International Marketing Strategy for Tesco

Inter interior(a) Marketing Strategy for TescoExecutive SummaryThis report outlines demesne(prenominal) commercializeing schema for Tesco for its grocery store entry into Sweden with a hunt down of kid wear. The SWOT and PESTAL analysis show that Tesco currently has the vision capabilities to successfully enter the market and implement a market tuition strategy. The report recommends that Tesco target the high-end market segment with a differentiation strategy.This report leave behind assist in understanding and the formulation of an international marketing strategy for Tesco Plc. The report ordain social function PESTLE and SWOT analysis to provide an cortical potential into Tescos current market situation. This testament help management in making the correct strategic choices in ground of corporate and international strategy in terms of lunching a range of sis wear (infant toddler clothes) into Eastern Europe (Namely, Sweden). The report will outline how Tesco wil l acquire such market diversity and also managing corporate portfolio. We will use the Ansoff Matrix to consider market entry models. The final part of this report will provide an activity plan for Tesco along with a profit and loss account. Measurements and control with contingency plans will also be discussed. companion ProfileTesco runs more than 2,300 supermarkets, hypermarkets, and widget stores in the UK (where it is the market leader in food retail), Ireland, Central Europe, and Asia. Its operations include convenience and gasoline retailing (Tesco Express), small urban stores (Tesco Metro), hypermarkets (Tesco Extra), and financial services through Tesco Personal Finance. A globular leader in online grocery sales, it owns a 35% stake in US grocery orbit Safeways GroceryWorks. It is the leading online grocery store and it is forthwith expanding its vocation with a TV channel and a retail based education institution.SWOT and PESTLE Analysis of Tesco PlcA PEST analysis o f the manufacturing will examine the local, national and global influences of political, economic, social and technological factors to understand opportunities and threats well.All of those (political, economic, social, technical, level-headed and environmental) factors will to some extent apply to the retail constancy in Sweden.POLITICAL Following the European desegregation and Free Trade Agreements, the market has opened up for British Companies to invest in Eastern Europe. Tesco already has 60 Hypermarket store in Hungary. Lidl is uncompromisingly fighting to maintain its market shargon with an aggressive determine strategy.ECONOMIC the Retail sector is fairly recession prawn and also very sensitive to changes in interest rates. Since the events of September 11th the world economies have suffered heavily, stocks plummeted and prices are at all time lows. The world economy is however, now on the up post September 11th. Consumers are optimistic and the retail industry is on ce again booming.SOCIAL changes in consumer taste and lifestyle represent both opportunities and threats for the industry. Opportunities in terms of natural market and consumers, however, there are added threats in terms of alternative established Swedish national retailers (foreign company bias).TECHNICAL Changes in retailing methods as such clothes sales via the Internet is now a common habitation in retailing. Paperless operation, the management and administration of the company are undertaken on IT systems, which are accessed through secure servers provide flexibility in the running of the business. As Sweden is at the forefront of technological advancement with national companies like Ericsson, Tesco would enjoy the comprehensive logistic and distri providedion channels already in place.LEGAL National legislation for health and safety both in terms of consumer rights and also in terms of production of own natural renewable resources for making clothes.ENVIRONMENTAL The re newable source of resources employ in production, namely cotton and wool are environmentally friendly. The threats are in terms of legal consequences for livestocks in terms of health and safety. Market Entry StrategyWe bottom of the inning use Ansoffs product/market matrix to identify directions for Tescos strategic development. This matrix offers directions for strategic pickaxe available to Tesco in terms of products and market coverage, taking into account its strategic capability and also candidate of stakeholdersSource Johnson, G., Scholes, K., Whittington, R., (2005)We can see from the Ansoff Matrix that Tescos lunch of Baby wear in Sweden will involve a market development strategy. As Tesco already sells kids clothing (existing product) but Sweden will be a new market. Both capability and market consideration has driven Tesco to into development into new markets. Kids clothing is a product that can be exploited in other market segments and also geographical spread intern ationally. Tesco may encounter some difficulties around creditability and expectations as they attempt to enter the new market. Tesco may not be seen as a credible mainstream supplier.Tesco Plc purport nodesTesco must(prenominal) decide which market segment in Sweden it wants to target this will subsequently determine its generic wine strategy. If it wishes to with the low cost retailers then it must adopt a cost leadership strategy. Otherwise it will have to look for differentiation so that it can charge premium prices at the high-end market. As the war-ridden rivalry in the low cost market is intense, Tesco should enter the high-end market with a differentiation strategy. However, in the lead Tesco decides on its target customers, we need to conduct a market analysis, in terms of size of the baby clothing market in Sweden, market shares of all the existing firms in the market and finally segments in spite of appearance the market, to identify particular segments, so that Te sco can target these and adjust its marketing.Marketing ObjectiveTesco could have the by-line objectivesProfitability, in terms of operating margin (a 10% target)Swedish Market share (a 20% target)Customer advocacy (the number of customers who recommend Tesco branded clothing, repeat business)Respected company (the number of community stakeholders who pry Tesco)Employee motivation (the number of employees who feel motivated to deliver Tescos goals)Tesco must ensure that it sets SMART marketing objectives that are measurable, time limited, attainable and relevant.Marketing StrategyTesco strategy is clear, with growth being pursued from quad areas the core UK grocery business, non-food, international expansion and retailing services such as financial services, the dotcom business and telecommunication packages. Basically, Tesco is using its strong stable core to keep the business ticking over time it forges new riskier areas of growth. Pushing further into non-food in the next ph ase (Johnson, G., Scholes, K., Whittington, R., (2005)). Lidl is currently destroying the market by sell the products below cost price. Therefore, Tescos generic strategy will have to be cost leadership, unless we can successfully differentiate our line of clothing so that we can charge a premium price.A marketing strategy will involve analysing the markets, and which products to offer. The strategy is implemented through marketing tactics, which involve enlarge decisions about factors such as the price and the way the product is distributed. So Tesco must decide on its model of entry in terms of, own stores, Internet selling or joint punt with an existing national retailer.Activity PlanMarket ResearchMarket Analysis (including demand for baby wear)Mode of EntryMarketing Mix Decisions (Place, Price, Product, Promotion) decisionsMethods of promotion advertising, public relations, direct mail, sales promotion and person-to-person sellingProfit Loss accountMeasurement ControlsTe sco must also have in place both financial and strategic controls. Financial controls are in terms of profit targets, capital bids and achievement appraisal. Strategic controls in terms of overall strategic balance, agreed business plan, optional services and basis and any short-term constraints such as human resources.Contingency PlanThe contingency plan must be in place to ensure that if the product fails having made large capital investments in new store, Tesco must have other products within its portfolio, which it can launch.References and bibliography http//www.forbes.comJohnson, G., Scholes, K., Whittington, R., (2005) Exploring Corporate Strategy Text and Cases, 7th Edition, FT Prentice Hall http//www.hoovers.com/nike/ID__14254/free-co-factsheet.xhtml ACCA Paper 3.5 Strategic Business Planning and Development (2001) The Financial Training Company M.E. Porter, Competitive Advantage Creating and Sustaining Superior Performance, Free Press, 1985 Jeannet, J., Hennessey, D.H, G lobal Marketing Strategies, 6th Edition, Houghton Mifflin