Marketing Management Performance - Report Example

Marketing work Introduction According to the world recognized marketing guru Philip Kotler (2001), "marketing is the delivery satisfaction at a profit." He further stated that marketing has a twofold goal which includes attracting potential customers by the promise of delivering superior value and retaining current customers by continuing the delivery of customer satisfaction. This view about marketing has huge implications for business organizations. For one, it highlights the current emphasis placed on satisfying customers by delivering products and services that they value. This new approach also emphasizes that companies should become market focused and customer driven in order to succeed, and even merely survive in the world's more competitive market. It is irrefutable that this principle also changes the role and function of marketing managers in the business organization. Marketing management is defined as the "analysis, planning, implementation, and control of programs designed to create, build, and maintain beneficial exchanges with target buyers for the purpose of achieving organizational objectives (Kotler & Armstrong 2001, p.14)." Truly, the business arena has evolved from placing emphasis on production, product improvements, and selling approaches and started to focus on customers. Marketing management functions now covers how a company can create and extend more valuable goods and services to each customer. This paper will look at how Tesco PLC in the United Kingdom carry out marketing management functions in their operations. Company Profile Tesco PLC is the largest British retailer based on both global and local shares. Traditionally, the UK-based international retailer specializes only in the distribution of food products but it currently adds other goods and services to its product portfolio which ranges from clothing to consumer electronics to consumer financial services to internet services to internet service and consumer telecom. Last February 26, the company announced a total annual turnover of 33.974 billion and reported a pre-tax profit of 1.962 billion. It is estimated that in every 8 UK retail sales, 1 is spent on Tesco. Tesco is currently one of the world recognized retailers. As marketing is an essential aspect of a business organization, it is irrefutable that Tesco's success can be attributed on how it manages its marketing activities. This report will specifically look at the management activities and decision which named the company as the #5 largest retailer in the global arena. Marketing at a Strategic Level Strategic planning is one of the essential marketing management activities undertaken by Tesco PLC. Accordingly, Tesco PLC's commitment in effectively marketing its products is mirrored in the way it crafts its mission, vision, and goals. Tesco states its mission as "Our core purpose is to create value for customers to earn their lifetime loyalty (Our Core Purpose)." This statement is further expressed in two key values known as "No one tries harder for the customer," and "Treat people as we like to be treated (Our Core Purpose)." With these statements and values as guides in conducting their business operations, Tesco PLC undoubtedly lays a strong foundation in marketing its products and services. Recently, the company launched its new simplified marketing strategy which is a response to the increasing complexity of operations due to the rapid growth of its stores, range of products, intense competition, and new customer demographics. These factors, along with other challenges make it relatively more difficult and longer for Tesco to make important decisions. Thus, simplifying their marketing strategy into three words which contains the core value and purpose of the company is seen to be beneficial. Tesco PLC's new marketing strategy is encapsulated into three words-Every Little Helps. Every Little Helps reflects the company's recognition that it has a huge feat to accomplish and that every little [effort] helps in reaching its goals. In a marketing sense, this indicates TESCO's high regard for customers as it puts them in priority. Every Little Help also means that every little bit of information known about the customer can help them improve their service as well as every little deed they do can help retain current customers. Another marketing activity done by Tesco PLC at a strategic level is the development of marketing mix. Marketing mix is "the set of controllable tactical marketing tools-product, price, promotion, place, and price-that the firm blends to produce the response that it wants in the target market (Kotler & Armstrong 2001, p. 67)." Development of a marketing mix is one of the most critical activities carried out by marketing managers as these decisions will have the largest bearing on the marketing of products and service. In the case of Tesco, we can see that it has developed a marketing mix which blends different factors which are complementary. In other words, the different decisions in the marketing mix-product, place, promotion, and price-create a single image for the giant retailer. As discussed above, Tesco's products offer a wide array of products. For the sake of a clearer illustration, we will evaluate only the marketing mix in the firm's groceries. Tesco PLC offers a broad range of consumer products which are referred to as "inclusive offer," recognizing the company's effort to appeal to the high, medium, and low income classes. Upmarket are offered the "Finest" product line while the other hand are provided with "Value." As a result, the pricing strategy of the retailer, is also designed to take into account the market that it caters to. Products for low income segment are priced relatively lower than products for medium and high income groups. As Tesco seeks to cater to different geographical locations, stores are dispersed on major cities and even online. Products are promoted through various media to reach target market. Marketing at an Operational Level At the operational level, Tesco PLC lives by its strategic marketing plan by focusing on its customers. Tesco is known as a business organization which extends excellent customer service. The major focus of Tesco in its marketing operations is the satisfaction of customer needs and building customer loyalty. The company launched its Clubcard, a loyalty card for the customers which allows them to accumulate points through their purchases and use these points to exchange for goods and services. Clubcard is regarded as one of the competitive advantages of Tesco as it the data gained from the loyalty program are eventually used to track the preferences of the customer. Tesco's operation is also focused not only on delivering a wide range of choices for each buyer but also on the provision of unique services to make shopping experience easier and more convenient. In the 1990s, programs are launched such as "making a staff available to help customers pack bags and take them to the car, having a policy opening opening checkouts is there was more than one person in queue, linking in with Airmiles group in relation to its Clubcrard, and the provision of facilities such as baby changing units, restaurants and coffee bars (Biz/Ed 2006)." Also a part of the company's effort to deliver more value to customer is the launching of an online shopping service through Tesco's website. Aside from the basic products it is currently providing, Tesco also "opened pharmacies in some stores, developed a range of financial services including a Visa card, mortgages, insurance and a bank account (Biz/Ed 2006)." In their feat to know customer's preferences, they are gained the following information through their surveys: clear aisles; can get what they want; good prices; no queues; and great staff. Armed with this information, Tesco PLC strives to give exceptional service to its customers. Ethics in Marketing Another aspect of marketing management is the creation of company policies and guidelines to help managers deal with the issue of marketing ethics. Currently, these efforts are referred to as Cause Related Marketing (CRM) which focuses on creating brand awareness through charity. The Computers for School initiative of Tesco has become the benchmark for CRM in the UK. Through the program 84 million worth of information communication technology equipment were delivered in the entire Britain for the last 10 years. This was made possible by the shoppers who have collected vouchers which were then exchanged to equipment by their respective schools (Ramrayka 2004). Tesco has been awarded the Ethical Marketing Award in 2003 due to its Race for Life Program which supports cancer research. This promotes the retailer's effort in encouraging individuals to adopt a healthy lifestyle. This program also gives opportunity for all women in the United Kingdom to jog, walk, or run the 5 km distance while at the same time raising money for Cancer Research UK's vital life saving research. Societal Responsibility and Marketing Another marketing management activity which is presently gaining popularity is ensuring societal responsibility in business operations. This activity often refers to the company's responsibility of giving the customers accurate information, education, and protection on a specific product. Tesco promotes societal responsibility by selling "healthier" products and its store. As the company recognized its customers' quest for living a healthy lifestyle, Tesco have reviewed salt levels in over 1000 products and claimed to have reduced 50 million teaspoons (282 tonnes) from its customers' diet. The company also introduced "nutritional signposts" as a feature of their products to inform buyers of the nutritional content of the commodities they are purchasing. It is also notable that Tesco promotes healthy living by creating a product line for health conscious patrons called "Healthy Living." References Biz/Ed, 2006, Strategic Planning: Tesco-Activity, Retrieved 26 April 2006, from http://www.bized.ac.uk/educators/16-19/business/strategy/activity/strategic1.htm Ramrayka, L, 2004, Giving is a hard-headed business, Retrieved 26 April 2006, from http://www.guardian.co.uk/ethicalbusiness/story/0,,1347117,00.html#article_continue Kotler, P & Armstrong, G 2001, Principles of Marketing, Prentice Hall International, Inc., New Jersey Tesco PLC Website, www.tesco.com Read More