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Tesco And Its Strategic Marketing Strategies

1.0 Executive Summary
This report examines the marketing strategies of Tesco, the market leader in the retail grocery industry in the UK. Analysis has shown that in this oligopolistic market, Tesco is following different marketing strategies to remain market leader. Tesco has been doing extremely well in focusing on different marketing strategies by constantly sticking to its principles “very little helps”.

Subsequently the report highlights the different marketing strategies adopted by Tesco, specifically market penetration, product development, market development and diversification have been analysed in order to see in which ways Tesco is competing profitably in the retail grocery market.

The following section discusses how Tesco operates in the competitive environment of the retail grocery industry. Tesco battles by expanding market demand, increasing market share and defending market share with strategies such as flank, pre-emptive or mobile. In return the main competitors Asda and Sainsbury’s are attacking the market leader by using offensive strategies such as frontal, flank or bypass, in order to gain market share. Tesco’s understanding of the customers as well as its strong defensive marketing strategies against competitors assure them the leading position in the market.

2.0 Introduction
The retail grocery industry in the UK, which is generally recognized as being oligopolistic, is clearly dominated by Tesco. The market leader has a market share of 30,6 % in comparison to key players such as Asda (16,6 %), Sainsbury’s (16,3 %) and Morrisons (11,1%) (BBC 2006; Burt and Sparks 2003). Tesco with different stores formats such as Tesco superstore, Tesco extra, Tesco express, Tesco homeplus and Tesco metro operates over 1,800 stores and employs over 260,000 people in the UK. A variety of products such as groceries, non-food articles (home entertainment, clothing, health and beauty etc.), financial services, telecom and online services (Tesco.com) are...