STRATEGIC MARKETING MANAGEMENT
TESCO PLC, UK
Table of Contents
Brief outline of the organization........................................................................................2
Task 1: Understand the principles of strategic marketing management............................2
(A.C.1.1) Using examples, discuss the role of strategic marketing in your organization..2
(A.C.1.2) explain the processes involved in strategic marketing.......................................3
(A.C.1.3) evaluate the links between strategic marketing and corporate strategy.............4
Task 2: Understand the tools used to develop a strategic marketing strategy...................5
(A.C.2.1) assess the value of models used in strategic marketing planning......................5
(A.C.2.2) discuss the links between strategic positioning and marketing tactics..............7
(A.C.2.3) analyse the merits of relationship marketing in a given strategic marketing
strategy...............................................................................................................................7
Task 3: Be able to use strategic marketing techniques......................................................7
(A.C.3.1) Use appropriate marketing techniques to ascertain growth opportunities in a
market.................................................................................................................................7
(A.C.3.2) plan how to use marketing strategy options in a market....................................8
(A.C.3.3) create appropriate strategic marketing objectives for a market.........................8
Task 4: Be able to respond to changes in the marketing environment...............................9
(A.C.4.1) Report on the impact of changes in the external environment on a marketing
strategy...............................................................................................................................9
(A.C.4.2) conduct an internal analysis to identify current strengths and weaknesses in a
marketing strategy..............................................................................................................9
(A.C.4.3) propose strategic marketing responses to key emerging themes in a marketing
strategy.............................................................................................................................10
References........................................................................................................................10
Brief outline of the organization
The selected organization is Tesco. Tesco is one of the leading retailers in the UK industry
and is one of the largest food retailers operating in UK. The Tesco store is founded by Jack
Cohen in 1919 and it has been started its business by selling the grocery products in a stall in
East End market of Brixton UK (Mamula, 2012). Tesco has more than 1800 stores across the
globe where they serve the best quality products to the customers. Tesco has basically
delivered the grocery as well the non-grocery products to the customers of UK. The retail
market in UK in the recent days is not so attractive for the customers as increase in the retail
organizations making it difficult for the retailers to stay within the retail industry of UK.
Task 1: Understand the principles of strategic marketing management.
(A.C.1.1) Using examples, discuss the role of strategic marketing in your organization.
The term marketing is defined s the wide concept as most of the people believe that
marketing means to promote the products in different marketing channels which can involve
the TV advertisements, writing some catchy phrases about the products or services,
producing brochures, innovation in packaging as well the improving the brand awareness.
These are all part of Marketing but only a limited view. There has been new concept derived
from Marketing which is termed as the strategic marketing (Mamula, 2012). Strategic
Marketing is basically the marketing process which involves in selection of the type of
products or services should an organization will be involved with so as to stay competitive in
this business environment. Strategic marketing evaluates what will be the competition is like
as what type of products or services need to be arranged or developed for the customers is
simply a massive issue which the management of different organizations till facing while
developing their strategic marketing plan. Strategic marketing management always
encompasses that what the potential customers want, what are their expectations, what are the
products we will deliver so that they can be provided satisfaction with and they can be
attracted easily for frequent purchases of the new as well the existing products or services
they deliver. Strategic marketing management also indicates that the organizations can have
the potential to make the delivery what the customers want it or demand it. It also tells that
whether the market is attractive enough to produce the products so that the organizations can
definitely gel up for having its existence in the market.
In this study there has been the development of strategic marketing plan for the leading retail
chain in UK known as Tesco. It is important that Tesco though it is a retail organization
operating its retail business within the UK industry the management of Tesco should deliver
the grocery as well the non-grocery products as these products have heavy demand and value
for the customers of UK ad they have basically targeted the household customers. The market
of Tesco is good within the UK retail industry as Tesco deliver the best quality products to
the customers at an affordable price by which the attractiveness from the customer’s point of
view can be imagined to a greater level. There will be effective marketing plan need to be
developed for the promotion of the products in the UK market by which they can be able to
counter the marketing plan of the other retail organizations. They should also develop the
marketing plan by the application of the different strategic models so that it can be useful for
Tesco to develop an effective marketing plan for leading the retail market of UK.
The tactical marketing describes that for the achievement of the goals there should be the
implementation of the strategies so that the tactics of becoming the market leader or
increasing the market share is done only by the management of Tesco. It is important that the
management should know about the role of the customers as without knowing this they could
not apply the strategy and it become difficult for tactically implementing them. It is important
to know the strengths and weakness of the company itself so that they can manage the
customers and make them attracted easily. The knowing of the customer profile can be useful
in choosing the right marketing channels so that the promotion of the products can be done in
an effective way. So tactical marketing is an extended version of strategic marketing where
the strategies which has been developed is implemented tactically in order to make the
organization like Tesco to become sustainable and have the stability in the retail market of
UK.
(A.C.1.2) explain the processes involved in strategic marketing.
Strategic marketing is a planning process which helps in establishing a clear direction and
the purpose for the marketing efforts to determine the objectives of the business (Ahmad,
and Buttle, 2001). There are actually five steps involved in strategic marketing process which
has been highlighted below
Mission- The first process in the strategic marketing process is to identify the mission of
Tesco by evaluating the target customers for the longer period of time. The mission statement
of Tesco is useful in anticipating the future goals of the business and it describes a ongoing
role for the organization’s product or the service. The mission statement of Tesco is to
provide the best quality products to the customers in the retail market of UK.
Analysis of Situation- The organization like Tesco should conduct as situational analysis
which is the relevant application of the SWOT model so as to determine the strengths and
weakness of the organization operating its business in the UK market. The situation also
describes that the management should evaluate the resources to be used for the development
of strategic marketing process. There will be the relevant application of the Porters five force
model which is also useful in the analysis of the competitive position of Tesco within the
retail industry of UK. This model can make the company to realize the strategy of te
competitors as well the market analysis can be useful for the development of strategic
marketing planning for the company.
Setting of Objectives- The third step is said to the setting of the smart marketing objectives
for the company selected for the study. The marketing objectives need to be specific,
measurable, time bound, realistic as well as accountable so that it becomes easy for the
marketing mangers to take marketing decisions properly by which the company should be
able to develop the real marketing objectives by which the company can become the market
leader within the UK industry.
Development of Marketing Strategy- It is important that the for the development pf strategic
marketing process the company Tesco need to develop a proper and reliable marketing
strategy by which it is possible for the management to promote the products or the services
delivered to the customers. The marketing strategy to be developed should be well organized
and it has been done by analysing the strategy of the competitors as well the retail market
environment of UK.
Evaluation Planning- This is the last step of the strategic marketing process. There should be
the planning for the knowing of the customer profile, the target and segment market base for
the customers, the marketing mix for the products delivered to the customers as well the
different strategic and marketing models like the STP analysis. The evaluation of the tactics
to be implemented which has been monitored and assessed with time.
(A.C.1.3) evaluate the links between strategic marketing and corporate strategy.
It has been analyzed that there has been a slight link between the strategic marketing as well
the corporate strategy (Flint, 2004). The corporate strategy and the strategic marketing of
Tesco coincides or overlap as in strategic marketing planning there will be the strategy of
determining the different aspects of strategic planning. This might include the developing the
pricing strategy for the products of Tesco, developing the distribution strategy for Tesco,
marketing planning for Tesco, assessing of the competitors as well the analysis of the retail
market of UK. On the other hand the corporate strategy of Tesco could be the management
decide how to increase the market share as well the profitability of the company. The two
strategies overlap or diverge when they corporate strategy is very less to do with the product
or service development and sales but to get the concentration in profitability.
According to this study it has been analyzed that the strategic marketing management of
Tesco is the analysis of the market, the competitors, the type of products and service bases
they have, the marketing strategy to be developed, the distribution as well the operational
strategy. With the development of the strategic marketing planning along with the tactics t be
implemented for the strategy to be made successful has a direct link with the strategy at the
corporate level. At the corporate level with the implementation of these tactics make the
organization to improve the brand image by evaluation of proper marketing plan along with
the quality development of the product or services can be useful in providing satisfaction with
the customers which can be useful in competing with the other retail organizations operating
in this retail market of UK. So the tactics to be implemented is making the organization to
increase their market share within the retail industry as a result thee has been increase n e
profitability of the company takes place. So there has been a very fine link between strategic
marketing and corporate strategy.
Task 2: Understand the tools used to develop a strategic marketing strategy.
(A.C.2.1) assess the value of models used in strategic marketing planning.
The marketing models which have been used for the development of the strategic marketing
planning could be the marketing mix as well the STP model. The models has been applied to
Tesco is given below
STP Model
Segmentation- For the Tesco products it is seen that there has been the geographic
segmentation for the company takes place as there has been stores located in the sub urban as
well as the urban areas from where the customers can get the products at any time and at any
cost as well. It also possesses the demographic segmentation as the age, occupation and e
income variable is closely related with the selection of the Tesco products (Parry, 2002). It
also segments the market according to the lifestyle and the social class where the Tesco
products are needed for the customers who provide a good lifestyle and have the well
equipped social class. So there has been segmenting of the market by product attribute for
Tesco.
Targeting- The targeting strategy for Tesco is the mass marketing strategy. They want to
target the whole market with only one offer and they focus only on the current demand and
needs of the customers. So Tesco can differentiate the market according to the market
demand.
Positioning- The company Tesco position their products as the best quality products at an
affordable prices range. They also position themselves to be the innovation in their promotion
so that they can attract their customers which can be useful in increasing the market share.
They also position themselves by providing the customers the loyalty card schemes where the
customers can gain points based on the amount they purchase and this attracts the customers.
Marketing Mix (4P)
Product- Tesco basically have the differentiated product line so they can be able to deliver
different types of products according to the demand of the customers which has an all round
stability of Tesco.
Price- Tesco basically offers the competitive pricing so the prices of the products are low by
which they can be able to compete with the other retail organizations within the UK retail
industry.
Place- Tesco generally place their products n the different retail stores of Tesco located in
different locations across UK so that the customers can have easy access to the products.
They also place their product online from where the customers can purchase them as well.
Promotion- They basically promotes their products with the help of TV advertising,
hoardings as well as the print advertisement like the advertisement in the newspapers and
radio advertising as well.
The STP model in strategic marketing planning can be useful in aligning the products to the
right customers. It provides different value of products to different customers so STP
generates value for the company to assess the market as well as identify the target customers
so that effective marketing planning can be created. The marketing mix provide the value of
the products to the customers as it helps in assessing that what type of product is delivered to
the customers. It also helps in targeting the customers by which te customer needs can be
fulfilled and identified. It also provides a message to the customer about the product delivery.
(A.C.2.2) discuss the links between strategic positioning and marketing tactics.
Strategic positioning drives the marketing strategy as it is useful in developing the marketing
tactics. When the strategic positioning of the company is developed first of all in
segmentation it identifies the customer base who have the similar needs, buying habits and
this helps in developing the marketing tactics (Chernev, 2012). Secondly strategic positioning
helps in identifying the target audience who can buy the products the company delivers as a
result the customer perception towards a particular product can be assessed. The strategic
positioning can build the confidence of the customers as well the management to gain the
knowledege of the market as well the profile of the customers and this make the management
to take tactical marketing decisions. Thus there has been a direct and positive link between
strategic positioning and marketing tactics.
(A.C.2.3) analyse the merits of relationship marketing in a given strategic marketing
strategy.
Relationship market is often defined as the process of attracting, maintaining and enhancing
the relationship with the customers. There has been diverse nature of relationship marketing
takes place and holistic as well. There has been a vital place of relationship marketing in a
strategic marketing plan (Chernev, 2012). The relationship marketing tells that without
developing a god relationship with the suppliers as well the customer’s the company could
not be able to have a sustainable growth and stability in the retail market. With the effective
relationship of the staffs with the customers make the customers to get attracted and come to
the same brand and the switching of the brand is very low. The relationship marketing helps
in making emotional attachment of the brand as a result the customers are aligned to the same
brand. It also helps is repeated purchasing of the same brand and this enhances and creates
value for the products delivered to the customers. It also drives profitability. The relationship
marketing also helps in gaining the trust and builds a positive goodwill for the brand and this
improves the customer satisfaction as well.
Task 3: Be able to use strategic marketing techniques.
(A.C.3.1) Use appropriate marketing techniques to ascertain growth opportunities in a
market.
Tesco has excellent growth opportunities in the retail market of UK. Tesco is considered to
the leading retail company operating its business in the UK market. It is largest retailer and
4th in the world. The current position of Tesco is very good and it has exponential growth in
the recent days to come. The business of Tesco operates in Europe, Asia as well in US. They
have over 470,000 employees (Lee and Carter, 2011). The revenue is 2015 was increased 5.6
percent over 2009. The operating profit for the company is 3457 million pounds which has
been grown to 9.1 percent from the year 2009. The net profit of Tesco is currently as 9.3
percent. They have around 4800 stores all around the world. The non-food items generate
more business for Tesco as the non-food sales rate rose by 6.2 percent in 2015. There has
been an increase of say around 4.2 percent in Tesco for the year 2015. Thus, from the
economical as well the statistical data reveals that the retail market of UK is quite lucrative
and the current growth opportunity and position of Tesco in the UK retail industry is very
good and highly sustainable.
(A.C.3.2) plan how to use marketing strategy options in a market.
Marketing strategy is one of the most important strategic development of any organizations
by which the business objectives can be met. There are various marketing strategy options
which have been developed in order to achieve the marketing objectives of Tesco. First of all
Tesco should introduce a loyalty card branded Club Card as this card provides discount on
the products they deliver which provide an opportunity to attract the customers as well for the
promotion of the products (Anderson and Vincze, 2000). There has been the promotion of
non-food items as compared with the fooding items which increases selling. The catchy
slogan created which is Every Little Helps. The innovation in the promotion which involves
the TV adds as well as print advertising making the customers more attracted towards the
brand Tesco. The voiceovers from celebrities like Terry Wogan, Ray Winstone etc. The
reimbursement of the Tesco retail stores with increasing space provide satisfaction to the
customers as they enjoy and get the best shopping experience.
(A.C.3.3) create appropriate strategic marketing objectives for a market.
The marketing objectives of Tesco is given below
To make refurbishment of stores so as to attract more customers of Tesco.
To increase the market share and become the market leader in the domestic market of UK is
the marketing objective.
To make innovation in the marketing as well in the promotional campaigns for Tesco.
To create value for the products they deliver to the customers.
To develop an appropriate marketing plan for Tesco is another marketing objective.
Task 4: Be able to respond to changes in the marketing environment.
(A.C.4.1) Report on the impact of changes in the external environment on a marketing
strategy.
There has been significant impact on the changes of the external environment on a marketing
strategy. With the change in the external environment there have been changes in the
formulation of the marketing strategy takes place as the marketing strategy developed can
create the company to compete in a planned way so if there has been change in this strategy
then the company might have the difficulty in outperform the rivals (Anderson and Vincze,
2004). The changes in the external environment also make it determine the profitability of the
company and with the change in external environment the marketing strategy developed can
determine and evaluate the operating profitability of Tesco. The change also helps in
identifying the strengths and weakness of Tesco and by assessing these elements the
marketing strategy will be developed.
(A.C.4.2) conduct an internal analysis to identify current strengths and weaknesses in a
marketing strategy.
The current strengths and weaknesses of Tesco has been given below
Strengths
Tesco has very strong financial position i UK ad also in other operating countries in
the world.
Tesco has a very good and efficient global supply chain network.
Tesco has made innovations in their promotional activities.
Tesco has the huge employee strength.
Tesco operates their business in different parts of the world.
Tesco has a powerful brand appeal.
Weaknesses
Tesco is mainly dependent of the domestic market of UK.
Tesco is not at all geographically diversified so it can be at risk if there has been
problem in the system takes place.
From the identification of the current strengths and weaknesses of Tesco in a marketing
strategy it is evident that Tesco has the opportunity to make innovative promotion of their
products as they have the financial strength of investing huge amount in their promotion. This
can also improve the brand image of the company. This can be the strength of the marketing
strategy. The weakness is that since they are not geographically diversified enough they could
not be able to make their promotion strong equally in all the parts of the world.
(A.C.4.3) propose strategic marketing responses to key emerging themes in a marketing
strategy.
The key emerging themes in marketing for the products of Tesco could be the development
of digital promotion which is a global theme. There would be the promotion of the products
of Tesco through digital media which is quite effective and innovative. The marketing
response on this strategy is quite innovative and this will make the customers to provide a
fruitful experience in understanding the type of products delivered to the customers. The
other emerging theme could be the local theme on the utility of the frozen products in the
different outlet of Tesco which has a good strategic marketing response.
References
Books
Anderson, C. and Vincze, J. (2000). Strategic marketing management. Boston: Houghton
Mifflin.
Anderson, C. and Vincze, J. (2004). Strategic marketing management. Boston: Houghton
Mifflin.
Chernev, A. (2012). Strategic marketing management. [Chicago, Ill.]: Cerebellum Press.
Dolan, R. (1991). Strategic marketing management. Boston, Mass.: Harvard Business School
Publications.
Lee, K. and Carter, S. (2011). Global Marketing Management. Strategic Direction, 27(1).
Moutinho, L. and Southern, G. (2010). Strategic marketing management. Hampshire, U.K.:
Cengage Learning EMEA.
Parry, M. (2002). Strategic marketing management. New York: McGraw-Hill.
Wilson, R. and Gilligan, C. (2005). Strategic marketing management. Amsterdam:
Elsevier/Butterworth-Heinemann.
Journals
Flint, D. (2004). Strategic marketing in global supply chains: Four challenges. Industrial
Marketing Management, 33(1), pp.45-50.
Ahmad, R. and Buttle, F. (2001). Customer retention: a potentially potent marketing
management strategy. Journal of Strategic Marketing, 9(1), pp.29-45.
Mamula, T. (2012). Role of marketing metrics in strategic brand management. Marketing,
43(1), pp.49-61.
