Marketing Strategy - Orange - Essay Example

However, through the course of time, the success of online retailers proved to be a factor of its resources and how it employs these to achieve its specific goals and objectives. From its humble beginnings, Tesco Plc has gained the reputation of being the largest British retailer in terms of global and local shares. It is estimated that in every £8 UK retail sales, £1 is spent on Tesco (Tesco Plc 2007). Recognizing the growth opportunities in the virtual marketplace, the giant retailer has decided to establish online presence during 1994.

Three years after, Tesco has started an online shopping which it named Tesco Direct (Tesco Plc 2007). Since then, Tesco has started offering grocery and food items in its virtual store, Tesco.com. On August 2006, the company announced the offering of non-food items in its online store under the name Tesco Direct. This marketing strategy has proved to be very efficient and profitable for the retailing giant. During the fiscal year 2006, the company announced a total annual turnover of £33.974 billion and reported a pre-tax profit of £1.

962 billion. Out of this, £1.2 billion is shared by Tesco.com in terms of total revenue and £83 million in terms of profit. Even though the share of Tesco.com is meagre compared to total turnover and profit generated by Tesco Plc, its growth has been remarkable. The fiscal year 2006 reports online sales double-digit growth of 29.2% while profits soar by 49.5% (Tesco Plc Annual Report 2006). Compared to its rivals in the UK retail industry, Tesco.com captures a higher market share at 65%. Walmart-owned Asda chain lags behind with 16% while Sainsbury corners 14% (Best 2006).

Its success has also been documented as it has been named the only retailer which has been able to make online shopping profitable (Walker 2006). The recent trends and developments in the global market stress the huge emerging opportunities in online retailing. In the UK alone, there has been a sharp rise in the number of