INTERNATIONAL MARKETING

Tesco International Marketing

Table of Contents

Introduction2

Company Profile2

Rationale for Internationalization2

Assessing the Target Markets3

Algeria3

Kazakhstan4

Pakistan4

Chosen Target Market5

Country Analysis5

Competitor Analysis6

Positioning6

International Marketing

Introduction

Company Profile

Tesco is a UK based retailer that provides retailing services in grocery and has been in operation since the early 1900s. It now has over 6000 stores with primary operations spread out through the UK, Europe and the US. Tesco also has a strong presence in other countries including Turkey, Thailand, South Korea, Slovakia, Republic of Ireland, Poland, Malaysia, Japan, Hungary, Czech Republic and China. However, it merits noting that fifty over percent of the Tesco's operations and outlets are present in the UK; which represents Tesco's largest revenue hub. Initial operations were limited to grocery and food items but Tesco chose to exercise extensive product and market diversification in order to branch out into non-food items and fast moving consumer goods. In addition, Tesco has also launched its own brands in an attempt to reduce costs. Backward integration has remained a strong part of Tesco's working philosophy. It is also widely perceived that the same strategy has served as the primary contributor to Tesco's success.

Rationale for Internationalization

International expansion is one of the most natural corporate responses to the increasingly undeniable implications of globalization (Grewal, Iyer, Javalgi & Radulovich, 2011). As a result, SMEs and MNCs have begun to move towards international expansion so that developing regions can be catered to in order to increase profit margins. This has led to a sharp increase in the need for retailers to innovate and experiment with new ideas and opportunities. In the specific case of Tesco, the need to engage in internationalization has always remained evident. It is because of the same reason that nearly fifty percent of Tesco's operations are in developing and/or developed countries around the world (Kumar, Gaur & Pattnaik, 2012). While Tesco's internationalization process has undoubtedly slowed down in the recent past, sustained internationalization can help to bring about a positive influence on Tesco's growth.

Assessing the Target Markets

Each target market demands individual assessment since each country represents a specific set of characteristics that are particular to it (Etgar & Rachman-Moore, 2010). Therefore, it is essential to acquire a comprehensive and concrete understanding of the dynamics of a target market that may influence Tesco's expansion and operation. The three countries that have been selected for the purpose of this discussion are: Russia, Germany and Kazakhstan.

Algeria

Algeria boasts a rapidly developing economy in which the retail sector is a rapidly developing part of the economical landscape. The retail industry is currently experiencing a boom after having experienced a significant weakening in the last few years. The Algerian consumers look towards smaller outlets to reduce costs and Tesco's unique infrastructure can be expected to function in perfect cohesion with the needs of the Algerian market. However, the cost of expansion in the Algerian retail sector is high and local investors therefore look towards diversification to support revenue margins. In addition, there is a trend that supports the opening of multiple small stores instead of ...