Marketing Mix Strategies of Tesco: An In-depth Analysis (Semester 1)

This report provides a detailed analysis of Tesco's marketing strategies. It begins with an executive summary and introduction to the company, followed by an in-depth examination of its STP (Segmentation, Targeting, and Positioning) strategy, including market segmentation based on demographics, psychographics, lifestyle, beliefs, and behavior. The report then analyzes the marketing mix, focusing on the 4Ps for products and 7Ps for services, covering product, price, place, promotion, people, process, and physical evidence. Furthermore, the report assesses Tesco's relationship marketing strategy, emphasizing customer loyalty and long-term engagement. The conclusion summarizes the key findings and recommendations. The report also includes references to academic sources. The report aims to provide a comprehensive understanding of Tesco's marketing practices and strategies, and how they have contributed to the company's success in the competitive retail market.

Marketing Mix

Table of Contents
EXECUTIVE SUMMARY.......................................................................................................................3
INTRODUCTION.....................................................................................................................................4
MAIN BODY.............................................................................................................................................4
TASK1........................................................................................................................................................4
Analyze the STP strategy, providing and insight into how segmentation, targeting and positioning are
currently applied......................................................................................................................................4
TASK2........................................................................................................................................................6
Examine marketing mix, focusing on the 4Ps for products and 7Ps for services.....................................6
TASK3........................................................................................................................................................8
Assessing relationship marketing strategy...............................................................................................8
CONCLUSION..........................................................................................................................................9
REFERENCES........................................................................................................................................11
Books and Journals:...............................................................................................................................11

EXECUTIVE SUMMARY
The report is considering the key points of marketing mix for the Tesco Company, a
British multinational supermarket and retail store founded by Jack Cohen in 1919. The company
headquartered their business in UK. The company’s objective is to satisfy their consumers by
producing best product and services at minimum cost, so it can be budget friendly to their
customers and company try to make them loyal and stick with their products and services. For
this the company will provide various schemes and offers to their consumers to attract them
towards products or services. The Company follows various marketing strategies by applying
STP approach that is segmenting, positioning or targeting into their business operations. The
company focuses on the target market with different categories of consumers with a goal to serve
best with services. The report also highlights the analysis of SWOT for the company to know
their strengths and weaknesses, opportunities and threats that can be applicable to the internal
and external market to work effectively. Whether the company faces various competitions like
ALDI and more but with the effective marketing mix strategies they can give a tough
competition to anyone. Tesco well establish their relationship with customers and makes them
satisfied with attractive offers and discounts. The company also provide loyalty card, so that they
can gain special deals too. Overall, the report is discussing all the marketing facts and strategies
which company is applying in their business operations.

INTRODUCTION
Marketing is a term which defines in a different ways by different organizations. It is the
process in management through which goods and services move to the customers. It defines
identification of the goods, determination of demand, pricing decisions and selecting distribution
of channels. It also includes developing plans of marketing and how it will implement in
promotional strategy (Akbar, Y. R., Zain, I. and Nuraini, P., 2019) . It focuses on the demands of
customers related to buying and services of products and services and decided whether it is
possible to produce at the right prices after all this the company will produce to sell it to the
consumers. This report is going to discuss on the Tesco Company which is a British
multinational groceries supermarket and general merchandise. Tesco has been found 102 years
back in 1919 by Jack Cohen. The company has covered more than five countries across Europe.
Tesco is a general merchandise and retailing business of toys, financial services, internet
services, telecom, clothing, electronics, books and many more. Tesco gives its first appearance in
1924 after purchasing of tea by John Cohen. In a general phrase, Marketing Mix is used to
describe the various kinds of choices companies have to make in the overall process of
introducing products and services in the market.
MAIN BODY
TASK1
Analyze the STP strategy, providing and insight into how segmentation, targeting and
positioning are currently applied.
STP marketing is an acronym for segmentation, Targeting and Positioning. It is broad
framework in marketing that summarizes and simplifies the process in segmenting the market. It
is a three step model that examines goods and services as well as the way of communication
which can be beneficial to particular market segments. STP marketing symbolizes a shift from
product based marketing to customer based marketing (Aras, M., 2018). In modern marketing, it
is familiar strategic approach used to communicate marketing communication plans and deliver
more relevant messages to appeal customers in a commercial way. Basically, this is focus on
commercial effectiveness and choosing the most relevant segments for the Tesco Company, and
then creating a marketing mix and product positioning strategy for each segments.
Applications of Segmentation, Targeting and Positioning to the Tesco Company:
Through segmentation, the company can identify positions with particular needs, mature
markets to find new consumers, deliver more focused and effective marketing messages to
convey. This approach is more efficient to deliver the right marketing mix to the right group of
people. The company will find more opportunities to make brand more effective and compelling
by offering various types of value to the consumers.
Market Segmentation:

Market Segmentation is a common technique carries by all size of companies whether it
is large or small marketplace. The thought is to organize the total market segments into small
groups of customers with known interests and traits to enable effective marketing.
 Demographics: Failure by any combination that is age, income, gender, ethnicity,
education, marital status, business size, resident size, profession, occupation.
Psychographic: This segment categorized personality and emotions of humans which is based
on behavior, including attitudes, purchase choices, hobbies, lifestyle, personality and leadership
traits, watching T.V., books reading and many more (Batat, W., 2019). Demographics refers who
the consumer is and psychographic refers why the consumer buy products.
 Target audience can be representative by talking to few people. Interviews can
helpful to get qualitative data to understand what makes consumers to pick.
 Surveys can reach out with more people than interviews. It can be harder to get
answers.
 Last one by gathering data by customer as they purchasing from loyalty cards. This
can reflect how consumer purchase and what kind of products they are likely to use.
 Lifestyle: Lifestyle of person refers to hobbies, entertainment, vacations, recreations
pursuits and more. Companies who are doing online and offline business will target
these consumers
 Beliefs and values: Beliefs and values refers to political, nationalistic and cultural
values and beliefs.
 Benefit: When consumer consumes a product with a intention to get benefits and
satisfactions.
 Behavior: It refers to the nature of the brand loyalty, purchase, distribution channels
used, and the reactions to the marketing factors.
 Life stages: It explains the different stages of human’s life in a chronological
benchmarking.
Market Targeting:
The most influential marketing results when the message is conveyed to right consumers
through right media and with right benefits. It formulates clear strategy with a intention to attract
target consumers or a specific type of consumer.
 To justify segments, markets must be large enough.
 Market Segments must exit with measurable differences.
 Different benefits occurs in different segments.
 Every segment must be accessible to marketing team and the market segment able to get
marketing messages.
Market Positioning:
When the Tesco Company wants to market their brand, typically the company goes
against one or two competitors competing for the same consumers or offering same offers to the
consumers. With a help of distinctive positioning strategy, the company will succeed in gaining

customers, building loyalty and creating sales. This is the place where product or services meets
with the requirements of particular target market (Chenavaz, R. Y. and Et.al., 2020). Formulating
strategies helps in the development and presentation of messages to be conveyed to target
consumers or market.
What Tesco is looking for in segmentation, targeting and positioning in their marketing
strategies?
 It must be considered that market should be large enough that consumers can easily get
into contacts.
 Approaches in market research must ensure that it will add value to the existing consumer
experience, above or beyond competitors.
TASK2
Examine marketing mix, focusing on the 4Ps for products and 7Ps for services.
Marketing Mix includes a set of tools and techniques used to promote goods and services
in the market or industry with a view of selling it to the potential customers. It is all about
product positioning and deciding the right place, right time and in a right way to sell it.
Marketing Mix elements consists of 7Ps that it product, place, promotion, price, physical
evidence, people and process (Do, Q. and Vu, T., 2020). A marketing manager of Tesco
Company take consideration about all these 7Ps and make marketing strategy.
Features of Marketing Mix:
 Marketing Mix involves pivotal decisions related to each and every “Ps” of mix. It
impact the best when proper weightage is apportioned to every element.
 It requires proper attention by the manager to review the mix and conditions of market
and make appropriate changes accordingly.
 Changes occurs within the business also affect the change in the marketing mix.
 Proper strategy of marketing mix helps in achieving goals of the organization.
 It focuses on the satisfaction of customers who are engaged in the process of buying
goods and services.
7Ps of Marketing Mix:
The marketing mix is actually a set of actions and plans that company develops and
implements in order promote their product and services to satisfy the customers. The Tesco
Company focuses on the marketing mix and analyses the 7Ps of marketing.
Elements of Marketing Mix Tesco
Product The company includes variety of products
such as clothing, electronics, financial
services, food, telecom services, internet
services and many more (Weldemariam, T.
and Ayele, Y. N., 2020). It includes products

from various brands in their product line as
well as the company include their own
product too. Tesco value, Tesco lotus, F&F
clothing are their own brands. Focusing on
the expansion of their product lines, it fulfils
every possible need of customer.
Price and pricing strategies of Tesco The company focus on the strategies of Cost
Leadership to maintaining their low pricing
factors as possible for their products and
services without compromising the quality of
their products (González, V. J. L. and Et.al.,
2019). Untamed competitions like Aldi and
Lidl in the UK market also affects on the
pricing strategy of the company Tesco.
Although the company has planned various
price wars against the competitors.
Place and Distribution Strategies of Tesco Tesco has mainly use two distribution
channels that is online and offline stores. The
company has spread their offline stores with a
number of 7000 all over the world. The
offline stores of Company has six different
types such as Tesco Express, Tesco Metro,
Tesco Extra, Tesco Compact, Tesco
superstore and Tesco Homeplus. The online
business of the Company known as Tesco
Direct. This strategy has been showing that
company has varieties of channels to be
distributed to reach potential customers.
Promotion Strategies Of Tesco The company already has a strong brand
image in the consumer’s mind. For its
promotional activities company uses different
modes like T.V., newspapers and other media
outlets to convey their messages to their
consumers. The company uses other forms of
promotion also like buy one get one offers,
discounting offers for specific products,
Tesco facilities customers with a loyalty card
as well.
Process in Tesco Process consists a set of activities to be
performed in order to get results. The offline
stores of Company facilitates the customer to
pick up their products their own and then go
to customer assistance to pay. They provide
self-service for customers too.
People of Tesco According to the survey Tesco involves
around 4,20,000 people in their business.

Customer Assistance plays a very important
role in the achievement of the business.
Hence, the company invest their most of the
time in training and developing programs for
their employees.
Physical Evidence of Tesco Tesco has an excellent logo with efficient
colors and fonts which gain attention of the
consumers (Sriram, K. V. and Et.al., 2019).
Offline store of the company are easy to run
with all categorized products which make
easy and comfortable to find products. The
website of the company also attract the
customers and is easy to use as well.
TASK3
Assessing relationship marketing strategy.
Relationship Marketing is a strand of customer relationship management that focuses on
customer loyalty and maintaining long term involvement of customers instead focusing on short-
term goals like individual sales and customer acquisition (Harrington, R. J., Ottenbacher, M. C.
and Fauser, S., 2017). The main purpose of this marketing is to create strong and emotional
customer relationship to a brand (Tesco) that can help business to grow with free word of mouth
promotion and information from customers. It is important for its ability to stay in close with
customers. It will help to understand how frequent customer use a brand’s product and services
and knowing or observing additional needs, so the company creates new products and offerings
in order to meet those requirements which strengthen the bond with customers.
Relationship Marketing Strategies can be defined as the practices that are focused on
translating each and every prospect of customers and customer retention by engaging them with
customized communication. The concept of relationship marketing strategies helped business of
Tesco to enhance their communication with customers and achieve their targets and goals (Iljina,
Z. V., 2019). It is designed to foster loyalty of customer, interactions with customers by
providing information directly which is suited to their needs and requirements, by promoting
open communication.
Objectives of Relationship Marketing Strategies:
o The major objective is to satisfy the customer needs and requirement that will be helpful
to maintain their addiction to the particular brand.
o It aims to identify customer needs, work on the customer’s feedback and manage on the
improvements of service to main long term relationship.
It also focus on increase in productivity and also lower the all over cost of sales, marketing of the
products and services (Jermsittiparsert, K., 2019).
Importance of Relationship Marketing:

 Higher Customer Lifetime Value: Relationship Marketing generate loyal and addicted
customers towards the company’s brand which leads to purchase repeatedly and higher
CLV. The loyal customers become the brand ambassador or advocates who recommends
products and services to their friends, family or the business associates.
Reduction in marketing and advertising: This involves ‘buzz marketing’ in which customers
become the ambassador or promotor for the particular brand. In this marketing consumers self-
describe about products and services which drive sales in an effective manner (Kubacki, K. and
Et.al., 2017). It just because spending money on advertising and marketing to acquire new
consumers can be quite expensive.
 Alignment of organization is strong around the world: The Company that spotlight
relationship marketing have a stronger alignment around an exceptional customer
experience. The teams of the Company will focus and serve customer and make them
happy and satisfied.
Recommendations to improve their marketing strategy:
 Analyze the competition: The analyzing competition for the business is very important.
The Company must be aware of the plans and strategies of their competitions what tools
the competition are using to attract customers, how the company serve to maintain loyalty
from their consumers and many more. This is very essential to stand out in the
competition and increases customer’s satisfaction as well.
 Improve campaigns by tailoring: Tailoring Campaigns relates to create personas in
marketing strategy. This will require in both customizing actual marketing campaign
marketing as well the researching channels in which company needs to convey messages.
Tesco must choose an appropriate option for their consumers.
Improving marketing campaigns by targeting: Market targeting should be chosen wisely to
bring strong and effective outcome and results, before doing any work such as conveying
messages or the channels of distribution (Paschen, U., Paschen, J. and Kietzmann, J., 2017). The
company must pre-determine their target market in which it wants to reach. It should adopt a
strategic way to create market to define all of this group people.
 Test to see how marketing campaign is performing: Another recommendations is
testing for the performance of marketing campaign. It is very essential take tests into the
marketing plans. The company must consider all the facts that should be measured that it
is working for the company or not. Testing performance for the Company could be tiring
and boring but it is necessary for the good of the company, so that it can take appropriate
actions after evaluation or testing.
Social Media Marketing: This is a way focusing on providing users or consumers with content,
find valuable and want to share around the world with social networks which results in
trafficking and clear visibility (Rahardjo, C. A., Harianto, H. and Suwarsinah, H. K., 2019).
Social media share content in videos, images that increase relevancy in search results within
social media networks like Facebook, YouTube, Twitter, Instagram or LinkedIn including search

engines like Google and Yahoo. It will help company to generate leads while reducing marketing
investments.
CONCLUSION
From the above studies it has been well concluded that marketing and marketing mix
plays a very important role in the in the business world. It helps the organizations that business is
doing their marketing at right place, at right time and in a right way. The marketing mix helps the
organizations in determining which marketing strategy is suitable for the business. From
marketing about products and services customers will get to know more about the product, their
value and usage and additional information might be helpful for the customers. Marketing
objectives highlights the intentions of the marketing team to provide clear vision to follow and
other plans to execute to review and support. Hence, it creates awareness for the brand and
makes business to stand out in a competition with the aim of gaining maximum customer
satisfaction.

REFERENCES
Books and Journals:
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