Tesco's Marketing Principles: Promotional Mix Analysis & Portfolio

This portfolio provides an analysis of Tesco's promotional tactics, examining the various components of its promotion mix. It covers advertising strategies, including in-store and out-store methods, supported by a SWOT analysis. The portfolio also explores direct marketing techniques, supported by a customer relationship management model, highlighting the use of e-leaflets, catalogue marketing, and discount codes. Personal selling strategies, both in-store and out-of-store, are discussed, along with the role of customer relationship management in enhancing customer interactions. Furthermore, sales promotions and public relations efforts are examined as integral parts of Tesco's overall marketing approach. The document aims to provide a comprehensive overview of how Tesco utilizes different promotional tools to maximize sales and build brand image.

Principles & practices of
marketing

Table of Contents
Background of the company............................................................................................................3
TASK 1............................................................................................................................................4
Covered in Portfolio...............................................................................................................4
Promotion Mix of Tesco.........................................................................................................5
Advertisement.........................................................................................................................7
Direct marketing...................................................................................................................11
Personal Selling....................................................................................................................13
Sales promotions..................................................................................................................14
Public relations.....................................................................................................................17
TASK 2Formal Report...................................................................................................................17
Introduction..........................................................................................................................17
Marketing strategies 1(AIDA)..............................................................................................18
Marketing strategy 2(Above/Below the line model)............................................................20
CONCLUSION .............................................................................................................................22
REFERNCES.................................................................................................................................22

Background of the company
TESCO'S Company is basically a multinational British company that deals in groceries
and general retailer merchandise. Companies main mission or core purpose is to “We make what
matters better, together”. Tesco companies values, vision, and mission are inter related with each
other for shaping a good image or identity of the company in the eyes of the customers. The
values of the company is to serve better services everyday to their customers. When TESCO
company was built the main mission of the organization was to help customers so that they can
utilize better quality of life and also company to become champion for customers. It is the third
largest retailer company measuring by gross revenue in the world, whereas it's the ninth largest
retailer in the world in terms of revenue. The headquarter of TESCO company is in Welwyn
garden city, united kingdom. The firm was founded by Jack Cohen in the year 1919 around 100
years ago. It is a public limited company,Company is serving it's services around the globe, there
are 6,569 shops of TESCO worldwide. While 500,000 employees are working worldwide and
there are 7000 stores of the firm globally. In UK there are 6 (six) distinguished stores formats for
the consumers which are huge in size and product range as well.
The main product in which firm is dealing are supermarket, Hypermarket, superstore,
convenience shop. Around 460,000 employees are working in different parts of the country. The
area where the firm is serving it's services are Thailand, Hungary, United Kingdom, Ireland,
India, Malaysia, Czech republic. The largest TESCO EXTRA is in England in the place known
as WALKDEN. It is spread in the area of 17,230 squares meters and 185,500 square feet of
floorspace. The TESCO EXTRA shops are huge in sizes so, they are mainly located out of the
town while hypermarkets are located nearly public places so, that customers are easily
approachable to the market.
According to statistic illustrations the market share of the TESCO company for grocery
stores in the 12 weeks to august 12, ,2018, the market share stood up to 27.4 percent as compare
to the corresponding period in previous year. Whereas discounters ALDI and LIDL have started
gaining market share every year and TESCO is losing it's market share in the same 12 week
period. In 2001 company gained 15.6% of grocery share and become the leader of market by
6.4%. By September 2004 there was massive growth in the share and raised to 28% and around
12% more than it's market rival. In the year 2004 TESCO was allowed to allowed to buy 10 of
the 52 safe ways stores which were obliged by Morrisons to sell as competition authorities where
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part of acquisition. In the recent years ,TESCO company has faced many allegations in terms of
social as well as environmental. Many of the allegations which company faced are exploiting
small farmer in the UK, employees are paid less and labour rights are minimal, turning town
centres into huge boarded up ghost towns, undercutting almost every other retailers, Co-
operating with Esso other corporates crimes.
TASK 1
Covered in Portfolio
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Promotion Mix of Tesco
Promotion mix is considered to be one of the 4Ps of marketing mix which is specifically
refers to the combinations of different promotional tools and techniques like public relations,
advertising, sales promotions and personal selling with a view to maximize sales and profits
(Promotional Mix, 2016).
Source: Promotional Mix, 2019
 Advertising: It is one of the key factor of promotional mix which contributes to the
brand building and also how the market perceives the company. It is considered to be
one of the big part of promotional mix because of its wide and far reach of advertising
and the message that a company can send to its existing and potential customers. It
mainly includes advertisement through social media, newspaper, magazines, banners
etc.
 Personal Selling: It is one of the traditional forms of promotional tool in which a
salesman directly interact with customers by visiting them. It can be said that it is a
face to face interaction which take place between the customers and the company
representative with the aim to influence customers to make purchase of the goods and
services.
 Direct marketing: In this type of promotional technique direct marketing technology is
being used in order to target customers individually, example like through telephone
calls, e-mail, catalogs etc.
 Sales promotions: It is another essential technique of promotion mix of which main
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Illustration 1: Promotion Mix

purpose is to stimulate customers to make purchase of their products like through
products samples, coupons, offers etc.
 Public relations: It is also a promotion mix techniques in which a firm tries to build
relationship with customers by sharing information with them about an organisation and
about the product and services. In case if any thing goes wrong on the information front
then in that case public relation department has to step forward so as to rebuild public
image again.
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Advertisement
Definition of advertisement
According to Grant Mc Cracken, 2019 it is a types of promotional activity that is used
by companies in order to promote their goods and services. It is one of the most powerful
marketing tactic that reaches to large number of customer at a same time (Advertising, 2019).
Advertisement is mainly done by Tesco in two ways first in In-Store advertisement and
second is Out-store advertisement.
Evidence of In-store and Out-store advertisement
In-store advertisement:
This are highly effective marketing tactic which are being designed to bring customers
towards the store so as to try their products and to build brand and product awareness. This type
of advertisement is helpful in influencing customer towards their product and services when
they walk through the front door of store.
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Out-store advertisement: This is a type of advertisement which works well for promoting
products in specific geographic areas. As outdoor sign is considered to be the first thing which a
potential customers sees and it should be sufficient bright and conspicuous so as to attract
attention of customers. Like Tesco does its out-store advertising through various channels like
magazines, billboards, newspaper, social media etc.
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SWOT model is being used to support the evidence of advertisement technique of Tesco
Thus, in order to support the evidence that has been rendered for in-store and out-store
advertisement swot model is being applied. With the help of this model it can be greatly
understood what all the the strength, weakness, opportunity and threat that they company suffer
and avail from such advertisement. The images above proves to be very much helps in attracting
large number of potential customers which result in increasing the market share and it turns into
a major strength for Tesco. On the other hand when the firm advertise its product season wise
like in rainy season they give more advertisement of washing machine which help in easily
drying up of clothes so as to attract customers, but side by side such advertisement affect the
demand of other product of Tesco which is a weakness for Firm. Similarly such advertisement
helps to grab further opportunity as well, in future if the firm launches new product or services
than in that case company need not have to create awareness as customers will already be aware
about the tesco products, thus it will term to be an opportunity for company. Lastly, such
advertisement also proves to be threat for Tesco as the competitors can easily acknowledge the
way a firm uses strategies to attract customers and similarly the competitors too will also use
which will prove to be a threat for firm as the customers may shift from company product to its
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competitors products.
Direct marketing
Definition of Direct marketing
It is a kind of advertising activity by which large or small business firm use to
communicate directly with consumer by using different media sources such as text messages,
emails online adds and websites etc. (DIRECT MARKETING, 2019).
In order to sell its products through direct selling tesco make use of out of store
personnel selling techniques such as e-leaflets, catalogue marketing, discount codes, etc. so as
to influence customer on spot to make purchase of its products.
Evidence of out of store direct marketing
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Customer relationship model is being used to support the evidence of direct marketing
technique of tesco
Thus, the above evidence of personnel selling concept of Tesco can be supported with
the help of customer relationship management. As it is a widely implemented model for
managing organisation interaction with clients, sales prospects and with customers. It generally
involves use of technology so as to synchronize, automate and to organise business process but
also for customer service and marketing. It overall goal is to find attract, retain and win new and
existing clients. Thus, in order to build customer relationship Tesco make use of catalogue
marketing and e-leaflets, discount offers so as to attract large number of customers to make
purchase of their products and services. As catalogue marketing offers an opportunity to
incorporate eye-catching and make it easy for customers and clients to respond to their offers. In
addition to this in order to build better relationship with customer firm renders discount offer
system too like rendering in half price, club card fuel save unto 20% , rendering opportunity for
customers to have taste in store itself before making purchase of products so that customer feel
free to make purchase are the example of offer render by tesco. Thus, it helps in influencing
large number of customers and building effective relationship between company and customers.
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Personal Selling
Definition of Personal Selling
It is methods mainly used by large or small companies in order to sell their product in
dynamic market. They basically hire a sales representative to meet with customer and discuss
the main purpose and benefits about products (PERSONAL SELLING, 2019).
Evidence of personnel selling
Tesco does it personnel selling in both the manner In-store and Out of store. In case of
In store personnel selling they render experiences of sampling products, offers an opportunities
for tasting of product before making purchase of product, so that it become easy for the firm to
acknowledge the customers preferences. Whereas in case of Out of store personnel selling firm
visit door to door and contact with individual personally and communicate about the product
and services to the customers and which helps them in getting immediate customers feedback
and reviews. As well as they try to get to measure the quality of customer experience through
through the process of mystery shoppers report.
Customer relationship management model to support the evidence of personnel selling of
Tesco
In order to support the evidence of personnel selling of Tesco customer relationship
management model has been taken into consideration which specifies that it is an approach to
managing g company interactions with potential and current future customers. Thus in order to
manage better relationship with customers, Tesco give more preferences o personnel selling as
this helps company to improve business relationship with customers and ultimately helps in
driving sales growth. As with the help of this promotional technique company can easily get to
know about what the customer think about the product and about an organisation and helps in
getting immediate feedback and helps in maintain long term and better relationship with
customers.
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Sales promotions
Definition of Sales promotions
It is consider to be an effective process of persuading a potential customer to purchase a
particular commodity. It is basically a shot term techniques that is mainly used to boost the
sales for a specific time period (Sales Promotions, 2018).
Evidence of Sales promotions
Tesco mainly does its sales promotion of products and services only through In store
process by rendering BOGOF, lock down pricing strategy, but alternative products etc. Here
BOGOF refers to the technique of Buy one get one free. For example like when sinter season
just starts off then Tesco render offer of buy one get one free on summer clothes so that storage
cost get reduced .Lock down pricing is other technique in which a temporary discount offer is
being rendered in the form like 20% off, 50% off etc. So that customers get easily influenced
towards their products. Moreover such techniques are also adopted in case when the firm
launches its new product as it helps in attracting customers to make purchase if new product and
to make use of it. Thus, overall it helps in boosting up the sales revenue of an organisation.
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Porter’s five forces of model is being used to support the evidence of sales promotions
This model incuse fives forces namely threat of substitute, threat of nee entry,
bargaining power of buyer, bargaining power of supplier and competitive rivalry Therefore
Tesco adopts sale promotion techniques like BOGOF, Lock down pricing, buy alternative
products etc. So as to deal effectively with this five forces of model. For example in case when
its competitors gives discounts on their products to customer so as to attract large number of
customers, then in that case Tesco too needs to adopts such strategies of sale promotion so as to
deal with such situation easily. Second case like if there exist any substitute of Tesco product
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and they render product at low price than Tesco then in that case company also have to lower its
price so as to deal effectively with its substitute and does not let a threat of substitute to harm
the profitability ratio of an organisation. Thirdly in case if any new entrant enters into the
market with the offer of same product and with same quality offered by Tesco then in that in
order to deal with such threat of new entrant Tesco takes sales promotions technique into
consideration. Lastly in order to deal effectively with the situation of the bargaining power of
buyer and supplier firm adopts such promotional technique practices in order o run business
smoothly and to maintain long term relationship with customers.
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Public relations
Definition of Public relations
It is a type of practice that help to manage the information spread among an individual
or other business firms and public. This mainly includes an entity to gain exposure to their
customer using topics of public beliefs and news that do not require any direct payment (Public
relations, 2019).
Evidence of Public relation
In order to promote it product and services Tesco make use of Out of store technique for
building effective public relations. Like the firm uses press and media coverage by carrying out
sponsorship programmes, sports events, charity events etc. so as to create positive publicity in
the mindset of customers towards the brand image of the company.
Corporate Social Responsibility model is being used to support the evidence of public
relation technique of Tesco
In order to support the evidence of public relation of Tesco, corporate social
responsibility model has been taken into consideration. Therefore it is a model which helps a
firm to be socially accountable to itself, its stakeholders and towards the public. In order o
create awareness about its goods and services in the market place and to build good and long
term relationship with customers company carry out some king of sports events, charity events,
sponsorships programmes etc. which is a kind of social responsibility towards the society so as
to create positive image about the firm in the mindset of target customers. As to engage in
Corporate social responsibility means that a company is operating towards the enhancement of
environment and society rather than contributing negatively towards the. Hus, it help the Tesco
to build strong public relations and in attracting large number of target customers to make
purchase of their products and services.
TASK 2Formal Report
Introduction
In this formal report two marketing strategies are being used by Tesco and they are
mainly AIDA and Above/Below the line marketing strategy. This two strategies are importance
for Tesco in marketing its new product that the firm is planning to launch as AIDA will help in
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creating awareness, interest, desire and action among the customers towards the products.
Whereas, Above/Below the line marketing strategy helps business to deploy wider target
audience and specific group of potential customers (Fletcher, J. and et. al., 2017). Thus, it can be
said that this marketing strategy will help business to attract the target audience towards the
products and services, which would result in achieving grater profitability margin for the firm.
Marketing strategies 1(AIDA)
AIDA
One of the founding principles of modern advertising and marketing is known as AIDA,
which stand for attention, interest, desire and action. In addition to this it can be said that it is a
marketing, advertising and sales approach methodology that is being designed to render insight
into the customer minds and specify about the steps that are needed to cultivate leads and to
generate sales (The AIDA Mode, 2013). In addition to this it can be said that AIDA model terms
to be the core stone of modern marketing, as missing in any one of the element of AIDA while
advertising or marketing of product in market may result unsuccessful for the firm.
Figure 1 AIDA Model
Source: AIDA Model, 2017
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Thus, this strategy can be effectively used by Tesco in order to create awneess about the
new organic hair care product and to influence customers to take actions by making purchase of
the product and this effectiveness can be explained below (Meynhardt, Chandler and Strathoff,
2016):
Attention:
In order to make target customers aware about the new products a marketer of Tesco
need to catch their attention and notice or need to take in visual media. Thus, in order to cath the
attention of clients Tesco make use of various approaches like placement of adds in an unusual
but noticeable place as well as make use of personalized messages as this are harder to ignore
than generic proposals.
Interest:
This is the second aspect which must be created by the Tesco firm in the mindset of
customers. So in order to generate interest among customers firm must present concise and well
paced information and this should be done by an interesting characters, mascot or voice actor.
Desire:
After generating interest among target customers, management of Tesco firm must create
utter desire among them by selling on product features, by showing of superiority of their
products over similar other products and by demonstrating versatility.
Action:
This is the final step in which the customers take their final decision and make purchase
of the product so as to get satisfaction level of value from the product.
Strength and weakness of AIDA for Tesco
The major strength of AIDA model for Tesco is that it will help in building long
lasting relationship with customers as well as helps in creating positive image of the firm in the
mindset of customer. As it helps customers to know all about the feature of the product this take
place during the process of creating desire in the mind of the customers towards the product.
Similarly, on the other it possess certain weakness too if the Tesco will implement this model in
order to attract customers then it will term to be costly enough and is term to be time consuming
process too.
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For example: In case if the firm tesco launches new product and in order to promote its sale
growth and to crate interest among customers about the new organic hair care product Tesco
adopts public relation techniques like by carrying out some kind of sports events or charity
events then it will term to be costly for Tesco which is said to be weakness for an organisation.
On the other hand it will help business to create long testing positive publicity and good
relationship with customers which is term to be the major strength for firm (Challagalla, Murtha
and Jaworski, 2014).
Thus, overall it can be concluded that this method of marketing strategy will prove to be
effective enough as large number of customers will get influenced which would result in
increasing its sales revenue and profitability ratio of the firm.
Marketing strategy 2(Above/Below the line model)
Above the line and below the line are two opposite marketing strategy which are being
used in order to promote product in the target market. If the firm wants to deploy wider target
market segment then in that case above the line marketing strategy terms to be best. Whereas in
case if the firm target market is some specific group or potential individual then in that it can be
termed as below the line marketing strategy (Above the Line (ATL), Below the Line (BTL), 2018).
Thus the Tesco can make use of both the strategy, as for local people below the line strategy
terms to best for all across the world above the line marketing strategy would be better.
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Figure 2Above/Below the line marketing strategy
Source: Above/Below the line marketing strategy, 2018
For example: In case if the Tesco launches new Hair care organic product as almost
every one in this world are concerned about their hair. This strategy can be effectively used by
Tesco to target larger part of population towards their new organic hair care product, as mostly
population are connected through social media like face book, Instagram etc. So this will help
business to target young youth generation peoples as they are connected through such apps
(Lees-Marshment, 2014 ). Thus, it is term to be above the line marketing strategy. Similarly in
order to attract other people who does not use social media application and belong to local area
itself for those Tesco firm should make use of distribution of pamphlets, broacher's, stickers etc.
Thus, it is term to be below the line marketing strategy.
Strength and Wekaness of Abobe/Below the line model for Tesco
The major strength of this strategy for Tesco is that it will help in capturing larger market
share. For example if the Tesco make use of social media app like Facebook, twitter, Instagram
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etc. in order to advertise about the product then it will help business brand to reach far and wide.
Where on the other side it do possess certain weakness like it is term to costly enough, and
online magazines and blogs have replaced the power of newspapers and magazines. Thus, it
leads in weakening the stronghold position of the above the line marketing tactics.
In case if the firm uses below the line marketing tactics it major strength is that it helps I
establishing more personal connection with their potential customers and this leads to loyalty to
business and are also term to be less expensive as compared to above the line tactics (Armstrong
and et. al., 2014). On the other hand it do possess certain weakness to like it would be difficult
for Tesco to target different types of culture and can get less market share due to exclusivity.
Therefore it can be said that this strategy will prove to effective enough for tesco as it
will help business to capture larger market share and which will result in increasing its
profitability and sales revenue.
CONCLUSION
From the above report it can be concluded that in order to achieve successful growth a
firm should adopt different types of promotional mix strategies so as to promote their products
and services like advertisement, public relation, personnel selling, sales promotions etc. IN
addition to this different marketing strategies are also needs to be considered by an organisation
like AIDA and Above/Below the line marketing strategy concept so as to capture larger part of
market share.
REFERNCES
Books and Journals
Armstrong, G and et. al., 2014. Principles of marketing. Pearson Australia.
Lees-Marshment, J., 2014. Political marketing: Principles and applications. Routledge.
Challagalla, G., Murtha, B. R. and Jaworski, B., 2014. Marketing doctrine: a principles-based
approach to guiding marketing decision making in firms. Journal of Marketing. 78(4).
pp.4-20.
Meynhardt, T., Chandler, J. D. and Strathoff, P., 2016. Systemic principles of value co-creation:
Synergetics of value and service ecosystems. Journal of Business Research. 69(8),
pp.2981-2989.
Fletcher, J. and et. al., 2017. Tourism: Principles and practice. Pearson UK.
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