Marketing Plan for Tesco - Research Paper Example

Marketing Plan for Tesco Executive Summary: The paper at hand, discusses about the marketing plan for Tesco Plc, a major food retailer. It covers various topics that relate to handling the market competition posed by the internal as well as external environment. This marketing plan mainly includes SWOT analysis, marketing objectives, core strategy, marketing mix decisions, budget, organization and implementation along with control of Tesco Plc. In the part of marketing objectives describe Strategic Thrust and Strategic Objectives. Core Strategy has been discussed Target Market, Competitor Targets and competitive advantage. Integrated mix plan of marketing plan, four P’s like Product, Promotion, Price and Place. Marketing budget has also been discussed in which staff requirement, resources, timing and marketing expense have been elucidated. Organization and implementation and control have also given the marketing plan, which includes key performance indicators. 2. Business Mission: To increase value added products for the consumers in order to earn their enduring loyalty. 3. External Marketing Audit Macro environment: External marketing audit concentrates on macro and micro environment. The latter is most excellent explained as surroundings that a business has to function in. This environment gives a company with probability for achievement and also restrictions its actions. “External factors can be split broadly into three groups, the economic environment, the competitive environment and your own market environment” (The Marketing Audit n.d., para. 3). The Market: Tesco is the largest of the four leading London supermarkets, namely, Morrisons, Asda and Sainsbury’s. In addition to its food business, Tesco controls an important online business and non food business. Tesco is the third biggest food retailer in the UK, with manage of about 31% of that nation’s food retail market; Tesco had effectively thwarted an attempt by wal-mart to take hold of the largest share of the British market. Tesco had also already recognized process in a dozen countries in Asia and Europe and had completed that the U.S offered the maximum opportunity for sustained company development. Tesco’s rise has been comparatively recent. In history recognized in the UK as a conservative retailer with a “pile it high, sell it inexpensive” method to store image and marketing, the reformation of the company came regarding through a countless of innovations and strategies. These incorporated diversification into a broad range of nonfood goods and services, the utilize of multiciple store arrangements, growth of a private tag or house store product for manifold products, and efficient marketing that assisted found its standing as a market manager. Tesco’s rise also contributed to what some analysts differentiated of markets and the organization of supply chains were retail- driven, while the US model of tended to be further produce driven, as a minimum until the early 1990s and the access of Wal-Mart and its control more than its own supply chains. Tesco’s early entry into the United State market mainly focused on suburden locations and middle income consumers, and its major competitive goal in respect to price, store size and to a convinced quantity product mix has been the food dealer Joe’s. In positioning its stores, Tesco’s access into food deserts has continued minimal, in spite of the high profile advertising concerning its wish to do so. Yet, a number of community groups intent on bringing stores into food desert areas have sustained to provide Tesco the advantage of the uncertainty and have commended the a small number of stores that have been positioned in small income communities. Competition: The competitive location of firms is to seem at the transforms that have been proceeding in the various part of retailing. Government figures in the UK are the main source of information on the varying arrangement of retailing in the UK and appearance the foundation for a lot of the conversation and examination of UK retailing. Food retailing includes the biggest sector of retailing. It is separated into expert retailers for instance tesco that have urbanized non food lines. Non expert food retailers are raising their control of the food region. The grocery segment has been main changes as the most important food retailers compete for place. Previous competition flanked by them shaped a large deal of development in big store outlets in this sector and guided to an impersonator store location strategy. The food giants have a substantial benefit in excess of less important food chains as Somerfield plc. This is mostly for the reason that of their capacity to buy in great quantities and demand a high stage of equally service and commitment from their dealers. This buying thump has destined that they have been capable to squeeze out the rivalry that could not compete on range and price etc. The main competitors of Tesco Plc are Retail companies such as Carrefour, Wal-Mart, ASDA and J Sainsbury. 4. Internal Marketing Audit: The marketing audit is a complete assessment of the company’s global marketing actions, its marketing method and its marketing surroundings. Internal factors include different elements that have a direct or indirect contact over the company operations. Internal marketing audit will assist to decide feasible and achievable marketing objectives. Operating Results: Tesco is operating well through each of its separated segments all around the globe, but there is a necessity to possess a competitive marketing plan, so as to reap out the profit made available by the existing situations of international market. Strategic Issues Analysis: The strategic Issues mainly include current marketing objectives of Tesco. “In the case of Tesco, one of the suggested strategic options is in international alliances with the local retailers in Asian markets” (Strategic Management of Tesco Supermarket: PESTLE Analysis, Porter’s 5 Forces Analysis, Critical Success Factors, SWOT Analysis, VALUE CHAIN Analysis, TESCO’s Strategic Options, Core Competences & Cultural Web 2005, para. 51). Marketing Mix Effectiveness: The marketing mix values are used by instruments to help them following their objectives. The marketing mix values are controllable variables which must be cautiously directed and have to meet the wants of the defined target group. Marketing mix is an essential element of business which wants to create sure that they are marketing the right person at, the right price in, the right place and at the right time. The main purpose of marketing mix is to satisfy the consumer. What Tesco needs, is to initiate and essentially acknowledge the requirements of the consumers in their target country. On the other hand, Tesco should not focus on mere estimation of the demands of the customers. The company is seen to develop a good connection with the customers by ensuring a capable provision of its services and products. Marketing Structures and System: “Market structure is best defined as the organizational and other characteristics of a market” (A2 Markets & Market Systems: Market Structures – Summary 2011). Marketing structure and systems of Tesco contain local and stores marketing, brand marketing, price and promotions etc. 5. SWOT Analysis: SWOT analysis is a device for auditing an organization and its surroundings. It is the first step of planning and assists marketers to concentrate on key issues. Following are the SWOT analysis of Tesco. Strength: Strong brand image: strong brand image is the power of the Tesco plc. Market leader: Tesco plc is the third biggest retailer of the earth that is a helpful feature for the Tesco plc. Diversified business across the world: diversified business in frequent countries is power of the company. Competent distribution channel: distribution channel of the Tesco plc is also competitive that is helpful issue for the company. “To have the most loyal and committed staff” (SWOT Analysis of Tesco Plc 2011, para. 6). Weakness: Failure in guiding the city center markets: breakdown to guide the city center market is the main weak point of the Tesco plc. Lack of marketing process: Lack of marketing procedure is another weakness of the company. Opportunities: Increasing demand for private labeled products: Consumers of UK are challenging for the private labeled goods that are chances for the company to boost its customer’s base. Diversifying market appeal: There are still some exposed regions, which have sufficient opportunities for the Tesco. Statistics recommend TESCO is the third main international retailer which signifies a level of buying influence to ensure mainstream financial systems of scale. Threats: “Strengths, weaknesses and opportunities facing Tesco you should have some good ideas about the threats facing it” (SWOT Analysis – Strengths n.d., para. 5). Low price supermarket discounting stores: Growing contribution of low price supermarket discounting stores is a threat that may influence the production of the company. Economic conditions: Changing financial circumstance like recession may also pose threat to the firm’s situation by influencing its profitability and market share. New entrants: New entrants are a different threat for the business, as they may pose dispute to the business processes. Threat of new entrants is low in retailing industry by reason of higher stage of barriers. New entrants similar to the short price discounters are posing a number of challenges to the company that is a most important problem of concern. Increasing raw material expenses from both non food and food will crash profit margins on the whole. 6. Marketing Objectives: The main objective of Tesco, like any other profit organization, is to earn maximum profits. To satisfy customer needs and wants. “To provide goods/services that is cheap and affordable to consumers or the public” (What are the Aims and Objectives of Tesco? 2005). To increase the sales of their products. To develop and maintain the number one position. 7. Core Strategy: To create a successful brand-customer rapport, a convincing brand uniqueness and client value should be created, customize the product on client point of view, and posses the capacity to pay attention and react by rights to develop the company’s contributions to meet customer desires. Target Market- Tesco is the one of the chief retailing business and it successfully accomplished in purchasing, introducing new innovative goods, developing their business in worldwide level. Tesco always tries to please their customers’ requirements and wants. Clients are increasing day by day and they are purchasing numerous products from Tesco. “Tescos target market is divided into specific segments to best target its diverse clientele” (What is Tesco Target Market? n.d., para. 1).At the present Tesco focusing more on the in a foreign country because it shows an underperformance in domestic marketplace. The specific target segments of the Tesco accomplish the marketing objectives in long run. . There is no single way for dividing markets into different segments. The criteria for dividing markets may be locality, demography, way of life etc. While finding out the target markets, concern must be given to current and upcoming probable sales of every section, the sum of competition of each section, the competence to convince each segment, the price of servicing and the section’s role in achieving the industry’s objectives. Competitor- There are numerous competitors to Tesco and between them the most significant competitors for the Tesco are Carrefour, ASDA, Wal-Mart and J Sainsbury are the major competitors of Tesco Plc: Competitive Advantage- It has competitive advantage over challengers that it gained by providing customers with superior value either by way of lesser costs or by offering better services and advantages that justifies the charged high price. The competitive advantages of the Tesco could be in terms of a well diversified worldwide format. This well diversified format of Tesco adding value to products and services and also that offering the consumer what he desires to purchase and not necessarily the Tesco offering the consumer what it want to sell. Brand image of the both food and non-food items of the Tesco helps to develop the competitive advantages. Competitive advantages subsists when the Tesco is capable to give out the same benefit as rivals by at a inferior price or distribute advantages that go beyond those competing goods. Therefore a competitive benefit facilitates the organization to formulate higher worth for its consumers and increases revenues for itself. 8. Marketing Mix Decisions: Marketing mix decision is used to explain “the combination of tactic used by business to achieve its objective by marketing its products or service” (Hall 2009) efficiently to a target consumer group. Here the marketing mix of the Tesco consists of 4P’s such as product, price, promotion and place. “Their other objective that is to create value for customers and earn their lifetime loyalty. This is done by splitting this objective into the 4 P’s” (What are the Aims and Objective of Tesco? 2011, para. 4) Product- Various food items and non-food items are available through Tesco so that this will helps to easy availability of all the products in one roof. But the advantages of implementation of globalization are favorable to purchasers and vendors. And also the food and non-food items of the Tesco consist of like gasoline, stationary including books, telecommunication, financial, banking, insurance, online retail, clothing and merchandizing of other non-food items for daily consumer use. Promotion- Tesco must adopt aggressive promotional policies with the intention of increasing its sales. The company must also adopt print, online and various media channels for campaign. Tesco must generate a logo or motto to draw the consumers towards the direction of the Tesco products. Proper promotion strategy should be adopted to capture the consumers or to produce positive reaction on the subject of the various food and non-food items of the Tesco in the mind of the target customers. Being a great profit -aggravated industry operating for several years in UK and various other global places, it is completely conscious about the ecological matters and require to have appropriate protections in place that might carry out these problems periodically. Adequate promotional strategy of the helps to attract more customers regardless of the environmental matters. Price- Pricing is one of the marketing mixes of the product which influence purchasing decision process of the consumers. Tesco must offer it goods at a lower price in accordance with its consumer’s purchasing power. Moreover, it is necessary to offer value added services to attract more consumers. Many of the time clients of the product connect the price of the product by way of its quality of the product. So we can see that price of both food and non-food items of the Tesco are largely depends upon its quality. Place- Tesco must be situated in an “accessible location for customers” (What are the Aims and Objective of Tesco? 2011, para. 4). The strategic preparation will smooth the progress of the manufacture or service industrial establishment to do somewhat that is special and significantly respected by the consumer. The strategic administration is the combined, industry widespread and the long terms implication which deals by way of fundamental ideology of implementation and assessment. So that successful strategic administration aids the Tesco to enlarge on the whole success and productivity. Tesco has, over the years, construct its reputation by way of confidence and guarantee, the consuming community have located on them consisting of protection of ecological healthiness and conducting in an environmentally forthcoming plans and measures .So that place of the marketing plan of the Tesco plays a significant role to overall accomplishment of the business objective. 9. Budget: To achieve its objective, Tesco must build up effective strategies that are available within the planned time. Anticipated budget for developing the marketing plan of Tesco is $ 5000. Furthermore, the most accurate timeline for the accomplishment of aims must be developed, with the intention of creating confident delivery of correct messages to the correct person in the correct manner and at the correct place. In the financial plan the budget required for every activity will be stated. It also illustrates the various sources from which the capital required for the business will be produced. 10. Organization and Implementation: Organization and Implementation is the practice, functioning or completing of a plan, a process, or any propose for doing something. Implementation is the act that must pursue any preliminary thoughts in order for something to really occur. “Marketing Implementation is what turns marketing plans into marketing actions” (Milne 2002, para. 2). Therefore, to achieve the marketing objective, Tesco must properly organize and implement its actions to increase its returns and attract more customers. Organization of marketing plan of Tesco should be systematically planned and directed to get together a need or to practice collective aims on a long-lasting basis. The main objectives of every business ventures are to earn profit and to satisfy the customer requirements and wants. Effective Organization and implementation of the marketing plan helps to achieve the marketing objective of Tesco. 11. Control: Assessment and control fraction of the marketing plan developed by Tesco plays a significant position in the successful implementation of the proposed marketing actions that are intended to maximize the sales of the company’s food products. Tesco has always focused in Delivering great value for customers. The mission, vision and the strategy of Tesco itself shows that. The CEO David Reid is trying hard by implementing new innovative strategies in order to achieve the organizational goals. So that proper control must be maintained to every phase of marketing plan to achieve objectives in a long run. Reference List A2 Markets & Market Systems: Market Structures – Summary. 2011. Tutor 2U. Available at [Accessed 25 Aug. 2011]. Hall, M. 2009. How to Achieve an Effective Marketing Mix. The Chartered Institute of Marketing. Available at [Accessed 25 Aug. 2011]. Milne, G. 2002. Marketing Plan Success, Version 5.0: Implementing Your Marketing Plan. Marketing Plan Success. Available at [Accessed 25 Aug. 2011]. Strategic Management of Tesco Supermarket: PESTLE Analysis, Porter’s 5 Forces Analysis, Critical Success Factors, SWOT Analysis, VALUE CHAIN Analysis, TESCO’s Strategic Options, Core Competences & Cultural Web. 2005. Available at [Accessed 25 Aug. 2011]. SWOT Analysis of Tesco Plc. 2011. Oppapers.com. Available at [Accessed 25 Aug. 2011]. SWOT Analysis – Strengths. n.d. 321books. Available at [Accessed 25 Aug. 2011]. The Marketing Audit. n.d. The Chartered Institute of Marketing. Available at [Accessed 25 Aug. 2011]. What are the Aims and Objective of Tesco? 2011. Monster India.com. Available at [Accessed 25 Aug. 2011]. What is Tesco Target Market? n.d. www.mt.com. Available at [Accessed 25 Aug. 2011]. Read More