Comprehensive Report: Marketing Strategies and Tesco's Implementation

This report provides a comprehensive analysis of Tesco's marketing principles and strategies. It begins with an introduction to marketing concepts and then delves into the various elements of the marketing process, including building customer relationships, designing customer-driven marketing strategies, understanding market needs, and constructing integrated marketing programs. The report examines the benefits and costs of Tesco's market orientation, followed by an analysis of the macro and micro environmental factors influencing its marketing decisions. It explores segmentation criteria, targeting strategies, and how buyer behavior affects marketing activities. The report also covers product positioning, product development for competitive advantage, distribution arrangements, pricing strategies, and promotional activities. Furthermore, it discusses the marketing mix for different market segments and contrasts international and domestic marketing approaches. The report concludes with an overview of the key findings and recommendations for Tesco's future marketing endeavors.

MARKETING PRINCIPLES

Table of Contents
INTRODUCTION......................................................................................................................1
TASK 1......................................................................................................................................1
1.1 Various elements of the marketing process................................................................1
1.2 Benefits and costs of marketing orientation of Tesco.................................................2
2.1 Macro and micro environmental factors which influence the marketing decisions of
Tesco.................................................................................................................................2
2.2 Segmentation criteria to be used for the product in different markets........................3
2.3 Targeting strategy for the selected product.................................................................3
2.4 Buyer behaviour affects the marketing activities in different buying situations........4
2.5 Positioning strategies of the selected product.............................................................4
3.1 Ways in which products are developed to sustain the competitive advantage...........4
3.2 Ways in which distribution is arranged to provide customer convenience................5
3.3 Pricing strategy to reflect organization’s objectives and market conditions..............5
3.4 Integration of promotional activities to achieve marketing objectives.......................6
3.5 Additional elements of marketing mix.......................................................................6
Task 2.........................................................................................................................................7
4.1 Marketing mix for two different segments in consumer market.................................7
4.2 Developing Marketing plan for different product and services to businesses than
consumer...........................................................................................................................8
4.3 Difference between international and domestic marketing........................................8
Conclusion..................................................................................................................................9
references..................................................................................................................................10

INTRODUCTION
There are various departments in the organization and marketing is one of them.
Large organizations focus on acquiring large customer base. Marketing principles are the set
framework of firms to ensure the best performance. These principles are concerned to
identify the customer needs and the way in which they can be satisfied (Kotler, 2008). Large
organizations follow these principles to ascertain that whether the needs of customers are met
or not. In the present report, one of the leading firms of UK, Tesco has been chosen. Here,
various elements and strategies which are necessary to meet the needs and wants of
customers are included. Along with that, buying behaviour of customers in different
situations is studied and various activities to meet the marketing objectives are integrated.
TASK 1
1.1 Various elements of the marketing process
The marketing process consists of various elements on which the organization works.
These elements are responsible for the identification of what individuals need and want
(Dudovskiy, 2014). Tesco’s marketing process consists of the following elements:
Build profitable relationships and create customer delight: Tesco generally identifies
the market opportunities with the analysis of present and future trends. They understand the
needs and wants of customers to build a better relationship which lead to the creation of the
delightful customers.
Design a customer-driven marketing strategy: Tesco identifies the market area in
which it can operate for selling its products and services while targeting the specific segments
of customers in order to design the strategy which influences the customer behaviour
regarding purchase.
Understand the marketplace and customer needs and wants: The strategies are framed
in context of understand the needs of the customer as per their wants in the marketplace.
Tesco ensure to have the clear understanding about the needs and wants of the customers.
Construct integrated marketing program that delivers superior value: Tesco
determines the elements of marketing mix with taking into account to construct the proper
marketing program which deliver the best to the customer as per their needs and wants. This
ascertains the availability and distribution of products.
Capture value from customers to create profits and customer equality: This element is
used in Tesco to capture the valuable response from the customer in order to create the profits
and also offer the same product as the customer are treated equally in Tesco.
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1.2 Benefits and costs of marketing orientation of Tesco
Organizations can develop their product in such a manner that it meets the demand of
customers. Tesco adopts the market oriented approach which helps to determine the
customer’s wants.
The market orientation proves to be beneficial for Tesco which can be understood by
the following ways:
Advantages:
Giving response to the existing demand: Tesco responds to the demand of customers
which prove to be beneficial as wide range of products are made available to them and they
can avoid the forecasting and guessing of the customer needs and demand.
Building customer value: Tesco understand the needs and wants of customers and
meet their demand by developing specific product as per their desire and build up the
valuable customer relations.
Drawbacks:
Deficiency of predictability: The customer base of Tesco is large and it is hard to
predict the requirement of them, there are various substitutes that are available and every
individual has diverse choices.
Extensive and expensive: Tesco spend a huge amount to identify the requirement of
customers by making surveys. The identification cost is high which determines the needs of
target market.
2.1 Macro and micro environmental factors which influence the marketing decisions of Tesco
Tesco operates in the business environment which has a great influence on marketing
decisions (Mason and Harris, 2006). Various environmental factors which are involved in this
are:
MICRO ENVIRONMENTAL FACTORS:
Suppliers: They are the key personnel as the business operates due to them only. They
make the availability of products and services by which the operations take place to meet the
demand of customers.
Customers: They are the key elements for the organization. Tesco attracts and hold
them by providing the best products and services.
Competitors: Tesco has many competitors so; they should enhance their work
environment to meet the competition.
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Intermediaries: They involve them to increase the market worth with higher profits
and build up a strong relationship.
In order to assess the above micro environment, I have taken the help of best suitable tools
such as SWOT analysis.
Swot analysis
Strengths
 Increasing market share
 Tesco online
 Superior location
 Brand value
 Customer demands and
customer trust

Weakness
 Debt reduction
 Reliance upon the UK market
 Long lead times
 Promotion
 Poor partner alliance
Micro Internal
Opportunities
 Increasing international
presence
 Health and beauty
 One million users(still
growing)
Threats
 UK structural change could
spark a price war
 Overseas return could fall
Micro External
MACRO ENVIRONMENTAL FACTORS:
Political factors: Tesco has to involve the political and legal aspects which are related
to the work environment.
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Technological factors: Due to technological advancement, Tesco tries to enhance the
skills of employees to meet the new advancements.
Cultural and Social factors: It includes the beliefs, attitude and behaviour of
customers which influences the availability of services which they render to them.
Natural factors: These factors have a greater influence on the organization as sudden
change in environment may change the demand of product.
Economic factors: Tesco ensures to make the products and services available at the
reasonable cost as per the needs and demand of customers. Being specific in quality, it
increases the price of product.
2.2 Segmentation criteria to be used for the product in different markets
Segmentation criteria are being used to categorize the customers as per their needs
and wants on the various factors. With proper segmentation, it is easy to ascertain the needs
and wants of different customers (Dibb and Simkin, 2013). Tesco offers a wide range of
products and services to the customers. Now, Tesco is entering in the new market that is
related to the clothing to follow the current trends. The customer base is being segmented on
various demographic variables that are related to the age, status and lifestyle of customers to
determine their present and future needs and demand as per their specification. With the
demographic segmentation, Tesco introduces the clothing segment for the entire customer
group which increases the customer base and helps in more revenue generation and also
improves the overall performance. This variable enhances the company’s image to sustain in
the long run which lead to higher contribution in profit making.
2.3 Targeting strategy for the selected product
Generally, big organization offers diversified products and services to the customers in
order to increase the market share by offering the product and services to the whole market
(Yu and Cai, 2007). Tesco follows the diversified marketing strategy as it has the large
customer segment. It is the chain of supermarkets. Customers visit the stores for various
products as they are made available to them at a single store. According to this strategy,
Tesco has to bring diversification in the work culture by offering range of products at one
place. While making the entry into fashion sectors in order to make the fashionable products
available to the customers, they are able to meet the needs of customers. Different styles and
brands of clothes and accessories are made available to all customers including men, women
and kids and so on. Tesco makes the availability of these fashion products to the customers at
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the reasonable price. They also ensure that they meet the needs and wants of various
customer groups. They try to develop a valuable relationship with customers.
2.4 Buyer behaviour affects the marketing activities in different buying situations
Buyers face many problems related to different buying situations. It affects the
marketing activities as the customers are not aware of various products and services (Wright,
2006). Tesco offers a wide range of products and services to the customers who are
associated with them. Different buying behaviour can be explained like:
Straight re- buy: In this situation, the customer is aware about his needs and wants.
Tesco ensures that they make the availability of products as per the need of customers as they
generally spend little time in choosing the alternatives.
Modified re-buy: As per the change in the market trends, modification in products
range should be done in order to retain the customers. Tesco properly evaluates and ensures
that it brings modification in the products and services which they are offering to them to
maintain the relation by satisfying the needs and wants of customers.
2.5 Positioning strategies of the selected product
Positioning of the product uses various elements in order to attract the target
customers for the product that is offered by company in different situations. The experimental
positioning is used in Tesco as it targets the customers who are more concern about the
fashionable products which are made available to them. They make the easy availability of
product so that customers would get an easy access to the product and will be able to meet the
demand as per their needs and wants. With product diversification, they are able to increase
their market value and grow in the competitive market with wide range of products in the
fashion sector.
3.1 Ways in which products are developed to sustain the competitive advantage
Now days, companies are applying different techniques to sustain in the market.
Product development is the key aspect to sustain in the competitive advantage (Johannessen
and Olsen, 2009). In order to remain functioning, Tesco has to develop the existing product
or has to diversify to sustain. Product development can be done with the new idea generation
or by bringing modification in the product range which are offered by them. With the proper
analysis of demand of customers, the products can be modified or developed so that they
would be able to sustain in the competitive advantage (Lin, Ma and Zhou, 2012). They can
also modify the pricing of product so that large customer base of Tesco can be attracted.
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Introduction of new product as per the requirement of customers can help the organization to
sustain in the long run as people would get an easy access to the product as per their need
specification.
3.2 Ways in which distribution is arranged to provide customer convenience
There are various channels of distribution to make the products available to the
customers as per their requirement. Tesco adopts the multichannel of distribution as it also
intends to lead the online distribution of products and services on the single click. They
ensure to make the products available to the customers in an easy manner. Tesco gets the
product directly from the producer to make it available to the customers. They ensure that the
product is made available in an efficient manner and the customers get an easy access for
purchasing it. The products are made available for target market at the single stop in order to
give the best service to them. The products reach customers through intermediaries. The price
of products ranges from low to high and they can buy it as per their convenience. These
offerings are made according to the need specification of people so that they would be
satisfied with what they are purchasing. Free home delivery is a good option as it would be
more customer convenient as the product would be made available at the door step.
3.3 Pricing strategy to reflect organization’s objectives and market conditions
Pricing strategy reflects the organization's objectives and market conditions. The
objectives are ascertained as per the present scenario of the market as per the conditions
specified by the customer. The prices are determined with keeping in mind the target market
for which the product is manufactured. Tesco adopts the competitive pricing strategy due to
high competition in the market. Tesco sets the prices with keeping in mind the present prices
of various products and services that they are offering to the customers. They set the price
lower than what the competitors are charging or it may be the same. Tesco adopts the
premium pricing strategy as they set high price for the premium quality of products which are
exclusively available at their store. They include the premium product with the best quality
which ensures high satisfaction of customers related to the products and services. The
customers are ensured with the best quality which helps them to stay with the firm in a long
run.
3.4 Integration of promotional activities to achieve marketing objectives
Promotion is one of the major aspects of marketing mix. The main aspect of
promotional activities is to attract more customers. Tesco being a large retailer adopts various
promotional activities to achieve the marketing objectives in the following manner:
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Contests: Tesco includes a wide range of products and services of different brands
which are being offered to the customers at their stores. They organize contest in order to
give an idea of the brand and to promote the products which are offered by them.
Online: Tesco adopts this strategy to make the product available to them on the single
click. This strategy helps to increase the customer base as it gets an easy access to the
customers for the required products and services as per their need specifications. Through
mails and online advertisement, they can also promote the products and services which they
are offering.
Branded promotional gifts: Tesco offers various branded products to lots of
customers. Tesco offers the card facilities and other gifts with the products which they are
offering to the customers. They can promote the sales by allowing discount on various brands
which they are offering to the target market.
3.5 Additional elements of marketing mix
Now days, the marketing scenario is more customer oriented than before. The
marketing mix includes the elements like price, place, product and promotion (Bowman and
Gatignon, 2010). This marketing mix comprises of these four elements that are operated in
the long run. But now in Tesco, with the modification in the work environment and the
requirement of customers, three additional elements are being introduced which were people,
physical evidence and process.
People: People are now very much work oriented. They are the essential element who
runs the business of the organization. Tesco is reliant on the employees as there are various
departments in which they operate. Having the right people is very essential as they are
business offering to offer the products and services to the customer as per their needs
specification.
Process: Tesco follows processes in a proper manner to make the product available
with quality service to the customer. Tesco ensure that the quality of product is delivered in
the best form again and again as the customer is paying for it. The follow up of process in
effective manner will sustain the customer in long run.
Physical evidence: Tesco products are available to the customer; keeping in mind the
physical evidence which include the surroundings in which they sell the product. Tesco
ensure that they deliver the best services in a proper manner.
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TASK 2
4.1 Marketing mix for two different segments in consumer market
Generally there are four marketing mix strategies which are involved in order
communicate the customer about the various product and services. These elements help to
plan and recommend the modification related to the various products and services (Bowman
and Gatignon, 2010). The market segments are now more customer oriented based on the
demographic, Psycho-graphic, behavioural aspects. Tesco include the wide range of product
and services. With the diversification in work culture and introduction of the new product;
range for all age groups customers. Tesco segmented the customer on the basis of the
lifestyle, age and status of the customer to make the product available as per the
requirements. In the behavioural segmentation of the customer the planning and
recommendations are made according to their response, knowledge and the attitude toward
the product and services which are being offered to them. Tesco ensure the buying behaviour
of the customer related to the products as customers has the attitude of choosing the
alternatives.
Marketing mix Female – segment Male - segment
Product
The can introduce wide range
of apparels with different
styles and design.
They can make the apparels
available as per the current
trends with the little
modification.
Place
The product should be
available in the outlets with
the ease as they frequently
choose the alternatives.
The place can be specifically
as they get what they want at
the single place
Price
The price can be high as they
are concern about the quality
rather than the price.
The price range should be
moderate as they consider
price more than the quality
Promotion
The promotion can be done
with the endorsement of the
product by the female
celebrities
The promotion can be done
with the endorsement of the
product by the male
celebrities
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4.2 Developing Marketing plan for different product and services to businesses than
consumer
Different organization offer different products and services. Organization offers the
product and services as per the market demand. Products and services are divided among the
various sectors of the customers (Doole and Lowe. 2008). Tesco analysis the current market
situation to assess the needs and develops the product as per the specification of the
customer's. They identify the potential customers with the proper surveys and analysis to
determine the target market for the new product which they are offering the new product.
Tesco establish a proper channel of distribution with the online facility which provides easy
availability of the product to the final consumers. Tesco adopt the free home delivery of the
product which is being ordered by the customer as per their need specifications. When the
marketing is done to the other business the entire focus lies on the logic behind the product
manufacturing and offering. Whereas in B2C marketing is done in order to ensure that they
meet the needs of the customer. The detailed information is necessary for marketing in the
B2B business. On other hand; in B2C the brief information is quite enough to understand the
offering which is made to them. In B2B the business entities needs complete information and
focus the feature of the product whereas in B2C the customer needs only the information
which reflects the benefits of the product which they are accepting.
4.3 Difference between international and domestic marketing
Marketing is the integral part of the business which refers to the plans and the policies
which are being adopted to meet the need and wants of the potential customers. Marketing is
done to attract the customer to avail the products and services (Andrew 2011). The difference
between international and domestic market are illustrated below:
Scope: In international marketing there are endless opportunities for the company to
target the customers. On the other hand in Domestic marketing the opportunities are very
limited.
Barriers: In International markets there are language and culture barrier as they are
entering the totally diversified market. Whereas in domestic marketing there is no language
and cultural barrier as they are operating in the domestic boundaries.
Risk-level: The risk level is high in international marketing as it is complex to
understand the behaviours of the new customers present in the market. Whereas domestic
marketing is less risky as it is easier to meet the demand as per the needs of the customer as
they are familiar with the behaviour of the customers.
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Financial resources: International marketing requires high source of finance as they
are operating in several different countries and markets. Whereas domestic marketing
requires less source of finance as they operates in the single domestic market.
CONCLUSION
Marketing is very important to make the customer aware about the various products
and services which are available in the market. Tesco is the leading retailer which provides
the products and services to the customer as per the needs and wants. To be more specific in
satisfying the need of the customer they segmented the customer on various aspects keeping
in mind their key requirement. In order to sustain in the long run they assure the convenient
manner to make the product and service available to the customer. Tesco ensure the
behaviour of the customer with whom they are dealing with to meet their needs and demand
and facilitating the higher customer value relations.
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