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Marketing Strategies For Sainsburys

Paper Type: Free Essay Subject: Marketing
Wordcount: 4219 words Published: 20th Apr 2017

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It is indisputable that the strategic development and survival is the key to organizational success. Obviously, each organization must have appropriate strategies and conditions that come from a competitive market to meet organizational needs with them. Turner (2003) stated that “in an effort to guide those whose job is to put into practice strategies, Henry Mintzberg, L (1998) ‘A Strategy Safari” and the process described with respect to ten schools of thought identified in the strategy development. These schools have changed in popularity eventually. Ten different schools descriptive and prescriptive synthesis are divided into groups. Prescriptive and descriptive differences between the schools point strategy for emphasis on the former latter strategy-focused development. And to three foundations, the school required efficiency and stability as well as directions for the development of the organization to do it is objective. (2007), by Stacey three prescriptive schools school of design, school planning, positioning schools, three schools each organization’s strategic development from basic research and are preconditioned element.

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Along with these schools, different schools of enterprising schools are descriptive, cognitive, education, schools, electricity, school, school climate, culture, school and give deep insights into strategic conceptualization. All recognize the importance of corporate strategy approach. Synthesis of the previous group that the configuration school, (Stacey, 2007) “in the context of the configuration or changes in the term of all other schools integrated the ideas of” are. The school integration efforts in recognition of the complexity of the fixed strategy represent.

The work of three schools which are planning school, culture and situation analysis of school to take Sainsbury to implement school work, these models will show how to apply these models on an organization for targeted goals which are to be achieved and proceed into the global market.

The Planning School of Thought

Planning the school, an important school of thought, the more toward how to formulate the strategy instead of the consensus is always aligned. Each organization needs to make strategies to achieve its objectives and in this report, we will apply this model to the Sainsbury is a leading retailer of Great Britain

Debate

Sainsbury was found in 1924 by Jack Cohen. Many years, nowadays, one of Sainsbury’s largest retailers in the world (http://www.Sainsbury.co.uk) is. How they succeed because they are now? They have a good plan is the basis on which Sainsbury has reached its strategic position, on the basis of these strategies they want to be, and will therefore be on the market.

In addition, Sainsbury uses Ansoff Models to examine their markets and products position. They therefore are always in search to develop new markets for their products in many countries to introduce Sainsbury and want to be global player. For example, Sainsbury’s has Opened stores in Japan, where, people buy fresh food every day, so the current format of hyper market to meet the Needs of Local Customers do not want. Sainsbury also Ansoff marketing strategies on product development later, the number of customers and sales for Sainsbury are increasing in numbers and the demands have pushed to invest large amounts of money.

This school also looks tightly at the SWOT model, the inside depth and foreign weakness Makipaa Marko (2004) concerning the risks and opportunities. Sainsbury’s SWOT model indicates that the company is capitalizing on its strengths and opportunities to overcome weaknesses and threats in the most optimal after his rivals.

Sainsbury is entering into more and more global markets and with them the Wal-Mart and other giant retailers are entering into to those markets which are posing pressure on the strategic decisions of Sainsbury.

Planning school and the Ansoff model using SWOT analysis related to the one organization to market their new product, potential plan know their budget program. The long-term strategy is more important than the medium-and short-term strategy.

Challenges

However, as this model is introduced, companies have difficulties to be faced could have an impact, while this model has many problems, the organization may face. First, the planners can direct attention to the excessive development of new strategic concepts and set targets present on the executive committee may be compromised and divert attention from the original target, which leads to mistakes. Risk is an important issue in this model that people can judge what these concepts, competing against competitors with what could be very risky in Sadler P (2003). Second, school planning depends on predictions and forecasting data on which the forecast is made is so bad, and then all policy decisions can be misleading, and therefore the main aim would not be feasible for the organization.

The Cultural School of Thought

The school culture is one of the sub-classes of the school described previously thought schools. This school sees strategy Arrangement as a collective process. The approaches of this school are: Strategy arrangement is considered as fundamentally collective and cooperative. The strategy is developed; an organization is “a reflection of organizational culture”.

(http://www.12manage.com) This model focuses on the important role that social processes, plays the faith and values in the adoption of resolutions and the plan strategy. In addition, it not only explains the resistance to change but it also provides strategic assistance in order to use the predominant values in organizations or regions.

Debate

Sainsbury culture plays a vital role in this success this is involved on how much, the people in the organization interestingly with each other. If people do not relate well to each other, it could be bad for the adoption of resolutions, which could be bad decision that also leads to the destruction of strategic position. Sainsbury have a positive culture. The kind of the culture of Sainsbury is customer driven culture. Customer driven culture is everywhere in the business and undertakes a material effort, customer service, to improve the market study and uses correct people and the training.

It has also a positive culture, in which personnel and workers are well in connection. They do not regard also change as opportunity as a festiveness. In addition the culture of Sainsbury is seen as dynamic. This is proven in the kind, which looks, a business, to appeal in order to change, as they work better, and after new ideas, more customer always seeks.

Challenges

A commitment to share about faith agreement moves by the behavior of an organization and therefore discourages past changes in strategy. It is culture, the deeply held beliefs and tacit assumptions that appear as obstacles to effective internal fundamental change. Since the wave of this model is the main reason leading to resistance to change. It can be missed, to justify the status quo. Then there is the focus of the organization also focuses on the way to control the negative impact of the strategy of the organization culture.

The Positioning School of Thought

The organization can develop its strategic position within the industry. In other words, even the positioning in the competitive strategy. This model provides strategy, structure and analytical development. Porter (1980) was the founder of the position of school of thought; it focuses on the Constitution of industries and their impact on strategies. In position approach the strategist look at the market position and the market situation to establish the strategies. (Manager C, EL on, 2005)

Challenges

This model has been used in many companies like Sainsbury, to help for positioning on the market, so they set up under the rest and a higher income than other firms that market position reaches the top. Sainsbury use the provider of Porter, substitutability, the customer, barrier to entry and market rivalry.

This model is necessary industrial conditions must be considered, under which the organizations operate. SAINSBURY for its main competitor is the ASDA. The contest is between foods that are so healthy that others like Sainsbury. ASDA is owned by Wal-Mart, which is the sequence of the leading grocery store in the United States, is famous for grocery items at low prices. This is one reason why people enjoy going to these stores to purchase necessities. When they extended the UK, they got through their strategy of cost leadership. This resulted in similar success, they reached the United States. However Sainsbury was able to compete ASDA last year.

Porter’s Model

Porter (1985), success is based on the strength and strength classified into two Cost Leadership and Differentiation. Focus, differentiation and cost advantage and differentiation – If you have these strengths, then used to sequence three generic strategies. For these three generic strategies cost plays an important role in the completion of the s-competitive use Sainsbury ‘on ASDA. Cost leadership means that the business of manufacturers of low cost or the supplier.

Challenges

First, the first side is in the hierarchy of an organization of persons, who formulate strategies, while implementation takes place next. This can cause the problem, as inconsistency. Managers who are the strategies without the involvement of the lower part of the staff could cope with any problem of implementation strategies, as they could face opposition from the lower part of staff or their subordinates. (Susanne, R2005) The other problem with this model faces can be developed. It is too narrow in that. The problem is with data that depends only on the data and the prediction is made if there is no problem provided in the data, then there must be deceptive strategies. If past trends and present are the only source, which is used to predict future trends, the strategies are very likely to fail in the implementation.

Whittington – School of Strategies

However, in the opinion of Whittington, schools strategies are four kinds and they are insufficient if we are talking about strategic management, without speaking. Each theory expresses the differences in the human ability to think and function effectively in an appropriate manner. Once the faces of each manager made with these differences, it is better able to consider and finally decide their own activities. Therefore, these four views are considered important tools for the strategic management of each company. To illustrate, we see the summary in the four basic theories:

Sainsbury is at competitive position, because their strategic costs are to be kept low and there must be vast choices for the customer to choose from, which can attract customers ever more. ASDA always is comparing the prices of Sainsbury with Sainsbury, for them to appearance do that the price is many lower in Sainsbury and it also more promotion than their competitor. In addition people, which come to Sainsbury, do not only buy somewhat to buy those individual parts, but them also the other things, which need her to more inexpensive purchase.

So you do not even promotion and price are cheaper still continue to sell Sainsbury and budget. Therefore using this strategy is the way to Sainsbury and may be more brilliant future. However one views the body, there is no better way of strategy: played directly by the local rules “It is evident that the four debut strategies differ greatly in their advice to the management and understanding you can use each approach in the. Enterprise systems are the main factors that motivate each organization to participate more actively in the global market. The next part is something of strategies, use or Sainsbury might be used to obtain their goals and objectives.

International Retail Strategic Decision

One of the most troubling trends in retail today is globalization. The global scenario considered extremely difficult for many retailers in the last two decades. Achievement of retailers on the local market is assigned to a high degree by the change in consumer behavior. Entering the markets like Brazil, Indonesia and Thailand portraits many difficulties for the organization, the shopping behavior and the expenditure of the consumer affect strategies. Many retailers tried and, around itself into global markets to manufacture not skillfully.

In this section we shall see how Sainsbury is able to formulate its pricing strategies and able to compete into global market.

Sainsbury’s Strategies

The Sainsbury has developed the pricing strategy in such a manner that more and more customers are attracted toward it and its prime emphasis is on generation more revenue and reducing the profit margins while increased revenue reduces the gaps for small profits.

Porter’s Five Force Theory and Sainsbury

According Porter (1980), the formation can be practical to many organizations. Examine the external environment and focuses on industry structure. The aim of this analysis, the development of a carpet is enabling businesses to create opportunities and protect against threats. This can lead to the competitive position of the company. This concept is divided into five forces of Porter’s Five Forces calls.

The threats of new entrants in retail supermarkets, the obstacle to entry are high. High initial investment and fixed costs are likely to put off many potential participants. Another obstacle to entry is thriftiness’s of degree. Sainsbury and other supermarkets are able to buy large quantities at a lower cost. Li contrast, the new approach of small businesses is more probable to buy small quantities at higher costs. New companies must also be aware mat Sainsbury has customer loyalty.

The threat of substitutes; threat of substitutes is high because Sainsbury sells the product at that same store retail sales are others that Sainsbury must analyze to what extent is it possible for customers to switch to compensation. In such cases, Sainsbury ensure that customers satisfied with your products or services. On the other hand, other companies in the sector are eligible to compete on price, thereby reducing margins.

The bargaining power of traders; in general, most people need to decide between different supermarket handcuffs that compete in price and choose different actions. These traders may the strong bargaining position. However, Sainsbury is monitoring the situation, not only with a major supplier, but due to a number of smaller ones. But the bargaining power increases Sainsbury. If a particular supplier is charging too much can Sainsbury can switch to another supplier.

The degree of competition between the remaining competitors, as seen on the market these days that all important group of actors on the world market as Wal-Mart carfour and efforts to increase its market share. Therefore, the grocery market is highly competitive.

With over ten years of overseas experience, Sainsbury has developed a strategy based on five elements (www.Sainsbury.com):

Be flexible – each marketplace is exclusive and involves a special method.

In Japan, customers like to shop for small quantities of very fresh food every day. Existing formats, hypermarkets do not meet the needs of local customers to Sainsbury’s entry into the Japanese market has been through the acquisition of an operator of discount stores.

Act local – local clients, the local cultures, local supply chains and local regulations require a tailor provided by local staff.

In Thailand, clients are accustomed to buying in traditional markets, interacting with suppliers and rummaging through piles of products to choose what they want. Rather than adopting the Western way of neatly packaged, convenient portions, our store Rama IV Bangkok tries to meet the needs of local customers.

Maintain focus – we understand that customers want good service, great selection and good value. To the leading brand is a local long-term effort and not to plant flags on

Use Multi-format – no single format can all come on the market. A whole range of convenience to the consumer markets is important and you need a discount approach altogether.

Our experience with the trade a mix of shops, we can now move faster on multi-format, and we have just opened Express stores in Hungary and the Czech Republic.

Developing capability – it’s not about size, it’s about skill – so we make sure we have the ability through people, sequences and schemes.

We trust that endowing in our people the right way to live our values and bring solid economic rewards, too. Develop individuals at all levels intends that we understand local leaders who effectively develop our culture and our business have.

Challenges

The rationale for the strategy is to expand the scope of the company to allow it to achieve strong long-term sustainable growth, the following major customers in growing markets in the country – in such as financial services, telecommunications and non-food and new markets abroad, first Europe and Central Asia, and recently in the United States.

The diversification strategy of the company was founded in 1997 and was the foundation for the success of Sainsbury’s in recent years. The new companies were founded and have in the past 12 years as part of this strategy will now have the scale that are competitive and profitable – in fact we are now the market leader in many of our markets outside the United Kingdom.

The Group continues to progress with this strategy, which consists of five elements, which our four priority areas were defined, and the long-term commitments Sainsbury in the community and environment. It is important, has given the impetus it gives the company, it continues to grow and by the economic downturn.

Overall Distribution Strategy of Sainsbury

Bearing in mind the factors that distribution decisions (i.e. decision marketing issues and relationship problems), which markets several options to choose, if he chooses to agree on a draft of its network distribution. We emphasize the word “may” because while in theory be an option seems possible factors marketing decision (e.g., products, advertising, pricing, target markets) or the type of distribution channel relationships may not allow promotion to follow a particular option.

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E.g., the sale by a desired retailer may not be possible if the retailer rejects to handle a item for consumption. The main reason why Sainsbury is able to reduce its cost is due to the reduction of the participants in the distribution of goods to customers as any of the layer is reduced the price that can be charged to customer can also be reduced.

For marketers the choice of the design of the distribution amounts to choosing among direct or indirect processes, or in some cases do both.

DDS for Effective Cost Leadership

With a direct distribution system (DDS) marketing of their product reaches the intended end-users by distributing the goods straight to the client. That there are no other parties in the distribution, assume that the property involved in the goods. The system will continue through at Sainsbury by the process of communication that occurs when a sale is divided. These methods are:

Direct Marketing Systems

With this system, the customer places the order either through information gained through contact with non-personal marketing agent, for example by visiting the website or marketing order in the distributor’s catalog, or by communication personal spokesperson with a client who is not a retailer, for example by calling toll-free order.

With this system, the customer places order either through information obtained through contact with the marketer who did not own, for example by visiting the website or for marketing in the distributor directory or a personal representative to communicate with a client who is not a seller, for example, by calling toll free line .

Direct Retail Systems

This type of system exists when a seller of items also operates its own outlets. As discussed above, Starbucks fall under this group.

Personal Selling Systems

The key to this system of direct distribution is that the person whose primary responsibility is to create and manage sales (e.g. seller) is mixed up in the distribution method, generally by persuading the buyer to place an order. Although the order itself cannot be handled by the vendor, for example, the consumer physically places the order online or by phone, the seller plays a role in generating sales.

Assisted Marketing Systems

Under the assisted marketing system, the marketer relies on others to help communicate the marketing of products, but handles distribution directly to the customer. The classic example of marketing systems assisted is eBay which brings together buyers and sellers for a price. Other agents and brokers also fall under this group.

Under the supported marketing system, the seller relies on others to communicate marketing items, but handles distribution directly to the client. A typical example of a marketing system that helped eBay brings together buyers and sellers for the price. Other agents and brokers also fall into this group.

Product Life Cycle (PLC)

Debate

The product life cycle through its trends and graphs are good indicator for the non-customized homogeneous goods and these graphs indicate the demand for the goods in the market and the overall pattern of how the organization is able to achieve its objectives. (Morrison J., 2003) These graphs show how the organization is performing and determine the strategic position of the organization. It is the competitive advantage that distinguishes innovative and cost leaders from others and a prospective competitive advantage is indeed can be innovation. (Hill & Charles, 2007)

Sainsbury is constantly expanding its activities to keep competition at a very high level, it is vital for Sainsbury to invest in new services and products to meet strong customer demand. Sainsbury is an example of a supermarket chain’s customers who use loyalty to diversify and broaden its product range. The food is always the main product of Sainsbury, but the website their or in their stores; you can find information on a range of other products that are not food.

Sainsbury is producing new product and sales based on customer loyalty and retention using to enter these new markets. It Sainsbury Finance and Insurance, where access to a credit card application Sainsbury and savings account products in the past that have come to the shore. Sainsbury Direct is a service catalog shopping and is seen as having established brands such as Argos catalog. Understand the lifecycle of the product, Sainsbury’s is able to identify new areas of diversification (www.accaglobal.com)

Sainsbury is offering the food items at a competitive range but one thing that they cannot control is the price of electronic items such as laptop. As it is very difficult to develop a laptop in the competitive market in which there are big giants such as dell and Compaq are competing. Sainsbury will be required to purchase the computers ate the competitive prices to be competitive (www.bizcovering.com).

Challenges

According to Daniels (2007) because of rapid innovation, have short life cycles, a factor that makes it impossible to realize cost savings by shifting production from one county to another. As stated in Sainsbury is a global retail market and even becoming global competitors. Therefore, Sainsbury move some products to a new market and environment. In such cases, Sainsbury face challenges from competitors who are to reduce cost and disposal of product. There are many difficulties in this competition, such as conducting a research environment conducive to a perfect prediction on the best products that can be used to beat competitors on the world market.

Conclusion

In fact, ail schools strategy and models are seen as an instrument of strategic information from an environmental perspective and a method for receiving a number of different perspectives to an organization. Strategy is built on the highest level of an organization. At the top level, the aim and goal and the means to achieve those targets are set, which are known as strategies. Through the use of strategic models in performance, Sainsbury has taken longer active on the global market. It has been proven by the success and development of Sainsbury’s in many countries.

 

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