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Background of the organization

Write an essay on business orientation of Tesco.

The purpose of this report is to evaluate business orientation of Tesco. This report consists of different marketing strategies, which has been adopted by Tesco for being market oriented. The term market oriented strategy refers to the process of attracting new consumers towards the brand along with retaining the existing consumers (Ballantyne 2015). In retail industry, the market competition is high in contrast with any other industries. Therefore, customer centric strategies are the key success factor for Tesco, which facilitate the organization for gaining competitive advantages (Line and Wang 2015). This report further consists of recommendations for the management of Tesco for making the organizational strategies more consumers centric.    

Tesco is the third largest retail organization of global market, which is founded in 1919. Since then, the company is satisfying their consumers with high quality. The company has more than 6814 stores in global market. When it comes to revenue, Tesco is the second largest retail organization of global market. In UK, Tesco is known as the leader of grocery market and holding 28.4% of market share. The major business strategy of Tesco is to expand in global market for ensuring business sustainability. Moreover, the product quality product and pricing strategy of Tesco makes the company reputed in retail industry.  

Following are the objectives of Tesco:

  • To expand overall sales volume within next five years
  • To attract consumers with effective pricing and promotional strategies
  • To communicate with the consumers for gathering valuable feedbacks from the consumers
  • To improve organizational performance based on the consumers’ feedbacks

Tesco has adopted a customer centric marketing strategy, which helps the company to gain competitive advantages. The company is known for its efficient pricing strategy and product quality. Moreover, the company has adopted different market oriented strategies for attracting consumers from competitive market (Lin et al. 2016). Following are the components adopted by Tesco for being a market-oriented organization.

In order to be a market-oriented organization, it is highly important to build efficient communication with the existing and potential consumers. Therefore, Tesco has adopted a communicative organizational culture, which helps the company to understand changing needs and demands of the consumers (Koh and Wong 2015). The major reason of understanding the changing needs of consumers is to solve consumers’ issues for better buying experience. Following are the steps followed by Tesco for fulfilling requirements of this marketing component (Santouridis and Stoumbou 2015).

Listen: Tesco accumulates consumers’ feedbacks regarding the product quality, availability and price feasibility through their website. Tesco gives high priority to the consumers’ voice and therefore, consumers are not required to wait for communicating with the management of Tesco (Shah and Jain 2015). Additionally, this strategy helps the consumers to share their post-purchase behavior, which actually helps the company to improve consumers buying experience.

Objectives of the organization

Solve: Tesco not only gather feedbacks from the consumers, but also gathers feedbacks from the consumers for increasing consumers’ satisfaction (Homburg, Jozić and Kuehnl 2015). In order to solve consumers’ issues, Tesco has days return and refund policy.  

Impact: The above strategies help Tesco to maintain business sustainability by increasing consumers trust factors (Verhoef and Lemon 2015). Moreover, the organization focuses on environmental protection in order to attract consumers and other stakeholders in competitive market.   

This strategy helps Tesco to understand the actual position of the competitors. It helps the company to understand the procedures followed by the competitors for satisfying needs and requirements of the consumers (West, Ford and Ibrahim 2015). In other words, competitive focus allows the organizations to implement better strategy in contrast with the competitors’ strategies. For example, Tesco follows competitive pricing strategy in which the company provides product at low rate than the competitors (Lederer, Schott and Keppler 2015). Moreover, the promotional offers provided by Tesco are considering the competitors activities. Therefore, it can be said that Tesco relies on competitors’ activities in order to adopt a customer centric approach. Additionally, Tesco has adopted “Low Price Everyday” approach for attracting new consumers from the competitive market.

In order to satisfy needs and requirements of every type of consumers, Tesco has implemented product diversification (Saad, Hassan and Shya 2015). This strategy helps the company to expand business operation in different fields, which affects business profitability positively. In primary stage, Tesco has started with food products; however, the company has expanded in different fields such as tourism, telecommunication and financial sector (Alteren and Tudoran 2016). The reason behind adopting product diversification is to influence consumers’ buying behavior. The purchase decision-making process of consumers consists of a step, where consumers identify the actual requirements. Adopting product diversification helps the company to attract different consumers with different needs and requirements.

There are several issues faced by the organization, which prevents the organization from understanding consumers’ needs and requirements. In order to implement a consumer centric approach, it is highly important to understand the shoppers’ target in which Tesco is lagging remarkably (Ballantyne 2015). Moreover, the feedback evaluation process of the company is not much effective than the competitors in UK market (Line and Wang 2015). Therefore, it can be said that the issues faced by Tesco prevents the company from being a market-oriented organization. The basic attribute of market-oriented company to be consumer centric and on the other hand, Tesco fails to generate accurate data from the consumers’ feedback. Following are the issues faced by Tesco while implementing market-oriented strategies (Lin et al. 2016).

Marketing strategies of the organization

Customer evaluation: The customer evaluation process of Tesco is not satisfactory enough to attract the consumers. In other words, feedbacks of the consumers are not evaluated efficiently, which prevents the organization from resolving consumers’ issues (Koh and Wong 2015). However, the company has an effective policy of communication in which the company establishes communication with the consumers. A low quality data evaluation prevents the organization from understanding the actual issues of the consumers; thus, improving the overall process becomes difficult.

  Employee efficiently: The employees of the Tesco are unable to deliver the designed service to the consumers, which prevent the organization from attracting consumers from competitive market (Shah and Jain 2015). Employees of an organization are solely responsible for communicating with the consumers. However, Tesco does not have any training program for educating the employees regarding how to evaluate consumers’ feedbacks. On the other hand, market oriented strategies are implemented for framing organizational goals and objectives for satisfying changing needs and requirements of the consumers (Homburg, Jozić and Kuehnl 2015). Therefore, it can be said that employee efficiency is one of the major issue faced by Tesco, which prevents the organization from attracting new and existing consumers.       

In order to adopt customer centric strategies, Tesco should give high priority to the consumers’ feedbacks. In this manner, the company will be able to understand the consumers’ issues regarding the products and policies. For example, the return and refund policy of the company may dissatisfy a group of consumer. Therefore, the company needs to amend the policies in order to satisfy the consumers accordingly. However, Tesco should not change the complete organizational policies completely based on the consumers’ feedbacks. Following are the possible ways to improve market-oriented strategies for Tesco.

Employee training: Tesco should focus on employees’ knowledge in order to improve consumer centric strategies. Therefore, Tesco needs to implement efficient training program for increasing knowledge of the employees regarding how they can build effective communication with the consumers. Gathering feedbacks from the consumers is not sufficient; the company needs to build healthy relationship with the consumers too for increasing customer retention. On the other hand, a market-oriented company is known for its customer centric strategy. Educating the employees regarding feedbacks evaluation is a customer centric strategy, in which the voice of consumers can be evaluated properly.

Competitive pricing strategy: Competitive pricing strategy refers to the process of modifying the pricing strategy as per the market competition. In this strategy, the company should monitor the pricing strategy of the competitors randomly. Incorporating this strategy will help Tesco to provide products at lowest rate. Providing high quality products at low price will help the company to attract new consumers from competitive market. However, it is not possible to provide best quality product at lowest price. Implementing low pricing strategy can affect consumers’ trust factors negatively. Therefore, the company needs to adopt a suitable pricing strategy, which can affect both consumers’ buying behavior and trust factors positively.

Issues of the organization

Customer communication: Tesco should spontaneously communicate with the consumers in order to understand the changing needs and demands of the consumers. A healthy communication strategy will help the company to gather consumers’ feedbacks regarding the product quality along with the post-purchase behavior of consumers. In order to implement customer-oriented strategy, the company should build healthy relationship with the consumers for increasing customer retention. If Tesco can build healthy relationship with the consumers, then it will be possible to increase consumers’ trust level. Therefore, it can be said that the company should adopt this strategy for improving their relationship with the consumers.            

The above-mentioned strategies are efficient for improving consumer centric strategy of Tesco. However, there are different barriers that Tesco can face after implementing these strategies (West, Ford and Ibrahim 2015). The strategies recommended above are completely consumer centric and therefore, the consumers can take advantages from the easy polices. For instance, if Tesco modify the replacement policy according to the consumers’ requirement, then it can affect organizational profitability negatively. On the other hand, this strategy can satisfy the needs and requirements of the consumers to the highest extent (Saad, Hassan and Shya 2015). Therefore, it is important to implement certain measurements in order to get rid of the potential threats. The advantages of the above-mentioned strategies, Tesco needs to implement a balanced policy in which the company can facilitate both organizational and consumers’ interest. In other words, the company should have a basic philosophy while framing organizational policies rather than following consumers’ instruction accurately (Alteren and Tudoran 2016). Following are the potential threats for Tesco after implementing the proposed strategies.

Low profitability: A competitive pricing strategy prevents the organization from delivering high quality product. In UK retail market, the competition is very high and therefore, many organizations have implemented low pricing strategy. Reducing price to the highest extent can affects profitability of the organization (Verhoef and Lemon 2015). On the other hand, reducing product quality can affects satisfaction level of the consumers negatively. Therefore, it can be said that a customer centric approach can hamper brand image of the company. In order to gain benefit from the proposed strategy, Tesco needs to focus on brand image along with market competition (Lederer, Schott and Keppler 2015). It is not possible to compete with the companies those are delivering low quality products at low price.

Low brand image: Communicating with consumers frequently can affect the brand image of the company negatively. The information provided to the consumers is sensitive in nature and therefore, rival companies can use that information against the organization (Saad, Hassan and Shya 2015). Therefore, the organization should not provide frequent information to the consumers. In order to improve brand image, Tesco should understand the priority of the information that can be sent to the consumers for attracting them towards the company.          

Conclusion

After preparing this report, it can be concluded that Tesco needs to improve their strategies for implementing a consumer centric organizational strategy. In order to improve organizational performance randomly, the company has adopted different strategies, which are market oriented in nature. On the other hand, evaluation of organizational strategies, it can be understood that the company is facing different issues. The recommendations proposed in this report are efficient and need efficient monitoring process for gaining positive outcome. This report consists of procedures in which Tesco can gain beneficial outcomes from the suggested procedures. In order to retain consumers from competitive market, Tesco needs to improve their strategic activities according to the proposed recommendations.

Reference list

Alteren, G. and Tudoran, A.A., 2016. Enhancing export performance: Betting on customer orientation, behavioral commitment, and communication.International Business Review, 25(1), pp.370-381.

Ballantyne, D., 2015. IS MARKETING BLIND TO THE INTERNAL CUSTOMER?. THE NORDIC SCHOOL, p.183.

Homburg, C., Jozić, D. and Kuehnl, C., 2015. Customer experience management: toward implementing an evolving marketing concept. Journal of the Academy of Marketing Science, pp.1-25.

Koh, A.C. and Wong, J.K., 2015. The Impact of International Marketing Research on Export Marketing Strategy: An Empirical Investigation. InProceedings of the 1990 Academy of Marketing Science (AMS) Annual Conference (pp. 172-175). Springer International Publishing.

Lederer, M., Schott, P. and Keppler, A., 2015. Using a strategy-oriented business process modelling notation for a transparent company-wide business control system. International Journal of Decision Support Systems,1(3), pp.325-347.

Lin, C.H.V., Sanders, K., Sun, J.M.J., Shipton, H. and Mooi, E.A., 2016. From Customerâ€ÂOriented Strategy to Organizational Financial Performance: The Role of Human Resource Management and Customerâ€ÂLinking Capability.British Journal of Management, 27(1), pp.21-37.

Line, N.D. and Wang, Y., 2015. Market-Oriented Destination Marketing An Operationalization. Journal of Travel Research, p.0047287515622288.

Saad, N.M., Hassan, S.H. and Shya, L.M., 2015. Revisiting the relationship between internal marketing and external marketing: The role of customer orientation. The Journal of Developing Areas, 49(3), pp.249-262.

Santouridis, I. and Stoumbou, M., 2015. Measuring Customer Relationship Marketing Outcomes in the Greek Banking Sector. In Industrial Engineering, Management Science and Applications 2015 (pp. 881-890). Springer Berlin Heidelberg.

Shah, T.R. and Jain, A., 2015. Customer oriented service culture and its impact on customer loyalty in organised retail context. International Journal of Indian Culture and Business Management, 11(1), pp.23-42.

Verhoef, P.C. and Lemon, K.N., 2015. 4. Advances in customer value management. Handbook on Research in Relationship Marketing, p.75.

West, D., Ford, J. and Ibrahim, E., 2015. Strategic marketing: creating competitive advantage. Oxford University Press.

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