Table of Contents
2.0 Contextualizing Adaptation and Standardization.
3.0 Key International marketing issues: 4Ps.
Place and Process
4.0 Tesco responses and recommendations.
In the UK retailer market; Tesco PLC is a long-lasting retailer company. This retailer firm has established a good brand picture not only in the UK market but also in international as well as in global markets. The net profit of this company is nearly £3 billion (Tesco Plc, 2019). Only Wal-Mart and Carrefour are getting top position before Tesco. This retailer firm offers various products to domestic and international customers including clothes, food, financial operations, drink, telecoms, and health. At present; this company starts huge service facilities in the international market. For this reason; this paper is prepared to understand the international marketing strategy of Tesco with contextualizing adaption & standardization.
2.0 Contextualizing Adaptation and Standardization
In the case of contextualization, the adaptation indicates guidance at the time of ensuring and maintaining standards. In the case of the application of the standards, business organizations can adapt the guidance to attain the ultimate standard (Chung, 2017). Dana (2014) stated that Product standardization is defined as the standard quality of the product in the market. Promotion standardization indicates the quality of the marketing mix to promote market products. Tesco has operated its business functions outside the UK but mostly in the UK nearly 60% of its total sales. In this section; the various theories or models are used to evaluating the effects of the external environment. Tesco Plc has imposed several tools and promotional activities to eliminate the bad effects of the external environment. In the case of international marketing evaluation; the EPRG model will be applied.
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EPRG stands for Ethnocentric, Polycentric, Regiocentric, and Geocentric (Dana, 2014). This framework helps to monitor and evaluate the ultimate position of the international market. The EPRG model also is very useful to take a decision on the activities of the parent firms and the subsidiaries (Dana, 2014). Ethnocentric indicates the home country orientation; Polycentric comprises the host country orientation; Regiocentric evaluates the regional orientation and finally; Geocentric indicates the world orientation of a business firm.
Figure: EPRG Framework Source: (Coventry University, 2018)
In the case of the global market; Tesco has started its business operation in the Hungarian market by using the S-Market chain in the year of 1995. After that; Tesco has started a venture with Thailand in the year 1998. In addition; Tesco has also started joining the business with Taiwan and Slovakia in the year 1999 (Tesco Plc, 2019). Tesco has a strong brand image in both domestic and international areas due to its higher acceptance to the customers.
Ronkainen (2016) mentioned that the International marketing system depends on some special theories. EPRG Framework is one of them. The first part of this model includes the ethnocentric approach which is suitable for Tesco to run the business activities abroad. This approach is helpful to generate success and orientation in the home country and to assess the culture and customers’ buyer behavior abroad (Robson and Katsikeas, 2016). It is very easy for Tesco to run its business activities in the domestic area than that of another global market. Tesco can operate a good business function in the nearest countries of the UK like France. But sometimes it seemed to be difficult due to the difference in language. In the case of running a business in Taiwan, Tesco also has faced problems because a strong entry strategy is needed. That is why; Tesco has used the ethnocentric approach to develop a strong position in the home country’s market and the countries that are near Europe. But they should consider the global market positively and start their business in the remaining countries in the world.
3.0 Key International marketing issues: 4Ps
what is the marketing mix
Priya Johnson (2018) stated that product is defined as the goods and services that offer in the market to the ultimate customers. In the case of Tesco; ethnocentric as well as regiocentric factors are considered to produce products and services. The products of Tesco have a different segment of variety, the standard level of quality, attractive design and features an attractive and strong packaging system. In the case of international strategy; the firm can expand the market on the basis of the demand of the market customers. In the case of the European market, Tesco has considered the product line and customers’ needs that help to expand the global market. Chinese people want to buy fish and instant noodles. For this reason; Tesco offers fish and noodles products to Chinese customers for attracting potential consumers. In the case of Thailand, people have shopping habits and purchase products and services from the fresh market and Tesco has served fresh foods to the customers.
Promotion indicates the functions by which a company introduces the new and existing products to the potential customers that inspire the customers to buy (Michelle Seidel, 2019). In these promotional activities; Tesco has followed the mixture of ethnocentric and polycentric approach. Tesco has applied most of the promotional functions in the UK. In addition; this firm also has applied promotional strategy in a global markets like Thailand and Poland. In Thailand; Tesco has taken a plan and implemented the plan with a view to introducing the products to the ultimate consumers. In Poland; Tesco has offered fresh foods and communicated with the customers for giving them enough information relating to the products.
Mark Acutt (2016) said that Price is defined as the paid amount of the customers for purchasing a product. In the case of the marketing mix; it is an important tool for marketing strategy. In the case of international marketing; this strategy should be followed by every international firm. Tesco has followed the polycentric pricing method to retain the global market. This firm considers the customer’s response in the international markets for generating the price of the products and services. This firm believes that one pricing strategy is not suitable for all countries. That is why; the price level should be prepared based on the demand, competitors’ price level, social status, the standard of living, and income levels of the customers ( Mark Acutt, 2016). At present Ireland has several crises and Tesco has offered low price shopping and various discount facilities to the customers. On the other hand; Tesco has imposed a slightly higher price level of goods and services in the case of European countries.
Place represents the functions at which consumers can buy the products. A polycentric strategy is suitable for the place as a marketing mix. The placing strategy is not similar for all countries. In the case of international trade; some local suppliers, as well as marketing channels, are needed to supply the products in the market (Manish Patidar, 2015). For this reason; Tesco has used a polycentric strategy in the case of Malaysia, China, and South Korea because the political, economic, and cultural sectors are not similar to UK (Zentes et al., 2011). Tesco has several stores and shops at which customers can buy their ultimate products.
4.0 Tesco responses and recommendations
In summary; this study outlined the international marketing processes and strategies that need to expand global marketing factions of Tesco Plc. The EPRG Framework has mentioned here and this has revealed that the ethnocentric approach is good to develop a strong position in the home country’s market. Tesco can hold business opportunities in the international market by adopting various international strategies. Tesco can enter the International market through ventures and acquisitions system. These processes help to attract potential global market customers in a rapid way.
Tesco has stopped its international market that did not make a profit over several years like the United States and Japan market. This retailer firm should check and monitor the international policy of the competitors to understand the strategy of marketing. Tesco should use marketing promotional activities both in the domestic and international markets for attracting the customers and retaining the customers as loyal. Tesco should offer various quality products and services within due time in the international market to establish a strong position in the global market.
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Chung, H. (2017) International standardization strategies in UK market, Journal of International Marketing, Vol. 11, No. 3, pp.48–82
Dana, T.E. (2014) Business internationalization. International Journal of Entrepreneurship and Small Business, Vol. 1, Nos. 3–4, pp.330–338.
Manish Patidar (2015) Steps in the Process of International Marketing. Available at: https://www.enotesmba.com/2015/03/steps-in-process-of-international-marketing.html. [Accessed on 31 October 2019]
Mark Acutt (2016) A Proper Marketing Mix Strategy Helps In Establishing a Niche in the Market. Available at: https://marketingmix.co.uk/marketing-mix-strategy/. [Accessed on 31 October 2019]
Michelle Seidel (2019) The Importance of Promotional & Marketing Strategies. Available at: https://smallbusiness.chron.com/importance-promotional-marketing-strategies-57205.html [Accessed on 31 October 2019]
Priya Johnson (2018) A Thorough Explanation of the Marketing Mix Strategy. Available at: https://marketingwit.com/marketing-mix-strategy. [Accessed on 31 October 2019]
Robson and Katsikeas (2016) Export product strategy fit and performance: an empirical investigation’, Journal of International Marketing, Vol. 17, No. 4, pp.1–2
Ronkainen, I.A. (2016) International Marketing. 6th ed. Texas: Harcourt College Publishers.
Tesco Plc (2019) About Us. Available at: https://tescoplc.com/about/. [Accessed on 31 October 2019]
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