Tesco Plc in the Uk and Thailand

TESCO PLC in the UK and Thailand

Company Report

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Silviya Yuri Martinova 7701821 Nur Shazalina Binti Razali 7420357 Lovia Abena Bekoe 7686078

Ebenezer Cudjoe 7851414 Nguyen Thi Anh Nguyet 7562211

Contents

1. Executive Summary        4
2. Introduction        5

1. Tesco’s background information        5
2. Tesco in the United Kingdom        5
3. Tesco Lotus        6

1. Marketing environment for the UK and Thailand        7

1. PESTEL        7
2. Competitive Position Analysis – Porters 5 Forces        12

1. International Marketing Strategy        18
2. International Marketing Mix Implementation        24
3. Evaluation of Tesco’s Strategies and Tactics in the United Kingdom and Thailand        28

1. Evaluation of Tesco's strategies        28
2. Evaluation of Tesco’s tactics        30

1. Recommendations        32
2. Conclusion        34

References        35

List of Figures

Figure 1 PESTEL (Rapidbi, 2012)        7

Figure 2 Thailand in the Comparison with the UK (Geert Hofstede, 2017)        9

Figure 3 Porter’s five forces of competitive position analysis (Chartered Global Management Accountant (CGMA) 2013)        12

Figure 4 Market Share of Tesco in UK 2016        14

Figure 5 Market Share of Convenience Store and Minimarts in 2012 (Getchee 2013)        15

Figure 6 Debt Burden of Companies in the UK (Financial Times 2015)        16

Figure 7 Tesco Shopper Demographics (InfoScout, 2017).        18

Figure 8 Aldi Shopper Demographics (InfoScout, 2017)        19

Figure 9 Positioning of Tesco Market in the United Kingdom.        22

Figure 10 Positioning of Tesco Market in Thailand        23

List of Tables

Table 1Tesco segmentation, targeting and positioning in the United Kingdom (Central intelligence Agency, 2017)        20

Table 2 Tesco segmentation, targeting and positioning in Thailand (Central intelligence Agency, 2017)        21

1. Executive Summary

This report provides information about the third biggest grocery retailer in the world -Tesco and its international marketing and competitive strategy in Thailand and the UK (BBC News, 2013). For the purpose of this report we have used different marketing researching tools including Porter’s five forces, PESTEL, the 7Ps, segmentation, targeting and positioning and evaluations of the company’s strategies and tactics.

Tesco is successful in the UK and Thailand and this is thanks to their great management strategy. Tesco’s biggest priority is to be a leader in low prices and this will attract many customers not only in Thailand and the UK but all over the world. In both countries, the company uses different marketing strategies to draw new customers and to win the loyalty of its current ones.

We recommend that Tesco should stand its ground in the upcoming economic instability in the UK and to take into consideration the aging population in the UK and the fact that in Thailand has a young population. Nevertheless, the company has to improve the supplier’s paying period, because this could become a big problem for them in the future.

1. Introduction

Tesco is the grocery retail giant in both of The United Kingdom and Thailand. History has shown that Tesco has touched many international markets. However, to examine the ways in which Tesco has used marketing strategies and tactics to grow in the United Kingdom- the local market, and to also evaluate the strategic responses it has made or might make when entering Thailand- the overseas market, it is imperative to know briefly the history and background of Tesco as well as marketing environment and marketing strategies used by Tesco in the United Kingdom and Thailand.

1. Tesco’s background information

Tesco was founded in Great Britain in 1919 by Jack Cohen. The home town of Tesco is East End of London and today it is an intercontinental retailer of groceries with main offices in Welwyn Garden City, Hertfordshire, England (United Kingdom).

Tesco is now the third largest retailer in the world and about revenues, it is the fifth-largest retailer in the world. It has stores in 12 major markets with 476,000 colleagues and 6,902 stores. The year 2013 saw Tesco report its first drop in profits for 20 years (The Telegraph, 2014). Nevertheless, the profit for the year 2016 was at GBP 129 million.

1. Tesco in the United Kingdom

Tesco in the UK is the largest in the Group (with over 3500 stores and over 310,000 colleagues) and in the UK (with UK market share: 28.3 percent in the first quarter of 2016) (The Reuter, 2016). The main competitors of Tesco UK are ASDA, Sainsbury’s and Morrison’s. The reason for choosing Tesco is because, the grocery industry is essential to the UK economy (£340 billion in 2015) and thus this is the potential sector to participate for investors (The Prospects, 2016)

1. Tesco Lotus

Tesco Lotus (began trading in 1994) is currently the second largest international business of Tesco Group with over 1,700 stores and over 50,000 staff. Big C is the biggest competitor of Tesco Lotus in the Thailand market. We choose Tesco because it has also built a strong position in Thailand. The retail market in Thailand is predicted that it will have a positive growth. The retail market is forecasted to grow at a CAGR of 6.38% by revenue (2016-2020) (The PRNewswire, 2016).