First, I would like to give thanks to the Almighty God for providing me knowledge and wisdom to conduct this research work. Then, I would give many thanks to my honorable supervisor, who has given me suggestions, directions and provided me with available resources to conduct the research work. After that, I would appreciate the libraries and publications of websites and journals, from which I have collected data to extend my knowledge and understanding on conducting the research work. Next, I would like to pray for my honorable parents who have supported me a lot with their finances, devices, and suggestions to develop my career. Finally, many thanks to my friends and classmates, who have supported me in my research work with their advice, suggestions, resources collections, and time contributions.
Understanding customer purchasing behavior has been a challenging issue for business organizations in the current business world. In addition, in the increased endless fading of advertising with the improved prevalence of promotional tools, building improved brand loyalty is a key issue for the retail giants. Advertising can impact and even shape customer behavior significantly. In addition, it can support organizations to link their brand with experiences, places, multitude, impressions, bands, cases, etc. However, still, now many organizations have vague ideas about the effectiveness of advertising on customer purchasing behaviour. Thus, analysing the effectiveness of advertising on customer purchasing behaviour has been a key issue for organizations including Tesco plc. Organizations including Tesco Plc must also need to know how the advertising technique can be used more effectively to influence customer buying behaviors.
The aim of this research study is to evaluate the effectiveness of advertising on consumers purchasing decisions to guide Tesco on how it can improve its advertising campaigns. The objectives of the study are: 1) To identify the factors affecting the selection of advertising methods in the retail supermarkets; 2) To identify the factors affecting customer purchase decision making; 3) To assess the effectiveness of advertising on customer purchase decision making in the perspective of customer views; 4) To investigate into the Tesco’s existing advertising campaigns to attract its consumers; 5) To make recommendations for the Tesco to improve its advertisings to influence customer buying behavior.
The undertaken research has benefited in different ways. Firstly, it has developed and extended the researcher’s knowledge and understanding of how to conduct effective research work. Secondly, it has taught the researcher how to conduct research in the real field on participants and how to collect data through secondary sources and primary sources like interview and survey. Thirdly, it has taught the researcher to review the literature critically on the research subject areas. Fourthly, it has developed the researcher’s understanding of research methodologies including research philosophy, research designs, data collection methods, data analysis techniques, research reliability and validity, and research ethics. Finally, the researcher has been able to find a solution to the research problems, which recommend Tesco to improve its advertisings techniques to influence customer buying decisions and attract them.
The study has used several methods and methodologies for this undertaking research work. As the research philosophy, the researcher has developed a pragmatism philosophy to undertake this study, where both positivism and interpretive paradigms have been applied. The researchers collected the required data from both primary and secondary sources and used both qualitative and quantitative data collection method. The researcher has used a deductive research approach to conduct this research study. For collecting primary data the researcher has used two methods: interview and survey. For conducting a survey a particular survey questionnaire has been made and for conducting an interview one question paper has been prepared.
As a sampling technique, two different samples have been used in the study. One sample has been used for conducting interviews with Tesco management people following probability sampling methods with random sampling technique. This sample has included five Tesco managers from five different branches. The second sample has been used for conducting a survey on Tesco customers following the non-probability sampling method with quota sampling technique to investigate their buying behaviours. In this sample, total of 50 customers have been selected, where 25 were males and 25 were females. The age groups of this sample were 16-65, and have been divided into five groups: 16-25, 26-35, 36-45, 46-55, 56-65. In each group, there were five males and five females.
The researcher has used SPSS software and MS Excel application to analyse quantitative data, theme and content analysing technique to assess the qualitative data. The researcher has considered several ethical issues in the research works, mainly data confidentiality and anonymity.
The key findings of the research are vast majority number of customers like to get information through Tesco websites, where the 75% of consumers love mobile devices ads and internet ads. In addition, about half per cent of the consumers love social media ads and ads through TV/radios. These data indicate that customers are more curious about digital ads than mass-media tools. As a result, Tesco must put more concentration on digital adverting (mainly on Tesco website, social media ads, mobile devices ads, and internet ads) than mass media advertising. Tesco should also keep in mind that in the technological advancement customers are moving their heads from mass-medias ads towards digital ads, and has to take required actions to meet the customer expectations.
Chapter 1: Introduction
Understanding customer purchasing behavior has been a challenging issue for business organizations in the current business world (Palmer, 2010). In addition, in the increased endless fading of advertising with the improved prevalence of promotional tools, building improved brand loyalty is a key issue for the retail giants (Aaker, 2014). Advertising can impact and even shape customer behavior significantly (Kotler et al., 2012). In addition, it can support organizations to link its brand with experiences, places, multitude, impressions, bands, cases, etc (Blackwell and Engel, 2006). However, still, now many organizations have vague ideas about the effectiveness of advertising on customer purchasing behavior. Thus, analyzing the effectiveness of advertising on customer purchasing behavior has been a key issue for organization’s including Tesco plc. Organizations including Tesco Plc must also need to know how the advertising technique can be used more effectively to influence customer buying behaviors.
1.1 Research Background
The undertaking research is based on a particular organization namely Tesco plc. Tesco, the leading retailer in UK and Europe, is serving millions of customers every week with its more than 500,000 devoted and dedicated staffs. Although Tesco gained better performance against its competitors before, nowadays it is facing challenges to meet organizational goals and objectives. It has been observing, mainly from 2010, a decreased sales revenue with declined profit margin, and facing difficulties to gain competitive advantages. The key reason is Tesco is nowadays facing difficulties to understand customer purchasing behavior in spite of using its Club Card effectively. Consequently, it has been a significant issue for Tesco to find out more options to realize its customer buying behavior (Tesco Annual Report, 2014).
Although Tesco plc is using advertisings as a tool to identify customer purchasing behavior, it is facing tough challenges in surviving competitive marketplaces and gaining sustainable competitive advantages. Although Kotler (2012) stated that there is a strong relationship between advertising and customer purchasing behaviors. However, Tesco plc has vague ideas about the exact impact of advertisings on customer purchasing behaviors. Thus, conducting a study on the impact of advertising on customer purchasing behaviour has been an important issue for Tesco plc. As a result, this study will assess the effectiveness of advertising tool on customer buying behavior to guide Tesco on how it can use this particular tool to understand customer buying decision.
1.3 Research Problems
Although the companies including Tesco plc in the retail industry is using several advertising techniques to influence customer purchasing decisions, still now many organizations including Tesco plc have vague ideas about the real impact of advertising on customer buying decisions. Companies including Tesco plc could not identify the actual figures of customers reactions towards advertisings as marketing tools. In addition, competitive marketplaces, slow growing and volatile economy, technological advancement and consumer changing needs and expectations are giving hard time to organizations including Tesco plc in surviving and gaining sustainable competitive advantages. Thus, companies including Tesco plc are looking for more effective advertising techniques to influence customer buying decisions.
As a result, this research study has evaluated the effectiveness of customers reactions towards advertisings in their buying decision from Tesco’s business perspectives. The study has measured and quantified the customer’s judgement towards advertising in their processes, behaviours and opinions. The study has measured the effectiveness of advertising on customer buying decisions using underestimating and overestimating technique on a particular number of participants, where these techniques have defined the meaning behind the outcome. The research findings have provided suggestions and recommendations for Tesco plc on how it can improve its advertising technique or can use it more effectively to influence customers in their purchasing decisions. The effectiveness of the recommendations provided has been justified by monitoring, assessing and evaluating customers reactions towards advertising their purchasing decision making. Finally, the research study has extended knowledge of Tesco plc on customer’s judgements and reactions towards advertising in purchasing decision and on factors which may create effective advertising to influence customer purchasing decision……………..