OMNICHANNEL STRATEGY & SUPPLY CHAIN MANAGEMENT
Introduction
The purpose of the report is to evaluate the strategy that Tesco Plc has adopted along with the process that has been set for the business in the Omni channel market hence an executive summary has been set. The summary states that the discussion will be made based on the company’s background, the internal and external analysis of the company and the ways that have been set for the advancement of the customer’s behaviour. The experience many are faced through purchase along with the benefits and pitfalls that the technology is used for the progress in the business.
Company background
Tesco Plc is placed in the UK that focuses on vigorous and bargain-basement, defendable food that will make the life of customers live a good and healthy life that will control the betterment of the standard of living. The group revenue of the sales that have been collected by the company is 54.8bn which has increased from the report of 2021 which is 2.5% (Tesco plc.com2022). The number of average employees who are working day and night to make the goal of the company in the right direction is 3, 54,744 who are always ready to serve the planet.
Macro Analysis
| Political | In the UK, the political structure is of modern parliamentary democracy with a constitutional monarch as head of the state |
| Economical | In the UK the monthly Gross Domestic Product (GDP) of the nation rose by 2.3% from 2021 to 2022 where wholesale and retail trade contributed to about 0.01% (ons.gov.uk, 2022) |
| Social | The social structure of the UK is diverse holding around 68, 695, 046 population consisting of about 0.87% of the world population in 2022 (Worldometer. U.K, 2022) |
| Technological | The UK is versed in technological advancements in the nation, and London is termed the hub of both technological and financial institutions. |
| Legal | In the country, a starting legal structure is developed under the law of Companies Act, of 2006 which highlights that companies have to abide by the equity policy in the organizational functions as part of ethical practices towards stakeholders (Legislation.gov.uk. 2022) |
| Environmental | UK companies have to abide by the UK environmental law of Control of Pollution Act of 1974 regarding air, water, noise and soil pollution to avoid legal intervention (field.org.uk. 2022) |
Table 1: PESTLE analysis
(Source: Self-created)
Technological trends and the ways to fulfil the changing consumer behaviour
The advanced technological infrastructures in the UK offer companies unlimited opportunities for business growth for companies to change with the demands and tastes of the target audience in the market. Tesco Plc has been persistent in the continuation of investment in technologies which are used for the development of Omni-channel consumer experience and to gain a competitive edge in the digitized UK retail sector. In terms of changing consumer preferences with the emergence of digital technology in the retailing industry, companies have to decide on the adoption of technologies such as Blockchain to understand the change in consumer behaviour to curate product development (Cui et al., 2021).
To improve the operating model in Tesco, the company has taken the initiative in the implementation of technological advancements through the mechanism of “Scan as you shop” along with self-checkout stations to provide consumers with technology to gain a better consumer experience.
In the UK market, consumers have increasingly expected delivery options to be included in standard practices where retailers such as Tesco have to move quickly to retain competitiveness in the market. Tesco has taken the initiative in deploying technology such as Artificial Intelligence (AI) in infrastructure that requires the flow of data from the collection points to inventory management to provide the consumers with a single view of the product (Wang and Pettit, 2022).
Tesco has maintained the central position for consumer interaction which has been emphasized with the emergence of technological advancements providing a cutting edge in the Omnichannel retailing sector.
Consumer experience through Consumer purchase journey and its impact on business strategy
In an organization, the consumer purchase journey has a direct impact on the formulation of a business strategy that is designed to help in increasing revenue in the given market. The valuation of consumer experience is determined by organizations through the following Consumer purchase journey which determines the consumer’s purchase decision in the long run.
In the method of follow-up of the Consumer Purchase Journey the company, strategies are formulated to gain the attention of the targeted audience and attract the audience in checking out the products put forward. Tesco focuses on the creation of Customer Experience metrics (CX) which are used to determine consumer engagement with the company in the market and determine their needs and interests (Ballerini et al., 2022).
Figure 1: Consumer Purchase Journey
(Source: Ballerini et al., 2022)
Tesco then includes the development of win situations in the consumer purchase journey in the development of Business to identify the specific needs and demands of the target audience. The implementation of Value realization is done through the formulation of personalized marketing channels which helps in gaining the attention of potential consumers in the UK market.
The validity of the Consumer purchase journey with the help of Josko Brakus’s Theory of Consumer Experiences is conducted through the company releasing over consumer satisfaction level and committing to purchasing decisions which is a continuous business strategy adopted by the company. The onset of the global crisis has led to a change in consumer behaviour, for which Tesco had to focus on implementing changes in the consumer purchasing journey to gain a sustainable business strategy and increase consumer experience (Frei et al., 2022).
Tesco may utilize the consumer purchase journey in anticipating the consumption experiences of the target audience which may be utilized in the development process of a consumer-based strategy. The readily available information gained through the journey may provide the organization with important insight into consumer behaviour and preferences which are used in the development of a business strategy for Omni-channel marketing.
Micro Analysis
Customers
There is no age bar for Tesco Plc customers as any age group customers are allowed to buy the services that the company is offering hence it makes equality in the community with the robust technology. The targeted audience by Tesco Plc is the cost-conscious individual as the audience over the field will be seen to bargain-sell based on variations in the value.
The method that Tesco Plc uses is to monitor the market with the use of scanning the code in the phone to check-in. Artificial Intelligence is widely helping to improve the quality of marketing in different parts of the world hence the help is extracted for the improvement that is deserved for the development of strategy (Srinivasan, 2022). From the base in the market, the company has enormously set the step towards the business in the supermarket that is helping the band to focus on fresh living.
Hence the company can serve in the global market which is giving influencing the development which may not hinder the audience from the statistical factor or quantitative tactic factor. During the pandemic, the business world has been seen to destroy yet the root of the strategic development by technical advancement has taken a shape hence the development of digitalisation was taken a gigantic face (Ali, 2022).
Competitors
The growth of any company attracts as in the global market, the competitors of Tesco Plc is ranging in different dimensions where ASDA has been seen to lead the company. Following ASDA, Sainsbury’s, Morrison’s, Aldi and many other companies have been seen in the list. ASDA has been seen to sell apparel along with furniture and grocery whereas Sainsbury’s has been performing experiments with the outlets.
Morrison’s has been seen to clutter the price based on the everyday work again Aldi has been seen not to offer any markdown that is making the company move next to Tesco Plc. The information is gathered for the expected strategy that the company is focusing on and the service that the company is providing to the audience (Rosnizam, et al., 2020).
Tesco’s online, mobile, physical marketing and supply chain strategies
Tesco’s online
Tesco follows internet marketing as its online marketing through which Tesco promotes its discount strategy on the products to the customers to retain and attract customers hence the brand is famous for its services. The management that is designed by Tesco Plc keeps the key in the development with the growth in the digitalisation that is offering the services in a conceptual way (Wood et al., 2017).
Tesco’s mobile
By the use of the Tesco mobile application as mobile marketing, customers can scan the code that is provided and may get into the official website of the company directly. The advancement of the internet has witnessed a great revolution in every aspect of life hence the need has been satisfied with the great pick over the technical growth (Tesco Plc, 2022).
The advancement has been set in the mobile marketing application of Tesco Plc that the activation of the location will be conducted so that the customers may get the exact location of the store even from a distant range.
Tesco’s physical marketing
Tesco Plc does its physical marketing through stores with many wide ranges of products in the stores hence it attracts more customers’ inward itself hence the products are visibly fresh while maintaining the quality.
The wide range of options is also available in that store which attracts the customers too hence the concept of fresh living is exercised by the company in different ways. Tesco Plc maintains the standard of the marketing strategy in the same way hence the development has been seen in performing worldwide and dropping the ability in the variation which takes the brand in the people’s choice (Coe et al., 2017).
Supply chain strategies
Tesco Plc has a supply chain strategy that speaks for controlling the orders that are placed in the way of ordering the product with the help of the medium that is stated.
The specific orders need to be placed by the customers hence the order has the requirement to be delivered within a certain date with maintaining quality. After the method has preceded that production is channelized with the freshness in the quality that is making the product being distributed later. Finally, the process satisfies the customer’ hence the supply chain has been recommended to uplift the strategic base of the company with the effort of delivering the transformed process with then management over the technology (Evans and Mason, 2018).
Figure 2: Tesco’s supply chain strategies
(Source: Evans and Mason, 2018)
The need to focus on the value of the supply chain is essential as the quality check of the product to keep the customers satisfied is necessary for the company. However, the products need to be in the range of purchase so that the capacity of purchasing is maintained by the company and attracts more customers towards it.
Analysis of the company’s technological initiatives
Critical analysis of the impact of technology data analytics in the development of strategic management of omnichannel marketing and supply chain process
In the retail sector, the use of data-driven marketing solutions has led to the transformation of the methods through which the companies advertise their products and services which allows for reaching an engaged audience with the right message. Tesco uses Big Data analytics in harnessing data that helps in the business process of connecting with suppliers and utilizing multiple stores to data warehouses through the use of the internet.
Furthermore, the use of data analytics and implementation of the Communication Mix theory has benefited the company with real-time updates to gain predictive analytics to be used in the Omnichannel marketing strategies to address the demands of the target audience in the UK. Furthermore, Tesco has included the use of technologies such as Big Data analytics and Machine Learning to optimize the business strategy to help make informed decisions and expand Omni channel distribution (Parackal et al., 2022).
On the contrary, the use of data analytics technology in Omnichannel marketing has presented pitfalls in the business process such as glitches in Programmatic advertising and overspending of revenue.
The use of big data analytics may be considered to be useful for companies in the retail sector in the UK for improving Risk Management based on previous patterns and trends throughout the supply chain process. The implementation of big data analytics in Tesco has benefited the company in increasing planning accurately by analyzing consumer data and identification of critical factors to determine the increase and decrease in demand in the business process.
Moreover, Tesco has included the use of data analytics techniques such as the Internet of Things (IoT) in the Supply chain process to help in identifying the critical factors through data and adopting a plan to formulate a business strategy (Noor, 2022).
Figure 3: Use of data analytics in the Supply Chain Process
(Source: Noor, 2022)
However, the use of Data Analytics in the Supply chain process has brought forward pitfalls in the operation process of deficiency in future predictions and having to deal with databases in the process of business strategy development.
Evaluate the area using of technology to help the company in meeting the touch points of consumers and develop an effective decision-making tool
The utilization of data analytics and technology such as Artificial Intelligence (AI) is being used by companies in the development of effective interactions with consumers to meet consumer touch points in the business process. Tesco has felt the benefit of the utilization of Big-data analytics covering all the digital touch points which have resulted in increasing the value of consumer experience in the given market (Dekimpe, 2020).
Furthermore, the company has incorporated System Management theory in the implementation of big data analytics in the Consumer experience and business strategy which has benefitted in harmonizing the large system to function at an optimal level. The application of Information technology which is presented by the use of data analytics systems such as AI has presented Tesco with data confirming consumer insight and personalized touch points to gain a competitive advantage in the market.
However, there are pitfalls in the use of data analytics in meeting touch points of consumers such as recommendation systems which may impact negatively consumer purchasing decisions and increase security and privacy issues.
Tesco may have felt the benefits of using data analytics and technology in decision making, as data-driven decision-making processes tend to be faster as well as reliable furthermore leveraging the company’s ability in providing insights on making strategic decisions.
The company has used data analytic tools such as Microsoft Excel, Google charts and Power BI which has resulted in accelerating the decision-making capabilities to develop business strategy and processes (Duma, 2022). However, Tesco has also faced pitfalls in the implementation of data analytics in the decision-making process which resulted in getting inaccurate insight which led to the wrong business strategy and the creation of a false sense of confidence in the business process.
Identification of Principles of Omni Channel strategic business management to determine best practices for a business strategy with model implementation
Omni channel business management includes the brand diversion and creation of a profile of customers that may be suitable for a better consumer experience to be precise. In other words, Omnichannel marketing is the tool by which the creation of the climate in which the customer thrives appropriately is made and detected, letting the customers be more connected to the business.
Tesco Plc is the company that has been taken in the case study whereby the touch points of such targeting strategy have been accurately described, in effect to the customer engagement and create future business prospects (Payne et al., 2017). The measurement of the business success depends on some principle marketing strategies, which are not necessarily an outcome of technological involvement and acute innovation done within the company profile.
Customer interaction is the primary purpose of Omni channel marketing, with the intention of the difference for communication, such as store customer interaction or online market space for the customers are the basic tools of Omni channel marketing. There are several issues that a company such as Tesco Plc may face to implement the Omni channel marketing strategy, whereby customer orientation along with getting a better market perspective is important (Hosseini et al., 2018).
Figure 4: Omni channel marketing prospects
(Source: Hosseini et al., 2018)
A recent study on the omnichannel marketing strategy has revealed that the customers are more anchored for the direct experience than for the experience of any kind of showroom or influencers, which Tesco Plc needs to notice (Kang, 2019).
Conclusion
It may be concluded that the report has been based on the different perspectives of Omni channel marketing, considering the consumer focus and taking to the journey of customer purchase, through exploration of various models of the journey. In this report, Tesco Plc had been taken as the company to study, identifying the major competitors of Tesco and finding out the degree of the Omni channel strategies that Tesco Plc has devised.
A PESTLE analysis has been done in reaction to the customer journey and the different technological means to satisfy rather customer demand in the UK have been explored further. Progressing more, a customer purchase journey map has been developed and suitable Omnichannel marketing strategies have been discussed throughout the report.
Recommendations
- The need to improve the capacity over infant care, beauty routine, apparel and many more are needed hence the competition is tight over the genres which need to develop the strategy over the courses
- The implementation of more offers will make new customers attract towards the self that will need the company to increase the buzz over social media and other platforms
- By making the technical growth the company may face the high pitch in the growth more in the overseas market hence the requirement is based on the competitive and cooperative managers are required
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