Proposed Marketing for Sainsbury Company - Business Plan Example

PROPOSED MARKETING PLAN For SAINSBURY COMPANY PROPOSED MARKETING PLAN FOR SAINSBURY COMPANY Shirley Bongbong Academia-Research Mission: Promotion of sustainable forest practices of environmental awareness' and responsibility. Provide a wide range of quality, healthy, fresh, safe and tasty foods in the counters. Corporate Objectives: Sainsbury's goal "to deliver an ever improving shopping experience to our customers with great products and fair prices in order to exceed customers' expectations for healthy, fresh, safe and tasty food"1 have proven to be a great motivating factor in the most literal sense of the word and its description. Their pledged corporate responsibility to raise standards and awareness for the best food for the best health has been making such a great story with regards to product quality monitoring and control and has acquired such achievements with both consumers and government alike. Company's Profile: They have won the Liveable City Award of London in 2006 and was the first supermarket to ever sign a partnership contract with local beef farmers pertaining organic beef supply. The company's unending efforts to source out viable products and suppliers made them extend their internal training and orientation of this array of shelf food products on noted chemically established effects of pesticides to their raw materials resources and producers and on to the first level farmers. Stressing that all of their farm products comply with the UK or its equivalent animal welfare standards, I proudly commend Sainsbury's effort to provide the freshest product with the most accurate product info labels to the least product pricing offer as possible. Sainsbury has been performing strongly with total sales up to 8.3% to 9,549 million and sales growth of 6.2%, pre tax profit of 123.0%, delivery of 1.3 billion of additional sales after 18 months.2 The company is said to have employed a total number of 153,000 employees and have established 728 supermarkets UK based and a duly represented website for online shoppers worldwide. Sainsbury is said to be UK's third largest food retailer.3 Established in 1869 by John James and May Ann Sainsbury, Sainsbury's internet based home delivery shopping service currently operates from ninety seven (97) stores. Marketing Audit of Products, Goods and Services: In addition to its high quality food and fresh grocery products, Sainsbury has been retailing books, CDs, DVDs, MP3s, videos and computer games. Also on display are flowers, wine, gifts, and electrical parts or accessories. On board with the online shopping directory is a provision for the banking and insurance needs of the customers or consumers with affiliate Sainsbury's Bank. The bank offers wide array of services on credit cards and personal loans of lower interest rates, simple savings and investments (child trust funds to internet savings), car financing all present via online banking. This study aims to make a Proposal on the Marketing Plan of Sainsbury's Supermarket Stores only. SWOT Analysis: A. History of Mergers and Acquisitions Sainsbury PLC is the parent company of Sainsbury's Supermarkets nationally known as plain Sainsbury at present. Its chains of supermarkets were acquired thru constant effort of branch-outs and thru merger and acquisitions. Bell Stores of North East England was acquired in February 2004. It was composed of fifty four (54) high quality convenience stores. Jackson's Stores across Yorkshire and North Midland was acquired in August 2004. It was composed of one hundred fourteen (114) stores and was UK's leading independent, regional convenience store. JB Beaumont of East Midlands was acquired in November 2004. It was composed of six (6) convenience stores and has been regarded as a long established neighborhood convenience store operator. We can give due credit to Sainsburys financial cost saving analyst on his fatigue causing search for branch outs and extensions by buying other known retail stores apart from managing its liabilities on hand. Inventories and liabilities of the buy outs are two important areas of consideration. B. Sainsbury's resources on supplies Sainsbury's has two international sourcing offices apart from its local resources. One is in Krakow, Poland and the other was located in Hongkong. Both offices were created to look for suppliers and increase supplier's database for the potential supply of its own label products. It serves to outsource and make available possible training for its recruits. From this aspect we can conclude that Sainsbury has an edge in controlling the quality and prices of its suppliers since there is a long list of them safely stored in the database. C. Sainsbury Quality Control Factors Sainsbury has build up a program for controlling the quality of the freshness and pesticide contents of their display items. As such they have made such a big improvement defining which product and which farmer is supplying and prove non-compliant to their corporate goals. Assumptions: Imaging and Defining Sainsbury's Supermarket Target Market of this Proposal A look at Sainsbury's share of the market pie reflects that the corporation is the third largest supermarket store in UK after the leader Tesco and second in the industry Asda. Sainsbury's image and corporate goals is very environmental and health wise, the mark choice of the century for go, grow, glow foods for elementary students science subjects. The company is very particular with the quality of their products, defining the labeling with regards to cholesterol or fat content, packaging and lastly the pesticide awareness upgraded to organic farming methodology. It has been a common aim to get to this present market of health conscious consumers irrespective of age. They have been working overtime on orientation of consumers' product knowledge and how to cook or use their available products on display health wise by giving over-the-counter cards information. This proposal aims to get a big share of the market pie and thereafter slice a little share as a start with the giant competitor Tesco. We aim to focus on the domestic side of this world, specifically housewives who are the ones ordering and handling the budgeting and grocery functions. And secondly on the caterers, they themselves represent a double or more on nth multiplier from a base single domestic consumption. Marketing Objectives and Strategies: A. Definition of the need of the Target Market: Housewives look over the health, supply and finances of the family. They would want to give their children the basic foods in a very affordable budget to be able to maintain the strength and energy of the kids without cropping out allocation for medicines and hospitalizations. On the other hand caterers serve more by looking into the kind of menus they advertise with much relevance to the health regime of the community he serves. Types of caterers vary from the on-call packed lunch, viands, or salads to the big caterers of wedding occasions and birthday celebrations. Here we focus our marketing plan to these on-call caterers because they are ones that generates income daily. They supply in schools, households, and offices alike. They are the constant budget makers aside from the housewives who constitute a big part of our customers. This group of on-call caterers might be small in numbers but they consume the best part of our shelf display on the supermarkets. The theme is getting stronger bodies in lesser budgets. We have to admit that the quality of the foods we purchase comes after the kind of budget constraints we are in. The achievement are the stronger bodies, health foods are just the means to get the end result, right. B. Competitor's Assessment: A quick look on the leader Tesco: Tesco being the number one leader garners its strength from its people and its services, in the literal sense of the word. What is Tesco's corporate goals With Tesco motto "Every little Helps"(Tesco Corporate Responsibility Review 2006, www.tescocorporate.com), we get the implication right from the source that they are counting and is noting a lot of customer feedbacks, surveys, and observations about their products, services, and staff. Their corporate values no-one tries harder for a customer and second treat people how we like to be treated, made great impact on how well management has run the success and growth of the store. "If Tesco was big three years ago (240,000 staff worldwide and the UK's largest private sector employer), now its statistics are mind-boggling. It employs 367,000 staff worldwide (250,000 of them in the UK), has 2,365 stores (1,770 in the UK), sales of more than 37 ($85.3) billion, and last year reported pre-tax profits of just over 2 ($4.6) billion. It also has an estimated 30 per cent of the UK grocery market. Tesco now ranges far beyond food, offering services including banking, flower delivery, online diets, legal advice, DVD rental and telecoms. There have even been suggestions that it might branch out into estate agency. It operates in 13 countries and is currently the market leader in six."(Supermarket Sweep: Tesco, HR report, Dec. 9, 2006, http://www.humanresourcesmagazine.com.au). C. Comparative study and analysis between Sainsbury and Tesco: Sainsbury was the market leader in retail stores and supermarkets in the UK supermarket industry before it lost its crown to Tesco in 1995 and was outraced by Asda in 2003. Let's take each aspect that made a lot of difference between the two giant corporations, Tesco and Sainsbury. 1. Corporate Goals Sainsbury is directed to producing, sourcing, and displaying health foods and ways on how their customers will buy or consume products on display. It is an all-standard, all money generating programs that aims to sell most of the items at the most safe and environmental friendly manner their resources can give. A very outstanding feature of the corporate goals of Tesco is their treatment and the high morale of its employees. It's the trust and respect they accord to each other, and accepting the importance of their employees towards the growth of the company. "Give support to each other and praise more than criticize. Ask more than tell and share knowledge so that it can be used. It takes strong leadership to listen, learn and accept that expectations. Fulfilling people's aspirations can mean moving a business in new directions. It means being creative, taking risks, doing some things that are not expected."(Terry Leahy, Tesco Corporate Rsponsibility Review 2006, www.tescocorporate.com). Analysis: With the emerging problems on human resources, Tesco was absolutely correct in gearing the needs of his employees as main factor for good service motivation. Human factors psychologically would work for remuneration but in their inner self they would want to get recognized for the little things that they do and of the kind of interaction and camaraderie they have in their areas of work. Supporting each other while on the job is a good employee attitude which we can only get when CEO's practice and respect them themselves. Sainsbury must redirect goals a little and put on human efforts a little recognition too. It is not a matter of policy, but is a matter of being included and accorded to in the vision of the corporate. 2. Distributions and branch outs of Stores Tesco is now having branches worldwide. Sainsbury must try to compete by exploiting the possibility of having worldwide outlets of their famed supermarkets. 3. Supply situation and nature of competition Tesco have a lot of suppliers listed but there have been feedbacks that it has been making predatory prices to their own purchases. They are said to maintain their profit margin but has been damaging the interest of local suppliers and of the community. Tesco has been doing occasional meetings and trainings with suppliers to cover product, packaging, new product development, Nature's choice, Ethical Trading and Product Safety. They also have the reputation to pay them on time. While both parties have been on the go for procuring environmental and health conscious suppliers, Sainsbury has the ability to source with integrity. Pesticides are getting monitored and controlled to its maximum limits only. Even if the product is still within the limits of the council, Sainsbury will terminate display of the products if it does not adhere to their beliefs for giving organic, affordable fresh foods. Sainsbury have been extending training to their suppliers regarding the subject and made quite positive reactions and produced. Sainsbury has also introduced the Trading Finance Platform which will enable them to view online the status of their expected cash flow. They have what we call as a sustainable and well maintained suppliers database in person and in programs. Analysis: With the exceptional thrust of the two giants towards maintaining and selecting good and responsible resources, we take into consideration the type of payment programs and timetable projected for release of corresponding payments. While maintaining the newly launched Trading Finance Platform of Sainsbury, we can integrate a part of Tesco hidden motivations for suppliers, which is to pay on time. Suppliers need to pay their employees too and most of all they have to get a hold of their working capital as soon as the invoices were generated. Focus must also be given to the kind of training and orientation they have been giving to these suppliers. Although high risk and might prove uncomfortable to management, Tesco has been generating brainstorming sessions during meeting and conferences made with their suppliers because of the inclusion of the packaging and product designs. Group feedbacks and comments on certain issues must be well noted and documented. 4. Product costing and waste recycling Sainsbury have launched organic compost able packaging beneficial to both consumers and community alike. The program can also reduce cost made on purchases of packaging materials. Tesco have been geared into recycling waste also but extending it to their customers by finding ways and means to make recycling their packaging easier for them also. Since Tesco have been purchasing their products in less cost, they can very well be ahead with the other competitors in terms of product pricing category. Their products cost less than the other known supermarkets. Analysis: Lowering the cost of the product does not only adhere to sourcing under quality materials or lowering purchase cost. The packaging and designs of the product has a lot to do with cost factors. Recycling waste for packaging is one big effort for environmental and cost conscious capitalist. 5. Advertising and online website for shoppers Sainsbury website as I have visited need to change their text and their anime stuff. Prices shall be displayed on line too for other online shopper across the globe. Tesco has a website that fits a corporate taste. They should open their website to other online shoppers too. What's the risk They are not going to deliver orders without the online payment invoicing. Analysis: Website and advertisements matters much. It is how your project your image that will do basic customer multiplication. A satisfied shopper and a satisfied employee can always do the word-by-mouth advertising which is the number one form of advertisements for all seasons for companies of all forms. Estimate Expected Results: Budget and Projected Sales of the Proposed Marketing Plan: The proposed marketing plan can very well rise to about 30% in the first year if we take into consideration the population of housewives that are not shopping at Sainsbury. With the number of hospitals and canteens and on-call caterers we can very well project a rise of 50% in the second year. In the pie we can very well sliced a part of Tesco's pie and increase our market share. Identify Alternative Plans and Mixes: Conception of the Proposed Marketing Plan for Sainsbury Supermarket 1. Incentives by referrals Sainsbury shall build a kind of networking look alike program wherein customer members beget members and garner bonuses in form of cash incentives or in kind additional grocery items by choice subject to the amount afforded by the level of active referrals he had sign up. Signing up is not the main point of referrals. The referred customer must be active in doing their purchases and groceries at any Sainsbury stores and credited to their account thru the computerized ID system inputted before invoicing sales. 2. Event creation Sainsbury must have the perfect marketing personnel to go around schools and offices to introduce Sainsbury products as gift or prizes for all occasions. They must have listed a number of grocery items per package with specific amount or cost noted at the side of the flyers or brochures. The packaging of the prizes must be done in a manner delightful to the eyes and plenty of items inside also. 3. Contacting on-call caterers Being our main target market apart from the housewives mentioned earlier, Sainsbury must be able to make a listing of these caterers and be able to communicate or visit them often. The idea is like a medical sales representative who always visits the doctors and clinics in order to make courtesy calls and introduce products. The point is building life long business relationship with these types of customers. We are not to wait that they come to our doors. We are to got outside and make business with them otherwise Tesco might get them first. 4. Free delivery options The on-call caterers as we call them might be located in places where we can pass them on way to a paid delivery or on the way to some errands, Sainsbury can very well take orders online and make free deliveries. Transportation and delivery fees are already charged with the paying customers along the way. Stretching our services a little to these Small Medium Enterprises can do us more good than harm. It will be wise to get paying customers in every street and corners of your locality so you can make free deliveries to any on-call caterers you can imagine serving in future. 5. Flyers and signboards Instead of spending for the printing cost of well designed and colored flyers to promote some products on sale, we can instead have signboards where we can make designs at the borders and print the sale products. These boards will be placed in entrances and corners and middle of the supermarket or any place that will prove easier for the customer to look and read. What is important is the content and availability of the signboards. 6. Housewives and service Do a little stretching with the service thing. Ask customers for their email addresses. Motivate them to refer Sainsbury to their friends especially those who are doing their groceries at other supermarkets. Ask permission from these housewives to send multicolored emails about the products on sale at Sainsbury supermarket. Give them every reason to reply your email and give feedbacks. These first hand sources are very important when you are on the go for competing with the leader in the industry. 7. Lower your product cost by involving suppliers Involving suppliers with how they make their produce or helping them with their methods in production and growing vegetables and animals could well lead to a low labor and production cost. This then will result to lower product cost which I firmly believe Sainsbury will benefit much. 8. Creating the need for the product The try something new today program of Sainsbury is a good way of creating the need for a particular product. Event Management people must create a list of reasons for a person to buy a particular product in a certain season or occasion. Make the thought appealing and tasty too. 9. Going to hospitals and canteens Marketing people must visit hospitals and canteens. They serve to cater a lot of people who must be health conscious due to specific dietary requirement of their illnesses. Bring product with labels appropriate to these industry. Since Sainsbury has been promoting health foods upon its conception then it is easier to recommend their much favored organic fresh foods. Budget: Sainsbury will allocate a budget of nothing for the first year implementation program of the best free ride deliveries of items to on-call caterers. Everything is being taken cared of by paying customers requesting deliveries. Remember that on the proposal the deliveries will have their schedules so as to make the motor pool people arrange the free rides respectively on the said routes. First Year Detailed Implementation Program and Evaluation of the Proposed Marketing Plan: The proposed marketing plan is a measure of how well Sainsbury can reach out to their customer in terms of services and event creation. If Sainsbury has been spending a lot of time recruiting attitude knowing that skills can be given to the person doing the job then this is the right moment to test their salesmanship and customer service. The number one factor that could garner more customers is the free delivery system by monitoring delivery routes. I suggest that deliveries for certain locations must be scheduled weekly or as the need arises to get it done many times in a week so as to be able to schedule hitching the free deliveries also. Any caterer will be overwhelmed by the offer since they are already very busy making up their own food handiworks. Going to the grocery is very time consuming and can cause delays in their services also. The launching of the free deliveries will take a major boom in this industry. Among the proposals the free delivery system will prove competitive and is the best tool to outrun the leader Tesco. The idea of visiting customers often will make them feel valued and will thereby urge them to patronize your product. The thought that you are already monitoring the freshness and the product handling when delivered will prove that you are very concern with how fresh and packed your products are when they reach the customers. This will entail them to give feedback and you to make necessary measures to improve services. Always take care of the needs and comments of your customers for this might cause us millions when left uncared. Tesco was never into the visit customers plan and the free delivery programs. Sainsbury will surely get a hit with the idea if they are fast in implementing it first. Event management for sure is a big go for all supermarket capitalist. Sainsbury must be original in its idea of event creation. One form of event management is bringing awareness to the people who are ill with arthritis or diabetes to the healthy foods we have on display. Or to those people who are sick with cancer. There have been studies and quite a fact to the Asian countries especially in China that herbs and fresh organic foods prolong the life of this ill people. One of which is the owner of JB orchids, Philippines4, who was very ill with cancer but have been monitoring his diet and closely studying basic food groups in order to prolong life. The Chinese guy is still alive as of to date. Impart to the listeners that food intake has a lot to do with prolonging life. To do this we must monitor what our body need or create the needs of our body to be healthy by addressing some welcome stories of our organic products on display. For every product Sainsbury plans to promote, every possibility must be accounted for and given careful consideration. Research is the main key to knowing stories certain or predominating customers will buy. It is simply conception, planning, research and action. References: TNS report on Sainsbury Wednesday, Nov. 15, 2006 Supermarket Sweep: Sainbury, HR report, Dec. 9, 2006 Supermarket Sweep: Tesco, HR report, Dec.9, 2006 Tesco Corporate Responsibility Review 2006 Terry Leahy, Tesco Corporate Rsponsibility Review 2006 Shan Dak, owner of JB Orchids Pharmaceuticals Actual interview and observations done. Read More