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

Tescos failure in America - testify ExampleReasons for the FailureMarket Positioning Positioning may be defined as the serve well of creating an image in the minds of the target market for the brand (Ferrell, O. et al., 2000). This berth can be functional, symbolic or experiential. Functional office tries to solve problems and provides benefits to the customers (e.g. - Wall marts everyday low prices) symbolic view creates affective fulfilment (e.g. - Apples products give an ego boost to owners) and experiential stance provides both rational and emotional fulfilment (Lao, 2013).TESCO entered USA through Fast and Easy (F&E) submits. The F&E stores were positioned surrounded by the discount supermarkets and the upscale constituent(a) stores. F&E stores were labelled as stores which will provide well-informed food at low prices. Thus TESCO tried to position itself between Wal-Mart and Trader Joes (Sonne & Evans, 2012). The positioning of F&E was neither functional nor symbolic. Wal-Mart succeeds due to its promise of everyday low prices whereas Trader Joes provides snob 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. Only 3 % of American population follows the healthy lifestyle unlike in UK and Europe where this purport 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 mistaking committed by TESCO. This was one of the main reasons for their failure in USA. Customer Relationship TESCO had a trouble 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 obsess with brands. Americans are willing to spend more money if they consider the brand good and worthwhile (Piercy, 2012). invigorated & Easy was an unknown brand to them. The name TESCO was not associated with F&E stores in any way. TESCO cerebrate its money and resources in opening more stores rather than advertisements on brand building. The Fresh & Easy stores were likewise highly dependent on private labels in a market which likes to see and buy mar k products. This was a big mistake in a country which likes to buy branded products. Lack of assistant In order to keep the costs low, F&E stores had adopted the self check push through system. The staffs in F & E stores were also kept