Tesco PESTEL and SWOT Analysis, Marketing Mix, and Sales and Negotiation Skills

Marketing, Sales and Negotiation Skills

Table of Contents
Introduction. 3
Tesco PESTEL and SWOT Analysis. 3
PESTEL Analysis. 3
SWOT Analysis. 7
The Tesco Marketing Mix. 9
Marketing Mix Discussion Table. 12
Sales and Negotiation Skills at Tesco. 13
Conclusion and Recommendations. 14
Recommendations. 14
References. 16

Introduction
The contemporary business world has attained unprecedented rivalry over the years, and entities are finding the need to develop better ways of carrying out separate functions to keep sustainable and relevant in various industries. Industries are massive now more than ever, with countless shop floors available both online and offline, making it necessary for firms to do something extra to bring customers their way and make the much-needed sales. That is marketing. It makes a firm's products visible to customers in markets overcrowded by other sellers. Today, businesses must extensively hone their marketers' sales and negotiation skills lest they lose their clientele to eager competitors waiting next doors. They must analyse their environments and understand the best marketing mixes to make significant sales in their markets. This report aims to explore the factors necessary for a company to market its goods today strategically. A case study of Tesco Plc. has been selected.
Tesco PESTEL and SWOT Analysis
PESTEL Analysis
The PESTEL model aids learners in analysing factors in the external environment of a business or industry by classing them into six categories that include Political, Economic, Social, Technological, Environmental and Legal categories (Yüksel, 2012). As an MNC, Tesco contends with such factors in the various countries of operation and below is an analysis of how they affect their marketing strategies.
Political Factors
Political factors can incentivise business and enable marketing or entirely serve to make it hard for a company to maintain its rapport with its clientele. As an MNC born in the UK, Tesco found it hard to attract investors due to Brexit's uncertainties since the UK's withdrawal from the EU left their relations rocky (Bloom et al., 2019). It was unclear what would follow and which markets Tesco would be denied from accessing, and that made Tesco curtail its international marketing initiatives significantly. Political instability also plays a part in influencing marketing, and recently, Tesco has stopped buying Russian products due to the invasion of Ukraine by the former (Mykhnenko, 2022). It means that their ‘product’ element in the marketing mix changes.
Economic Factors
Different countries have different wage rates and the higher the wage rate in a country, the more difficult it gets for the company to afford the labour and have good marketing teams. The UK has an ever increasing wage rate that should rise from £8.91 to £9.50 at the beginning of April 2022, while countries in Asia where Tesco is present offer the cheapest labour due to high levels of unemployment (Guo & Newbery, 2021). Costs and pricing also affect marketing efforts. The UK, for instance, has immensely raised borrowing costs and the effects are that Tesco needs to increase prices for its products which will hurt its image.
Social Factors
Consumer expectations have exponentially changed in recent years, which significantly impacts marketing. The modern customer is health-conscious and with the proliferation of lifestyle diseases, Tesco must remove from their marketing mix food items that cause obesity, cancer and other lifestyle diseases. According to Adamy (2019), over 65% of UK customers love building loyalty with reliable brands. Tesco is noted to use marketing tactics that cultivate loyalty, with the Tesco Clubcard being the primary driver of loyalty. Also, the modern customer is convenience-conscious and in marketing, Tesco teams must explain how they think their operationalisation serves that convenience for the customers.
Technological Factors
Technology has exponentially evolved inside the first two decades to change how things get done immensely, and the business world is on record for having gained the most over other aspects of life. Tesco used to have poor customer experiences, especially with incidences such as the horsemeat scandal, but that has come to an end with innovations (Mykhnenko, 2022). The company can now reach out to its customers through social media sites such as Facebook, Instagram and Twitter for feedback and announcement of new developments such as bonuses and new products. They also have the PayQwid payment system that has boosted their eCommerce operations (Guo & Newbery, 2021). The "scan as you shop" checkpoints have also brought delightful experiences for clientele who no longer have to wait in queues.
Environmental Factors
The world is conscious of sustainability in development and operationalisation, which has seen a range of initiatives to promote the same sprouting across societies. Sustainability-conscious customers want to associate with the brands supporting the theme through gestures such as depending on renewable energy sources to address the climate crisis. Tesco must adopt such procedures and mention them in their marketing mix to attract such customers (Adamy, 2019). Adamy (2019) shares that Tesco has projected to produce 100 per cent of its electricity by 2030 and halve its carbon emissions by 2025.
Legal Factors
Tesco is not new to legal suits, and it narrowly survived the famous Accounting Scandal of 2014 when it suffered severe financial austerity. It was again in 2016 when its employees successfully sued it for age and gender discrimination, among many other loggerheads it has had with judicial systems across countries (Guo & Newbery, 2021). Besides causing financial losses in court fines, such suits taint the brand's image and make it too hard for the marketers to regain their customer base.
PESTEL Analysis
Factor
Impact
Political
1 Brexit
2 Political instability
1 Scaring away investors
2 It makes it difficult to market goods in hostile regions
Economic
1 High wage rates in some countries
2 Low wage rates in some countries
3 High production costs
1 High labour costs
2 Affordable labour
3 Need to raise prices for goods which affects customer loyalty
Social
1 Changing customer expectations
2 Loyalty among UK customers
1 Need to change operationalisation at a cost
2 Need to invest in loyalty-building activities
Technological
1 Technological evolution
1 Increased efficiency in productivity
Environmental
1 Universal demands for sustainable operationalisation
1 Need to invest in sustainable sources of energy
Legal
1 Incessant legal suits
1 Losses through court fines
2 Loss of brand reputation
SWOT Analysis
Tesco’s SWOT Analysis is as follows:
Strengths
Tesco is the largest supermarket in the UK, with a market share of 27.7% (Fatricia, 2017). Such dominance enables them to make huge profits annually and use them to suppress competition from emerging rivals. The grocer has also ensured continuous geographical diversification across Europe, Asia and North America, enabling them to spread risks and build brand image overseas (Guo & Newbery, 2021). Tesco has also immensely deployed technology compared to rivals leading to increased customer loyalty in a viciously competitive industry.
Weaknesses
Tesco’s expansive blunders are one of their greatest nightmares so far, and they have had to exit markets such as China, Japan and the US after shambolic entries that led to massive losses (Dakhli et al., 2019). As mentioned earlier, they have problems operating within the legal provisions of different jurisdictions. That had landed them into heavy fines when they were already going through financial troubles.
Opportunities
One of the priceless opportunities presently is technological advancement and the company can utilise current and emerging technologies to gain sharper competitive edges over its rivals (Pheunpha, 2021). Ecommerce can mainly place them in a league of their own if they deploy it better as globalisation increases. There are also emerging markets in Asia, Africa and the Americas, and the company can come up with better strategies for entering them (Guo & Newbery, 2021). Many firms in the international markets are welcoming superior brands for strategic alliances, and Tesco may consider them in their expansive efforts.