysis................................................................................3
3. SWOT analysis of Tesco plc..............................................................................................5
Conclusion..................................................................................................................................6
References..................................................................................................................................7

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Introduction:
The assignment deals with the chosen company which is Tesco plc. a retail store in
the United Kingdom is referred to as the third largest retail store in terms of the gross
revenues. In terms of the overall revenues it is referred to as the ninth largest retailer in the
world. Tesco has diversified business which are the retailing of books, clothing, furniture,
electronics toys and many more. The operations of Tesco are conducted over 11 countries all
across Europe and Asia. Tesco offers wide variety of foods which are the beverages, grocery,
beauty products, consumer electronics and electrical goods. In this particular assignment
SWOT analysis, PESTEL analysis, product portfolio, competitor’s analysis and SMART
objective of the company is performed in that case.
Discussion:
Part – 1
1. Situation analysis
Tesco have substantially reported growth in the operating profit before payment of tax in
the financial year 2018. This has further helped the upper level management of the company
regarding the payment of dividend. As per the non-financial goals of the business, Tesco is
further looking to unlock the substantial synergies which are available to the combined group.
Lots of benefits are also provided to the new shareholders in the market (Chaffey and Ellis-
Chadwick 2019).
The overall growth strategy of Tesco helped to strengthen their core business in UK.
Tesco plan to accomplish this strategy by diversifying the product range from food towards
the financial, non-financial and telecommunication services and further entering into the

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global market. By analyzing the capital structure of Tesco, it is found that the company’s
level of debt can enhance its value and investment decision based on the past and future
transaction made by the company. Share price and dividend theory is basically based on the
different valuation techniques used by the investors. Previously the company has faced
various strategic issues over the past years (Kotler et al. 2015).
From the financial years 2005 to 2009 based on the report, sales and income figures of
TESCO have steadily increased. This further helped the company in generating positive
return for the potential investors in the business. The effect of the global financial crisis
affects the UK economy where the government may loosen its restriction towards TESCO.
This is the perfect moment for the company to serve foods and basic living materials which
will work as an expansion of Tesco’s business. As the gearing ratio of the company is high
which will further support Tesco to expand its business which is based on the potential risk of
default on loans (Soros 2015).
2. Industry and Environmental Analysis
Environmental analysis plays significant role for the company in order to understand
the intensity in the competition of the market. Further the change in the weather and climate
factors also harms the profitability position and production of the company. It is significant to
understand the current market situation and based on that the upper level management of
Tesco will take decisions based on the same. The PESTEL analysis of Tesco will provide far
better understanding regarding the current situation in the market and the other factors
associated with the multi-platform international retailer. The details of the PESTEL analysis
is provided accordingly:
 Political factors – The retailing company is operated worldwide where the political
creates great impact on the performance of Tesco. Due to scarcity of jobs, it is

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important for the government of the country to enhance the employment generation
and hence it is significant to create jobs in the retail sectors. The increase in the
employment opportunities of the country will also increase the demand of the product
along with diversifying the workforce. Before entering into the market the key
elements which must be considered by the company are the political stability in the
retail sectors, level corruption associated in the environment, benefits to the
employees and many more.
 Economic factors – The certain economic factors which Tesco must take into account
are the leverage cost, profit, demand and prices. The company must stay aware
regarding the change in taxation and policies which may harm the business prospect
of the company. Tesco must also take care of the other economic factor which may
harm the business prospect of the company such as the inflation, growth rate and
overall economic indicators (Gitman, Juchau and Flanagan 2015). The decisions of
the upper level management of the company will depend upon the all the economic
factors associated with the business.
 Social factors – In recent years the attitudes of the customers are constantly changing
and due to that reason Tesco has enhanced the amount of the nonfood amount items
offered to sale. Basically, the demand of the customers depends upon the taste and
preferences of the customers. Due to some of the health issues arising in recent years
the approach towards foods are constantly changing accordingly. The social factors
of the company include the demographics, culture, class structure and attitude which
may create impact on the company’s financial performances.
 Technological factors – Technology in recent years is constantly increasing in a
devastating manner where over the last five years the performance of the industry is
moving in a fast manner. Tesco upgrades its technologies on an interval basis and

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also understands the impact on cost structure in the retail industry. Further the impact
on the value chain structure in Consumer service sectors also must be analyzed by
Tesco.
3. SWOT analysis of Tesco plc.
The SWOT analysis of the Tesco plc. is performed in order to understand the position
of the company in the market and further strategies which the company will adopt in order to
understand the overall financial performance.
 Strength: Tesco is leading in terms of the market share where it particularly
dominates the grocery retail market of Great Britain with actually 4% of the market
share. Geographically as per the survey data there are approximately 6800 stores in
14 countries. The number of stores in the market are also growing and the revenue of
the business is also increasing year after year. The usage of technology will also help
the company to keep update regarding the profile of the customers. Tesco keeps
update of the preferences of the company and accordingly takes business decisions.
The supply chain network of the company is also effective and also have efficient
waste management policies of the company (Baker 2016).
 Weakness: There are various weakness of the company which can be highlighted
such as the failed operation in the US and Japan which took place in the year 2012.
Actually the failed export operation led to close the stores in the nine years of
operation in Japan. In the year 2017 there were frauds and accounting scandal took
place due to the false accounting declaration along with misrepresentation of profits.
Tesco also reported a decrease in the operating profit of the company due to that the
share price of the company fell to 9% which has proved to be worst performance of
the company in the year 2018. As per the financial evaluation of the company, there
were high debts and credit card liability further affected the overall financial

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performance of the company. The low-cost strategy which were adopted by the upper
level management of the company reduced the profit margin in a significant manner.
This kind of declination in the financial performance is a main reason behind the
downfall of the company.
 Opportunities: Tesco opened a retail discount store named as Jack and further has the
opportunity of growth in the business if the company can successful run the business.
The company actually maintain strategic alliances with the other brands that further
offers excellent opportunities for the business. Tesco is further expanding the
business operations in the countries like the South Korea, Indonesia and Turkey
which is quite a profitable opportunity for the company (Morgan et al. 2019).
 Threats: There also exist some of the significant threats of Tesco where the
competing against the super market where the current growth and performance of
Walmart is rising along with the performance of the Carrefour and Aldi is said to be
the biggest competitors in the market. This is the reason behind the threat in the
market position of the business. The other threat is the misleading customers with
fake farm brand names and further marketing the products under the brand name
which is Woodside Farm. The economic crisis and credit crunches are the other
threats in the business of the operational efficiency and the performance of Tesco
(Shoup 2017).
Conclusion
From the above discussion, it can be concluded that the financial performance of
Tesco is poor but as per the analysis of the SWOT and PESTEL strategies of the company it
is quite clear that there will be significant growth in the business of the company. The
environmental and social factors play key role in competing with the other retail sectors in
the country. Effective marketing strategy will help the company to achieve the potential

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customers in the market. As per the current market situation, it is the responsibility of the
business to constantly analyze the threats and opportunities which are associated with the
company. Tesco poses real opportunity to grow in the future if the management system of the
company is effective.
References
Baker, M.J., 2016. What is marketing?. In The Marketing Book (pp. 25-42). Routledge.
Chaffey, D. and Ellis-Chadwick, F., 2019. Digital marketing. Pearson UK.
Gitman, L.J., Juchau, R. and Flanagan, J., 2015. Principles of managerial finance. Pearson
Higher Education AU.
Kerin, R. and Hartley, S., 2015. Marketing: the core. McGraw-Hill.
Kotler, P., Burton, S., Deans, K., Brown, L. and Armstrong, G., 2015. Marketing. Pearson
Higher Education AU.
Lovelock, C. and Patterson, P., 2015. Services marketing. Pearson Australia.
Morgan, N.A., Whitler, K.A., Feng, H. and Chari, S., 2019. Research in marketing strategy.
Journal of the Academy of Marketing Science, 47(1), pp.4-29.
Shoup, C., 2017. Public finance. Routledge.
Soros, G., 2015. The alchemy of finance. John Wiley & Sons.