Strategic Marketing Planning Report: Tesco's Analysis and Strategies

This report provides a comprehensive analysis of Tesco's strategic marketing plan. It begins with an introduction to strategic marketing and its importance, followed by an examination of the impact of Brexit and COVID-19 on Tesco's operations. The report then delves into the organization's structure, resource requirements, and environmental analysis, including a detailed PESTEL analysis. Key aspects of Tesco's marketing strategy are explored, encompassing marketing objectives, STP analysis, and the 7 Ps of marketing. Finally, the report discusses implementation, control, and evaluation of the marketing strategy, culminating in a conclusion and references. The report highlights the importance of strategic marketing planning for organizations like Tesco, emphasizing the need for effective market analysis and adaptation to external factors.

Strategic Marketing
Planning
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Table of Contents
Introduction......................................................................................................................................3
MAIN BODY...................................................................................................................................3
TASK...............................................................................................................................................3
Strategic marketing.................................................................................................................3
Impact of Brexit and COVIDE-19.........................................................................................4
Organization structure and resources required-......................................................................5
Environmental analysis..........................................................................................................5
PESTEL Analysis...................................................................................................................6
Marketing objective of organization......................................................................................7
Marketing strategy section-....................................................................................................9
STP Analysis........................................................................................................................10
7 Ps of marketing..................................................................................................................11
Implementation, control and evaluation...............................................................................12
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14
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Introduction
Main objective of this report is to better understand the concept of strategic marketing in an
organization. An effective marketing strategy planning play an essential role in efficiently
utilizing the company sources and reach to large number of prospective customers and turned
them into customers of company product and services. Marketing include a set of activity,
institutions, process of creating and communication which help in delivering and exchange of
value to the customers of organization (Argenti, 2018). Marketing help an organization to better
understand the needs and wants of customer with the help of proper research and provide a
product to customers which satisfying them most. For success of an organization it’s very
important that they adopt an effective marketing strategy. For this report Tesco is taking into
consideration. It is a multinational British retail company, which is founded by Jack Cohen, in
1919. It mainly deal in various supermarkets, hypermarkets, superstores and convenience shop.
Company diversified in various area such as retail of books, clothing, electronics, furniture, toys
and so on. This report will include the concept of strategic management. This report include
environmental analysis and marketing objective of organization. Other than this it include STP
and 7Ps of marketing. Other than this, it define how to implement and control marketing
strategy. This report will include various PESTLE factors which help in analysing the influence
of external environment.
MAIN BODY
TASK
Strategic marketing
It refers to a way which focus on the energies of organization and resources on core of
action which lead to enhance the sales of organization products and dominance of target market.
Strategic marketing planning is a combination of product development, promotion, distribution,
pricing, effective relationship and other elements of marketing. Strategic marketing planning
help an organization in achieving their goal in a specific time period. Without a strategic
marketing plan organization is not able to get the benefit of available resources and also waste
resources of organization. So for effective success of an organization it’s very important that
they can effectively analysis the market and formulate a strategic marketing plan.
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The retail industry in UK will consistently accounts for around 5% of gross value added
in the economy of UK. It is analysis that 14% of all United Kingdom investment is made by
retailer. Retail industry will contribute the most in the growth and success of country economy.
Impact of Brexit and COVIDE-19
Brexit is the name which is given by UK departure from the European Union. It is a combination
of two words that is ‘Britain ‘and ‘Exist’. It refers to the possibility of withdrawing from the EU.
In context of selected company it has both positive and negative impact on company, which are
discussed below:
Positive impact-
 In context of Tesco, it is a multinational company and because of Brexit is quite easy for
company to move around Europe. Which also include the purchasing of products online
from different members states both to and from the United Kingdom.
 In context of selected company it will already trade in Euro because of which any change
in Euro will not affect their business (Baikov, 2017).
 Most important benefit of this is that the interest rate in the UK is same as the interest rate
of EU. This will be a positive aspect as UK will have a worse interest rate.
Negative impact-
 Taxation rate and public spending will be set by European Central Bank which is not a
favourable situation for Tesco as it affect its sales of products.
 Because of Brexit UK will lose the benefit of exchange rate fluctuations which affect
Tesco in making additional profit.
COVIDE-19 Impact on Tesco
During this pandemic customers are not allow to take a step outside the home as because
of lockdown which affect the growth and performance of business. In context of selected
company various positive and negative affect of it are discussed below:
Positive impact-
 In context of Tesco, they experience a positive impact of COVIDE-19 on sales of their
product. As the demand of food & grocery will increase because consumers are stay at
home.
 Other than this the demand of goods on its online shopping store are also increase as
customers are not able to buy products physically.
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Negative impact-
 Investment cost in online store will increase for company as customers are not able to
buy products at physical store (Bryson, 2018).
 Customers do not want to purchase anything because of the fear of COVIDE infection
which create problems for selected company.
Organization structure and resources required-
In context of Tesco, it follow a Hierarchal organization structure in their organization.
According to this structure positions and obligations are effectively divided into many parts.
Selected company adopt this organization structure so that they will ensure that the work will
done in an effective and smooth way. In this type of organization structure the higher authority
have the maximum responsibility and authority to take decisions. Their properly managed
organization structure will help them to face the effect of Covide-19 and Brexit on business.
Other than this company have sufficient human resource and financial resource which help
company to face this type of challenge effectively (Erganta, 2019). In context of selected
company they will require more finance to invest in the online business so that they will
effectively face the market trends and achieve higher benefit from these trends. Other than the
financial resources company will require efficient staff members for delivering products to
customers home.
Environmental analysis
Environmental analysis is a strategic tool which is used by an organization for effectively
analysing the various internal and external factors which impact the growth of organization or
affect the performance of organization. An effective analysis on environment will help company
in identifying various growth opportunity and threats for company. It is analysis that business are
generally influenced by their environment. Effective environment analysis help an organization
in adopting a best strategy which assist in taking effective decisions, which help in the future
growth of company. Environmental analysis play an essential role in strategic marketing
planning. In context of Tesco, various importance of analysing environment are discussed below:
 In context of selected company, effectively analysing the environment will help company
to analysis the day to day change in market and analysis the market trends and event in
the market, which help company in providing the products according to the needs of
customers.
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 Any change in environment will affect the functioning of all departments in organization
which will cause reduction in performance of organization. In context of selected
company regularly analysing environment help them to take timely decision to overcome
from various challenges occur because of change in environment.
 In context of selected company, this will help organization in analysing the strength and
weakness to the organization.
 It will help selected company, in providing a right product and adopt a right marketing
strategy based on the choice of customers in line with the trends, culture and climate.
 It will help in effectively analysing the competitive factors with the help of it selected
company is able to take correct marketing decision for achieving the benefit of
competitive advantage. Which help select company to achieve higher profit and growth
in market
PESTEL Analysis
It refers to a framework or tool of analysing the external factors of business environment
which influence the growth and performance of a business. This framework will include five
important factors which are discussed below:
Political factor- It refers to an external factor which is related to the government and
government policies which will impact an organization. This factor will include political policy
and stability and various trade, fiscal and taxation policies. In context of Tesco, it is a British
retailer company which is established in UK and the political environment of UK is stable but
Brexit will create a lot of uncertainty. In context of select company, it is very well in capable in
responding to the current trends and future legislation and effectively adjust its marketing
policies accordingly. In context of selected company, any change in import duty will directly
impact the growth of Tesco because it import some inventories from outside UK such as from
China and East Asia.
Economical factor- This external factor has an impact on the economy and its
performance. Any change in economic performance will directly impact the organization and its
profitability. This external environmental factor will include the interest rate, employment rate,
raw material cost and foreign exchange value. In context of select company, this factor
negatively affect the performance of select company as the country is affected by the Covide-19
pandemic as many people will lose their jobs and switch to cheaper brands. To overcome from
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this situation company adopt various strategy which reduce its operational cost so that they can
provide low cost products to their customers (Ghorban and Gholipour, 2018). In context of
selected company, it is analysis that because of COVIDE-19 many people will lose their job
because of which the rate of unemployment will increase and as a result of it people will spend
less money which influence the growth of Tesco.
Social factor- It refers to an external environmental factor which main focus is on the
social environment and on the identifying various changing trends in market. This factor will
help an organization in effectively analysing the needs and wants of customers. It include the
changing family demographics, level of education, change in lifestyle, change in attitude and the
cultural trends. In context of selected company this factor will positively impact the organization
as the demand of chicken and vegan food will also increase in the European market which offer
Tesco good opportunity for its future growth. In context of selected company, according to the
social trends people are more conscious towards their health. This will negatively affect the
company but they will introduce some healthy organic food which help them to face this factor.
Technological factor- This external factor is related to the rate of change in technology
or innovation in technology which could affect the growth and performance of an organization.
This factor will include the change in digital technology, automation and research and
development. In context of Tesco it adopt new technology in their business which help in the
growth and development of company. While at the time of Covide-19 company provide online
services to their customers which help company in enhancing their sales of products.
Environmental Factor- It refers to an external environmental factor which is influenced an
organization performance by its surrounding environment and have impact of ecological aspects.
Now a days with the increase in the importance of CSR activity this factor play an essential role
as it help in performing the corporate social responsibility. This external factor will include
climate, carbon footprints of company, recycling procedures, waste disposal and sustainability.
After the Covide-19 Pandemic customers are more conscious towards the nature and at that time
company take a step to reduce its carbon footprints by removing plastic packaging. Which will
positively impact the growth of company (Hall, 2017).
Legal factor- This factor will define various legislation which are formulated by
government. As it is very important for an organization to effectively understand what business
operations are legally allowed. An organization needs to be aware about any change in
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legislation and its impact on the operations of business. This external factor will include various
legislation related to consumer law, health and safety law, and law related to international trade
regulation and restrictions. In context of selected company, government policies will directly
impact the performance of Tesco. Such as labour cost in UK is high which increase the cost for
company and Tesco is not reduce this cost as it not able to pay wages below minimum wage set
by government. In context of Tesco, the government policy and legislations are directly Impact
Company. Such as it is analysis that UK and EU competitive law prohibit anti-competition
activities and because of which selected company cannot just simply merge or purchase another
supermarket of its size in the UK as the country competition watchdog will block such moves.
Marketing objective of organization
The core of any marketing plan is based on the clear and strategic marketing objective. It
refers to a brand defined goal. Marketing objective of an organization will provide a clear
direction for team members to efficiently achieve the marketing goal. It is an important part of
marketing strategy. The objective of company play an essential role in its future growth and in
terms of Tesco it is very important for company to achieve a major share in market. The
objective of selected company is focus on the SMART pattern which means specific,
measurable, attainable, reliable and timely. In context of selected company various corporate and
marketing objective are discuss below:
Corporate objective
 To improve the staff productivity- In context of selected company, their objective is to
improve their staff productivity by providing them required training and development
program. Improve employee productivity will help company in enhancing their work
performance (Hassan and AbouAish, 2018).
 Increase customer satisfaction- Another corporate objective of selected company is to
enhance their customer level of satisfaction. Company will try to achieve this objective
with the help of regular response rate and interacting with their customers through social
media. Increase in customer’s satisfaction means increase in customer’s loyalty.
 Established the store in new area- Another important corporate objective of selected
company is to establish new more store in different locations which help company in
expanding their business and which will help in enhancing their sales of products.
Marketing objective-
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 To obtain a leading position in retail industry- Main marketing objective of Tesco is to
achieve a leading position in the retail industry. For this company achieve various
strategies as there is high level of competition in retail market.
 Increase market shares- Another marketing objective of select company is to increase
its market shares up to 40% within 12 months. Selected company will achieve this
objective as company have sufficient resources to achieve this objective.
 Increase sales- Another important marketing objective of Tesco is to enhance the sales
of its products by 70 to 80% within 12 months. For successfully achieving this objective
company will adopt various effective marketing strategies which help company in
attracting customers towards its products.
 Increase revenue- In context of selected company, it has a marketing objective to
increase its revenue and the profit up to 40% within the 12 months. Selected company
have sufficient resources which help company in achieving this goal within 12 months.
Achievement of this goal will help company to invest more money to expand their
business (Hill, 2020).
Marketing strategy section-
Tesco marketing strategy main objective is to achieve the trust of their stakeholders to the
brand. In context of selected company its various marketing strategies are discussed below:
 Advertisement- In context of selected company, their marketing strategy is related to
effective use of print and media advertisement and send effectively communicate the
message to the current and potential customers. According to this marketing strategies
company will conduct various campaigns which help in attracting customers towards
company products.
 Sale promotion- Another important marketing strategy adopted by Tesco is various
forms of sales promotion which play an essential role in the marketing strategy of select
company. It will promote their sales by providing free gifts, club card etc (Kolb, 2017).
 Create new product line- In context of selected company, their new marketing strategy
is to enhance their product line which means offer something new to their customers. In
context of selected company they offer new product such as beef, fish, pork and fruits
which expand their product line and by offering new products company will attract
customers.
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 Shift towards digital marketing- In context of select company Tesco mostly used
traditional promotional tools but their new marketing strategy is to invest 30% of their
marketing revenue in the digital marketing. This strategy will help company to reach a
large numbers of customers and attract them towards company products. Digital
marketing is a cost effective tool as compare to traditional marketing which save cost for
company and provide better results.
 Point-of-purchase marketing strategy- Another important strategy that company adopt
is the point- of –purchase sell to a captive audience. For attracting their customers Tesco
use this marketing strategy in which they effectively display their products and define the
benefits of products to customers which help in attracting customers with the help of
good visible. This strategy will help selected company in attracting the customers
towards company products and make them to buy that product (Koronios, Vrontis and
Thrassou, 2021).
STP Analysis
It refers to a model of marketing which is divided into three important parts which are
segmentation, targeting and positioning. It is simple marketing framework which simplifies the
process of market segmentation. In context of selected company, it is very important to select a
best target market as it is quite impossible for company to satisfy the need of all type of
customers. In context of selected company STP is discussed below: (John, 2016)
Segmentation- It refers to the first step of STP process which help an organization in
segment its market. In this step company divide the whole market into various groups based on
some criteria. This step include various criteria which are demographic, geographic,
psychographic and behavioural. Demographic market segment will divide the market on the
bases of age, gender, income level and level of information. While geographic market segment
will help an organization in divide the market on the bases of country, region, state etc. Other
than this Psychographic market segment will include the lifestyle, hobbies, and attitude and so
on. In last behavioural market segment will divide the market on the bases of brand loyalty and
key benefits. In context of selected company it segment its market on the bases of all four
categories which is segment the market on the bases of demographic, geographical,
psychological and behavioural (Kumar and et. al. 2020).
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Targeting- this is consider as the second step of STP as in it the best segment is
identified by the company which is found as most attractive. Targeting also include a numbers of
factors which need to consider before target a particular market. It include size of the segment
and its potential to grow. Other one this the level of profitability achieved from a market segment
and last is how easy it is to reach market. In context of Tesco its target segment market is
describe in the below table:
Segmentation bases Target customer segment
Geographic Region UK, and other 13 countries
Density Rural and urban
Demographic Age All age categories
Gender Males and females
Income Low and middle
Occupation Student, employee and
profession
Education For all type of education
Social status Working class, middle class,
low middle class
Family size All type of family
Psychographic Lifestyle Traditional, contended
conformers
Personality Easy-going, determined
Behavioural Occasions Regular
Benefit sought Cost advantage variety
User status Active user
Attitude Sceptical, positive
Segmentation- In context of Tesco, it divide its market segment on the base of
geographic, demographic, physiographic and behavioural factors. On the bases of geographic it
divide the market into region and density, while on the bases of demographic it divide the market
on the bases of age, gender, income, education, occupation and so on. Other than this it select the
market segment on the bases of lifestyle and personality & on as per the behavioural factor it
divide the market on the bases of attitude and status of user and occasions and so on.
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Positioning- It refers to a marketing activity in which company create a effective brand
image in the mind of their target customers with the help of effective positioning strategy.
Positioning of brand help an organization in differentiating its products from its competitors. In
context of Tesco it use a wide range of positioning strategy in order to attract its target customer
towards its products. Various positioning strategy are discussed below:
 Functional positioning- In context of Tesco, it sell its finest range of products through
functional positioning as this strategy is related to the quality and functionality of
products and services. For this company promote its quality in advertisement.
 Symbolic positioning- This type of positioning is based on the values and aim of
customers. Selected company use this strategy in relation to its clothing products (Mavi
and et. al. 2019).
 Experiential positioning- In context of selected company it use this type of positioning
strategy for its health and beauty range of products.
In context of selected company from above discussion it is analysis that company will target a
large amount of market segment customers which increase its sales of products and also expand
their size of business. While on the other hand it will require a large amount of investment of
company to efficiently manage the need of all target market customers. In case of positioning it
is analysis that selected company will adopt various strategies to position their product in the
mind of customers which increase their brand awareness in market. It is analysis that company
need to conduct an effective campaign activity for better positioning their product.
Globalisation refers to a word which describe the growing interdependence of the world
economies, culture and population which is bought about by cross border trade in goods and
services, technology, flow of investment and so on. In context of selected company, they start
their international expansion only about 10 years ago and is present in about a dozen countries in
Europe and Asia. Selected company will use its own investment while entering into any global
market as financial resources are the competitive advantage factor of company.
7 Ps of marketing
These 7 Ps of marketing are the set of action which the selected company used for
promoting their products and services to their target audience. In context of selected company
various components of marking mix are discussed below:
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Product- It refers to any kind of goods and services which a company wants to sell its
customers. In context of selected company it has a wide range of products which include
clothing, stationary, cosmetics, and electronics and so on. By expanding its product line
company wants to caters needs of their customers. It is analysis that the type products that
company offer will attract more and more customers (Pato and Kastenholz, 2017).
Price- In context of Tesco they adopt a cost leadership pricing strategy. Company
provide good quality products at a reasonable price to their customers. This pricing strategy will
help selected company in achieving competitive advantage in market. In context of selected
company they will require to formulate an effective pricing strategy such as dynamic pricing
strategy is best for company.
Place- In context of selected company, for providing their products to Customers
Company use two distributing strategy, which are online and offline channel of distribution. This
pricing strategy will help company in easily providing its products to customers. In context of
Tesco, for offline distribution strategy company will use direct channel of distribution in which
they directly send the product to their supermarkets, while in case of offline distribution strategy
selected company will require to develop a effective online website through which they can sell
their product directly to the customers.
Promotion- Selected company has a strong brand image which help company in
promotion of their brand. Other than this company mostly use newspapers, television for
promoting their products. In context of selected company, they will require to adopt social media
as their promotional tool as it provide a wide range of coverage and also help in effective
interaction with customers.
Process- It refers to a set of activity which are performed in order to achieve something.
In Tesco offline store customer pick up their product and go to customer assistants to pay and
other than this they can also use self-service machine to make payment (Shams and et. al. 2018).
In context of Tesco, they will require to increase the involvement of their customers in their
process.
People- In context of selected company around 420,000 numbers of workers are
successfully working with company. Tesco invest a huge amount of money in their employee
training and development which helps in motivating their workers to provide best service. In
context of selected company, they will require to adopt various HRM approach so that they will
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enhance motivation of their employee and encourage them to provide better service and maintain
the culture of organisation.
Physical evidence- In context of selected company it provide a very good physical
environment to its customers which not only include the furniture, business cards, equipment’s
but also it has an excellent logo which help their customers to easily identify their products. In
context of selected company, they will require to develop an effective and attractive online
website so that their website will attract customers and provide a unique environment.
Implementation, control and evaluation
In context of selected company, they effectively implement their long term marketing
plan which help company in achievement of organization goal. This report provide various
marketing strategies which help company in effectively analysing the environment of
organization and successfully implement their marketing plan for the achievement of marketing
objective. In context of selected company it will able to control the plan effectively by regularly
analysing the actual performance with the standard marketing plan. By comparing the actual
performance with the standard or already set target company is able to identify the gap where
they need to take correct action and what strategy they need to adopt so that they will achieve the
actual objective of organisation. From this report it is evaluated that selected company needs to
an effective marketing mix which help company in adopting effective marketing strategies. In
context of selected company it is evaluated that COVIDE-19 and Brexit will impact the growth
of selected company but also provide various growth opportunity. For successfully achieving the
organisation goal company will adopt various marketing strategy and formulate a effective
marketing mix (Winney, 2018).
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CONCLUSION
From above discussion on this report it is concluded that an organization needs to select
effective marketing strategies as it helps in the growth and development of company. In this
report PESTLE analysis help company in effectively analysing their external factor which
influence the growth and performance of company. Other than this it is analysis that it is very
important for an organization to select an effective target market segment and positioning
strategy.
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