International Marketing Strategy for Tesco

International Marketing Strategy for TescoExecutive SummaryThis report out crimps transnational securities industry speckleing strategy for Tesco for its securities industry place entry into Sweden with a range of baby wear. The SWOT and cankerAL analysis show that Tesco currently has the resource capabilities to successfully enter the securities industry and implement a market development strategy. The report recommends that Tesco target the high-end market segment with a differentiation strategy.This report will assist in intellectual and the formulation of an international selling strategy for Tesco Plc. The report will use PESTLE and SWOT analysis to provide an insight into Tescos current market situation. This will help management in making the correct strategic choices in ground of corporate and international strategy in terms of eat a range of baby wear (infant toddler clothes) into Eastern Europe (Namely, Sweden). The report will outline how Tesco will make much (prenominal) market alteration 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 image for Tesco along with a loot and loss account. Measurements and control with contingency plans will also be discussed.Company ProfileTesco runs more than 2,300 supermarkets, hypermarkets, and convenience livestocks 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), sm all urban stores (Tesco Metro), hypermarkets (Tesco Extra), and financial services through Tesco person-to-person Finance. A global leader in online grocery sales, it owns a 35% stake in US grocery chain Safeways GroceryWorks. It is the leading online grocery store and it is now expanding its business with a TV channel and a retail based education institution.SWOT and PESTLE abstract of Tesco PlcA PEST analys is of the industry 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, legal and environmental) factors will to slightly extent expend to the retail industry in Sweden.POLITICAL Fol subalterning the European Integration 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 manage with an aggressive pricing strategy.ECONOMIC the Retail vault of heaven 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 once again booming. hearty changes in consumer taste and lifestyle represent both opportunities and threats for the industry. Opportunities in terms of new market and consumers, however, there are added threats in terms of alternative formal Swedish national retailers (foreign company bias).TECHNICAL Changes in retailing methods as such clothes sales via the Internet is now a common place 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 distribution channels already in place.LEGAL National formula 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 renewable source of resources used 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 can use Ansoffs product/market intercellular substance to identify directions for Tescos strategic development. This matrix offers directions for strategic option available to Tesco in terms of products and market coverage, taking into account its strategic capability and also expectation 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 internationally. 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 Target CustomersTesco must decide which market segment in Sweden it wants to target this will subsequently determine its generic strategy. If it wishes to with the low cost retailers then it must adopt a cost lead strategy. Otherwise it will have to look for differentiation so that it can charge premium prices at the high-end market. As the competitive rivalry in the low cost market is intense, Tesco should enter the high-end market with a differentiation strategy. However, before 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 within the market, to identify particular segments, so that Tesco can target these and adjust its marketing.Marketing ObjectiveTe sco could have the following 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 respect Tesco)Employee motivation (the number of employees who detect 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 cosmos pursued from four 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 blind drunk stable core to keep the business ticking over while it forges new riskier areas of growth. Pushing further into non-food in the next phase (Johnson, G., Scholes, K., Whittington, R., (2005 )). Lidl is currently destroying the market by selling 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 detailed 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 venture 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 personal sellingProfit personnel casualty accountMeasurement ControlsTesco must also have in place both financial and strategic controls. Financial controls are in terms of profit targets, great(p) bids and performance appraisal. Strategic controls in terms of overall strategic balance, agreed business plan, optional services and infrastructure 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, Global Marketing Strategies, 6th Ed ition, Houghton Mifflin