Tesco's failure in America Essay Example | Topics and Well Written Essays - 3000 words

Tescos failure in America - Essay ExampleReasons for the FailureMarket Positioning Positioning may be defined as the process of creating an image in the minds of the target market for the brand (Ferrell, O. et al., 2000). This placementing can be functional, symbolic or experiential. operational berth tries to solve problems and provides benefits to the customers (e.g. - Wall marts everyday low prices) symbolic positioning creates affective fulfilment (e.g. - Apples crossings give an self boost to owners) and experiential positioning provides both rational and emotional fulfilment (Lao, 2013).TESCO entered ground forces through Fast and Easy (F&E) stores. The F&E stores were positioned between the deductive reasoning supermarkets and the upscale organic stores. F&E stores were labelled as stores which will provide healthy nutriment at low prices. gum olibanum TESCO tried to position itself between Wal-Mart and Trader Joes (Sonne & Evans, 2012). The positioning of F&E was ne ither functional nor symbolic. Wal-Mart succeeds due to its promise of everyday low prices whereas Trader Joes provides prig value to the rich and entices them to be different and buy organic food. Trader Joe is clearly positioning its product for the rich and Wal-Mart for the mass market. TESCOs positioning was not enticing to either of the 2 segments. There was no market which wanted health organic food products at low prices in USA. exclusively 3 % of American population follows the healthy lifestyle unlike in UK and Europe where this trend is the norm (Sonne & Evans, 2012). ... Trader Joe is clearly positioning its product for the rich and Wal-Mart for the mass market. TESCOs positioning was not enticing to either of the 2 segments. There was no market which wanted health organic food products at low prices in USA. Only 3 % of American population follows the healthy lifestyle unlike in UK and Europe where this trend is the norm (Sonne & Evans, 2012). Thus positioning itself as a store with a healthy image in a nation which loves fast food and soda was the biggest mistake committed by TESCO. This was one of the main reasons for their failure in USA. Customer Relationship TESCO had a roily relationship with USA customers. This was because it ignored the cultural differences between USA and UK.TESCO looked more like a coloniser who stuck on to its customs and culture rather than adopt the culture of the new country. Some of the mistakes leading to a troubled customer relationship were Low Brand Recognition USA unlike Europe is obsessed with brands. Americans are willing to spend more specie if they estimate the brand good and worthwhile (Piercy, 2012). Fresh & Easy was an unknown brand to them. The name TESCO was not associated with F&E stores in any way. TESCO focused its money and resources in opening more stores rather than advertisements on brand building. The Fresh & Easy stores were also highly dependent on private labels in a market which likes to see and buy branded products. This was a big mistake in a country which likes to buy branded products. Lack of Service In order to keep the costs low, F&E stores had adopted the self check out system. The staffs in F & E stores were also kept