Introduction
In the complex business environment, marketing is the heart of the business, and its importance is increasing in the public, non-commercial, private and charitable sectors. The writer is working as the professional marketer of an organisation in the United Kingdom. The writer has to produce a report by describing, comparing and assessing the marketing activities of Starbuck and Tesco about specific products. In this report, the writer has critically evaluated different theories and principles of marketing about two different companies. Therefore, this unit aims to understand marketing views and how other organisations utilise approaches in business.
1. Role of marketing in organisations
1.1 How marketing techniques used to market products
Kotler and Armstrong (2006) stated that Marketing is the set of activities by which a person or organisations create values for people and make a relationship with those people to capture value from them. In the competitive business world, business organisations have to fight with other competitors for generating the most profit. Marketing is the best way to build a profitable relationship and capture values from consumers. In comparison to the aims and objectives of the Public and Private sector, the private sector aims to survive first and then grow. On the other hand, the public or voluntary organisation seeks to minimise costs, meeting quality standards and service provision. Therefore, the marketing objectives of the private organisation are to create brand awareness, be the market leader and understand the perception of the market. So, there is a close connection between the organisational objectives and marketing objectives.
An organisation utilises different techniques to achieve its marketing objectives. An organisation operates survival strategies to survive, Ansoff matrix, growth-share matrix to assess the SBU’s of a company regarding market growth and market share. Besides, an organisation utilises different brand-building tools and techniques to increase the image of a brand. At last, the most powerful courses in the competitive business world focus on relationship marketing to market products.
1.1.1 Comparison of marketing techniques in Starbuck and Tesco
The author has compared the marketing techniques of Starbucks and Tesco in the following:
Starbucks’s Marketing Techniques
Starbuck has created a strong brand image that facilitates its marketing activities. For example, consumers can easily recognise Starbucks coffeehouse by its unique logo. Then Starbuck has utilised the ‘Brand Extension’ theory that defines Starbuck launches new products by using its existing brand name that supported the company to expand its market.
Tesco’s Marketing Techniques
Tesco follows diverse marketing techniques to produce its market. Tesco focuses on relationship marketing that determines how to build a relationship with customers, engage customers with the brand, and turn the relationship into a profitable one.
1.1.2 Effectiveness of techniques in marketing products Starbucks
It is evident that Starbuck uses Brand-building techniques to market its outcome, which is helpful to that company. Starbuck can use its existing brand image to launch a new product that supports the company in expanding its market and generating revenue.
1.2 The limitations and constraints of marketing
According to Bevan (2010) mentioned that Different legal acts limit the marketing activities of an organisation. The writer has discussed the laws and regulations of marketing that limit firms’ marketing activities.
Data Protection Act
It is evident that the data collected from the consumers must be secured from misuse. For example, a company collected data from the consumer illegally and used it for different purposes without its concern.
Sale of Goods Act
The Sale of Goods Act defines that advertisements should describe the product accurately. For example, some antibacterial products outlined that this product can kill 99.99% of germs. They can’t tell 100% because of this law.
Consumer Protection from Unfair Trading 2008
The business organisation is obliged to act reasonably with the customers. This act defined the protection of consumer rights that illustrated how the business organisation would treat their customer. For example, a business organisation can’t promote their product to consumers by providing untruthful information.
Besides, the government has some other legal regulations such as the Consumer Credit Act, Acceptable Language Act, Consumer Protection (Distance Selling), etc., that restrict the business organisation’s marketing activities.
2. Use of marketing research and marketing planning
2.1 How Tesco uses marketing research to develop its marketing plans
Proctor (2005) mentioned that Marketing research is the organised process of a company by which the management design the process, collect valid data from consumers, assess the data and find relevant data to take any marketing decision. On the other hand, a marketing plan refers to the comprehensive document that defines the overall marketing plan of a company. Therefore, Tesco must conduct marketing research before making a marketing plan. Tesco conducts primary research to collect primary data directly from the market. For ordering information, the company collects both qualitative and quantitative data. Tesco uses different questionnaire, survey, and consumer feedback methods to contribute to its marketing plan. Market research reduces the risk of Tesco developing a marketing plan. On the other hand, sometimes Tesco has to spend money collecting data that is not valid for a marketing plan.
2.1.1 Limitations of marketing research of Tesco
Though marketing research is beneficial to the development of marketing plans, it has some limitations. Sometimes, research shows a false result that impacts marketing decision making. Besides, the study is a complex process, and the cost is too high for collecting appropriate information.
2.1.2 Recommendations for improving the validity of the marketing research
The author wants to recommend that the data should be collected relatively from the customers. Besides, quantitative data should be used more than qualitative data to generate a more beneficial result. Therefore, the appropriate approach to marketing research contributes to the development of Tesco’s marketing plans (McCarthy, 1978).
2.2 Marketing research for marketing planning
In this section, the author will discuss the marketing research used by Tesco to design its marketing plan. Tesco develops its marketing plan using three different tools.
Tesco utilises SWOT analysis tools to assess its internal strength and weakness to face external threats and seek future opportunities. For example, the power of Tesco is that Tesco has a good image in the market that creates the opportunity to expand its market. On the other hand, Tesco’s weakness is that it has to face competition that threatens to lose the market to its competitors (Raffo, 2004).
On the other hand, Tesco utilises PESTLE analysis theory to evaluate the impact of a different macro-environmental factor on the performance of Tesco. In this case, Tesco has to assess the Political and legal rules of government, the economic condition of the market, Social, technological and environmental factors.
After evaluating the above factors, Tesco Design a SMART goal for its marketing plan that determines the program must be specific, measurable, achievable, realistic, and timely.
3. Understand how and why customer groups are targeted
3.1 How and why groups of customers are targeted for selected products
Dibb (2006) mentioned that Market segmentation refers to the process by which Tesco divides its customers based on similar needs. Therefore, Tesco evaluates market attractiveness, then launches new products and designs marketing activities for the market. Without targeting the excellent market and selecting the customer group, the company will not reach its target customers. For example, if a company sells ladies’ dresses in front of boys’ schools, they will remain unsold. Therefore, to generate sales and profit, increase market share, and brand reputation, Tesco has to target a particular customer group and then design a customer-driven marketing strategy (Cave, 2002).
4. Be able to develop a coherent marketing mix
4.1 Coherent marketing mix for a new product
Kotler (1980) mentioned that Marketing mix consists of the four Ps of marketing: product, price, place, and promotion. For completing this section, the writer has selected a new food item from Tesco.
Product: Anything Tesco offers to the customers for sale it’s called the product. Recently Tesco offered a new food item for sale that has never launched before is the latest Tesco product.
Price: Price is the portion of money a company charges for its product. The customer pays the money in exchange for buying the product.
Place: Tesco has made this product available on the top shelves in all the departmental stores.
Promotion: Promotional activity is essential to market a new product because, without advertising, it is not possible to inform, persuade and create desires for the product. Promotional activity includes advertisement, personal selling, sales promotion and public relation.
4.2 Coherent marketing mix targeted to a defined group of potential customers
Product: According to Tesco Real Food (2016), the name of Tesco’s product is Mega bites which are relatively new in the market.
Price: The price of the product is selected at two pounds for every fourteen bites. It is found that the company used a market penetration strategy to set the price of this product.
Promotion: It is evident that Tesco has to create awareness of its target market by providing information then turn the attention into interest by persuading them. Finally, Tesco sells the product to customers and makes it their desired effect. Tesco utilised different promotional tools such as TV, sales promotions and its website to promote this product.
Place: As this is a new product, Tesco has made this product available to all its departmental stores. Besides, this product is distributed through both online and physical presence.
The author has understood that Tesco focuses more on promotional activity than other Ps of marketing from the above discussion. Therefore, every p is the pillar of marketing that makes a foundation for a new product.
Conclusion
Bevan (2010) mentioned that Marketing is the heart of any business activity of an organisation in a complex business environment. This unit has illustrated some of the tools and techniques marketing organisations use to achieve their objectives. In this unit, the author has explained how different organisations utilise marketing principles to meet their consumers’ requirements and accomplish their goals. The author has also understood how marketing data is turned into valuable resources to generate marketing plans. Then, the writer segments and targets a market to design a proper marketing mix for an organisation. The writer suggested the marketing department of Tesco focus accurately on the customer group and design adequate marketing plans to generate profit and increase market share.
References
Bevan, J. (2010). BTEC level 3 business. London: Edexcel.
Cave, S. (2002). Consumer behaviour in a week. London: Hodder & Stoughton.
Dibb, S. (2006). Marketing. Boston: Houghton Mifflin.
Hall, D., Jones, R. and Raffo, C. (2004). Business studies. Ormskirk: Causeway.
Kotler, P. (1980). Marketing management. Englewood Cliffs, N.J.: Prentice-Hall.
Kotler, P. and Armstrong, G. (2006). Principles of marketing. Upper Saddle River, N.J.: Pearson Prentice Hall.
McCarthy, E. (1978). Basic marketing. Homewood, Ill.: R.D. Irwin.
Proctor, T. (2005). Essentials of marketing research. Harlow, England: Financial Times/Prentice Hall.
Tesco Real Food. (2016). New Products | Latest Food Products | Tesco Real Food. [online] Available at: https://realfood.tesco.com/our-food/new-in-store.html [Accessed 11 Apr. 2016].
