Every organisation need to focus on marketing effectiveness for improving their sales. The most effective marketing strategies are the ones that focus on the specific audience and specific benefits. The current report focus on the UK’s second largest supermarket Sainsbury’s that offer groceries, electrical, clothing and more. A detail background study on the company will be presented along with a discussion on the external factors that would affect the current performance of the company. Porter’s five forces and pestle analysis tool will be used for analysing the business environment of Sainsbury’s. In addition to this, the current report presents a section that discusses the success factors of Sainsbury’s and how well the Sainsbury’s achieve its success over their rivals in detail.
The third largest chain of the supermarket is in the United Kingdom is known as the Sainsbury’s, and the network has over 1200 hypermarkets (Kirby et al., 2010). Besides the Sainsbury retailer has approximately 770 convenience retails and 15, 000 own brand products and further the Sainsbury’s have almost 1,000 non-food suppliers and 2,000 food suppliers. The Sainsbury’s is mainly engaged in grocery trading and retail banking. In 1869, The Sainsbury’s retailer was co-founded by the Mary Ann Sainsbury and John James Sainsbury and was headquartered in London, United Kingdom. Sebora et al. (2014) mentioned that, the Sainsbury’s functions general merchandise operations, convenience stores and hypermarkets, an online grocery and as well as the Sainsbury’s bank. According to Scott (2013) Sainsbury’s company sections comprises property investments, financial services and retailing and the retailing segment is mainly involved in the 335 convenience stores and 536 supermarket operations. Besides, the financial services segments of the Sainsbury’s contain the Sainsbury’s bank operations.
Moreover, the Sainsbury’s also two property investment ventures include the Sainsbury’s joint ventures with the Land Securities Group Plc and the British land company. Aluko and Knigh (2017) opine that the Sainsbury’s continues to be outgunned by its three major competitors. The Sainsburys is planning to merge with the rival Asda. The Sainsbury’s sales rose by just 0.2% in the 12 weeks to 22 April, and it is the dawdling pace of growth for more than a year, and the sale of the Asda rose by 1.4% in the periods, and it is very competitive for Sainsbury’s (Burnett and Burnett, 2013).
Market analysis of Sainsbury’s
The market analysis of the Sainsbury’s has been carried out with the help of Porter’s five force analysis and PESTEL analysis. Wrigley (2014) mentioned that the Market analysis is a qualitative and quantitative assessment of the dynamism of the market. Further, the principal aims of the market analysis are to understand its evolving opportunities and threats and determine the attractive of the market as they relate to the strengths and weakness of the organisation (Fields, 2011).
The pestle analysis is adopted to analyse and explain the significant external factors that likely impact the business performance of the Sainsbury’s.
Political factors: The political factors evaluate the political situations of the country and how it affects the business. In the case of Sainsbury’s, the political factors in London have significant impacts on the Sainsbury’s performance (Hammad, 2015). The increased internationalisation of retailers could pose as both a challenge and opportunity to the Sainsbury’s. Further, in 2006 June, Britain is voted to leave EU. What this move may predict is likely to cause both economic and political upheaval for the UK economy at least a short term.
Besides, the debts rate on customers and government is very high which have a direct influence on the customer’s behaviours and on the situations of business which experience great pressure. In this case, the Sainsbury’s has to not only work in these market conditions nevertheless it also has to keep its business running continually. Further, the Sainsbury’s has been capable of enduring a steady growth because of its long heritage of providing excessive product quality at competitive prices.
Economic factors: Economic factors are affecting the prices, costs, demand and profitability and these factors play a significant role in the business industry (PANDEY, 2017). One of the main economic factors that might be impacting the supply chain of Sainsbury’s is the rule of the lifting cost. Further, the unemployment and high inflammation rate have become the two main elements of economic factors that impact the Sainsbury’s considerably. As results of the food products high prices and unemployment, the Sainsbury’s products demand will decrease which in tune will shrinkage the food products production.
Social factors: Through presenting the non- products, the Sainsbury have mostly advanced form this strategy. In addition to that, the social trends increase in healthier food products provides an excellent opportunity for Sainsbury’s. Nowadays consumers prefer to have all the products available through easy ways (Kolios and Read, 2013). Sainsbury’s is still at benefits; subsequently, it has released 806 convenience shops and established online purchase for food items whose trades have improved through over 6% associated to the high retailers whose sale have dropped by nearly 2%.