Two businesses to develop their use of e-business
In this assignment I’ll be explaining the competitive pressures on two businesses to develop their use of e-business. Secondly I’ll be explaining how two businesses have responded to competitive pressures to develop their use of e-business. Lastly I’ll be evaluating how successful my selected business has been in preparing for the growing use of e-business. The Five P’s Competitive Pressure faced while developing the use of e-business (ASDA) Actions taken by the business to respond to these competitive pressures Product The competitive pressure ASDA is facing is pricing of products.
They need to make sure their prices are much more reasonable than competitors such as Tesco. If Tesco are selling their products at low prices, ASDA will need to either have a similar price, or go cheaper or offer a good promotion with the product such a ‘buy one get one free’. This will enable ASDA to gain more customers. Not only do they face the pressure of changing their prices but also updating their product. If Tesco introduces a new item on the market ASDA will have to counterattack by doing the same and doing it better.
ASDA have taken action by lowering all their products prices, and compared to Tesco they have over 1000 more items cheaper at ASDA than Tesco. This gives them the advantage of gaining more customers to shop with them as the pricing at ASDA is more appealing. A also sells items of clothing such as school which engages more parents to shop with them. This also means that not only are they competing with other brands in the ‘Supermarket field’ but also mainstream shops from the ‘clothing market.
This shows that ASDA are making excellent strategic decisions and are staying ahead of the markets. Place/Physical Evidence The pressure ASDA faces when operating online is drawing the customer’s attention onto their homepage by making it as attractive and appealing as they can. They need to be able to grabs the attention of the public before close competitors like Tesco. If ASDA’s homepage is more visually appealing than Tesco’s people will want to use their site. The information on the homepage must be relevant and accurate as customers tend to get annoyed at false information.
The way ASDA has taken action is by promoting special offers and deals on the homepage of ASDA’s website. This means that as soon as a customer visits the site their attention will be captured by the bold graphics and promotion on the page. This will make the customer curious on what else is on offer. In addition the information written on the site 100% accurate as if you were to go in store, the products will be the same price. This builds a good relationship with the customers’, as ASDA is not deceiving them. Price The pricing of the products is key for ASDA making profit.
If the pricing is not appealing to the customers it is more likely that the public will turn their nose at them and go to a better store with the pricing they find reasonable. If ASDA was to have higher price on a certain product and it was cheaper in Tesco the customer will automatically but it from their as it is worth their money. ASDA will need to compare their prices with competing stores and make strategic decision on how to better their pricing without losing profit. The way ASDA have taken action is by not only lower their prices but they have also added more deals and offers than competing stores.
For example the 250ml shampoo head shoulders are sold at Tesco for ? 1. 99 however in ASDA the 450 ml is sold for 2. 99. Although it is more expensive the value of it is more worth it as you are getting more for your money. In addition there are a lot of buy one get one free product and ASDA made products that appeal to the customers. Their prices are very hard to compete with which means stores like Tesco will have to work harder on their pricing and ASDA can just take the time to think of strategic plans on how to get gain more customers.
This shows that they are always one step ahead of the market. People ASDA faces the pressure of delivering excellent customers service. As ASDA has a lot of products similar to Tesco both companies will be competing for customers. This can be done through here customer service. When a customer goes into any of these online supermarket websites they will always compare the prices of each product through different websites such as ‘my supermarket’. So as a result of this ASDA provides better customers service than Tesco because ASDA always respond to the customers through social media and their website.
the consumers will want to shop again online due to the online experience and also the friendly service and customer service. ASDA has taken action by being friendly towards their customers. They are always willing to help and resolve any enquiries customers have. They greet their customers politely and are willing to help them with any questions which are often online. By doing all this they are providing the customer will outstanding customer service, as a result this build strong customer relationship with them.
In addition not only are they friendly are helpful towards their customers they also look after their staffs well. This creates a peace and good working environment. Customers will enjoy the online experience and not feel uncomfortable to purchase fresh product online due to the good reviews on the online website. Furthermore ASDA have social media sites online to reach to customers about their enquiries or feedback which can help ASDA to help the customer and improve within each business around the UK. Promotion
Every online business has some sort of promotion, especially big businesses who compete with each other online; in this case ASDA faces a lot of pressure from neighboring online businesses such as Tesco with their promotion strategy. When promoting a new product this can be pressure-rising to ASDA. This is because If ASDA has a new promotion technique; they will face the pressure even more if Tesco are promoting the same technique as them. This means they will need to think of a strategic idea of how to grab the public’s attention before Tesco and how to lock on to them for a longer period of time to keep the loyal customers with ASDA.
ASDA has responded to this competitive pressure action by promoting their online products by giving out free deliveries on orders over ? 25, and this has had a massive impact on the ASDA’s online business base which has increased many customers and majority of them are happy with the service. Recently ASDA has promoted their delivery by customers paying ? 5 per month and they can get their deliveries for free in any time they order during the month, and this can go for 12 months.