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  • Subject area(s): Marketing
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  • Published on: 14th September 2019
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The Introduction Of Tesco Plc Marketing

Tesco plc is one of British largest retail grocery currently the first in terms of the top 10 retail

grocery in the United Kingdom. It was the first UK business to make £2 billion in profits when it

announced the feat early in 2005, (Tesco Annual Review, 2005) and the third largest global retailer

based on revenue. Over the years, retail grocery sector represents the largest industry in UK

providing employment for millions of people in UK either in manufacturing or in retailing. In

2003 retail accounted for 9% of domestic product (Datamonitor, 2003).

The name TESCO was derived from the combination of a tea supplier's name T.E.Stockwell and

Jack Cohen the founder of Tesco plc. Tesco was founded by Jack Cohen when he began to sell

surplus groceries from a stall in the East End of London in 1919 and in 1924 Jack Cohen made a

new label by combining the first three letters of the supplier's name (TES), and the first two letters

of his surname (CO) to form TESCO. Tesco is one of the largest food retailers in the world,

operating around 2,318 stores and employing over 326,000 people.

In UK, Tesco plc operates under four banners namely Tesco Extra, Superstore, Metro and Express.

The first Tesco store was opened in 1929 in Burnt Oak, Edgware, and Middlesex and in 1947;

Tesco was floated on London Stock Exchange as Tesco Stores Holdings Limited. Fifty percent of

sales in Tesco are gotten from Tesco's own-label products which are in three levels, values, normal

and finest. Tesco plc is also becoming one Britain's largest independent petrol retailer because as

well as convenience produce, many stores have gas stations and other retailing services rendered

by Tesco also include Tesco personal finance. Tesco plc does not only specialise in food and

drinks, the company also specialise in some other areas like clothing. Electronics, telecoms,

retailing and renting of DVD's CDs, music downloads, car insurance and lots more.

Products with range of Prices: Tesco has several kinds of product in the market. These products

range from food, non-food products, home appliances, medicines and so with different prices on

all the products. In Tesco you can get whatever product you want at an affordable price. The prices

vary anyway, the higher the quality, the higher the price and vice versa and this depend on the

Growing supermarket space: Tesco in the grocery business has long witnessed a significant

growth in size since its establishment in 1924 and this is as a result of the growing population of

consumers patronising the company and their increasing demand of several products.

Strong brand image: Tesco is a household name in UK known for their market dominance in good

quality and trustworthy product. It is because of Tesco strong brand image that most customers see

great value in their services and this has earned the company lots of profits.

Tesco Online: Online marketing has also influenced the development of many TESCO products

and this benefits both the company and its customers. This personalised service makes shopping

more convenient for the customers and currently being used by over one million customers in UK.

The use Tesco Online in marketing is one of TESCO's expansion strategies. It has enabled

customers to pay their bills electronically thereby reducing long queues thus bringing simplicity

Prices: Their price of goods poses lots of problem for Tesco plc. Trying to satisfy their customers'

needs by cutting cost of their products even their services can lead to a reduced profit margin for

their business. High reliance on UK market: Tesco's reliance on UK market is also one major

weakness because if at any time the economy faces any challenges, this will definitely affects the

business of Tesco, so it very much advisable for Tesco to look beyond UK and increase its foreign

outlets and selling other commercial items.

Internet: Tesco's online successes is one great opportunity. Since the introduction of Tesco online,

the use of technology in shopping has grown in quite a short space and moved into profitable

status. Their website is so fully packaged totally different from all other grocery site and since

there are no matches in terms of comparisons, it remains an advantage on the side of Tesco.

Intervention in Asian market: Tesco's intervention in the Asian market has serious positive

implications in their growth internationally and this in no doubt will give Tesco an opportunity to

develop its brand more so make Growth of non-food sales: Tesco known for their cut-cost

structure can initiate same strategy to non-food retail and it is evident that Tesco capitalising on

these opportunities are opening new store basically for the sales of non-food items which has

given Tesco a tremendous result in increased market share in UK

Economic instability: The unstable, unpredictable nature of the economy and political changes in

UK pose lots of threat to Tesco and one critical example of these changes is the credit crunch

which strokes the UK. This impacted on the consumers' a lot because going by their low income,

they had to go for products with low prices thereby paying less attention to higher priced brands

and this can force a switch in Tesco's price structure.

Competition: This has also been a persistent threat and this one major reason why Tesco will keep

up with the price cuts so as not to lose their customers to major competitors like Asda and

High price of raw material: The upsurge in cost of raw materials from both food and non-food

could trigger poor production and this can impact Tesco overall profit margin.

Tesco's vision is concentrated basically on their customers. They see themselves in many years to

come as being the only grocery business in UK due their market development strategy.


The objectives of an organization govern the potentials value of the organisation. The following

Tesco aims to minimize the cost of products and at the same time aim to earn high. Profit

maximization is one major reason why a business will stand and Tesco sees selling at low price

will attracts more customers thereby giving customers better chances of making choice in the

quality and quantity of products at a valued price.

Dedication to their employees as well as to customers, ensuring that all their wants and needs are


For Tesco to remain on top rather to maintain its position in the top 10, the following measures

need to be critically evaluated:

Tesco employees need to have sound knowledge of their products so as to make shopping not too

complex for their customers. Customer's satisfaction is one vital key to business success. Tesco

actually need to improve more in their customer service.

Tesco at all time need to assure customers quality brands and also services by investing more in


Tesco is an organization more voluminous in terms of revenue acquisition and customers than any

other grocery market in UK and for it to maintain its current standard or create a wide margin in

the market, a lot need to be done to achieve it objectives.

Firstly, Tesco need to divert the attention of customer from non-food products to food products. To

do this, they need not to concentrate their advertisement more on non-food products but also

encourage their customers to eat more sea foods, fruits as well as vegetables. They should also

emphasis more on sales promotion of their own-labelled products on advert thus re-directing the

customer's usual orientation of branded products.

The management need to put the quality of staffs into consideration not only the quality and

quantity of their products. Arranging training programs will be appropriate to evaluate their

employees quality, such programs will enable them gather vast knowledge of their products more

so keeping the goals of the organization alive in the employees.

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