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   Introduction and Background

   Marketing strategy is a business plan designed to help a company achieve its marketing objectives and goals. In the context of the present dynamic business environment, businesses are striving to strategize on ways of obtaining large market shares and brand leadership. The 4Ps framework is majorly applied by companies to measure and generate strategies through innovation (Jenkins & Williamson 2016). This report maps Tesco’s innovation activities onto the 4P framework. Tesco is one of the leading retailers in the United Kingdom and world over. It operates thousands of hypermarkets, convenience stores and supermarkets in the UK, Asia, central Europe and Ireland among others. The retail was started in 1919 by Jack Cohen in the east end of London. Over the years, Tesco has slowly grown to what is today toping retailing business worldwide. The company’s mission aims at being sure about requirements of its customers and providing them the best products ('Tesco PLC' 2017). This report evaluates the current portfolio of Tesco’s innovative activities and identifies its new targets for strategic innovation.

   Present Portfolio of Innovation Activities

   Product

   Tesco strategizes in offering a wide product range available in its stores. The strategy of offering wide product range avails a variety of products to cater for customers’ needs and preferences in all market segments. Some of the products offered by Tesco include food, technology and gaming products, home and garden products, sports and leisure products as well as health and beauty products among others. The company offers its products in different brand names such as Tesco Kipa, Finest, Tesco Loves Babies, Tesco Bank, F &F Clothing and Everyday Value just to mention (Lewis 2012). The company operates different categories of stores where different products are availed depending on set of stores. Apart from that, Tesco sells some of its products through online platforms. It carries out routine review of stores to adjust product categories according to the prevailing needs and preferences of its customers. Interestingly, the company provides financial services such as credit cards, insurance, mortgages and loans through its Tesco Bank to facilitate purchases by customers (Lorange & Rembiszewski 2016). The product strategies have helped the company to meet the needs and preferences of customers on time.

   Price

   Pricing strategy involves altering price of products in relation to those offered by competitors so as to obtain the best price that is competitive in the industry (Jenkins & Williamson 2016). Tesco operates under the strategy of cost leadership as the most prevailing pricing strategy. In this marketing strategy, the company offers quality products at the lowest prices in the market. To achieve price leadership, the company employs economies of scale as well as exploiting best procurement channels to maintain low prices and high quality at the same time (Fagerland & Jennings 2009). Besides, it continues to liaise with supplies to improve and make the chain efficient so as to reduce costs. Although it provides stable low prices, it sometimes go out of its way to reduce promotional expenses so as to lower prices for goods owing to the received complaints from some of its customers. Additionally, Tesco provides brand guarantee to its customers where they can buy same brand cheaply when they find same prices for the brand in other places, hence ensuring customers pay less at. Recently, Tesco introduced new brands of food at low prices as well as restructuring its teams dealing with the product to improve its offers to customer (Lewis 2012).  The price strategy has helped the company to increase customers’ loyalty to its products.

    

   Place

   Tesco operates in different places across the world such as UK, Asia, Ireland and central Europe among others (Lorange & Rembiszewski 2016). It operates over 7,000 stores in approximately 11 countries. Its store types include Tesco Express, Tesco Superstore, Tesco Metro and Tesco Extra. The superstores are basically large supermarkets selling groceries and non-food items in small ranges. Tesco Metro are situated in major cities and towns centers and they are about 1000 meter squares in size. Tesco express are smaller stores selling essential products of high margin. These products are highly priced than those sold in other stores. On the other hand, Tesco Extra are hyper store selling a wide product range under the same roof. Such products include both general merchandise and groceries. This strategy allows customers to fully carry out their mundane shopping once under one roof. Apart from these, Tesco also operates one stop stores which are smaller but charge higher prices than all others prices (Lorange & Rembiszewski 2016). This strategy ensures all customers are able to easily access product of their choice at the most convenient time and means.

   Promotion

   The promotion strategy of Tesco corroborates the overall business strategy of cost leadership. Its marketing objective includes both short-term and long-term maximization of profits, increasing brand image and value. The organization uses various forms of promotion to achieve its marketing objectives (Lewis, 2012). For instance, it carries out its promotion through advertisements, point-of-sales marketing strategies, announcing discounts and offers on regular basis and sponsorships among others. Promotion involves all ways in which it communicates its products to the market and it does this through promotional mix. Its marketing mix includes advertisement, direct marketing, sale promotion, publicity and public relations, sponsorship and online marketing.

   Strengths and Weakness of Tesco Innovation Activities

   Strengths

   Under the product innovation strategy, a number of strengths such wide variety of product which provide alternatives to customers in terms of type, brand and cuisine of food which do not render customers without an option depending on their needs and preferences (Baker 2014). Tesco pricing strategy is one that has been able to keep prices lower regardless of market dynamics. It offer cards allowing customers to accumulate points which can be used to purchase products or converted to money. Further, it offers excellent avenues to give discounts to customers. In the end, the pricing innovation strategy helps Tesco to offer lower prices and in the process increasing sales volume while realizing projected revenues. Tesco is also strategically spread far and wide to capture large markets in the industry. It has different categories of stores ranging from small to large seizing all customers’ preferences (Lewis 2012). In its promotional strategy, the company focuses on low pricing which has set it aside from other retails in the industry.

   Weaknesses

   Weaknesses are manifested in areas where the strategies applied by the organization fail to exploit full potential of the strategy. The strategies such as promotion used by Tesco are relatively expensive, not easy to target specific audience, require specialists and inflexible among others (Baker 2014). The price leadership strategy demands that the company work together with supplies, focus on procurement and use economies of scale to maintain low prices yet maximizing profits which is a tedious and fragile operation. Providing a wide range of products is very expensive and lacks accuracy. It also demands a large pool of workers and specialists which has financial implication to the company. Additionally, operating in many countries may be strategic but can adversely be affected by external factors such as international trade regulations, cultural disparities and currency dynamics among others (Lorange & Rembiszewski 2016). These are some weaknesses which Tesco must dispense with its innovation strategies.  

   New Targets for Strategic Innovation

   Although Tesco has initiated tremendous innovation strategies, gaps for new targets still exist for the company to explore. Apart from brand guarantee, the company needs to devise a strategy where all products which are safe for consumption are not wasted (Fagerland & Jennings 2009). This can be done through donating such products to the less privileged through charity organizations in a safe and certifiable manner. Further, Tesco Bank can be improved beyond the payQiq application to accommodate more features to make transaction faster, cheaper and more convenient to customers (Lorange & Rembiszewski 2016). Since Tesco operate a price leadership strategy, it should maximize the value from its properties such as purchasing freehold on its stores so as to decrease exposure to increased spending which could follow things like increase in rentals. Moreover, the company needs to reduce its costs of operation so as to maximize profits and at the same time sell its products at relatively low prices compared to others retails companies in the industry (Fagerland & Jennings 2009). Alongside price leadership strategy, Tesco should move forward to provide differentiated products so as to improve its success in the market. The company should maximize on mobile potential such as mobile payment is one of the technological strategy that puts it ahead in the industry. Since technology is by and large applied by other firms, its application by Tesco must remain meticulous and unique for it to work as an outstanding innovation activity.

   Conclusion

   Marketing strategies is one business operation which contributes to success of a business in any industry. It is important for a company to invest in innovative activities alongside other operations. 4Ps framework is a tool applied by companies to measure strategic performance over time. Evaluation of Tesco’s 4Ps indicates good performance by the company in most of its strategies. Tesco operates a wide range of products and prices leadership strategy is spread far and wide from UK, to central Europe, Asia and Ireland. Its promotion strategies are iconic and primarily focused on low pricing. Although the innovation portfolio presents a lot of strengths such as wide product variety, easy product accessibility and low pricing yet maximizing profits, it still experiences weaknesses such as being expensive and inflexible among others. Tesco new targets for innovation activities include no product wastages, obtaining freehold to reduce rent expenses and other costs. To this end, Tesco is doing well and has the potential to do even better in the coming years.