CARDIFF METROPOLITAN UNIVERSITY

How far has the influence of E-Marketing strategy affecting the consumer patterns of purchase decisions within this current economy - A case study with Tesco Inc., Store at Upton Park?

THIS DOES NOT FIT WITH THE RESEARCH QUESTION?

IF YOUR FOCUS IS CUSTOMER SATISFACTION THEN THIS IS THE FOCUS. YOU USE QUESTIONNAIRES TO MEASURE CUSTOMER SATISFACTION

WHAT DO YOU MEAN BY E MARKETING? WHY IS IT IMPORTANT? ARE YOU TALKING ABOUT CRM? WHY?

A qualitative analysis

By Lissamma Shaji

Submitted to Mr. Roger Fulford

TABLE OF CONTENT

CHAPTER # 1: INTRODUCTION 1.1 Background of the Study 1.2 Purpose of the Study 1.3 Research Questions (s) 1.4 Aims and Objective of the Dissertation 1.5 Company Overview Tesco Plc Inc., 1.6 Scope and Limitations of the Study

CHAPTER # 2: LITERATURE REVIEW 2.1 Introduction 2.2 Service Industry and its importance 2.3 Elements of E - Marketing services and its services 2.4 Impact of E Marketing upon Customers Satisfaction 2.5 Customer Satisfaction theories and its functionalities 2.6 Customer Vs Employee satisfaction Model

2.7 Types of Customers and their behavioural patterns 2.8 Behavioural patterns Vs purchasing power of the Customers based on Marketing Mix strategy followed by Tesco Plc Inc. 2.9 Conclusion

CHAPTER # 3: METHODOLOGY 3.1 Introduction 3.2 Research Framework 3.3 Sampling Method Overall Approach 3.4 Justifiable reasons for choosing Qualitative Analysis based on Marketing Mix strategy implied by Tesco Plc Inc., 3.5 Data Collection Process Customer participation 3.6 Data Analysis 3.7 Reliability, Validity and the Limitations of this Research

CHAPTER # 6: BIBLIOGRAPHY CHAPTER # 7: APPENDICES

CHAPTER # 1: INTRODUCTION Background of the Study In recent times with growing pains of retaining potential and satisfied customers is the greatest challenges faced by most businesses across the globe. Even more so for a business like Tescos to sustain its continued stream of income and to make profit has to maintain its highest level of customer satisfaction by developing products and services that customers want, by making them available to them at reasonable price (Pride and Ferrell, 2012) as and when required. However, there are various factors that determine the customers level of participation even if the company has done all that it could in terms of its marketing research, following the guidelines laid within the marketing mix: such as change in technological advancements, economical conditions in conjunction with other marketers competing within the given retail business arena (Bob E Hayes, 2008). To such an extent it is important for companies like Tescos to define its strategy and create products or services that customer wants and satisfying their needs, can be achieved by following a strategic strategy based on surveys, questionnaires, feedback forms and above all having a club card which has been the key determining factor accurately studying the behavioural patterns of its customers (Ron S

and Silvia S, 2011). In this dissertation the primary focus rests up the buying patterns of its customers have changed drastically with the implementation of E-marketing strategy especially in and around Upton park area in East London. Purpose of the Study Getting in touch with various customers and employees working at Tescos has enabled me take up this research and the statistics that reveals the changing needs of the customers buying patterns based on the ongoing recession in the UK. This has raised great concerns with loss of employment and lower income where customers are forced to adopt their life style and raise awareness of decision patterns based on environmental or ethical considerations based on green consumption (Moisander, 2007). Added to it the stringent competition faced by its retails traders like Wal-Mart, ASDA, 99p shops is the closest competitors. However it has been recorded that nearly 35% of the UK consumers are concerned about environmental issues (Defra, 2006), 50% of them prefer organic food and only 10% determine the purchasing power unlike 5% being indifferent (Hughner et al., 2007) are those pursuing their own selfish goal (Chatzidakis et al., 2007). An interesting fact that led me to pursue this research is that me being a customer of Tesco can shop regularly at four different retailers at a given point based on the influential factors like family, friends, retailer websites includes price comparisons across the retailers has changed my behavioural patterns later affirmed by the consumer research conducted by (Jim Blythe, 2007). Research Questions (s) How far E-marketing strategy does affected the customers decision process in purchasing the products or services from Tescos based on their level of satisfaction. By analysing the retail trends in comparison with Tescos competitors like ASDA and Wal-Mart how far has Tesco been successful in satisfying its customers buying patterns and influence its decision process in retaining its potential customers and returning customers. With the evolution of Green products has Tescos been able to influence and bridge the gap between The Customer Loyalty Ladder (Club card) and CRM retaining existing customers for long term with the changing mood swings and behaviour patterns of the customers.YOUR RESEARCH QUESTION NEEDS TO BE FOCUSSED. YOU HAVE TOO MUCH - E MARKETING, CUSTOMER SATISFACTION, CRM DECIDE WHAT IS THE FOCUS IT CANNOT BE ALL THREE.

YOU WILL NOT HAVE THE RESOURCES TO COMPARE ASDA AND WALMART

IF THE FOCUS IS CUSTOMER SATISFACTION THIS NEEDS TO BE STATED;

Aims and Objective of the Dissertation The primary aim of this dissertation is to analyse the changing behavioural patterns based on E-marketing techniques in relation to the services provided by Tesco. Objective To analyse the factors that determine the decision process and influence the buying behavioural patterns at Tesco based demographically, age, employment etc. Has the impact of technology been influential in bridging the gap between CRM and Customer Loyalty Ladder based on Kano model of Customer Satisfaction? Company Overview Tesco Plc Inc., Upton Park

IT IS A PLC

Tesco is known for its brand retailer helping in providing its customers what they want with the slogan every little helps saving money during these difficult times (Tesco, 2013). They are known for their brand loyalty diversified across the globe having and work force nearly 1 million people at various levels, backgrounds and age groups. However since 2008 there seems to be a decline within the global retail industry overall sales yet Tescos has shown an incredible growth of 13% within the UK and 26% across internationally (Tesco, 2013) and expanding regularly. Scope and Limitations of the Study One of the greatest limitations of the dissertation is that the analysis conducted based on the questionnaire and interview techniques are limited to one particular branch and does not reflect the overall behavioural patterns of the customers in relations to Tescos. Secondly in terms of the comparison with Wal-Mart, ASDA and 99p Shops a qualitative method has been chosen to determine Tescos price point noticing the buying patterns of the customers having different loyalty margins within these retailers does not give an exact analysis of the behavioural patterns. Due to lack of time and resources it is hard for a researcher to conduct interviews and surveys engaging in complex sampling techniques within the given time

frame. IF

YOUR FOCUS IS CUSTOMER SATISFACTION THEN THIS WILL BE THE FOCUS. WHY THIS?

CHAPTER # 2: LITERATURE REVIEW

YOU NEED TO CONCENTRATE ON CUSTOMER SATISFACTION THEORIES WHERE ARE THE MAIN THEORIES ON CUSTOMER SATISFACTION?
Introduction

Service Industry and its importance Whether it is online or offline customers form the back bone of any organisation and in particularly within the E-Marketing platform marketers have analysed various strategies and methodologies required in retaining a potential customer called lead while meeting customers expectation (Gundalch, Bolumole, Eltantawy and Frankel, 2006). In order to optimize the importance of profitability having right market mix deliverable strategy that requires a balanced integrated approach between the companies and the customers (Angelina Close, 2008). Achieving such integrity costs time and extensive research especially in gauging the customers attitude towards the organisation and brand awareness followed by loyalty satisfaction in exchange for their services (Neslin et al., 2006). However with the growing competition within the retail sector where customers buying patterns and behaviours are changing at a rapid pace in comparison of the service quality based on feeling (Geffory Paul, 2010). Thus it is important for an organisation like Tescos to measure the existing gap between the CRM and Customer Loyalty ladder (Tesco, 2012) can be achieved with the aid of servqual an instrument used to measure both customers and organisational service patters in delivering their products based on performance, quality, responsiveness, reliability, security, knowing the customers patterns through their purchasing power especially in todays economy with a fleeting crowd (Pride and Ferrell, 2012).

Elements of E - Marketing and its services What are the primary elements of E-Marketing services? Smith and Chaffey (2002) suggest that it is a mode of practising marketing strategies with the aid of digital technology within which customer satisfaction takes precedence (Lucas, 2002). With the change in technological development the customer preferences and organisational strategic plans have

drastically changed the way market works. Irrespective of the type of services rendered by the company it is important that the website has reliable hosting, fast, easy to access and navigate with 24/7 functionality, relevant information that helps one to make informed decisions about products and services, email capabilities followed by auto responder messages are essential to build a relationship with the customer database and above all a secure merchant payment gateway followed by the number of people visiting the website (Rayport and Jaworski, 2008). Simons et al., (2002) further suggests an element of synergy existing between the website and the direct mail, physical channels of communication allowing customers to add value through their feedbacks and comments (Don Schultz, 2005). Impact of E Marketing upon Customers Satisfaction While taking into account various advertising mediums employed by the organisation her for our purposes Tesco will not only be able to provide customer satisfaction but also know their customers behavioural patterns such as: the demographic understanding, age, sex, income, marital status and occupational standards can be easily analysed. Visitors landing on the website allows Tescos to have insight into the customer itself knowing their personal preferences upon which the direct marketing or email marketing be based on further leading to campaign effectiveness in brining newer customers while retaining the existing ones. Other benefits includes knowing their behaviours obtained through life questionnaires based on attitudes, interests, opinions, emotional buying power including the days on which these campaigns be run (Richard Gay, Alan C, Rita Esen,2007 ). However E-marketing like any other medium of advertising has got its own limitations: Due to frequent visitors there has been difficult to validate and integrate the data obtained through samples, use of pop-ups surveys forces the customer to participate rather than willingly take up the survey has irritable consequences, due to change in customers emails it is hard to reach potential customers followed by false responses can be manipulated ( Customer Satisfaction theories and its functionalities Types of Customers As mentioned above that the primary focus is on the customer which is the paramount in any business as the adage goes customer is always right (Tam, 2004). In order for Tescos to provide a quality service in satisfying a customer has to measure the preferences of the customer and translate into a series of parameters (Grigoroudis and Siskos S., 2010). One can measure customer satisfaction parameters are directly linked to their jobs, motivational factors, feedbacks, knowing companies correlation to feedbacks and comments as indicated

in fig. 1.1 (Hill, 1996). It is also important to identify customers of a specific nature Edosomwan in 1995 had identified customer under three categories: Internal customers, External customers and Self-unit customers what is currently known as TQM. One can analyse the behaviours of the customers based on Direct Measurement Methods where the data is coming straight from the customers through surveys, complaints, personal interviews basically connected directly with the customers. MUSA approach (MUlticriteria Satisfaction Analysis) directed to a more rational customer who is keen on spending yet very systematic. Another Model can be Simple Quantitative Model is based on frequent responses of a particular question that are assumed critical in relation to satisfied or dissatisfied customers. Customer Vs Employee satisfaction Model

IF YOUR FOCUS IS CUSTOMER SATISFACTION THEN THIS WILL BE THE FOCUS. WHY THIS? STICK TO THE CUSTOMERS

It is essential for any business to be successful has to bridge this gap between the customer and the organisational expectation, management expectation with the existing gap on the level of quality service rendered, intended level of service vs unsatisfied quality service experienced by customers (Derek Allan and Morris W., 2002). In order to achieve the highest level of satisfaction one can apply Marginal resource model which emphasises on the relocation of the services is better than Derived importance model can be unreliable (Bryman and Bell, 2003). On the other hand employee motivation is critical for the success of the organisation in providing quality services to the customer. If the employee is satisfied within the organisation can influence their productivity, increase high level of participation, reduce absenteeism and have tremendous influence on the customer which exactly coincides with the six sigma system developed by Motorola (Salih Kusluvan, 2003) which most companies follow in achieving their desirable profits.

Behavioural patterns Vs purchasing power of the Customers based on Marketing Mix strategy followed by Tesco Plc Inc.

IF YOUR FOCUS IS CUSTOMER SATISFACTION THEN THIS WILL BE THE FOCUS. WHY THIS?

The key determinant of the Customers behavioural patterns and their purchasing power largely depends upon the Marketing Mix which Tesco are good at achieving it. As most marketers are aware that the marketing mix implies 4Ps namely consisting of Product, Price, Promotion and Place (Kotler and Armstrong, 2006). Each element has various elements that are key to a particular customer and does influence their purchasing power in exchange of profits (Peter and Donnelly, 2007). Product Strategy defines as something that the market needs for personal consumption (Ferrell, 2005). Customers buy products based on various factors with careful consideration and in comparison with the available brands based on price without foregoing other elements like brand name, size, features of the product, newness and its profitability to the consumer, packaging Place (Kotler and Armstrong, 2006). Some customers will rely on the products durability, reliability, product trial attitude (Kim and Jon, 2007). However with the development of technology it is becoming even significant that the customer is able to get information on the product at their finger tips indicates that products do have significant influence on the consumers motives (Uusitalo, O and Maija, R, 2007). Pricing Strategy Tesco is perceived to have followed this strategy quite well has kept it prices relatively low in order to attract more customers and to retain the existing ones especially in a given economy where the customer is more value-based than price itself (Skoras, 2005). Tesco follows a High-low pricing strategy based on EDLP strategies in providing premium quality products where quality is assured by purchasing private label products at a lower price. In this way the product differentiation led by Tescos can profit itself by providing and satisfying a customer yet benefiting itself through low buying concept (Cataluan, Francisco J.R., 2004). Promotional strategy Promotions and price strategy goes hand in hand as it greatly influences the customers behaviour (Ferle and Steven, 2006) and turn well especially with an

offer followed by bonuses. However research indicates that most in-store promotions had negative influence on the customers than advertising mediums had great sales (Shi, Ka-Man and Gerald, 2005). Place Strategy Plays a key role in the distribution of the product to its end users depending upon its wholesalers and retailers located not only at key strategic places but also be available to the customers in need and satisfies his wants (Kotler and Armstrong, 2006). The Customer sees stores as a pre-requisite to build stronger bond with the organisation as an emerging category that satisfies his needs and desires just around the corner (Feil, 2003).

CHAPTER # 3: METHODOLOGY Introduction Most businesses consider feedback as the process of integral growth (Griffin and Moorhead, 2011) that determines the productivity, customer behavioural patterns and ability to use advertisements effectively. Even more so as the technology develops more and more advanced testing marketing systems have been placed in order to get the ROI. Considering Ecommerce as becoming more and more customer friendly has manipulated the consumers buying and decision powers are transforming the way the products and services are delivered in conjunction with the customers choices and preferences (Johnston, Wade and McClean, 2007). As mentioned earlier that this research is primarily based on quantitative analysis using a casual and descriptive research. The chosen population has basic understanding of the internet and has some experience of online buying capabilities. The target population has been given a closed ended questionnaire in order to gather an in-depth behavioural pattern of the population selected randomly from 1 to 5 where one is strongly disagree and 5 being strongly agreeing. Based on the simple random method has been chosen as most of the recipients are readily available within the study environment of the researcher. Finally the whole research rests upon the quantitative analysis represented in the form of graphs, diagrams, statistics and interpreting it within the given analytical data (Saunders, Philips and Adrian, 2012). Research Framework Research framework coincides with Literature review based on the simple sampling method where the participants are free to participate within the research process and free to withdraw at any given time. No incentives are manipulations are encouraged in line with the ethical aspects laid within the UWICs policies and procedures. This type of sampling method detailed by Bryman and Bell (2003) insisted that this type of research needs quantitative analysis as this allows the researcher to investigate the problems in the realistic settings. The primary focus with be on the three major components as laid within the aims and objectives based on four primary variables like generation gap, lack of technological awareness, income upon which the decision process rests within the e-marketing arena. Nearly 100 participants will be given a questionnaire to fill and using the Cronbachs alpha coefficient for reliability in validating the research including the time spent on the internet.

Sampling Method Overall Approach The participants are the customers of Tescos in and around Upton park area upon which this research is based on. All the participants will be given a copy of the questionnaire after passing through the HRM consultant at Tescos upon approval the participants will be contacted through Email initially and then gathered later on for 30-45mts in case they have any questions to clarify. The questionnaire is based on Likert Scale method of rating ranging from 5 being the highest and 1 being the lowest with Strongly agree, agree, disagree, Strongly disagree, Neutral and Not sure. The participants have to circle the ratings consisting of three parts: First part is based on the age, gender, access to the internet, Hours of Usage. Nearly 5 questions, second part is based on the E-marketing strategies employed by Tescos is mainly for the employees of Tesco nearly 10 questions including marketing mix and finally the third part will be based on the customers purchasing and decision making process 10 questions. The purpose of having a two way questionnaire between the employees and the customers is to validate what the Tescos think about its customers decision process and whether to know E-commerce has changed any aspects of the decision process within the customers including their expectations. Once the questionnaire is collected will be placed in the excel data matrix coded using numerical codes displayed through charts. Justifiable reasons for choosing Qualitative Analysis based on Marketing Mix strategy implied by Tesco Plc Inc.,

IF YOUR FOCUS IS CUSTOMER SATISFACTION THEN THIS WILL BE THE FOCUS. WHY THIS?

Most researchers agree that there isnt one way of doing research in normal cases it swings from one end to another between qualitative and quantitative researches depending upon the nature of the research. As part of the quantitative method includes deductive and positivistic methodology as Marketing Mix is seen as a process of knowing what the customer wants

which is the key in knowing the behavioural factors influencing the way customers buy products. Data Collection Process Customer participation Nearly 100 customers are chosen on simple random methods and 10 Employees in answering the questionnaire within a weeks time after submitting and being approved by the Tescos HRM.

Data Analysis Primary data Analysis is the Customers from the Tescos and its Employees who are willing to participate voluntarily in the research programme and of course are free to leave the questionnaire unfilled or do not like to participate at any given time. Secondary data Analysis largely rests upon the periodicals, internet, library, newspaper and other business journals.

Reliability, Validity and the Limitations of this Research In order to make any research being reliable and validating the findings of the research one cannot reach the exact or closest proximity which is difficult to achieve however with consistent observation one will be able to express reliability with correlation (Danie Mullis, 2004). In context of this dissertation the measurement of scores is based on two tests one from the side of the employees and the other from the side of the customers are then correlated to get reliability correlated. However this reliability test though does not reflect entirely the total population of the Tescos within the scale of zero to ten where zero is considered as poor and 10 is quite beyond the measures of proximity which is hard to achieve. Nevertheless anything close to 10 is considered as reliable and is acceptable. In this context utilizing the SPSS (Statistical Packages of Social Sciences) in order to calculate the reliability of the data to be gathered within the Likert-Scale measuring from one to five is quite achievable.

Validity

However it is accepted that there exists a close relationship between reliability and validity as long as the data is considered as valid based on the accurate data collected and interpreted in the light of qualitative analysis in the light of the three part questionnaire conducted within the employees of Tescos and the data collected from the customers (Jerry R, Jack N and Stephen J.S., 2011).

CHAPTER # 6: BIBLIOGRAPHY

Berman, Berry (2004). Retailing management: A strategic approach. New York: Prentice hall. Bob E Hays (2008). Measuring customer satisfaction and loyalty. USA: Quality Press. Cataluna, Francisco & Javier Rondan. (2004) Price discrimination in retailing. International Journal of Retail and Distribution Management, 34 (4), 205-215. Feil, Kim.(2003) Reevaluating beverages place at retail. Beverage Industry, 94,(2), 36. Ferrell. O.C.& Michael D. Hartline (2005). Marketing strategy (3rd Ed.) Mason, Ohio: SouthWestern Thomson. Jayaraman, Munusamy and Wong Chee Ho. (2008) Relationship between marketing mix strategy and consumer motive: An empirical study in major Tesco stores, UNITAR E-Journal, Vol 4, No.2, 41 56. Jim Blythe (2007). Consumer Behaviour. USA: Thompson Learning. Kotler, Philip & Amstrong, Gary (2006). Principles of marketing (11th ed.). New York: Pearson International. Miqual, Salvador & Eva M. Caplliure (2002). The effect of personal involvement on the decision to buy store brands. The Journal of Product & Brand Management, 11 (1), 6-18. Pride and Ferrell (2012) Marketing. New York:South-western learning. Ron S and Silvia S (2011). Modern Analysis of Customer surveys: with Applications using R. USA: Wiley Publications. Shi, Yi-Zheng, Cheung Ka-Man & Gerald Prendergast. (2005). Behavioral response to sales promotions tools: A Hong Kong study. International Journal of Advertising, 24 (4), 467-486.

Skouras, Thanos, George J. Avlonitis & Kostis A. Indounas (2005). Economics and marketing on pricing: how and why do they differ? Journal of Product & Brand Management, 14 (6), 362-374. Uusitalo, Outi & Maija Rokman.(2007) The impacts of competitive entry on pricing in the finish retail grocery market. International Journal of Retail and Distribution Management, 35 (2), 120-135.