Detailed Marketing Management Report: Tesco's Strategies and Analysis

This report provides a comprehensive analysis of Tesco's marketing management, focusing on its business activities within the retail industry. It begins with a background statement outlining the industry, Tesco's market positioning, and its unique selling proposition, highlighting its strengths in providin...Read More

MARKETING
MANAGEMENT

EXECUTIVE SUMMARY
Marketing management is a set of measures and strategies which is taken in proper
consideration by an enterprise to maintain sustainability and quality of its promotional and
selling out of goods or services. The present report will cover business activities of Tesco. The
report will lay emphasis on proper management of marketing or promotional activities. Also, it
will help in proper assessment of the business activities and hence, it will improve overall
marketing operations which are taken in consideration by the firm. The evaluation of different
constraints is done by the firm which will improve quality of business actions to a greater level.
Other than this, an assessment of competitors of Tesco is done in context that will assist an
organization to carry out effective market plan and strategies which will improve its marketing
measures. This will help an enterprise to have a proper market share and improve the customer
satisfaction level. Apart from this, evaluation of marketing mix and its effective relation with
external market environment factors will assist an organization to improve the quality of
products and services that are offered to their customers.

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
1. Background statement to outline the industry, market positioning and its present unique
selling promotion........................................................................................................................1
2. Marketing audit, outlining the overall attractiveness and its potential for market growth. ...3
3. Description on competitor analysis on three main industry players.......................................7
4. Critical explanation on marketing mix actions to achieve the gaps between the firms present
strategy and external environment..............................................................................................9
CONCLUSION................................................................................................................................9
REFERENCES .............................................................................................................................10

INTRODUCTION
Marketing management is the process in which value is created for the customers. It is
philosophy which helps firm to examine needs and wants of customers by analysing the market
demand. This strategy works as planning, organizing, motivating, coordinating and controlling
the overall activities so that it will lead to enhance sales, profit and beat competition effectually
(Albayrak, 2015). Furthermore, it is science and art that explores, creates and delivers value that
can assist to fulfil the demand of target customers. The present report depends on business
activities of Tesco. It is a global leading brand that works to provide innovative products and
services to customers. It deals in retail sector and engaged in offering the services by which
customers can get satisfied. Moreover, market positioning, unique selling position, marketing
audit and competitor analysis of three main industry players will be covered here. It will improve
the overall quality and maintaining of the marketing processes and evaluation process which will
improve the promotional capabilities, market share and revenue generation of the firm.
MAIN BODY
1. Background statement to outline the industry, market positioning and its present unique
selling promotion
Background of Tesco
It is a global leading brand that works to attract the customers by providing retail
services. Tesco is the leader of supermarket multiple sector as well as whole grocery market.
Thus, retail industry is responsible for distribution of finished products to public. This firm takes
various initiatives in order to attract and retain customers to develop staff and enhance corporate
image of Tesco. Thus, quoted firm ranks among one of the largest online supermarkets in world.
It is one of the leading retailers within UK industry. This is one of the far largest ever grocery
and retail sector chins in world. Thus, it is British international grocery and general
merchandising retail chain. They produce goods so that they can provide services in terms to
variety of merchandising. In addition to it, retail industry has been changed from last two
decades (Toon and et.al., 2016). In this, it can be said that this is the enterprise that works hard to
analyze the needs and wants of customers and provide them effective and efficient services.
This consists of wealth of small, departmental stores and shopping malls. By the use of
social media, it is one of another key aspects for retailers to grow in market. The online demand
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of retail sector enhances chances of satisfying and retaining loyal consumers. The retail industry
also allows many discount offers and weekly attractive ranges of products so that it can attract
services of customers (Siamagka and et.al., 2015). The supermarket revolutionized way of
people to cover whole of the UK market. Thus, Tesco takes many initiatives in order to have
expansion in the ranges of its products. Thus, it can be said that retailers should work as develop
attractive website to compete against the growing number of online competitors in the market.
Illustration 1: Growth measurement of retail sector
(Source: Retail Market Research Reports, 2018)
§
Market positioning of Tesco
Tesco uses the experiential positioning and it mainly targets its customers for health and
beauty range of products (Jin, Ji and Gu, 2016). In addition to this, it can be said that multi-
segment positioning is an alternative kind of positioning at the same time with number of
product and services in market. There is a set of macro and micro environmental factors that can
impact over marketing decisions of Tesco in both direct and indirect manner. Thus, products and
services offered by the quoted entity and other firms cannon be attractive to all individuals in
equal terms. In addition to this, market segmentation of Tesco is based on the needs and wants of
customers. In simple terms, marketing segmentation works as to population members into the
groups as per the needs, wants and other criteria that works as to developing the products and
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service to satisfy the needs and wants of particular groups. This is one of the highly competitive
markets in UK.
Furthermore, segmentation can be divided into geographic, demographic, psycho-graphic
and behavioral base. Main strategy of Tesco is to earn loyalty with the help of prices and they
retain customers. Furthermore, quoted firm targets the customers who earns the middle income
with the young children. It usually targets the people who are more interested in the quality
products. Buying behavior has direct implication on marketing activities so that customers can
get attracted towards products and services in market (Guo and et.al. 2017). In the present
scenario, consumers are very choosy and conscious about the commodities and services. There
are many factors that affect the profitability of enterprise as quality, quantity, price and selection
of products available. This kind of things are attractive in order to raise performance of firm and
to build competitive brand image in the eyes of customers. By maintaining the quality and
affordability of products, enterprise is able to gain competitive advantage in market.
Furthermore, it must be managed well to have enhancement in profitability and productivity in
the enterprise.
Unique selling position of Tesco
This is the point that differentiates the products from its customers. Thus, there are
number of factors like lower cost, high quality, etc. The successful USP promises clearly offers
competitive products to the customers in order to attract them. The unique value position define
firm in market and develops pricing strategies. Being the largest retailer, they have some serious
brand presence in market. Under the same, company earned recognition not by promising the
cheapest price but also by providing the widest selection of products and services. Thus, they
must put their consideration on creating the value for customers by promising the treat people in
well manner. The Unique selling position of Tesco is the firm that enables to provide quality
products (Yang and Gabrielsson, 2017). With the help of this kind of strategy, it is possible to
gain long term advantage in market. Cost plays one of the essential roles in terms to enhance
buying decision of the customers. The Unique value proposition of Tesco is based on component
as quality, quantity and products in market. These kinds of factors are helpful to build the
competitive advantage in market.
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2. Marketing audit, outlining the overall attractiveness and its potential for market growth
In this, marketing audit will consider the both external and internal influences on market
planning. It is fundamental part of marketing planning process. This is one of the comprehensive
process that works as to be systematic, independent and periodic evaluation of firm's marketing
assists. This is one of effective tool that works as to reviewing the marketing strategy, analysis
the objectives and strategies of the enterprise. Thus, marketing audit considers the both internal
and external influences on marketing planning. An internal environment audit focuses over
resource of the enterprise and various things as labor, finance, equipment, time and other factor
of production. Thus, internal marketing process of Tesco can defined accuracy, actuality and
product portfolio, pricing and distribution.
It is also assists in terms to focuses on market share, profit margins, cost and
effectiveness of marketing mix. The external audit helps to analyses the factors outside the firm
so that Tesco can promote its business activities in the effective and efficient manner. This is the
main role of marketing department to keep the close contacts with uncontrollable forces. To be
successful in marketing, it is essential to accommodate with the policies and procedures. In order
to demonstrate the requirement of marketing audit it works as to examine the firm’s internal
environment and it can be done with the help SWOT analysis as are:
To determine the external forces, retailer has to face various external forces and it can
enhance the competitive environment in market (Albayrak, 2015). Thus, strength, weakness,
opportunities and threats will be helpful in order to develop the business strategy and its brand
engagement in market.
Strengths
 Tesco has won some awards for retail excellence, customer service and overall shopping
experience.
 The leaning market share of this quoted firm is at 28.1%.
 This is also effective in terms to use of technology by improving the operation, greater
cost effectiveness and enhancement service experience.
 It is firm that usually put its major focus over the quality, selection and services and this
provides the economic financial position to all types of economic cycles.
Weaknesses
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 The few subsidiaries are not working as to operate better services and this are more
vulnerable in terms to certain external factors.
 Lack of focus on specific market due to the issue of entering into the all market at the
same time.
 The business model is followed and the amendments are needed to the differ
geographical markets so that things can be done in better and efficient mode (Toon and
et.al., 2016 ).
 In this, the sales objectives for the high price non-essential items are not be achieved as
per the expectation.
Opportunities
 Under it, there are number of the strategic alliances with the other brands and admired
companies to offer products to attract the more consumers in the certain target market.
 This firm has number of the opportunities in the private label market.
 The firm also has significant opportunities to grow online shopping for Tesco and it also
provides the homes deliver services to the customers.
 The countries at which Tesco is underperforming then there could be more opportunity
for joint ventures so that it can aid to market intelligence and market research to bring
improvement in the performance of the enterprise.
Threats
 The economic recession and credit crunches will continue to threaten the market share
and profitability in the all areas that leads to reduction in the size of purchase by
consumers (Siamagka and et.al., 2015).
 There are number of the political and government regulations is putting the pressure on
Tesco to adhere to the new regulations in terms to make the significant changes to the
operation structure for additional expenses.
 Greater stakeholder pressure relates with environment and social responsibility that also
adversely impacts cost of the Tesco.
 The rise in the price of the quoted firm leads to threaten the Tesco portfolio and causing
it to have expansion in the supplier market in terms to get better pricing on raw materials.
 The pricie of the foods are continually risen around the world and it also reduces that
what customer need to buy and how much disposal income they have in market.
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PESTLE Analysis
It is framework that works as to analyse the dynamic and unpredictable environment in
which Tesco works as to have identification of forces and it also impacts over performance of
firm in market. It is also essential tool for marketing audit and it has defined in following manner
as are-
 Political - The Tesco Plc has to manage all these challenges and it also build effective
barriers to safeguard its competitive advantage in market. With the help of innovation in
new products and services the customer can get attracted towards firm. By building
economies of scale and it also lowers the fixed cost per unit. The firm as Tesco plc needs
to determine its standards regularly. With the help of promotion between the western and
eastern European countries, there is possibility to have expansion in retain network
across the EU (Jin, Ji and Gu, 2016).
 Economic - This factors are also directly put its impact over the buying behaviour of
customers. The substantial reduction in the interest rates minimised the further rise in
unemployment. However, the lot of financial uncertainty that means the consumer are
likely to spend less on premium products and encompassing the organics and ready
prepared meals. Thus, economic recession can adversely impact over both sales value
and margins. Ups and downs in economic recession affects the purchasing of customers
and it also brings a huge impact on enterprise.
 Social- The ageing population can discourage the food retailer. The consumer attitude
towards the food is continually changing and they ate becoming the health conscious
(Guo and et.al., 2017). This kind of the facto leads to impact over the working of the
entities. The taste and preferences of customer also depends over the changes in climate
conditions. Furthermore, there is increase in demand for the organic product has been
accommodated by Tesco and it will also reflect this changes in demand. In order to cope
up with this, it is essential to make better evaluation on needs and wants of customers so
that things can be done effectually and they can be satisfied with the services provided by
firm.
 Technological - Under it, supply chain, operations and processes of grocery and food
retailer can get influenced by the technical advancement in market. Thus, the operation of
supermarket bring affected by the use of internet with the use of online grocery retailing.
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The rapid enhancement in technological advancement leads to positively impact over
working of enterprise. Thus, it can be said that the shopping as online retail has also
effective and gained considerable popularity due to increased access to broadband users
in the country. This kind of working affects the brand image of firm in market.
 Environmental- Being the environment friendly, there is also reduction and it also being
promote d by the legal authorities (Yang and Gabrielsson, 2017). This things can assists
in terms to have reduction in overall cost and it is also good for Tesco corporate social
responsibility image. Thus, the environmental factors works as to reduce the food waste
and their carbon foot print.
 Legal- The changes in the laws and legislation also bring long term impact over the
working of the enterprise. Thus, value added tax can affect the non-food sector of Tesco.
Thus, this kind of factors leads to enhance operating cost of supermarkets.
Hence, it can be said that the external and internal both are essential tool in order to bring
better marketing audit so that the all things about the marketing can be analysed in the proper
manner.
3. Description on competitor analysis on three main industry players
The competitive analysis is one of the critical part under marketing plan. It is
helpful in terms to analyse the competitors and how the working of firm can be compared.
With the help of evaluation of strength and weakness the firm is able to conduct its
activities effectively. This is the term that is also useful in terms to enhance growth plans.
This is the kind of mechanism that helps to develop effective competitive strategies in the
target market. Thus, the competitor analysis on three main industry players as are:
Basis of
comparison
Tesco Sainsbury Asda Morrison's
overview It is large UK
grocery firm and
it competes with
the number of
convenience
stores. It has
The Sainsbury is
third largest
grocery retail
chain in United
Kingdom. This
also works as to
This is firm that
engaged in
providing the
retail services to
customers. They
works as to
This entity is
work as to
operate 514
supermarkets
and 150
convenience
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highly
fragmented
stores. This is one
of global retail
chain and it also
leads to gain
competitive
advantage in
market.
provide highest
quality grocer
services among
the peers and it
enhance brand
strength
(Goworek,
McGoldrick and
McGoldrick,
2015).
provide discount
grocer niche,
offering low-
priced items with
a
disproportionatel
y high private
label offering.
stores. Being the
most second large
producer in UK
they also operates
the number of
food
manufacturing
facilities and
engaged farmers
to source poultry
need and produce.
Market share Tesco is the UK
grocery market
leader with
market share at
28.4%.
This firm has
holding the
43.7% of the
market share.
The Aldi has
grew its market
share from 6.8%
to 7.6%.
The market share
of the Morrison's
is almost about
the 10.5%.
Positioning This firm has it
position in the
market on the
basis of Multi
segmentation.
This firm puts its
major
consideration
over the price
positioning and
they also put
enhance product
quality.
The positioning
of Aldi, as they
use of targeting
strategy so that
they can attract
the customers.
The position of
Aldi is to segment
the market in
proper manner so
that quality can
be enhanced.
Pricing strategy The Tesco put the
major focus over
the quality of
commodities with
the affordable
pricing.
This is the firm
that charge the
premium price as
they are highest
quality grocer
among its peers.
They uses the
pricing as well
quality strategy in
order to attract
the wide range of
customers in
The pricing
strategy of Aldi is
to lower based
pricing so that
brand image can
be sustained in
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market. market.
Facilities This entity
provides online
retailing services
and home
delivery service
to customers.
Sainsbury also
providers the
online services
and it also
charged the
delivery fee
between the £1
and £7. Thus,
there is no deliver
charges for the
order above £100
booked for
delivery on
Monday.
Aldi only
provides retail
services to the
customers.
They provides the
on lien as well
retail services to
the customers by
the use of online
technique.
Vision The vision is to
be most highly
valued business
in terms to
customer they
serve,
communities in
which they
operates
(Goworek,
McGoldrick and
McGoldrick,
2015).
The main Vision
of Sainsbury is to
be the most
trusted retailers.
The customers
are the heart of
business and
success. To offer
the future growth
they put major
consideration
over the products
they need in
market.
The main vision
of Morrison is to
provide the
quality products
at the lower based
price. It also
enhanced the
working of the
enterprise and
build
competitiveness.
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4. Critical explanation on marketing mix actions to achieve the gaps between the firms present
strategy and external environment
The effective assessment of the marketing mix operation will help the firm to improve
the quality of business operations and activities that will help in proper assessment of operations
and thus, will help in the proper assessment of the operations related to selected retail enterprises
(Baker, 2014). This will help Tesco Plc to develop a proper market strategy that will impact and
influence the marketing and other organizational functions of the firm. As the present marketing
conditions as discussed above indicates an effective scope of growth and development. On the
basis of this operation, this can be said that the proper assessment of business operations and
thus, will improve the quality of business activities in much suitable way (Retail Market
Research Reports: Latest Retail Industry Trends & Statistics, 2018). The effective marketing
mix assessment of the selected retail organization indicates that there are certain improvements
and it will improve the quality of business activities and operations in much suitable way.
Marketing approach assessment of Tesco plc is as follows:
 Product: At present, Tesco plc has a wide range of product portfolio including food,
clothing, stationary, finance based services and electronics. This makes the firm enable to
cater a wide range of customers and improve their satisfaction level. However, the stiff
competition from other existing and new retail enterprises is the major factor that can lay
an adverse impact on business activities. Hence, looking at this condition, Tesco plc has
to opt for other customer based departments or sectors too like health and beauty based
products, in order to maintain its sustainability (Melis and et.al., 2015). This will help in
improving the quality of operations and thus will lead the firm to make a better marketing
plan.
 Pricing: Pricing of the products and services provided by Tesco plc are required to be
monitored and planed appropriately. As the selected enterprise is a plc firm, the pricing
strategies are been monitored by government. But on the international level, the costing
are required to be placed on the basis of purchasing power, economic conditions and
social attributes of the country. Thus, this will impact the operation of the organization
and will lead the firm to improve the cost approaches of products and services offered to
their customers. This will improve the quality of business operations and increase sales
margin of firm.
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 Place: The organization will look after the proper accessibility of their retail stores or
outlets for their customers. At present, the firm is operating in many major economies of
the firm, but it is found that the retail outlets are not well reached and accessible to
majority of its buyers (Chi, 2018). Tesco plc is required to perform an extensive demo
graphical or political research and assessment of the organization that will help the firm
to improve the quality of assessment and thus will lead the enterprise to meet the
objectives of the organization by increasing its reach to its customers in much suitable
way. Besides this, Tesco plc can opt for placing its outlets in supermarkets and primary
trade locations of a city or country that will assist the firm to gain a good marketing
operations and thus, will lead the selected retail enterprise to have a good revenue
generation.
 Promotion: The promotion or market advertising measures are one of the key attributes
of the organization that will help the firm to improve the quality of business activities and
operations in much suitable way (Verhoef, Kannan and Inman, 2015). This will help the
firm to improve its sales and generate a decent amount of revenue from the organization
in much suitable way. At present, Tesco plc is using a vivid range of promotional
mediums like TV commercials, radio ads, social media marketing etc. all these measures
are performing their roles very effectively but, along with it, traditional and environment
friendly marketing measures like word of mouth and local print medium can be also
improved to carry out the proper promotional activities in much effective way (Retail
Market Research Reports: Latest Retail Industry Trends & Statistics, 2018).
A good promotion will help in mitigating the gap between the present marketing
operations and the proposed promotional tools that can be taken in consideration by the
firm.
 Process: This is the firm with maximum gap and scope of improvement. Thus, it is
required to look after the proper assessment of business activities in much suitable way
(Kotabe and Helsen, 2014). The process measures in the Tesco plc involves the selling
and purchasing activities that is been carried out on the online and offline manner. Online
manner helps in improving the quality of sales of products and services using
technologies in business activities (Nicasio, 2018). However, on the offline level, the
selling of good s needs some improvement. The firm is required to improve the quality of
11

products and services which will help in meeting the needs and demands of buyers.
Proper customer support can be provided to mitigate this factor.
 People: It involves the effective assessment of staff to improve the customer satisfaction
level that will improve the quality of products and services which will improve the
quality of services in much social way (Goworek, McGoldrick and McGoldrick, 2015).
This providence of assistance and training the staff to cater various types of customers
will help in proper management of the marketing operations of the firm and improve
social connectivity of firm.
 Physical evidence: This included the proper assessment of the customer experience and
satisfaction level which can be tangible or non-tangible in nature (Bueno, 2018). Both,
online and offline stores of Tesco plc are required to look after the proper assessment of
physical assessment operations. This will also improve the following of legal obligations
to maintain product quality and effectiveness.
CONCLUSION
The above assessment showcases the effectiveness of marketing management operations
for a firm. Furthermore, on the basis of assessment, it can be signified that marketing
management is an essential tool for an organization to maintain quality of products and services
effectively. The assessment of background of statements of retail industry and positioning of the
firm in it helped me to improve my knowledge of USP of firm. Overall assessment of marketing
audit and competitors helped in improving strategies of the firm. The marketing mix approach
indicates effectiveness of promotional functions and its link to external factors will improve the
overall performance of firm.
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REFERENCES
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Goworek, H., McGoldrick, P.J. and McGoldrick, P.J., 2015. Retail marketing management:
Principles and practice. Harlow, UK: Pearson.
Guo, L. and et.al. 2017. Automated competitor analysis using big data analytics: Evidence from
the fitness mobile app business. Business Process Management Journal. 23(3). pp.735-
762.
Jin, J., Ji, P. and Gu, R., 2016. Identifying comparative customer requirements from product
online reviews for competitor analysis. Engineering Applications of Artificial
Intelligence. 49.pp.61-73.
Kotabe, M. and Helsen, K., 2014. Global marketing management.
Melis, K. and et.al., 2015. The impact of the multi-channel retail mix on online store choice:
does online experience matter?. Journal of Retailing. 91(2). pp.272-288.
Siamagka, N.T. and et.al. 2015. Determinants of social media adoption by B2B
organizations. Industrial Marketing Management. 51. pp.89-99.
Toon, M.A. and et.al. 2016. Processes and integration in the interaction of purchasing and
marketing: Considering synergy and symbiosis. Industrial Marketing Management. 52.
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Verhoef, P.C., Kannan, P.K. and Inman, J.J., 2015. From multi-channel retailing to omni-
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Yang, M. and Gabrielsson, P., 2017. Entrepreneurial marketing of international high-tech
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Bueno, B. J., 2018. What is Retail Marketing?. [Online]. Available through:
<http://cultbranding.com/ceo/what-is-retail-marketing/>
Nicasio, F., 2018. 6 Retail Marketing Strategies to Help You Get New Customers.
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marketing-strategies-help-get-new-customers/>
Retail Market Research Reports: Latest Retail Industry Trends & Statistics, 2018. [Online].
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