Tesco Case Study Essay Example

of relevant promotions in all of their stores that cater to both the customer and the product. They strive to differentiate themselves from competitors and tailor their promotion strategies to specific markets.

The company targets parents with young children by offering chicken shaped like rabbits, while excluding the elderly and retired population. Their goal is to work alongside their regular goods with a W.I.G.I. initiative.

Tesco uses the "When Its Gone Its Gone" strategy, which involves offering one-off promotions. This strategy features top brands like Calvin Klein, at highly competitive prices. However, there are only a limited number of these items available, so once they sell out, they are gone for good. These products are often imported from America or other parts of Europe, where they can be purchased at a lower cost. Despite objections from some companies, attempts to prevent Tesco from using this approach have been unsuccessful. Overall, Tesco's marketing revolves around their image as a store that prioritizes customer satisfaction and affordability, while still offering high-quality merchandise.

This advertisement consists of two distinct groups: 1) the promotion of a named product through national advertising, and 2) in-store promotions for specific items such as discounted televisions. These promotions are featured in both national TV ads and local newspapers.

It has been proven that two-thirds of adults are influenced by advertisements, as seen in the case of Tesco's advertising campaign in 1997. The campaign consisted of 2000 appearances in newspapers. Tesco's long-term growth strategy incorporates four key elements, with the core UK business remaining the highest priority. By prioritizing customer value and choice, Tesco continues to gain market share. Tesco has four store types, including Extra, which

is essentially a regular supermarket with added services.

2. Tesco's regular 'supermarket' is known as Superstores. 3. Tesco's stores in town and city centers are called Metro. 4. Tesco's convenience offer is known as Express.

Tesco aims to be equally successful in both food and non-food retail, currently holding a 5% market share in the latter. Their non-food selection includes electrical, home entertainment, clothing, homeshop, cookshop, and white goods in their bigger stores. To adapt to evolving customer shopping preferences, Tesco offers new products and services, such as their rapidly growing e-commerce business. As the world's largest grocery e-tailer, Tesco has developed their own system for international markets.

Tesco's brand extension can be seen in both Tesco.com and Tesco Personal Finance. Additionally, Tesco has entered into the Telecoms industry by introducing a fixed line phone service and a directory enquiry service. Tesco has also successfully expanded into new growth markets in Central Europe and Asia.

At the half year 2003/2004, 47% of total Group space was located outside of the UK. Tesco currently has a presence in Hungary, Poland, the Czech Republic, the Slovak Republic, Thailand, South Korea, Taiwan, Malaysia and the Republic of Ireland, with the acquisition of C Two-Network in Japan in 2003/2004. Tesco houses various functions internally including Finance/Accounts, Operations, Personnel/Human Resources, Marketing, and Research and Development. The accounts function within Tesco is crucial as it serves as the foundation for the company's records by keeping detailed records of all transactions within the business, which are usually stored on computer.

Tesco's accounts department consists of two parts. The first involves individual accounting for smaller stores, typically using a balance sheet approach. However, in larger

stores, accounting occurs at the department level, such as for vegetables, electrical goods, clothing, and entertainment. The second part involves compiling individual store accounts and adding them to the main accounts accessible to each store manager. This supports decision-making within each store.

Accounting plays a crucial role in determining whether Tesco is meeting its objectives or not. By examining the accounting records, managers can make forecasts and determine if the store is achieving its profit goals, increasing its market share, and maintaining a steady cash flow. Furthermore, managers can use accounting data to identify which product ranges are selling well and which ones are not. This information can then be passed on to other departments to improve sales by promoting underperforming products or enhancing popular product ranges.

At its core, Tesco's main objective is to sell its products, making Operations its fundamental production function. As a result, this function must be integrated with every other function within the company. Therefore, Operations represents one of Tesco's essential functions.

The linking function of this function includes Finance/Accounts, Research and Development, and Marketing. This function is crucial to Tesco as it ensures the excellence of their services, products, and product quality by implementing Operations. Tesco heavily relies on this function as it oversees the smooth running of the company and the continual provision of high stock levels in stores. Personnel within Tesco have several roles within the Human Resources department.

The Employee's comfort is the foundation for several roles, including Policy Making, Welfare, Support, Negotiations, Administration, Education and Development, and Recruitment. These roles are split between individual stores of Tesco and a larger geographical area with policies set by the

head office. While individual stores have their own Human Resources functions, there is also a Personnel function that oversees a group of stores. Policy Making, Negotiations, and Education and Development occur at the head office, while Welfare, Support, and Administration are specific to each store. Tesco is known for having one of the best marketing functions worldwide.

Recognizing the importance of their marketing team, Tesco acknowledges that it is thanks to their efforts that they have become the leading supermarket in the U.K. Their marketing function is seen as the primary channel for communicating news and updates to their customers.

Profitably identifying, anticipating, and satisfying customer requirements is a common practice. Tesco's recent ad campaign featuring Prunella Scales, known for her role as Cybil in Fawlty Towers, has gained widespread popularity. These ads have been likened to a mini-series, with eager anticipation for the next installment and Scales' entertaining appearances.