Tesco

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Compare and contrast the concepts of marketing orientation, production orientation and sales orientation. Which one of these philosophies do you feel Tesco utilise?

Answer:

The marketing orientation evolved from the earlier production orientation and sales orientation, and continuously extend to the relationship marketing, ultimate purpose for all are earn profits through deliver products or services to customer (Kotler & Keller,2008).

Since 1920s, production orientation was the first evolutionary of marketing development where apply with the concept of mass production to lower its cost price, mostly focused on product quantity rather than quality and assumed that customer will buy it if cheaply enough (Pearson,1993). It happened in the seller’s market when demand exceeded supply. During 1930s~1950s, sales orientation under the transition period of product supply exceeded demand, it was the period which mainly focused on sales instead of offering what customer wants (Kotler,1999). Customer will buy your product if you sell hard enough. In sales orientation, marketers produced products same as production orientation but “hard sell” and “push” activity were the method to stimulate the sales volume and target.

In 1950s, manufacturers started to realize that analyse and understand customer wants and needs both were important than pure selling, this was the marketing orientation era which began adopt with 4Ps- Product, Price, Place and Promotion to persuade potential customer to buy quality products or services (Kotler & Keller,2008). In marketing orientation, cost reduction and efficient processes are the commonality share with production orientation. With reference to sales orientation, marketing orientation also apply the selling tactic. However, marketing orientation more concentrate on the customer-oriented services which associates with well-laid plan market segmentation and market strategy (Kotler & Keller,2008).

From my perspective, Tesco highly possible utilise the marketing orientation philosophy. Rogers et al.(2005) carried out an empirical research on Tesco, it analysed and discovered that Tesco has successfully became the market leader not only in UK but also in Eastern Europe two emerging market such as Hungary and Slovakia. When Tesco entered the new market of Eastern Europe, it starting to adopt with the 4Ps concept to build up its market share and brand value. Furthermore, Tesco cooperate with Eastern Europe authorities in order to gain some local knowledge, it is the best efficiency rapid penetration into the competitive market (Rogers et al.,2005).

Through continuous communication to sustain good relationship with customers is vital and critical in marketing orientation (Gilbert & Sumner,2004), that’s the key for Tesco to form up a strong relationship and loyalty with its customer. Periodically, brand image survey and customer survey are conducted by Tesco to find out the company’s image and services, product quality, range and promotions (Rogers et al.,2005). In addition, Tesco is always close-knit link with suppliers to acquire cheaper product to establish strong supply chains. Consequently both will benefit customer with cheaper quality products which they require and desire.

In the course of internationalization process, Tesco management understands each country is unique with its own culture and encourages on information sharing between UK head office and foreign countries’ branch (Rogers et al.,2005); hence the management, selling tactic and packaging are flexible to comply with the relevant country’s customer needs. Furthermore, Tesco has gained a lot of useful experiences and tips on enhancing the flexibility and receptiveness of the company (Palmer,2005), accordingly the company is much more observant to experiment, learn and respond to the unexpected later phases of expansion throughout the worldwide. On the other hand, Rogers et al. (2005) also...
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