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5 ways Tesco uses Big data Analytics

• Neelam Tyagi
• Jun 20, 2020
• Updated on: Jun 14, 2021

Data and information, inside any business, are expanding at exponential rates, generated by social media, sensors, connected-devices, smartphones, and other sources. 

Various organizations are continuously looking to adopt the potential of these fast-moving, enormous, and convoluted streams of data in order to attain the turnaround enhancement in the achievement. You can have a glance at top 10 big data technologies in 2020.

“Without big data analytics, companies are blind and deaf, wandering out onto the web like deer on a freeway.”  - Geoffrey Moore , author and consultant

Moreover, business executives should be wise to account whether the information they accumulate could do extra than improving performance. Indeed, big data can deliver billions of amounts of revenue that serve as fuel in growth.

(Must check: Top Big Data Analytics Tools )

How Tesco uses Big Data and Analytics?

The famous supermarket faces many difficulties initially, sweeping from maturing customer behavior and management to requirement of reducing food waste and compensating to modern rivals. As discussing food market and services read the role of big data for the food industry .

Most of the Tesco rebuttal falls in cutting-edge strategies, up-to-date data and its real time analytics.

For instance, organizations specifically use sensor data for regulating the temperature of refrigerators and fridges crossover the entire network of stores. Each device is supervised centrally, and predictive modeling  are being used for identifying when to service a particular unit.

Below are the specific services Tesco uses Big Data efficiently;

For controlling lighting and heating costs

Tesco is harnessing data to cut down heat and light costs, the retailers could work with their suppliers to connect heating and lighting regulators from its multiple stores to data warehouses through the internet. 

Tesco can figure out the energy performance of each store through Google map and can observe which stores are running absolutely coolly, which stores are being overheated or under-heated. 

During a project Tesco found, it can turn on the heating three hours later and yet the stores have the suitable temperature for opener time. It leads to saving energy and costs. 

For improving value chain

From supply chain to sales and service, Tesco uses big data analytics to deliver data-driven strength in every terms of its value chain. Data updates in real-time analytics, like “Broccoli Cam”, could be accumulated with predictive analytics  to convey the reorder cautionary priorly via supply chain and logistics thread. 

Tesco considers Big data technology as a multi-channel strategy to acquire the future trends in the consumer retailing behaviour that addresses the demands of users for using physical stores, mobiles and desktop devices combinedly. 

For instance,  a user is able to implement an internet kiosk at any outlet for ordering products to collect in the store, use a mobile phone to order groceries that are being delivered at home.

Combined retailing mode needs the company to understand the purchasing pattern of each customer and their preferences of mode and logistics requirements. Learn explicitly how Big data analytics help in business.

5 ways Tesco uses Big Data Analytics 

Appending channels

Another yet exceptional example, the Big data multi-mode approach of Tesco is the Blinkbox, an on-demand video service provider. Blinkbox is tailored for Clubcard holders who subscribed to ad-free supported movies and TV streaming. 

Tesco is leading the ways in technology and big data, but its achievements are not restrained in data accumulation and decipher.  

Tesco observes that processes execution are envisaged via data analytics are key success factors, and these processes are steadily formulated, introduced and tested out. These processes are not prefabricated solutions, instead they are pioneering in nature. 

That’s why Tesco gets that the data, the systems and processes are dynamic. They demand to drive and transform regularly. For this, while more data is not enough, customer relationship channels are also paramount.  

(Most related: Big data applications )

Anticipating the future trends

With the huge usage of connected-devices that generate data at a high scale, each organization uses these sensors and hence Tesco, these are used for various purposes like monitoring temperatures of freezers and refrigerators. 

Developers, data scientists in the company are encouraged to deploy open source technology to sense the future trends, wherever possible give support to the open-source team where technologies are emerging. 

Tesco also uses Github code to support the research team, by keeping use of the prominence technological augmentation, Tesco hopes to maintain market value against more agile and technology-driven initiatives.  

By utilizing the advantages of this fascinating Big data technology with IoT and real-time analytics approach and with the Tesco technical system as in its global network of stores and distribution infrastructure, can bring the huge possibilities of achievements for Tesco.  

Estimating sales

The essence area of research and operation where Tesco makes use of data at forefront is sales anticipating. Data modeling of customer data throws some interferences such as “how people purchase in a store around a week?” even more, “how they shop for every item?”.

By applying data analytics and clustering methods , it is also found that “the way items are bought together is not really the way the items behave.” 

Across thousands of stores that stock thousands of products yield out over 100 billion data points when tracking those products at once. This is where in-database analytics comes into picture ,i.e, deploying distinct analytics technologies in databases where data is stockpiled. It prevents moving data in batches for external analytics.  

Moreover, a clustering method is implemented to ensure items are anticipated and act in the proper way, when to order items and they will always remain in stock and not going to waste items.

(Also read: How Big data is using AI? )

Key challenges for Tesco

Consistency in obtaining a clear considerate of the dynamic nature of customer behavior ,

Making proficiencies in Tesco logistics and circulation series, to maintain costs down, and curtail environmental influences. 

Confronting the denounces of evolving business models that compete with their own, and 

Decreasing the quantity of waste food from any stores.

Tesco is the  biggest food retailer in the UK  that becomes avant-garde while picturezing data and technology. It is among the one of the early supermarket chains that started tracking customer activity via its loyalty card system and strongly controlled the transition to online retailing. But, from facing key challenges to boosting performance through newest technologies, big data and analytics is possible answers to make efficiencies plausible.

"Big Data will spell the death of customer segmentation and force the marketer to understand each customer as an individual within 18 months or risk being left in the dust.” -- Ginni Rometty , CEO, IBM

In this blog article, we learned, identical to other companies, Tesco is leveraging Big Data and analytics for boosting its performance and serving customers worldwide. 

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Tesco PLC - statistics & facts

History and retail growth, international and online expansion, key insights.

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Grocery market share in Great Britain 2017-2023

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Tesco group revenue in the United Kingdom (UK) 2015-2023

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• Supermarkets in the United Kingdom (UK)
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TESCO – British Retailer that redefined Grocery Shopping

The first time I visited a ‘Tesco Extra’ store was at midnight, making an emergency run for next morning’s breakfast. The store seemed to occupy the area of an entire football field in Ashby-De-La-Zouch, UK. Even at an ungodly hour, Tesco was well-lit with visiting customers.

Inside, there were never-ending aisles lined up with groceries, food items, clothing, electronics, and whatnot. It was easy to lose way and lose track of time in the colossal supermarket.

I thought to myself that this would be the only store of its kind in the county, but I was wrong.

Tesco has 4008 stores across the UK and Republic of Ireland , with 7005+ stores and franchises across the world. In Europe, Tesco has established itself in Hungary, Slovakia, Czech Republic, Poland and Turkey. In Asia it has stores in Thailand, South Korea, Malaysia, Japan and China.

TESCO is much more than a chain of supermarkets selling a million products. It’s a giant conglomerate, spanning across so many verticals. It’s the equivalent of one of the FAANG companies but in the Grocery & Retail sector. It becomes imperative for business enthusiasts like you and me to understand the business model of this retail giant called Tesco.

It’s considered a part of the ‘Big Four’ supermarkets alongside ASDA, Sainsbury’s, and Morrison’s in Europe.

The Birth of Supermarkets in Britain

Founded in 1919 by a war veteran – Jack Cohen , Tesco began as a grocery stall in the East End of London, making a profit of £1 on sales of £4 on day one. Tesco’s first store was launched in 1929, selling dry goods & its own brand of Tesco Tea. A hundred more Tesco stores were opened in the next 10 years.

With 100+ mom-and-pop stores in Britain, Jack wanted to expand his product range. He traveled to the US in 1946 and noticed the self-service system, where customers would select different products on the shop floor and finally checkout at a counter. Jack brought this concept back to Britain, giving birth to Tesco Supermarkets and changing the face of British Shopping. His motto was to “stack ‘em high, and sell ‘em low (cheap).”

Tesco has a wide range of supermarkets depending upon their size, range of products, and location. This also helps regulate their Supply Chain to reduce wastage.

Tesco Business Model is based on various verticals

Tesco has deep-rooted its businesses in the European market so well, it’s difficult to miss out on the Tesco hoarding anywhere. Its Businesses and subsidiaries are:

A glimpse into the Complex Supply Chain

A supply chain is one of the critical aspects of the business model of a giant retailer like Tesco. Tesco has its priorities set when it comes to procuring products from different parts of the world:

• Use expertise to offer a better range of products at reasonable prices
• Use economies of scale to buy more for less
• Leverage and maintain relations with global branded suppliers
• Grow the brand

It procures goods from over 44 countries, majorly China. A stock of up to 90,000 different products (30% are food & beverages) is transferred via the global sourcing office located in Hong Kong. Keeping wholesalers out of the loop, Tesco procures directly from suppliers. The conglomerate has developed and maintained long-lasting relations with suppliers’ world over—the main ones being General Mills, Kellogg, Mars, and Princes.

Tesco has set up a separate division to regulate its supply chain, “the machine behind the machine” – Tesco International Sourcing (TIS). It can be compared to the East India Company of the 18 th -19 th Century, catering to only one customer – Tesco.

TIS is connected to over 1000+ suppliers across 1200+ factories . It’s responsible for over 50,000 Tesco product lines in terms of quality control, sourcing, production, designing, timely delivery, and sorting trading/customs documentation.

All activities are coordinated centrally at TIS, with just 533 staff members. These staff members undergo rigorous training to detect & analyze Supplier-violations and conduct Auditing.

Tesco coordinates with TIS on a daily basis to procure products in the following ways:

• The local team uses customer insights to create a Product Brief (new or modified) specified for each region.
• TIS analyzes the product brief and develops a Product Sourcing Plan depending upon – stores that need this product and figuring out minimum transport time and cost, as per the region.
• The Plan is executed, and specific demands are handed out to Suppliers all over the world. Expert TIS Buyers make sure the best deal is made.
• Inbound logistics are consolidated at specific Tesco Depot to receive the product efficiently from Suppliers.
• Local teams then make sure the product is distributed to different Tesco stores from the Depots.

Tesco adding eCommerce to the mainstream business model

Being in the Top 50 retailers globally as of 2021 , Tesco’s annual revenue worldwide in 2020 was £58.09B , a 9.1% decline from 2019 (due to the Pandemic & disposing of its Asia operations , to focus on the core business in Europe).

It shifted from Brick & Mortar to Brick & Click stores. The Click+Collect functionality on its website accounts for 43% of E-grocery sales in the UK. The Click+Collect concept enables customers to place their orders online and collect their orders a few hours later at the nearest Tesco Depot. Tesco created these specialized Depots for online orders only.

Despite shutting down most its mall operations, Tesco survived 2020 through its online retail store Tesco.com , with double the orders. Its E-commerce net sales had shot up by 31% from 2019-2021.

A Global Operations & Technology Center in Bengaluru was also set up in 2004. This center serves as the backbone of distribution operations for Tesco worldwide. Its business functions are- Finance, Property, Distribution Operations, Customers & Product. The employees at this Center are Engineers, Analysts, Designers, and Architects.

Tesco’s Marketing Strategy

Tesco has always believed in acquiring loyal customers and regaining stakeholders’ trust. It aims to reach customers from all financial backgrounds. So it launched 2 of its own sub-brands – Tesco finest for the affluent customers and Tesco Everyday Value for the rest of the crowd.

Tesco also launched the Club Card in 1995 as a Membership card, to maintain customer loyalty and keep them coming back. The Card operates on a point-based system with discounts on products, & other subsidiaries like double data on Tesco Mobile. With 5 Million subscribers in the first year , Tesco finally overtook its competitor – Sainsbury’s to become No.1 in the UK.

The Club-card strategy was used to obtain customer data and observe buying habits. This data was analyzed, allowing Tesco to put the right products on shelves while eliminating unpopular ones. Tesco realized that the Club Card isn’t just a quick fix & temporary promotional tool; it’s a promotion in itself. This made the Tesco Club Card unique and long-lasting.

Tesco also realized that spending Billions on traditional marketing efforts and maintaining a ‘one-size-fits-all’ brand image wouldn’t work. It decided to hyper-target specific customers and to earn their trust. For starters, thousands of head-office staff and senior executives were sent to work in stores – to demonstrate how Tesco values its customer. Customization became key for its new marketing strategy; sending out discounts on birthdays via Emails and campaigning from door-to-door.

Tesco also made a partial shift to Digital Marketing which costs much lesser and has a wider outreach. It created well-tailored profiles on all social media platforms. On Twitter, it has more than 15 accounts, separate for each of its business units. The online customer care account on Twitter is active 24-7.

All supermarkets commonly advertised themselves to have quality products at a reasonable cost; Tesco wanted to differentiate itself as a unique brand. It introduced step-by-step Recipes prepared from ingredients available at any Tesco store, with Chef Jamie Oliver as its Health Ambassador . Tesco Food and its variety of recipes were a massive hit. Later on, the monthly Tesco Magazine as a food & lifestyle magazine was also launched, with 4.65Million readers worldwide.

The beginning of the pandemic in March 2020 left people apprehensive about visiting a physical store to buy groceries. To deal with customers’ concerns, Tesco came up with an instructional advertisement in April ‘20. With crisp instructions similar to that of an in-flight safety video, this ad showed customers how to physically shop and behave at Tesco stores. It was considered to be the most effective advertising and communications campaign of 2020 as per YouGov BrandIndex .

Competition

Tesco’s earliest competitor has been Sainsbury’s since the 70s. The Tesco Club Card strategy in 1995 helped it overtake Sainsbury’s to become the No.1 Retailer in the UK, but not for long. The ‘Big Four’ supermarkets in Europe have been in close competition throughout the years. Tesco has acquired a 28% majority stake in the UK market.

The horse meat and accounting scandals were a real setback for Tesco, letting competitors take over the European market. The newest German entrants – Aldi and Lidl had caught customers’ attention and market share in a short span of time.

With a combined market share of 12%, these German retailers posed a threat to Tesco. So much so that Tesco began the ‘ Aldi Price Match ’ campaign to curb the growth of the German discounter and win back customers. Tesco started price-matching thousands of its products with that of Aldi, offering better quality and branded products at Aldi’s prices.

Tesco has a majority market share in Britain, with Sainsbury’s and ASDA in tow:

Tesco Adding Sustainability to its business model – The Little Helps Plan

It’s a well-known fact that giant conglomerate retailers are one of the major causes of rapid climate change and increasing carbon footprints. Tesco realized its impact on the planet and launched the Little Helps Plan as a core part of business in 2017. This plan serves as a framework to attain long-term sustainability. Its four Pillars – People, Products, Planet, and Places are aligned with the UN’s Sustainable Development Goals.

Until now, the Plan has enabled Tesco to:

• Permanently remove 1 Billion pieces of plastic from its packaging
• Redistribute 82% of unsold food, safe for human consumption
• Remove 52Billion unnecessary calories from foods sold

Apart from this, it also aims to increase sales of Plant-Based Meat alternatives by 300% by 2025. At present, it has 350 plant-based meat alternatives on the shelf.

Apart from partnering with various other organizations, Tesco entered a 4-year partnership with World Wide Fund for Nature (WWF) to address one of the biggest causes of wildlife loss – the global food system. It aims to eliminate deforestation from products, promote recyclable/compostable packaging and minimize food waste.

Tesco is one of the few successful retailers in the world, with a compelling history. Tesco has overcome numerous issues across its supply chain, faced global criticism, and still stands undeterred in the European market with its rock-solid business model. It has always adapted to its unpredictable consumers and continues to do so while caring for the planet.

The business is healthy. We said we would rebuild the relationship with the brand and consumers; you will see that in every measure of customer satisfaction we do that. The business is healthy, vibrant and there is a lot of optimism of what we can do going forward. CEO Dave Lewis, who took over Tesco in 2014 (during the struggle years) & stepped down in September 2020

-AMAZONPOLLY-ONLYWORDS-START-

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An Engineering grad, currently working in the fields of Big Data & Business Intelligence. Apart from being immersed in Tech, I love writing and exploring the business world with a focus on Strategy Consulting. An ardent reader of Sci-Fi, Mystery, and thriller novels. On my days off, I would spend time swimming, sketching, or planning my next trip to an unexplored location!

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NPSx and InMoment Announce Strategic Partnership

NPSx and InMoment Announce Strategic Partnership To Provide CX Practitioners With Broad Range of CX Solutions

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Inside tesco’s award winning customer segmentation analysis.

Tesco is on a mission to truly know their customers, what they want, why they need it, and their pain points in order to implement high-impact experience improvements. Knowing their customers’ personas and key drivers for each channel allows Tesco to understand what behaviours need to be measured so they can compare experiences between in-store and online experiences.

Find out why Tesco won the award for Best CX Impact at the CX Elite Awards 2021!

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Tesco’s Stumble into the US Market

• Entering the US, Tesco deserves credit for creating a neighborhood market approach—emphasizing fresh produce and meats, and good quality but value-priced prepared meals.
• By not partnering or hiring local executives, Tesco missed the opportunity to learn more about the habits and needs of target customers.
• Tesco rightly aimed to scale the concept as soon as possible so that fixed overhead investments in its own distribution centers could be spread across a larger number of stores.
• Perhaps Tesco's original rollout plan was too ambitious, with executives assuming that the company would get everything right on the first try.
• Tesco has listened to its customers, learned from its mistakes, and made appropriate midcourse corrections.

Tesco PLC is the third-largest retailer in the world, just behind Wal-Mart and Carrefour. But that didn't make the UK-based chain immune from many costly mistakes as it entered the US market in 2006.

For example, it opened some of its Fresh & Easy stores on the wrong side of the road, eliminated discount coupons, and decorated in a spare style more suited to a hospital than a food retailer. Five years later, Fresh & Easy has not made a dime, and analysts are wondering whether the company should pack up and go home, as so many other British retailers have done before it.

Tesco's story makes ideal Harvard Business School case material for teaching everything from multinational strategy to on-the-ground logistics. Marketing professor John A. Quelch recently introduced Tesco PLC: Fresh & Easy in the United States , developed from public sources.

Sean Silverthorne: Each country poses its own obstacles for multinationals entering new geographies. Your recent case on Tesco highlights challenges faced by companies coming to do business in the United States. Tell us about the initial strategy to conquer the United States with Fresh & Easy stores.

John Quelch: The United States is an unusually competitive and cluttered market. It is tough to succeed without a clear and sustainable point of differentiation. While successful grocery retailers are expanding internationally, the odds are long. Both Sainsbury's and Marks & Spencer of the United Kingdom have withdrawn from the United States. Wal-Mart tripped up badly in Germany.

Tesco's international forays have hitherto been successful—with the possible exception of Japan. Tesco intelligently elected to concentrate on fast-growing, emerging economies in Eastern and Central Europe and in southeast Asia. Its modus operandi has been to joint venture with a local retailer, acquiring good store locations and local management talent in the process.

Tesco deserves credit for not taking a "me-too" approach in its US strategy. Tesco entered the California, Arizona, and Nevada markets with a new retail concept: a neighborhood market emphasizing fresh produce and meats, and good quality but value-priced prepared meals. Averaging 4,000 items in assortment, its Fresh & Easy stores aimed to be distinctive on those two attributes: fresh and easy, conveniently located stores with a conveniently preselected assortment.

Q: The company did a serious amount of homework before entering the United States, including sending 50 British executives to live with California families. But it seems the advance team didn't learn all that it should, such as the notion that designing stark stores with concrete floors wouldn't necessarily appeal to American tastes. What can other companies that are thinking of moving into the United States learn about Tesco's early fact gathering and strategy development?

A: I suspect that Tesco had a view on what would work before sending its executives to live with those California families. The result was perhaps a bias toward gaining evidence in support of a predetermined strategy.

California is a car culture. Most households undertake a weekly shopping expedition, supplemented with stock-up purchases at convenience stores. A small neighborhood market's success depends on enough consumers changing behavior to buy a higher proportion of their groceries on a more frequent basis. This could work in inner-city locations where younger shoppers might buy their evening meal on the way home each day, but it is less likely to work in the suburbs.

In addition, the Fresh & Easy assortment carried around 50 percent private- label products, rather than more familiar national brands. And finally, fresh produce was prepacked rather than loose on the shelves. While this can actually improve freshness, consumers perceive the opposite.

Q: Tesco decided initially to fill its US management ranks mostly with British expats instead of hiring locally. How did that strategy work for them? What can we all learn?

A: Tesco established Fresh & Easy as a greenfield investment rather than acquiring or joint venturing with a US retailer as its starting point. Therefore, Tesco did not have immediate access to local retail savvy, not just in store design and assortment but also in the critical area of store locations.

Many Fresh & Easy stores are refits of preexisting retail stores that were up for sale; at least some of these stores were on the wrong side of the road, more easily accessible to inbound rather than outbound commuters who would more likely be thinking about what to buy for dinner. Foreign managers, transplanted from the UK, might not readily have these kinds of insights. And as a greenfield newcomer, Tesco would not necessarily attract California retailing's best and brightest talent as it would assuredly do in the UK.

Q: As sales remained under plan, Tesco execs halted development of new stores temporarily and made adjustments to those stores already open, such as shifting product mix, allowing some coupon discounting, and expanding hours. Do you have advice for companies about revisiting original assumptions? Do companies new to the American market have to do this reassessment more frequently or look for different things?

A: Tesco has not been afraid to listen to its customers, learn from its mistakes, and make appropriate midcourse corrections.

The assortment was expanded by 600 items; stores that were originally stark and unwelcoming—to project a value price feel—were painted in pastel colors; and more signage was added. Weekly price specials were increased to build store traffic.

Perhaps Tesco's original rollout plan was too ambitious. It assumed that Tesco would get everything right on the first try. On the other hand, Tesco rightly aimed to scale the concept as soon as possible so that fixed overhead investments in its own distribution centers could be spread across a larger number of stores.

Q: What issues do students have to answer as they make their way through the Tesco case?

A: There are two questions that students must wrestle with.

First, are Tesco's problems in the United States a result of poor strategy or poor execution? The latter problem is obviously more correctable. On the other hand, Tesco has lost time; competitors have responded to its initiatives by incorporating some of Tesco's approaches in their own merchandising and assortment selections.

The second question is how long the Tesco board will permit management to hemorrhage losses in the United States. Originally, Tesco announced a five-year plan to profitability that would come due in 2011.

Q: The case ends with Tesco in the fourth year of its five-year plan, with largely disappointing results. We heard the news recently that Philip Clarke has authorized a new expansion program through at least 2013, when it finally expects Fresh & Easy to become profitable. Correct decision?

A: Sir Terry Leahy, Tesco's highly successful CEO for more than a decade, recently announced that he would step down in favor of Philip Clarke, a long-standing Tesco insider. Speculation that this might result in the the company abandoning the Fresh & Easy experiment no doubt prompted the recent announcement that Fresh & Easy would be given a two-year reprieve until 2013.

Tesco has the resources to continue, and the US market's size remains a juicy target if Tesco can get it right.

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Tips & Trick for the Garden & Home

What market research methods do Tesco use?

-Tesco conducts primary research to learn how their service is progressing, how different stores provide their services, and how they can improve their businesses to help it become more successful. Questionnaires that are popular with customers. Focus Groups based on surveys (web, phone, postal, and other).

Customer Interviews. What are market research techniques, after all? While there are many different ways to conduct market research, most businesses employ one or more of the following five basic methods: surveys, focus groups, personal interviews, observation, and field trials. Which techniques you choose for your business will be determined by the type of data you require and the amount of money you’re willing to spend.

What are the four different types of market research, in the same way? Secondary research, surveys, focus groups, interviews, observation, or (6) experiments/field trials are the most common types of techniques. Primary and secondary research are the most basic types of market research. What are some other popular ways to gather market research data?

Interviews (either by phone or face-to-face), surveys (online or by mail), questionnaires (online or by mail), and focus groups gathering a sample of potential clients or customers and receiving their direct feedback are all examples of primary research. What is Tesco’s use of quantitative research? Tesco also conducts quantitative research, which includes Tesco’s sales and the percentage of customers who choose the same answer in a quantitative questionnaire, as well as data that can be used later.

This would take up a lot of time for them because they wouldn’t be able to gather the opinions of all of their customers.

What are the different types of secondary research?

Secondary research, also known as desk research, is a method of collecting data from existing sources. Secondary research entails research that has been published in research reports and other similar publications. Public libraries, websites, data derived from already filled-in surveys, and other sources of information can all make these documents available.

What are the two most common types of market research?

Quantitative and qualitative marketing research are the two main types of marketing research. Phone, mail, the Internet, or in-person interviews are usually used for quantitative research.

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What are the main areas of market research?

Marketing research focuses on the following areas: Product Research: Products include goods and services. Research on Market: Research on Sales Methods and Policies: Research on Advertising: Research on Pricing: Research on Distribution: Research on Business Environment and Corporate Responsibility:

What are the three different types of marketing research?

Exploratory, descriptive, and casual marketing research designs are the three types of marketing research designs: exploratory, descriptive, and casual. Exploratory research is a method of gathering preliminary data to help identify the problem and hypothesis.

What is the most effective type of marketing research?

Which types of market research should your company conduct? Secondary research aids in the assessment of global markets and the identification of trends.

You can zero in on individuals through phone interviews. You can gain a thorough understanding of your own needs, attitudes, plans, and reactions. Surveys can assist you in bridging the gap between the two.

What is the best way to look at market research?

7 steps Determine the purpose of your market analysis. There are numerous reasons why businesses conduct market research.

Take a look at the outlook of your industry. Target customers should be able to be identified. Compare your competitors. Gather additional data.

Analyze your findings. Put your research into action.

How do you get paid for market research?

Businesses and other organizations hire marketing research firms to gain insight into consumers’ minds in order to gauge their reactions to specific products and services. They need people to participate in surveys and focus groups to do so, and they will compensate participants with cash, gift cards, or merchandise for their time.

What exactly is the purpose of survey research?

Design of a survey for research. Survey research designs are quantitative research procedures in which investigators conduct a survey to a sample of people or the entire population to describe their attitudes, opinions, behaviors, or characteristics.

What exactly is quantitative research design?

Quantitative research design refers to the creation of a research project that employs quantitative research methods. Quantitative research entails large sample sizes, focusing on the number of responses rather than the more focused or emotional insight that qualitative research seeks.

What is the best way to conduct product research?

Let’s get started. Identify the Best Market or Niche, Identify Top Competitors, and Spy on What They’re Doing Choosing the Best Domain Name For Your Website

Choose the best products or services to sell to your target market. Choose Winning Lead Magnets from the list below.

What is the best way to research a competitor?

Identifying your competitors should be part of your competitive analysis. Obtaining information on your competitors. – Brand awareness refers to the percentage of people in your target market who are aware of your competitors.

Evaluating their strategies. – Assess their strengths and weaknesses in comparison to your brand’s.

What impact does secondary research have on a company?

Secondary research, for example, can help you determine which types of customers to target, which types of customers buy the product on a regular basis, provides more insight into customer information, and ultimately helps you retain and attract new customers.

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Elements of Marketing Process of Tesco

Alternatively, marketing can be defined as “a business orientation that focuses on satisfying customers’ needs at acceptable levels of revenues and costs” (Loudon et al., 2010, p.2).

Elements of marketing process of Tesco contain the following:

1. Analysis of the market and environment . Strategic tool to conduct this analysis include PESTEL, SWOT, Porter’s Five Forces, Value-Chain analysis and others.

2.  Identification of the marketing target . Tesco targets specific segment of population in the UK and other countries where the supermarkets of the company operate.

3.  Setting marketing objectives . Marketing objectives of Tesco include profit maximisation in short-term and long-term perspectives and increasing the value of the brand image. Marketing objectives of Tesco are closely associated with their business strategy which consist of the following seven elements (Vision and Strategy, 2013, online): a) to be growing the UK core, b) increasing international presence through offline and online channels, c) growing retail services in present markets, d) focus on corporate social responsibility, e) enhancing brand value, f) engaging in more diversification and g) creating value through teamwork.

4.  Dealing with elements of the marketing mix . The importance of dealing with each elements of marketing mix taking into account needs, wants and other unique characteristics of target customer segment is fully understood by Tesco management.

5.  Reflection, control and revision . This element of marketing process is used by Tesco marketing management in a periodic manner in order to assess the levels of effectiveness of marketing strategy and possible improve certain aspects of marketing strategy due to changes in external or internal environment.

Although the costs of Tesco’s marketing orientation might be significant, the contribution of marketing orientation of Tesco on its core purpose of profit maximisation is significant as well.

Link between Tesco’s marketing orientation and its competitive advantage is direct and strong. In other words, competitive advantage of Tesco relates to its competitive costs, and this competitive advantage is communicated via the marketing message of ‘Every Little Helps’ through integrated use of a set of marketing communication channels.

 References 

Definition of Marketing (2014) American Marketing Association, Available at: http://www.marketingpower.com/AboutAMA/Pages/DefinitionofMarketing.aspx

Loudon, D., Stevens, R. & Wrenn, B. (2010) “Marketing Management: Text and Cases” Routledge

Vision and Strategy (2014) Tesco Plc, Available at: http://www.tescoplc.com/index.asp?pageid=12

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How the NHS and Tesco Use Market Research

Business Level 3

Unit 3 – P3/M3

Unit 3 P3 – Section 1

Marketing Research

Marketing research is when you research the market so you can get information about other businesses around the area, the marketing research includes things like what the product is what it’s for and how they are presented, Marketing research is also researching what types of products are good, and in which area’s they will sell well, Marketing research is basically getting data of other business in the same area or same type of business as yours.

-Primary Internal research

Primary research is Information that comes directly from the source that is potential customers. You can compile this information yourself or hire someone else to gather it for you via surveys, focus groups and other methods. Tesco may use primary research by asking for feed back, doing surveys and focus groups to get information from customers about the business and products and way it could be improved, this feedback is gained from the business, people like employee’s, Mystery shoppers,

Internal research is when you collect research from inside of the business and External research is when you go outside of the business to collect information.

The sales figures of Tesco and the NHS could be improved with this research because if the business has the right research they know what to do so they can improve their services, Tesco and the NHS will keep their business figures, and they will also have a central database where they keep their customers data on.

- Primary   External research

Tesco and the NHS will use things like questionnaires to research their services at the business so they have information on how to improve them, they will use their feedback to make changes in the business, They will also give customers and employee’s things like surveys which will include questions on service and things like that in the business, Interviews and focus groups are also used to focus on certain objectives to improve on, they will also have interviews with employee’s, they will set up a focus group where they talk to professional types of people and talk about the product, mystery shoppers will be shoppers sent the external business to research them and later feedback to the business that sent them. NHS will ask questions about things like experience at hospitals, did they have good customer service, was their any risks of infections, where as Tesco ask questions such as if they we’re giving good customer service such as do they like the Tesco brand, how often they spend money at Tesco.

-Secondary Internal research

Secondary Market research that's already compiled and organized for you. Examples of secondary information include reports and studies by government agencies, trade associations or other businesses within your industry. Tesco can research for secondary marketing research as it is research that has already been done, this research might now always be reliable but it can still be used, further research can be found in places which include libraries, books, annual reports, reports from other business, internet, management, statistics, Internal research is when you collect research from inside of the business and External research is when you go outside of the business to collect information, Tesco will need to keep their

Report on sales so they can tell what they’ve made or lost, they will also have to review previous market research so they can find ways to improve. Where are NHS will have to keep records of number of patients they had visits from at a hospital.

-Secondary External research

This is a preview of the whole essay

Tesco may use things like websites to gain information about other businesses so they can research, they may also use things like trade magazines, books and newspapers because they can gather information from there and research so they can later improve on their services, Industry reports from industry associations can help the business because they can research from it, Government department figures and facts is good a way to research figures and facts from other business so they can find ways to improve on the business, public records such as census data are public records of statistics in from a national to neighborhood level use by government, Tesco wont be able to access census data but the NHS  has access to these records. NHS will also investigate websites from other organizations such as Charities that deal will heart disease. NHS managers will read newspapers and magazines related to health service. The management at NHS will have to look at government department figures on statistics such as population increases/decreases, death rates in area’s of the UK. NHS can also get census data details concerning birth rates and death rates.

-Qualitative

Qualitative research is a method of advertising research that emphasizes the quality of meaning in consumer perceptions and attitudes; for example, in-depth interviews and focus groups. Tesco can use Qualitative research because they will need new ways to advertise their products and ways to improve their advertising techniques. The management within an organization has to analyze the results and make decisions on the outcomes to the interviews or method of research used.

-Quantitative Tesco

Tesco will have to research different figures about their business, they need to also know about customers, when they visit the store and how often, they need to know market figures, competition figures, percentage of market share, answers to surveys, how much a family spends every month, how many staff members leave Tesco and how many stay, and the reason they leave, percentage of customers that use special offers, what percent of the market do different supermarkets own, they use graphs and charts to analyze and make important decisions on the feedback and make changes and improvements.

-Quantitative NHS

NHS would collect figures on infections, death rates, birth rates, accident rate, nurses let staff turn over, how many people for security, rates of abuse, doctors responsible for death of patients, accidents in the hospital, new staff hired, staff leave rate, how many people a doctor will see a day, how much money they get from the government to make sure they can take care of operates/machinery and looking after their patients, do they have to make cuts of figures/funding, laying off staff, they will have to investigate the budget figures to ensure they can pay for the staff, machinery and other expenditure on things like electricity, a lot of NHS hospital’s have to make cuts because of cuts in funding from the government and tax payer.

-Qualitative NHS

They have focus groups for things like new machinery, drugs things that will link to the business, for things like lasers they would have big focus groups, also benefits and draw backs of using the new machinery, and services, the research from the NHS is really important because the answers need to be correct as it could save people’s lives, the NHS will have big groups to test out new products within the NHS for example if a new piece of machinery came out a focus group would have to be put in place to focus on that piece of machinery and test it before it is used in the hospitals, they have focus groups for any new product they release or want to bring into use.

-Qualitative Tesco

Tesco will have focus groups for new products they will be releasing in their store,

Such as the Iphone grocery application, it would have had a focus group to discuss the product, things like reasonable prices, features and how people would use them,

For a example before Tesco released their Iphone grocery application it must have gone through a focus group that must have tested it and found ways to improve on it, when the focus group thought the product was good to be released they would release it for use in the store, they will ask open questions to try to get as much information on what people think of the product before releasing it, the focus groups allow the business to understand what people thing about their prices,

Their products, what to change, customer preferences, opinions, interests, the

Focus groups help Tesco with finding out what the business thinks of their product.

M3 Limitations

Market research can become very expensive because there are many methods as businesses take part in primary and secondary research on a regular basis, companies such as Tesco and NHS will spend millions of pounds on their market research to find out exactly what people want and need in their products.

Huge paperwork costs that occur in a business for example Tesco and the NHS will have to spend money on photocopying of questions, graphs, charts, reports and results; they will have to buy numerous ink cartridges they will have to spend thousands of pounds on advertising and producing booklets on the results.

There are many staffs involved with market research for example all staff need to be trained in order to do the job properly from the staff who ask the questions to the staff who analyze the results to the manages who have to make recommendations with the results, As well as training the staff all the staff need to be recruited this costs money as you have to pay for the Job advert and the expensive human resource staff to employ the correct person with the correct skills to be able to do market research as well as hiring staff to take care of the research then they have to employ other staff who are ICT and Math experts to analyze to results to make sure there are no errors, further staff costs include managers who needs to make recommendations and improvements based on the market research, manages in the NHS and Tesco are paid a lot of money to do this job, therefore there are more costs.

Huge costs when you have to pay for the focus groups they involve loads of professionals who have to be paid at least £30 a hour which has to be paid by the company and they spend a number of hours asking questions which costs the company time which they could use to work at the business, you also need NHS and Tesco interviewers who want their money for asking the questions,

Many hours are spent on market research, this time is spent on things like answering questions, analyzing data, sorting through data, sheets, graphs and tables, The time spent to do market research is out of the business so the business could loose money because of this time being spent on something else, the business uses many hours on Market research as it will talk a lot of time to gather and sort out the  information gathered about market research, Time costs money because when they are taking part in market research they are not in the store which means they cannot sell from the business which means that they could loose out on money due to this, Market research also takes a lot of time because it is very long as you will have to go through research from lots of different areas, Market research takes many hours a day which could be used in a better way, time is also spent training the questioners when the staff could be doing other things.

-Validity of data collected

The data that has been collected by the market researchers must have to be valid to the market they are researching otherwise it will be useless to them, Poor research will not give Tesco and the NHS relevant results in what they want to research, if you are asking wrong questions you will end up getting wrong answers which will not fit in with the business, for example Tesco would not ask questions like, Is Tesco in the top ten hospitals because it is time consuming and cannot help the business in any way because the data collected is invalid.

If Tesco and the NHS don’t use the research correctly they could get the research wrong and make a change in the business that wouldn’t benefit them, all the data they have to collect and use must be valid, This means that Tesco and the NHS must use the correct research in their business so they could make a change that will benefit them.

The information collected must be reliable so Tesco and the NHS can go ahead and make changes in their organisations from the results that came back from the data such as surveys and questions, Tesco and the NHS must make sure that the information is reliable, they can do this by checking multiple surveys to make they are similar and not just ticked or answered at random.

People exaggerate so all data might not be 100% correct so you will have to ask different people so you can get answer from different people which will make the results more stable so the business can use them, Tesco and the NHS must ask a large number of people so they can get the correct research and not false data which they cannot use.

People say that they will do things when they won’t such as saying they will come to the store, and buy the products when they don’t bother which would make it false research/data, Tesco and the NHS must make sure they have researched from a large number of people before they make a certain change because if only one person wants a change and the other million don’t Tesco and the NHS will loose out.

When asking people questions, some people ignore the questions and walk or move away which is time wasting and the questioners don’t get an answer so they don’t get any research, which means they have to get research in other ways, Tesco and the NHS must make sure they are persuasive when asking customers and patients to answer their questions, NHS can ask their questions in the hospital waiting rooms, whereas Tesco can hand out questionnaires with every sale.

The results given must be analyzed correctly because if they analyzer makes a mistake it could cost the business because it wouldn’t match the research given and the business will loose out, Tesco and the NHS must make sure that their research is analyzed correctly so they can make valid changes of things the people actually want to see in the business, not a mistake in the research, Tesco and the NHS must also make sure their questions offer consistency so the responses will be a good quality, high detailed and reliable answers, they must make sure they get these good quality answers so they can get ways to improve on their business.

The customers must understand the questions correctly, because if they don’t they could make the answers or just move onto the next question, if every question isn’t answered it will be harder for the NHS and Tesco to determine results from the market research, Tesco and the NHS must make sure that their questions are clear and understandable by checking them so the people answering the questions will have a easy understanding of answering them.

The questions in the focus groups must be suitable so the people who are answering must understand them, and they must be related to Tesco or the NHS; the business focus groups must be suitable for people to answer, Also the employee’s from Tesco and the NHS must be there to actually work and collect market research, whereas they could be their to get out of work or help, so Tesco and the NHS must ensure that their employee’s are doing the correct jobs so they can earn their money for collecting market research so they can improve their businesses, rather than wasting time getting paid for nothing.

Document Details

• Author Type Student
• Word Count 2676
• Page Count 6
• Level AS and A Level
• Subject Business Studies

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Tesco sits at the top of the food chain but rivals are growing peckish

As the biggest supermarket prepares to unveil impressive profits, smaller grocers will find that falling inflation leaves them with nowhere to hide

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As the UK’s biggest supermarket, accounting for more than a quarter of our national food shop, Tesco will shine a spotlight on a rapidly changing grocery market with its annual financial results on Thursday.

With sales expected to rise almost 5% to just under £69bn, Tesco is back in the ascendant, gaining market share as household bills remained under pressure and shoppers looked for bargains.

Under chief executive Ken Murphy, the group has improved service and price competitiveness, using its size and strong balance sheet to soak up some of the effects of inflation and flexing its Clubcard loyalty scheme to fend off the threat from discounters Aldi and Lidl .

The group, which also has supermarkets in Ireland and central Europe, is likely to report underlying profits of £2.3bn, according to City analysts, up from just under £2.1bn last year.

Its new line of defence is the former Aldi UK boss, Matthew Barnes, who took over from Jason Tarry as head of Tesco’s UK business on 1 March. He is likely to get his first outing in front of City analysts on Thursday.

With years of discounter experience, he could have some thoughts on how Tesco can keep its edge. Its Clubcard Prices scheme, which offers special discounts to loyalty card members, has been widely copied, but Tesco also faces an expensive redesign of that scheme’s marketing material after it lost a legal battle with Lidl over the use of a yellow blob similar to the German discounter’s logo.

Meanwhile, the group’s impressive sales and profit figures may begin to prompt renewed questions about its power over the UK food market. As well as large supermarkets, it owns the One Stop convenience chain, Tesco Express, and the UK’s biggest grocery wholesaler, Booker, which gives it control of thousands of small Premier and Londis shops.

The UK’s competition watchdog is already looking at whether loyalty card discount schemes – including the Tesco one and Sainsbury’s Nectar Prices – are having a detrimental effect on the grocery market.

There have also been calls for the Competition and Markets Authority to take a new look at whether Tesco’s control of Booker could be detrimental to thousands of small rural businesses that have little choice but to use that wholesaler.

The UK grocery market is at an inflexion point. After more than a year of high inflation, the pace of food price rises is rapidly easing. As wage inflation has caught up with price rises, shoppers have begun putting more grocery items in their baskets and picking more premium products.

That could be good news for the likes of Tesco, Sainsbury’s and Marks & Spencer, all of which have been adding sales. It could also be good for the nascent turnaround happening at Morrisons and Waitrose. It may be less good news for some.

While inflation may have made it tricky to renegotiate deals with suppliers and keep a lid on costs and price rises in order to hang on to customers amid heavy competition, rising food prices at least guaranteed impressive- looking sales figures for most.

Now sales figures will begin to wilt, further exposing those businesses, including Asda, the Co-op and even Aldi, that are struggling to win over shoppers while they continue to battle rising costs and high interest rates.

“For those with falling volumes and rising costs it could be painful,” says Clive Black, an analyst at Shore Capital. “We expect sales numbers to be less strong for the foreseeable future than they have been for the last couple of years.”

Room for manoeuvre will be limited as inflation is unlikely to entirely disappear, given the near 10% rise in the legal minimum wage in the UK, higher business rates and persistent cost rises on some commodities, including wheat, cocoa and seed oils, as the war in Ukraine grinds on.

The ongoing issues in the Red Sea and a soggy start to the year in the UK are also likely to mean higher prices, and potential shortages of staples including potatoes as farmers struggle to harvest and plant crops.

Tesco’s scale may help insulate it from these problems – but it also makes it ripe for attack.

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• Observer business agenda
• Supermarkets
• Retail industry
• J Sainsbury
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