The Practical Application Of Scientific Or Engineering Knowledge
The purpose of this literature review is how technology is used and helpful to an organization. This literature review deals with the existing drivers for outsourcing and factors that are contributing to its success. In addition, literature review will give us an opportunity of knowing about findings of the others on this topic or related topic, what type of research they had conducted to get to know the topic more deeply, their valuable suggestions and how this all is linked with current study. Also, in this chapter we are going to focus on the following points or themes: how technology has played a vital role in the development and betterment of the retail industry with particular focus on ‘ASDA’ supermarket. The chapter also outlines that no matter what kind of technology and modern techniques the retail industry uses the basis of marketing never changes and how these modern methods can be used in a better way.
2.2 An overview concept of technology:
“Technology is the practical application of scientific or engineering knowledge to the conception, development or application of products or offerings, processes or operations.” (Chris Floyd)
Technology is critical for two reasons. First, technology is fundamental to the success of every product business. Second technology driven innovation is the only viable route to long term growth, and so you need to manage explicitly the application of technology for longer term.
New technology has enabled supermarkets like ASDA to scan purchases of goods at checkout and an up to date record of the products purchased. In last ten years there are so many networks and new software are implement in technology which are very useful to organization to improve their sales. That all changes are the influence of technology on marketing activity on the Internet.(Coupey,2001).
Technology like interactive communication and online has begun to change the approach in which shopping, banking entertainment, and education system, Rapid advance in technology has brought of new sources and forms of information technology which has enabled the collection, storage and analysis of consumer data to become relatively simple and cost effective and the whole thing can be stored in a computer file and folder. In technology, new feature and new system are implement at everyday so companies have major difficulty are to update their technology system to compete their competitors there is example of Microsoft has moved beyond International Business Machine (IBM) as the world’s leading Software Companies.
How does an information technology affect a business? Difference managers have difference views, some managers would say that they result in unnecessary difficulty and expenditure. This may be true, when managers do not have to accept the latest information technology if they do not believe that they are giving benefits. So why are new technical change adopted? The reason may often be fear that if your competitors has updated to the latest networks, latest technology and e-business system, then competitor may have competitive benefits, then it is a powerful reason to invest in new technology or system.
The most complex aspects of marketing are technology. It is a study of how technology is used in retail industry, if customer is buying some goods how you are selling the product and what technology is used to sell your product and how it is helping your business.
The most complex aspect of marketing is the consumer their hearts and actions. If consumer behaviours were easy to explicate, then all products sell as well as projected. Consumer behaviour is the study of how people buy, what they buy and why they buy. I am doing my research on technology with help in retail sector Literature reviews a detailed and justified analysis and commentary of the merits and faults of the literature within a chosen area, which demonstrates familiarity with what is already known about your research topic. Saunders et al, (2003) defines the purpose of the literature review is to ensure that is no important variable is ignored that has in the past been found repeatedly to have had impact on the problem.
2.3 Marketing strategy:-
A product can be defined as an idea, a service or a good of any combination of these three, means product is total package which company are offer to their customer, it should be physical features of the product, or the intangible aspects of the services, but the central idea of company to satisfy its customer. So, the total product concept compiles of design, materials, quality, safety, warranties, varieties and servicing. (Russ&Kirkpatrick, 1982).In marketing mix, product variable is an important part which involves researching on customer demands and developing products accordingly. There are two internet related product decisions first one is Core product and second one is extended product. Core product defines as the main product purchased by the consumers and extended product is the services and advantages which comes with the core products. (Chaffey, et al,2006).retail stores like Asda, comes out with the product that are suitable for consumers and satisfy their requirements. Now a days competition of retail markets are so powerful and competitive ,the opportunity to takeover each other business is always the central point in supermarkets, therefore ASDA to improve its product lines and compete with other leading retail stores by using systematic and well planned technological business plan. Asda has simplified its websites, so consumers can easily find their products. So technology has helped Asda to compete with other leading retail stores in the country and improves online servicing.
Price is a mainly effective part of the marketing mix because of its direct impact on the customer, the business and the economy. To the customers, price is a major indication of quality and a central idea in the decision-making process. The company has to build up pricing strategies when introduce new product. There are two basic strategies, skimming and penetration strategy. The skimming strategy is recommendable for new technology or innovations; in this the price will be lowered at successive stages when the product achieves larger sales. For second one in this a product is introduced at a low price to attract the largest number of buyers as soon as possible.(Lancaster and Reynolds,1995,p.46). The internet has changed the implications for pricing it helps in low pricing of products which are available on online. It is very difficult for managers to set standard price for a product particularly in the retail industry, therefore it is said that competitors as a whole determine price for the industry. ASDA has gained competitive advantage as its prices are considered to lows compare to its product quality. In retail business, pricing is very competitive because of availability of large variety of goods and options are vast for customers to choose between products of different retail markets.
ASDA has benefit in this field because of its new technology innovation and excellent supply chain management. Price is therefore the mainly key part in the retail industry and ASDA has maintained overall leadership in this low price field.
Argued by kuttner(1998) “ The internet is a nearly perfect market because information is instantaneous and buyers can compare the offerings of sellers worldwide. The result is fierce price competition, dwindling product differentiation, and vanishing loyalty.”(Jonathan Reynolds, Christine Cuthbertson, Richard Bell)
Place or distribution is very crucial to the success of any retail sector .The distribution of products, transport, inventory and storage systems are main place element of marketing mix. In other words, Place refers to the means by which your customer acquires your product. This includes the actual place it is purchased (the shop, the telephone, the web page, the warehouse) as well as the actual route of distribution.
It is very important that the product or service offering are at the right place at right time to the consumer. Technological development in the field of supply chain and logistics has helped business like asda to open their stores in remote areas, where the presence of human population is less compare to high streets.
The introduction of Internet Technology has simplifies the production, outsourcing and distribution of products to consumers. This part of the Marketing Mix must be handled resourcefully as it involves huge cost.
The first three P’s Product, Price and Place are performed with the industry or between the industry and its marketing partners, but in promotion the industry directly communicates with the potential consumers through its promotional performances.
Promotion part of the Marketing Mix refers to how marketing techniques are used to inform consumers about the industry and its product line. (Chaffey, et al,2006).Promotion is a element of Marketing Mix carried out by the retail industry as promotional performance of the industry has the mainly straight control on the total amount of sales. Its means promotion is the technique of communicating complete product and business benefits to market targets.
There are many types of promotion in which technology used like, web page designing, online advertising, e-mail, networking, direct marketing and price cut or price off and discount coupons for the customers in order to increase brand purchase, goods purchase and spending.(E-Marketing: What Went Wrong and How to Do It Right, By K & A Press, Ira S. Kalb,p.n.181)
ASDA provides money off vouchers, voucher codes and discount offers on their website to attract customers.(http://moneyoffvouchercodes.co.uk/retailer/asda) retreived on 03/11/11.
Asda used latest technology which useful to increase its sales and profit margin .promotional activity is very important to gaining benefits over its competitors. Asda give different offer for save money to attract consumers.
All the four P’s of the Marketing mix analysis is a primary step for effective marketing strategy. The 4 Ps of marketing including the product, price, placement and promotion are the four wheels of the vehicle on which the path of a company’s marketing success is actually dependent. The researcher has further elaborated on this aspect in his study with the technology playing an important part.
2.4 Customer Relationship Management
Customer relationship management is a complex combination of the designing a CRM strategy, optimizing the business process and implementing the information technology.
CRM stands for an entity-wide implementation of a central data storing of customer information like sales, accounting marketing, customer support, customer service, crm also including ERP, vertical market and custom software application that offer significant customer data to the CRM. CRM technology is offered on-premise, on-demand or through Software as a Service (SaaS) CRM, depending on the vendor. Recently, mobile CRM and the open source CRM software model have also become more popular.
CRM technology is very useful to increase the market sale because this technology helping the organisation to enable its marketing sections to identify and target their best consumers manage marketing campaigns and generate quality leads for the sales team.CRM technology also used for Assisting the company to better telesales, sales management and account by optimizing information shared by multiple employees. CRM technology Allowing the development of individualized relationships with consumers, with the aim of getting better consumer satisfaction and maximizing income, its also useful to recognizing the most beneficial customers and giving them the top level of services. Asda also used CRM technology to Providing employees with the information and processes essential to know their consumers value and categorize consumer requirements and successfully build relationships between the business, its consumer base, and distribution partners.(ECRM: Using the Internet for Customer Relationship Management at the TQU Academy By Dipl.-Informationswirt Peter Schust)
Internet technology has been an important part of this strategy. Adaptive Websites are those web based systems that helps the user according to its needs. The primary aim of these adaptive websites is to satisfy customers despite their demographics and experience.
ASDA uses the online technology to provide customer service to its consumers, if a consumer has a complain or enquiry. ASDA has its own 24 hours consumer service, which solves consumer problems online (www.ASDAplc.com)retreived on 06/11/10.
Personalisation and Customization are used broadly in the retail business. Personalization defines as the combination of technology and customer information tailoring e-commerce interactions between a business and each customer. While customization is also a Web applications that bring information to customers based on gathered information about them.
ASDA has recognized a strong consumer base by successfully utilising the data held within their system by leveraging the concept of CRM (Customer Relationship Marketing).
Personalization defines as the combination of technology and customer information tailoring e-commerce interactions between a business and each customer. Personalization is the way wherever the consumer profiles are shaped, and potentially modernized, automatically by the organization with least clear control by the consumer. The best example of automated personalization is Amazon.com (Mubasher, 2007).
While customization is also a Web applications that bring information to customers based on gathered information about them.
There are few cases where these two ways are not differentiated. Example of the kravatz’s paper suggests that personalization and customization in the same background (Kravatz, 2007).but in most of cases differentiate the two concepts and researcher use personalization and customization in different contexts.
ASDA has recognized a strong consumer base by successfully utilising the data held within their system by leveraging the concept of CRM (Customer Relationship Marketing).
Relationship marketing is very important point. It helps industry identify potential consumers and cater its product based depends on consumer needs only means of the information held in their databases, so resulted in vast level of competition with the retail sector in the UK and across the world.
Asda has used the online environment and the traditional sense. asda believes in establishing customer relationship which will be its key to success. Electronics marketing retail companies are very skilful in database marketing and customer relationship marketing (Kotler, 2005) and E-Commerce technology have helped organisations good position in this retail field.
The main aim of serving customers systematically and establishing consumer relationship in turn develops consumer loyalty, the internet helps company like ASDA to recognize the most beneficial types of consumers and serve them. According to a customer life cycle a customer dealing with a particular firm is not perpetual. Customer may become dissatisfied and may shift where they get good deals and satisfaction. There should be strategy to build up high class consumer relation, service to retain and stimulate product and promote repeat buy for consumers to be loyal. (Waarden, 2008).
For any organisation, customer service is also main factor to attract the customer, when customer buy the product and also after the sales, its also for the online shopping when helpline to solve the problems this is a competitive advantages of organisation but customers always want better and cheaper products, so the customer tend to move were they find the cheaper and best ,so loyalty factor can be questioned .but for the Asda ,which give best product at very cheaply compare to other supermarket. Asda used motto “saving you money every day”. ( http://www.asda.co.uk/ retrieve on 8/11/10)
2.5 Logistics Technology and E-scm at ASDA:
Logistics technology plays a key role in the successful management of the retail business. Logistics services are a channel of the supply chain with the value of time and place utility. The internet integrates business information between supply chain partners. Logistics Technology and supply chain is managing the flow of products, their transformation in to finished products to the final buyer. The main functions are production, transportation, inventory procurement, customer satisfaction. Logistics Management plays a key role in the retail sector like ASDA have their business in different areas and supply of products and services must be efficiently carried out, there are require good relation with the suppliers of the products.
UK major food retailers are giving more concentration on technological development and innovation. Radio-frequency identification (RFID) is the automatic identification technology that uses radio waves to automatically tracking and identifies objects. In RFID technology uses tag for logistics purposes, this tags are bound with individual products in warehouses. They can be used as scanners with the range under 6 metres (ibid).after the used of rfid in the uk retail industry they have advantages of better tracking and forecasting ,greater efficiency and speed in stock operations. (Jones et al,2005).
E-SCM. It is apparent that supply chain management involves a firm's suppliers and customers, as well as the processes used to transfer a product or service from an order in inventory to delivery. An E-SCM must also integrate technology, especially the internet, in an effort to speed communication and information flow throughout the supply chain. The internet has allowed collaboration among supply chain partners to become automated, providing access to real-time information and fostering a communication-based network for businesses to operate throughout its supply chain.
Logistics technology is expensive so industry must use it perfectly for gain benefit against their competitors. If the elements of logistics not controlled effectively than its remarkably expansive.(Fernie&Sparks, 1988).The products or stock also expensive and if damage might become out date or might not sell. Distribution centre and ware house are costly to maintain and operate, also use for transportation vehicles are expensive and require maintenance. Companies always want to get their goods to the market fastest, try to minimize the their inventory costs and the most mileage from their services and delivery fleets are the one that succeed and most super market are connecting their logistics process with buyers and supplier.(Aghazadeh, 2004)
ASDA has large scale purchasing power and established well planned supply chain management and logistics system, so it can control it suppliers and distribution, it has latest information system and associated with leading software solution providing companies and deliveries of products has helped it get advantage over its rivals. the trained staff of asda use this logistics technology to serve the consumer better and make them to satisfy. The competitive nature of the UK retail sector has organized supply chain and logistics management very important and the vast investment put into in by company like ASDA emphasizes its importance.
2.6 Business To Business (B2B)Internet Technology
Business to Business can be define as electronic commerce transactions between two organisations using the internet. In the past years buyer faced lots of problems for collecting information of suppliers globally, but using the internet this process has simplified a great arrangement (kotler, 2003). Business to Business is a new adventure in which business buyers and sellers execute logistics and marketing activities using the embedded technological innovation of the Internet (Woodside, et al, 2004).
Asda uses B2B technology as a vital part of its business strategy and it try to bringing the goods in timely and cost effective manner to its store. asda is a very giant company and to continue this business operation on large scale improve the relationship between the suppliers and distributors when the B2b useful to set the price for particular service and products. The government imposed the strict regulation on regarding online payment and online conducting business so it makes very easy for company to conduct their online business. Due to lack of interest of people in B2B transaction some difficulties are occurs, but world moving fast and time is money, every organisation try to adopt this B2b transaction due to internet efficiency, fast online payment methods and government policies.
2.7 Business to Consumer (B2C) Internet Technology
Business to Consumer (B2C) can be defining as electronic commerce transactions between the customers and organisation by selling goods or services using the internet. The B2C commerce is a one application of internet in which consumer buy any product online and payment made online through debit or credit card .consumers have easily access the internet during last 10 years, so retailers like Asda has many opportunity and challenges make business strategy for it.
In b2c transaction mode companies require to make consumers confidence that everything will be safe and secure, because ordering and payment are not face to face so B2C is very sensitive issue for the companies.B2c of electronics commerce is not only the deal with the consumers need but also develop the consistency of the entire development through well-organized management and safe payment process.(Efraim et al,2004).ASDA stores have a vast consumers and also large amount of information of their consumers which is uses to develop customer relationship and products and cater services to its consumers. asda provide more safe and secure online payment facility and their business over the online proves this point.As outlined in the recent article, ASADAAAA sales online has reached £10 million per week (www.foodanddrinkeurope.com)retrieved on 09/11/10. The key factors of the B2C marketing is based on trust and commitment, mutual value creation, consumers satisfaction and make consumer more loyal in regard to online internet transaction. (Caceres&Paparoidamis, 2007).
The major factors that hinder the growth of B2C electronic commerce in the supermarket chain has been identified by Hughes & Reiner (2006) they are the short lifetime of the products, time constraints with the delivery of the products, issue associated with the storage and distribution of the products, the need to spontaneously process the electronic payment in order to process the order and effective billing and management of the online orders in the supermarket. It has been outlined that the internet transactions are on a decline, due to thefts and various monetary problems but having a sound and systematic business operation can reap good value as proved by company like Amazon, EBay and Dabs, which are increasingly successful in B2C transaction. ASDA has successfully overcome the above issues and have grown as the number one company. There is always the odd hike up or fault encountered but overall it has stood firm in providing the best and secure goods and services to its customers.
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