The Importance of Tesco Online Marketing in Improving Sales assignment

The Importance of Tesco Online Marketing in Improving Sales  assignment Words: 4079

Times to use online supermarkets monthly 23 6. The best choice of supermarket for online shopping Ђћ 24 7. The most attractive point for using online shopping 25 8. Feature or add-ions paying extra -?? 25 9. Percentage of interviewees’ satisfaction of tests. Com in different level 28 10. The satisfaction ways to handle the problems m satisfaction ways to handle the problems 30 12. Preference way for online payment List of Tables Table 1 . Supermarkets market share in the I-J -?? 2. Settee’s Client Relationship Enhancement Stages . 3. The statement of online experience in Tests 4.

The statements of tests. Com image -?? Chapter One Introduction 1. 1 Background to the Research Problem Chapter Six 1 . How the marketing process operates 7 2. Percentage – Recommendations Reference -?? 35 37 41 2911. The 3 -?? 13 26 27 In the twenty-first century, marketing is becoming even more important in the business world. A market is any set of arrangements that allows buyers and sellers to exchange goods and services. It can be anything from a street market in a small town to a large market involving internationally traded goods.

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One definition, from the Institute of Marketing, is that: ‘Marketing is the management process involved in identifying, anticipating and satisfying consumer requirements profitably. ‘ Markets re fickle in the modern, fast moving and continually splintering as customers’ wants change, technology advances and competitors find new ways of adding value and creating additional satisfactions for consumers. Marketing is a generic term used to describe the transfer of all goods and services from producers to consumers to participate in various activities.

In addition to popular related functions, such as advertising and promotion, marketing also includes product development, packaging, distribution channels, pricing, and many other features. Modern marketing concepts, this is the most successful small equines applications, which aims to discover and meet customer needs in all activities of the company. After all, entrepreneurs may come up with a great product and use the most efficient mode of production, so, but all efforts will be wasted, if he or she is not the perfect product to sell to consumers. Marketing is perceived by lots of business people to mean simply promotion and advertising.

However, the term ‘marketing actually covers everything from company culture and positioning, through market research, new business/product development, advertising and promotion, PR (public/press relations), and arguably all f the sales functions as well. It’s the process by which a company decides what it will In order to sell its products or services, a business must be able to let as many people as possible to know about the products or service and will be willing to buy from it. The process of finding as many customers as possible is called marketing.

For many years, businesses have used various Medias like television, newspaper, and magazines to promote their products or services. Today, they can use the Internet to do so and the process of using the Internet to market a product or service is called online marketing. Ell, to whom, and when and how and then does it. The internet, web and CIT have transformed many parts of international companies, but the marketing function has perhaps been most affected. E-marketing is now a significant part of every global corporation’s marketing arsenal (Chrysanthemums and Sings, 2005).

The Internet and the World Wide Web have had a transformational impact on all functions of the corporation. The marketing function has, arguably, seen the greatest change. The scale and growth of internet shopping is impressive. In 2005, the most recent year for which reliable figures are available, ales to households were over EWE ban – a fourfold increase during the previous three years. It is benefiting millions of people and thousands of businesses. Over 20 million I-J adults shopped online in 2005, with 56 per cent of internet shoppers we surveyed having spent over IEEE each during the year.

In the same year, an estimated 62,000 I-J businesses were selling online to households. An ad in an Internet directory is generally free, and you can include links directing customers to your Web site for more information. And because you can provide customers with a wealth of information, they no longer have to pick up the phone to have their questions answered. Online marketing offers faster response times, improved customer interaction, clearly measurable results, greater flexibility and is more cost-effective.

However, the rapid growth of internet shopping means it is more important than ever that online retailers know their obligations to their customers, and that shoppers can feel confident about addressing any problems. Tests Co. Ltd. Is one of the world’s largest retailer, more than 2,300 supermarkets and convenience stores, and employs 326,000 people in the business. The core equines of Tests as the Britain’s largest private sector employers and the largest food retailers with nearly 1, 900 shop. Tests is the world’s largest food retailers online and confirmed, product images and packaging information on online shopping essential.

Customers must be able to visualize products and labeling information adequate to enable them to make more informed purchasing (Website 1). In 2006 Tests, the Auk’s most successful grocery retailer (with about 30 per cent market share), again reported a record-breaking year. Over the previous four years it had almost doubled group sales (excluding VAT) and profits to Been and E. Ban respectively. Significantly, sales to the rest of Europe had grown from 9 to 13 per cent of group sales and Asian sales were 11 per cent of group sales (up from 6 per cent in 2002).

The company had also extended its product range significantly since 2002 – moving into non-food sectors and retailing services (G. D 2006). Tests sells approximately 40,000 food products in its superstores, as well as clothing and other non-food lines. The company’s own-label products are at three levels, value, normal and finest. Own brand accounts for approximately 50% of sales. As well as convenience produce, many stores have gas stations. The company has become one of Britain’s largest independent petrol retailers. Other retailing services offered in the I-J include Tests Personal Finance and Tests. Com.

Tests Personal Finance is a joint venture with the Royal Bank of Scotland. It has over 3. 4 million customers, and provides various financial products and services. Tests, well known as Britain’s leading food retail group with a presence also in Europe and Asia, has also been a pioneer online. Tests. Com is generally recognized as the world’s largest online grocer. By September 2007 online sales in the first half of the year were IEEE million, 35% year-on-year increase, and profit increased by 62% to EWE. 7 million. Tests. Com now receives over 300,000 orders each week. In 2008, the online supermarkets’ market share was update.

Below the diagram would be shown the Auk’s supermarket’s market shares. Table 1: Supermarkets market share in the UK Supermarket I Market share I -rescue | 27. 1% | USDA | 10. 1% | LAID | 9. 5% | Ginsburg | 6. 9% | Waitress | 4. 2% | (Source from: Website 2) 1. 2 Significance of the Research Problem Online marketing is very essential to the supermarkets, as well as to most businesses. Internet marketing is a business imperative because the Internet is an revocable and unstoppable trend. Even if you have a traditional “brick-and-mortar” business, you’ll lose valuable customers without an online presence.

People routinely search for goods and services with their computers in lieu of the yellow pages. If your business isn’t on the Web, customers will likely choose another company with whom to do business. With a dramatic increase in online shopping users in the world, online marketing becomes more and more important for the businesses. Online grocery shopping appears marginally more expensive than treading the supermarket aisles even if you disregard the delivery charge. With Woolworth Home shop, our basket of goodies cost $140. 48 compared with $130. 98 in-store.

And it’s almost an identical story with Coles, where the grocery selection totaled $144. 59 with Coles Online compared with an in-store cost of $138. 22. It’s not a complete surprise that online supermarket shopping costs more: there are the labor expenses of filling your order. But in other online shopping, where you buy one or a few items, say hardware or clothing, online is usually cheaper than in-store as rent is cheaper storage rather than showroom and there is possibly a more efficient use of staff. The delivery charge will vary according to where you live. I have used the maximum charges here.

The gap between online and in-store shopping widens to $25. 40 with Woollies and $26. 16 with Coles. Buying in-store will also involve fuel costs; but you may be making the trip in any case, particularly if you need to buy fresh food. Online marketing is a new model which is different to the traditional model; it has been changed by the recent years. Online marketing is another sale way for supermarket to sell their products. To compare with the traditional model, online marketing has more benefits than that. As well as, more and more people prefer to buying things at home rather than going out.

And so many busy people do not have enough time to go shopping when they work. With so many factors that affect people to use online shopping system. The strategic innovation inherent to online supermarket has extended the players’ business scope definition to include new services in addition to food/grocery. With large customer base, supermarkets can cross sell different products. Particularly, players can now explore opportunities from non-groceries, where profit margins are much higher. Such redefinition confirms the significance of core competence’ in exploiting opportunities of strategic innovation (Hammer and Parallax, 1994).

For example case study B did not narrowly understand their businesses as ‘grocery provider’ but as Value provider’ based on their perceived core competence of ‘managing customer ownership by providing value’. Such reconfiguration of business definition is not strictly novel as supermarkets have long pursued this strategy particularly those pioneering with the hypermarket concept (e. G. , Wall-Mart and Careful). However, stores’ offerings were always restricted by space and high cost of customer acquisition. Internet has now enabled limitless opportunities to sell different products and services.

Supermarkets refer to it as ‘gratification’, applying principles of grocery retailing to other products ‘services – convenience with high value for money -using the Internet as a cheap medium to acquire customers. Thrust, online marketing is so important for supermarket retailing. 1. 3 Statement of the Research Purpose The main aim of this research is to find out the essential of internet marketing to improve sales in Tests. According to online services, many analysts and industry observers, the success or failure of the business model, these companies use the feature.

Online grocery business, regardless of the specific models used is the root cause of performance of the company is a major focus of this study. To explore this question, this article uses case-based theory construction. The purpose of this paper is to examine the importance of online marketing in improving sales in Tests. Theoretical approach is based on acceptance of technology demonstration and media theory is appropriate. In all the major reaction is from the interviews to obtain a qualitative survey and analysis. 1. 4 Statement of the Research Problem There are many different methods to increase supermarkets sales.

In this research, the point is the online marketing helps supermarkets to improve their sales. The recent desire by grocery retailers to operate in the online home delivery channel may be centered in the need for growth in a mature industry characterized by traditionally low margins. Home delivery is the main attract factor for online shoppers. Improving sales is all of businesses want it. As the first online channel, many traditional BAM supermarkets started to develop and run their own online channels. However, these independent supermarkets and supermarket chains have been able to prove that online channels can be profitable.

Over the years, Internet sales have become a powerful business tool, users can use the private entrepreneurs. Many owners have benefited from the Internet to market and publicize their products in many different ways. As the Internet, a company can help the business market, with a greater range of customers and increase the operating profit. 1. 5 Aim and Objectives The main aim of this research is to explore Tests online marketing strategies to improve sales. There are three objectives in this research: 1. To critically review the literature related to online marketing 2. To explore how Tests use online marketing to achieve the goals 3.

To explore what other marketing strategy can be used to improve tests. Com sales 1. 6 Research Question: 1 . What marketing strategies are generally used by the supermarket retail sector in the I-J? 2. What are the marketing strategies used by Tests? 3. What is the rationale for Deco’s online marketing concept? 4. How has the firm’s profitability been improved as a result of its online marketing strategy? 5. How can Tests improve its online marketing strategy so as to improve its sales and build its customer base? 6. What are the major factors that Tests win the online permeates war in the I-J?

Chapter Two Literature review Changing from shopping at the supermarket to online grocery shopping can improve an online grocery retailer’s productivity by shortening supply chains, reducing overhead costs, and enabling ‘Just-in-time’ service. Moreover, the business concept of online grocery shopping can make the recruitment process more effective, credit control more efficient, employees better informed and empowered, and the enterprise more responsive to changes in the markets. Therefore, being connected electronically drives other changes that optimize business processes and performance.

Additionally, online grocery shopping is the key advantage for competitive success because it empowers a comply to reach its goals more efficiently and quickly. 2. 1 Marketing The word ‘marketing has two distinct meanings in modern management practice. It describes: 1. The range of specialist marketing functions carried out within many organizations. Such functions include market research, brand and product management, public relations and customer service. 2. An approach or concept that can be used as the guiding philosophy for all functions and activities of an organization.

Such a philosophy encompasses all aspects of a business. Business strategy is guided by an organization’s market and competitor focus and everyone in an organization should be required to have a customer focus in their Job (Houston, 1986). The modern marketing concept unites these two meanings and stresses that marketing encompasses the range of organizational functions and processes that seek to determine the needs of target markets and deliver products and services to customers and other key stakeholders such as employees and financial institutions.

Increasingly the importance of marketing is being recognized both as a vital function and as a guiding management philosophy within organizations. Marketing has to be seen as the essential focus of all activities within an organization (Valentine, 1996). The marketing concept should lie at the heart of the organization, and the actions of directors, managers and employees should be guided by its philosophy. There are some features of business marketing behavior that may have led to this definition. * Consumers are if vital importance.

A product has a far greater chance of being a success if it satisfies consumers’ needs. Marketing must be aimed at products meet them. * Marketing is a process. It does not have a start and an end, but is ongoing al the time. Businesses must be prepared to respond to changes that take place. This is shown in fugue 1. For example, a business marketing own range of office furniture would be unwise to decide on a strategy and then not take into account consumers’ reactions. If the firm sold modern designs, but sales were poor, it might consider designs for offices that wanted a traditional look.

Monitor consumer Reaction/sales Performance Monitor consumer If necessary Adapt Marketing strategy Re-assess Consumer reaction/ Sales level Devise/analyses Marketing Strategy (Figure 1) How the marketing process operates Source from: Rob Jones, (2004) Business studies) * Marketing involves building relationships with customers. Profitable businesses are often built upon good customer relations. This might involve dealing with customer complaints in a careful and considered manner, for example. Customers, as a result, are likely to develop a favorable view of the business. Marketing affects all aspects of a business. A production department would not continue making a product that does not satisfy the needs of the consumers at whom it is aimed. In the same way, pricing decisions cannot be made without knowing how much consumers re prepared to pay. * Marketing is not Just about selling. Selling is only one part of the marketing process. Before selling their products, many businesses carry out a range of activities which take into account consumer preferences. These include market research, the testing of products on consumers and the design of products. Many businesses regard profit making as their main objective. Firms in competitive markets must make a profit in the long run to survive. Marketing must therefore satisfy consumers’ wants profitably. Even when profit is not the main objective, marketing has a vital role to play. Charities, such as Sofas and many public sector organizations such as colleges and hospitals adapt and change the marketing of their services to satisfy their consumers’ needs. It is only in the last sixty years in the UK that marketing has begun to assume such an important role in business.

And the factors affect the marketing of business. Economic growth, businesses are now aware if the growth in demand and the wide variety of taste of consumers. Successful marketing is essential if businesses are going to gain their share of a growing market and increase their turnover and profit. Larger markets can pose a problem. The investment needed to launch a product onto a large market is enormous. Marketing must make sure that such products will succeed or the business can face large losses. Fashion, Tastes and fashions in today’s markets are changing faster than ever before.

Marketing must anticipate and respond to these changes. Toy manufacturers, for example, try to be aware of the next ‘craze’. Marketing has become more important as firms have realized that consumers’ tastes may be influenced. There is a variety of techniques that can be used to achieve this. Technology, Businesses must respond to changes in technology. A firm’s products can become obsolete very quickly unless it is able to respond to such changes. Marketing and production departments now work closely together to anticipate new opportunities that arise.

Marketing must also provide consumers with technical details about products. It is unlikely that consumers will know all the uses of new products which have previously been unavailable. Technology has influenced the marketing methods that businesses use. Examples of technical marketing media now used by firms include advertisements on websites, electronic billboards and satellite TV. Competition, both at home and from abroad, has meant that successful marketing is vital to maintain a rim’s market share. UK businesses have also had to respond to the sophisticated marketing techniques of foreign companies.

This has meant that the expenditure on marketing by many UK firms has risen as a share of total spending in the last few decades. The British motorcycle industry serves as a warning to those firms which fail to respond. British companies such as Triumph and BAS had dominated the market for motor cycle in the I-J ever since the sass. When the Japanese company Honda launched its ICC moped in the I-J, British companies did not see this as a threat. Their lack of response allowed Honda and other firms, such as Yamaha and Awakes, to almost completely take over the market for motorcycles in the I-J.

By the sass, the British motorcycle industry had effectively collapsed. Tests currently leads the Auk’s other leading grocery retailers in terms of market share. This pattern is repeated online. The Nielsen/Nitrating audience panel for September 2007 for the top I-J supermarkets shows the lead of Tests, offline market share is in brackets from TONS which monitors the household grocery purchasing habits of 25,000 demographically representative households in the U. K. * Tests. Com (5. 2. Million unique users, September 2007, 30. 9%) * USDA (1. 4 unique users, 16. 9%) * statutory (840,000, 16. %) * waitress (332,000) * Morrison (225,000). 2. 2 E-marketing concepts E-marketing describes company efforts to inform buyers, communicate, promote, and sell its products and services over the Internet. Together with e-purchase (purchase of goods, service and information from online suppliers) this makes up e-commerce, where companies transact or facilitate the selling of products and services online (Kettle and Keller, 2006). The proportion of online shopping users in the British permeates sector is growing dramatically for the last 10 years in changing their buying habits.

British supermarkets have development towards to the online service system. The primary advantages of e-marketing is lowering cost and enhancing reach to customers. The cost of e-marketing is typically lower that of other marketing methods such as face-to-face salespeople or distributors. Furthermore, e-marketing allows firms to reach customers that may not be accessible due to temporal or location limitations of existing distributional channels (Seth and Sahara, 2005). E- racketing will also change customer behavior. These include co-creation, universal availability, and flexible time.

With the increase in usage of e-marketing, the customer will take more active role in the fulfillment process, leading to “co-creation”. Co- creation involves both customers and marketers interacting in design, production and consumption of the product or services. E-marketing tends to reduce customers’ location dependence (e. G. Amazon), and allows customers to engage more readily in direct order taking and technical support. Finally, e-commerce and e-marketing will aka it possible for customers to be time flexible, that is they can interact with the firms independent of time and place (Seth and Sahara, 2005).

Not only is e- marketing changing market practice and behavior, but also affecting competitive advantage. Redbrick et al. (2007) conclude from their survey of US firms that e- marketing has increased in recent years, and that adoption of e-marketing is positively associated with performance. The launch of Tests Direct in the autumn of 2006 was a key event in the development of multinational retailing – the Auk’s largest permeates chain moving decisively into the non-food sector with an online offering.

The success of the operation won Tests the 2007 European Supply Chain Excellence Award for Retail & Distribution. Online marketing offers faster response times, improved customer interaction, clearly measurable results, greater flexibility and is generally more cost-effective. For instance, we routinely carry out several e-mail campaigns on a yearly basis to our various communities, e. G. Promoting the new Impact Factors in a particular subject area Just after the release by Thomson Reuters, r promoting fast publication times of individual Journals.

Transactions using E- commerce were estimated to be more than one hundred billion dollars in the year 2006 in the United States of America. This represents approximately ten percent of the total domestic market. Thus, this is an indicator of rising trends in online shopping. Almost 33% of the online shoppers, shop by using the search engines to study the details of what they are shopping for. A characteristic feature of the online shopping trends is that people go more by the word of mouth when it comes to selecting a website or a company for online shopping.

If we research on what is the most sought after thing in the online purchases, then the answer is books of different kinds. In addition to the books, day to day accessories and clothes, perfumes, shoes are bought in large numbers. Buying air tickets online has become a very common thing. People tend to visit a website which offers good products and has transparency in dealings again and again. There is another survey conducted by The Nielsen Company, which suggests that around 85% has already used to make a purchase online which shows an improvement in the online shopping trends.

Another claim is that around 50% of the people using Internet around the world, are active online shoppers. A survey conducted about two years ago, about number of online shoppers, suggested the number to be around 627 million which has risen to about 875 million as of now. People from countries like Korea, Germany, United Kingdom, Japan and United States of America, are very fond of online shopping. Many manufacturing companies are aggressively marketing their products considering the change in the online shopping trends using E-commerce web hosting to attract more and more customers.