TESCO's Marketing Strategy: Segmentation, Targeting, Positioning

This report provides a detailed analysis of TESCO's marketing strategies, focusing on Segmentation, Targeting, and Positioning (STP), the 7Ps of the marketing mix (Product, Price, Place, Promotion, People, Process, and Physical Evidence), and relationship marketing tactics. The report examines how TESCO currently applies these strategies, offering insights into its market segmentation across geographic and demographic factors, its targeting of various customer segments, and its brand positioning. It also assesses TESCO's marketing mix, evaluating each of the 7Ps in relation to its product offerings, pricing strategies, distribution channels, promotional activities, employee management, operational processes, and physical evidence. Furthermore, the report explores TESCO's relationship marketing approach, highlighting its current tactics for building customer loyalty. Finally, the report provides recommendations for improving TESCO's marketing strategy, aiming to enhance its effectiveness and achieve its business goals.

Marketing
Management
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Table of Contents
INTRODUCTION...........................................................................................................................3
TASK...............................................................................................................................................3
Analyse their STP strategy, providing and insight into how segmentation, targeting and
positioning are currently applied by chosen organisation......................................................3
Examine company's marketing mix, focusing 7Ps for product or services, that chosen
organisation is currently applying..........................................................................................5
Assess company's relationship marketing strategy with an emphasis on their current tactics.8
Provide recommendations on how your chosen organisation can improve its marketing
strategy...................................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................12
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INTRODUCTION
The term marketing management refers to an operation which is being performed by
company's marketing department in order to analyse the scope of firm’s products and services
that can satisfy customer’s needs or becomes unsuccessful in market. The nature of marketing
management is to have more focus on customer’s needs and wants instead of being profit
oriented so to gain long term profit (Abeza and et. al., 2020). It comprises of planning and
implementing the product or service plan's components such as price, promotion, distribution of
final goods or services that can help business in satisfying customer’s needs and demands. The
present report comprises discussion upon concept of segmentation, targeting and positioning that
are currently being applied in TESCO. The report comprises of 7p's of marketing mix for a
product along with a discussion upon relationship marketing strategy with an emphasis on
company's current tactics. Further, a recommendation is being made for the company for having
improvement in its marketing strategy that can be applied in future for its success.
TASK
Analyse their STP strategy, providing and insight into how segmentation, targeting and
positioning are currently applied by chosen organisation.
The term STP strategy refers to company's segmentation for market, targeting as well as
positioning which is being applied by each company in order to have develop values for
customer’s through sale of their products and services (Aeberhard and et. al., 2020). The strategy
is helpful during creation of plans related to marketing communications as this assists business in
having priority markets for delivering personalised messages to their customer’s so to engage
them.
 Market Segmentation: This involves segmenting customers on the basis of certain basis
such as behavioural, demographics, psycho-graphic, geographic, etc. Behavioural form of
market segmentation includes customers who buy goods on the basis of behaviour such as
what is going to purchase, how frequently, and several others (Alharbi, 2020). Demographic
segmentation includes basis of gender, age, profession, income group, etc. whereas psycho-
graphic comprises of interests, opinions, lifestyle, etc. The market segmentation based upon
geographic basis includes state, nation, province and others.
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In case of TESCO, the company covers its customer’s from all over 13 foreign countries
other than UK for all category of customer’s from both rural as well as urban areas. TESCO
offers its products for both females and males customer’s as well as students who either buys
product on regular basis or occasionally.
 Targeting: This involves evaluating such segment of customer’s which will provide highest
revenue from large amount of sales in market (Calzada, 2020). This comprises of market
size, opportunity, reach and scope of generating profits. Here, a company selects that market
where it can cater more and more customer’s which will be targeted for selling of product
and services.
In relation to TESCO, the company sells its products where customer’s carries high value
for product and services. Business also targets chain of supermarkets where customer reach is
high in order to get all their products under one umbrella.
 Positioning: This comprises of placing company's product and services away from market
competition in the eyes of targeted customer’s. Every business applies different factors for
market positioning such as experiential, symbolic or functional (Choudhury, 2020).
Experiential positioning involves major emphasis on connecting customer’s emotionally
with the brand, product or services. The symbolic positioning refers to enhancement of
personal image, ego or belongingness of buyers for company's product or services. The third
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Illustration 1: STP Strategy

factor that is functional positioning comprises for resolving various queries or problems of
customer’s and offering of authentic advantages to them.
In relation to TESCO, the company enjoys high brand value and offers its products with
greater clarity, competitiveness, consistency as well as credibility. TESCO other than above
three factors also applies various other positioning forms such as multi-segment, experiential,
user, competitor, etc. positioning for the sale of its products.
The strategy for market segmentation, targeting and positioning provides several
advantages to companies such as high appeal to audience towards product or services,
crystallised brand image, innovation in product, etc.
Examine company's marketing mix, focusing 7Ps for product or services, that chosen
organisation is currently applying.
The term marketing mix refers to a foundation upon which company's business tasks or
actions are being based. Initially there was only 4p's of marketing mix which later on according
to the market demand and situations those 4p's got extended to 7p's (FITRIYANI, 2020). This
helps companies in determining their brand offerings or product. The 7s' for marketing mix are
discussed below with context to TESCO Company:
 Product: This comprises of company's product or services that is manufactured by company
for the purpose of sale in market, produced according to customer’s needs and demand
(Gornostaeva, 2020). This further includes products purpose, packaging, looks and other
additional values which are associated with such product.
In relation to TESCO, the company offers huge variety of its products in different
segments such as electronics, food, financial services, clothing’s and many others which are
preferred by customers in market. Company is able to satisfy its customer’s needs through
offering more than 40,000 products in its retail stores.
 Price: The next P in marketing mix includes the cost of product at which company offers its
products or services to customers in market along with customer’s reaction towards it. The
price of a product should be set according to the value associated with it which is being used
by customers (İpek, 2020). This mix of marketing is the source of revenue generation for
companies as this adds profit margin of business who is selling such product or services in
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market. Company here can either adopt price skimming or price penetration form in order to
have high sales for its product or services.
In context to TESCO, the company places low price for its products so that can be easily
bought by customers of every income group, without minimising product quality and values that
are being associated with products. TESCO offers a system of club cards to its customer’s to
collect some points for their buying that has an option of getting converted into money later.
TESCO tries to maintain economies of scale in its business and offers low price products into
market.
 Place: This comprises of location where company's distributors operate and have further
sales in market. This includes physical location as well as online platform such as e-
commerce website, warehouse, shops, stores of high-street, even could be anything
(Kautish, Sharma and Khare, 2020). Company should select such place which is being easily
accessible by its potential buyers and does not face any kind of inconvenience while having
purchase of their products or services. This also includes availability of demanded product at
right times to customer’s so that they can stay retained and does not shifts to other
company's product if found tough to buy from them.
In relation to TESCO, company is having its headquarter in England, UK and serves its
product across globe through international business. The company offers its products and
services into physical market as well as on online platform through e-commerce websites or even
buyers can place order for their products by accessing company's official website.
 Promotion: This comprises of making company's product or service public so that
customer’s get familiar with their offering and buys such item (Lahtinen, Dietrich and
Rundle-Thiele, 2020). This can be done by adequate advertisement, selling techniques or
marketing. Company can advertise their product either by traditional mode of marketing that
is television ads, magazine, billboards and several others or modern form which comprises
of pop up ads, website advertisement, etc.
In connection with TESCO, the company spreads awareness of its products and services
through traditional mode of advertisement as well as modern way that is advertisements through
television, various discounts for promotion, certain charitable sponsored events, strategies for
increasing sales and many others.
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 People: This P of marketing mix covers company's workforce and all other support staff
such as employees, sales persons, consumer service team, and several other staff which it’s
directly or indirectly associated with successful manufacturing and distribution of that
product (Rana and et. al 2020). It is very necessary to have competent employees in order to
have effective and attractive product that is being accepted and preferred by customers in
market.
In relation to TESCO, the company is having highly skilled assistants for sales who
contribute large in order to bring success for the company. TESCO on the other hand operates its
business functions with a contribution of more than 420,000 employees across globe along with
large force for assisting their customer’s by solving their issues or queries.
 Process: This comprises of all the actions or steps that are being adopted by company in
order to fulfil purpose of selling company's product or services. This includes all series that
a company follows in its delivery process for its product to potential buyers (Rooney,
Krolikowska and Bruce, 2021). Various steps such as distribution, payment, customer
relationship maintenance, sales funnel, etc. are being considered under process of marketing
mix. Process sometimes involves several phases for trial and error which are associated with
sale of product.
In connection to TESCO, the company tries to make its buyer's happy through its fastest
or less time consuming services for billing of their purchases along with comfortable
acquirement of their products within company's physical stores as well as its online purchases.
TESCO has acquired highly skilled employees for this task especially as well as quick solution
for consumer's grievances.
 Physical Evidence: The last P of marketing mix includes some physical presence that helps
in validating company's product or services in market (Thaichon, Brown and Weaven,
2020). This comprises of its look, value, smell, colour, logo or something which allows
customer to identify their product from their rival firms.
In context to TESCO, the company is having attractive and clean retail stores which
assists customer’s in easy identification and categorization of company's product. Along with its
physical stores TESCO also operates with easy understanding and use of its official website that
allows buyers to place their order easily.
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Assess company's relationship marketing strategy with an emphasis on their current tactics.
The term relationship marketing strategy refers to a way or process of developing
customer's loyalty and trust with company's brand that results into high sales which increases
value for its lifetime. The main purpose of developing relationship marketing strategies is to
retain customers for long term instead of one time purchase of company's products and services.
There is a need of effective management and continuous communication by companies in order
to have successful strategies for relationship marketing. Companies to have effective relationship
marketing conducts certain campaigns along with an understanding of their preferences and
interests so to engage more and more customer’s on regular basis through offering unique and
new products or services that gives certain values to buyers. This thought encourages customers
to stay retained for long term with company. The various strategies for relationship marketing
comprises of knowing about company's customer’s, developing certain campaigns, offering high
level of services to customers, personalised communications or offers, etc. out of which a
business can adopt any of it in order to have better relationships with its customer’s in market.
Various relationship marketing tools such as Pipe drive, Mail Chimp, Survey Monkey, Podium
or Hoot Suite are available for companies. The various benefits from developing effective
relationship marketing strategies are mentioned below:
 The concept is much cost effective as it can act or added to any campaign for marketing
to company's product or service. Every company somehow develops strategies for
relationship marketing which does not demands for major or additional monetary
investment by firm.
 This allows customers to stay retained with company's product or services for long term
through its loyalty or trust who can also recommend their product to friends, family
members, colleagues, etc.
 Effective relationship marketing helps businesses in increasing customer's value for
lifetime through its sales for long period of time. This assists businesses in getting more
customers as well as without involving investment in respect to money and time.
In case of TESCO, the company applies approach of relationship marketing through offering
provision of effective services by organisational employees along with a key dedication to
respond customer’s on real time basis so to encourage and retain customer’s from their trust
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and satisfaction level. Company on the other hand fulfils its needs and demands of its
potential customers through introduction of unique or new products in market time to time.
TESCO by launching its club card raises loyalty and trust in the eyes of its customer’s thus
helps them in retaining more and more customer’s through repetitive shopping that assists
TESCO in retaining and developing relationship with its buyers. TESCO is able to collect
and maintain its customer’s data which presents a view to their preferences and needs. The
collection of customer’s data also assists company in having direct marketing through
sending promotional mails on their email id or messages on their registered mobile numbers.
TESCO being a multi-national retailer frim is always successful in getting customer’s trust
and loyalty towards company and maintains a regular relation with them so to have high
sales and handsome marketing of its products and services through building effective
relationships with them.
Provide recommendations on how your chosen organisation can improve its marketing strategy.
The various recommendations to TESCO in order to improve its marketing strategies are
mentioned below:
 TESCO can enhance its customer relationship management process with the help of which
company will be able to market its products and services directly on regular basis to its
potential buyers who have trust and show loyalty for firm. This will allow TESCO to
generate more sales and revenue from market.
 It is to be recommended to TESCO that company should invest more of its finance on
advertising its products and services through hoardings or through modern form of
advertisement so to attract more and more customer’s in international level. Company
should scan environment of such global market so to advertise its product and services in a
way that can influence customer’s to have high international sales.
 TESCO should adopt such marketing strategy that encourages customer’s to buy more and
more products and stay retained for long term. Company can do this by offering certain
discounts, incentives, offers to its potential customer’s on regular basis. This will attract
customer’s for buying products in bulk in order to get some discount or offers upon their
purchases. This technique or strategy will help TESCO in increasing its sales and generate
more revenues than usual.
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 TESCO is being recommended to improve its marketing strategy through employing highly
experienced as well as skilled employees or manager who can bring new unique ideas for
marketing their product or services in local as well as overseas because the retail industry
faces huge tough competition due to easy availability of similar products that are offered by
rival firms. A good leader or a manager can bring some innovative idea or present best
marketing strategy based upon its market condition and brand image.
TESCO other than above mentioned recommendations can modify its existing marketing
strategy or ways of advertising its products and services with modern ways of marketing.
Company can lower down its prices for products during season time or on special occasions
so to attract more and more customers who can buy products more than the actual demand.
Direct marketing will also help company in generating high sales which can be a better
marketing strategy for its physical stores. In case of online selling TESCO can adopt
marketing strategy that provides ads or short videos on common mobile apps as well as on
social media where most of the people spend their time.
CONCLUSION
From the present report it is concluded that marketing is an essential part of every
company that contributes a lot in achievement of business success. Formulating different
marketing strategies is very necessary in order to advertise or market company’s product or
services to the reach of customers who are its potential buyers. Company can use segmentation,
targeting and positioning strategy in order to know and analyse its market which is best suitable
for the sale as well as idea of potential buyers for whom the product is being manufactured by
company. There are different 7P’s of marketing mix such as product, price, place, promotion,
people, process and physical evidence which contributes business to have true and fair
understanding of the feasibility for its products which they are wishing to offer in a market for
sale. The term relationship marketing strategy plays a very crucial role in attracting as well as
retaining more and more customers so to have regular purchase form them. Any company who
wishes to have effective marketing strategy or global reach should adopt different marketing
plans according to the environment of market so to have better influence on customers. Proper
marketing brings more customers, high sales and large revenues for the business firms.
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REFERENCES
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