ASDA Report

E-COMMERCE PROBLEM IN ASDA FROM OPERATIONAL AND MARKETING PERSPECTIVE























Table of Contents
Introduction 3
Operational and Marketing Problem 4
Relationship between operation and marketing issue 5
Customers of ASDA 6
Customers' Expectations 7
Strategies to meet expectation of Customers 8
Customers Desires and ASDA services Discrepancies 9
Effects of Discrepancies on ASDA 10
Recommendations 11
Conclusion 12
References 13














Introduction
ASDA is the UK's second largest supermarket; the company was founded in 1949 under the name of Associated Dairies and Farm Group. However, the name was shortened to ASDA in 1965. This supermarket is mainly focused on food, clothing, electronic, toys, and general merchandise. Moreover, ASDA is the largest supermarket chain in the world, and it has become a subsidiary of Walmart in 1999. Walmart currently employs over 2 million colleagues in 27 countries. In The UK, there are over 175,000 colleagues working across its many aspects in ASDA, which have become one of the largest employers. These were divided into several of roles in supermarkets, home offices and ASDA living. Recently, ASDA continues to expand their operations in the UK, and also increased their local number of supermarkets from achieving the number of stores from NETTO (ASDA Ltd., 2015).
ASDA Company operates as one of the biggest food retailers in the United Kingdom. There are more than 350 stores operating all over the UK with over 160.000 colleagues in this large community, around 42000 square feet have been built as food retailers. And also this company's stores sell a wide variety of products which including food, apparel, housewares, music videos and books. However, in 1999, this company was acquired by Wal-Mart Stores Inc. ASDA occupied 16.4 percent of UK grocery market share which lower than that TESCO achieved with 31.1 percent (Corporatewatch.org, 2015). This report will focus on the e-commerce issues and its impact on marketing and operating aspects and also current market and customers' expectations will be explored, which will establish a gap between customer's expectations and customer's perception. At the same time, this report will analyze what remedial measure organization have provided to narrow the gap between the customer's expectations and customer's perception. At least, a conclusion and some recommendations will be made at the end.
Operational and Marketing Problem
The retail industry in the UK has grown to a great extent, and the biggest opportunity for ASDA is to focus on their online retail maintenance. The ASDA has maintained its online grocery store too like another retail store in The UK, ensured operational efficiencies and is also focusing on the performance of the website. The major problem faced by ASDA is that less amount of the customers purchases through their online stores. According to Burt and Sparks, (2001) tough there has been seen enormous progress in the field of e-tailing yet there is a need to be done more in this regard because still customers are not much comfortable in e-tailing. The online customers are less loyal than the traditional customers which are creating a problem for ASDA in its operations.
Tough there are a lot of online grocery stores have been introduced by the retailers but still customers do not feel comfortable in purchasing the products online. The major reason behind these are the security problem, shopping habits, difficulties faced in the payment process, less control in selection of product and delivery charges, etc. are the problem which are faced by the customers while doing online shopping through ASDA website. According to Kirby, (2000) despite e-tailing being very popular among the citizen and shift of retail stores towards e-tailing still they have to face problems because of customers attitude towards e-tailing. Still in many countries customers do not have much inclination towards e-tailing or some technical problem compel them to no shop online. The biggest operational problem is the effective management of the online business and providing the customers with enough variety of choice that they start changing their shopping habits and turn to the online business of the ASDA (Whysall, 2001).
Another issue faced by the ASDA is related to marketing. The issues concerns regarding the education of customers regarding the online shopping. Effective advertisement and marketing of their website and online products that people turn towards the online products of ASDA. Along with the operations of the organization, marketing is also a very important thing on which ASDA has to focus. If ASDA wants to earn maximum revenue through its online business, then it has to focus on the effective marketing of its website. Marketing is the major thing that play a significant role in the progress of the company (Whysall, 2001).
Relationship between operation and marketing issue
According to Lambin, Chumpitaz and Schuiling, (2007)marketing and operation management are two separate departments of the organizations but still there are some issues that have a relationship between both these departments and issue in one department creates problems in the other departments. Maintenance of online retailing and marketing of products of ASDA are closely related. Website development and presenting the products of ASDA is the operational problem of the organizations but till the effective marketing of online products and website of ASDA would not be done till then ASDA would not be able to generate effective revenues (Whysall, 2001). However, development of effective marketing strategy of the website and products depend on how much the good website has been developed and how much variety the consumers are getting on the website of the ASDA. Burt and Sparks, (2002) states that for the effective marketing it is important for the organization to make its operations effective and efficient. If the website of the ASDA is not providing the customers with a variety of products and the product mix is low on the website of ASDA then ASDA would not be able to generate enough revenue from their website. So it is the responsibility of the IT department of ASDA to develop an affective website and introduce a much variety of their websites as they could (Gummesson, 1994).
On the other effectiveness of marketing strategies also depend on the variety of products introduced by the ASDA. If customers do not have enough variety and choice on the website of ASDA then no matter how much money ASDA spend on developing marketing strategy to persuade the people to buy their products they would not buy. So effectiveness of the marketing strategies also depend on the operations of the organizations if the organization is lacking in the operational sector then no matter how much money they spend on marketing of their products they would not be able to generate enough revenue and increase their customers. Lambin, (2008) opines that if any organization wishes for its marketing strategies to yield good results then its operations must be in synchronization with its marketing strategies otherwise all the efforts on marketing would be vain. ASDA can increase their online customer base creating effective, interesting website where customers could enjoy the liberty of choosing their favorite products. In this era of internationalization and e-commerce, every organization is offering their products online (Kerin and Peterson, 2010) if ASDA would not provide a variety of products to their customers on their online stores then they would move to any other online store. This would also affect the marketing of ASDA, despite spending large amount of marketing of their products and online stores they would not be able to attract more customers.
Customers of ASDA
Customers of ASDA come from different walks of life. At ASDA customers belong from every age group. ASDA being a retail store offers a variety of products on its outlets and franchise that are purchased by not only young people but from old people. Its customers include students, housewives, businessmen, professionals, lawyers and doctors, etc. The same customer base is targeted on ASDA website and to facilitate the customers more and save their time ASDA offers a variety of products to their customers on their websites too. The performance of the traditional and online retail stores of ASDA depend on the marketing and operations of the ASDA that how effectively their market their online products and how much variety of products is available on their websites for their customers (Doherty and Nelson, 2010).
The success of every retail is dependent on their customer base and the marketing strategy how effectively they target their customers. To know about the needs and expectations of their customers ASDA has developed and effective feedback system, where their customers can write their feedback and give suggestions to ASDA. ASDA aims at offering quality products at low price that is why it is becoming very popular among the customers as compared to other retail stores and another major reason is their effective feedback system through which they involve their customers in their business and keep updating their products according to needs of their customers. ASDA keeps on meeting the expectations of its customers and same it is trying to do for its online retail store to provide the customers maximum products at minimum prices (Xie and Allen, 2013).
Customers' Expectations
The major expectation of the ASDA customers is low-price high-quality products. ASDA is already providing their customers high-quality products at low price. The customers who are loyal to ASDA want more variety at their stores and online retail store as well. ASDA always strives hard to provide their customers with the maximum variety they of products. Customers are having a great variety of good retail stores but those who are loyal to ASDA want ASDA to offer them all those products that they could get from any other retail store at low prices. Provision of high-quality products at low price is one of the competitive advantages of ASDA, which keeps its loyal customers stick to it (Graves, 2014). Another greater demand and expectation of ASDA customers are reduction or removal of delivery charges if they shop from their online retail store. A major reason for less online shopping from the ASDA stores is that customers have to pay extra delivery charges after they purchase products online. Sometimes while shopping online customers have to face problems in payment processing. They have to face a problem is paying so ASDA has to fix the problem of payment on its website so that their customers could easily pay for the products that they purchase. Moreover, another major problem is product variety that is less on online retail stores of ASDA (Hutcheson and Moutinho, 2010).
Strategies to meet expectation of Customers
According to Hutcheson and Moutinho, (2010) for every retail store meeting the expectations of customers is very important if the expectations of the customers are not met effectively then, the retailing store cannot make progress. ASDA always tries hard to meet expectations of theirs customers. The customers of ASDA want high-quality products at the low level of prices which ASDA is providing them. The customers of ASDA sometimes found to complain about the improvement of the customer services of ASDA. ASDA has strategy training programs of their sales officer to improve their customer services along with that they introduced the feedback portal on their website too where the customers can complain about their products and tell them about their shopping experience (Macaulay and Cook, 2001).
Customers are always kept as a priority by every retailing organization to maintain their position in the market that is why every organization creates an effective feedback mechanism to know about the demands of their customers. ASDA always encourages their customers to provide them suggestions that could help them to improve their services. In case of the online shopping, the ASDA is trying to increase its products mix and variety on their website so that customers have enough variety to choose their favorite products. ASDA is tried hard to make their payment system more efficient and user friendly so that no customer would face any problem while online payment process and also they have introduced complaint portal on their website if any customer face any kind of problem regarding payment of delivery procedure they can contact their customer services department that remain online 24/7 for the customers help (Doherty and Nelson, 2010).
ASDA has also reduced its product delivery charges to facilitate their customers so that their online customer base could increase to much they have a traditional customer base. ASDA also provides their customers variety of the financial services like general insurance, personal loans, credit cards and life insurances. The basic purpose of financial services of ASDA is to take the hassle out of the lives of their customers. ASDA also provides different discount and promotional offers for their customers on any special occasion so that they could increase their customer base. ASDA is providing online shopping coupon to their regular online shopping customers so that they could get a discount if they keep shopping through the online store of ASDA. This strategy is increasing the greater online customer base of ASDA (Kirby, 2000).
Customers Desires and ASDA services Discrepancies
According to Graves, (2014) customer services is a priority of every organization, but sometimes there are discrepancies that are found in customer services of every organization. ASDA also has some discrepancies in its tradition store and online store customer services. It has been observed most of the time ASDA customers has been found complaining about the rude customer services behavior (Matusitz and Leanza, 2011). According to some of the customers of ASDA their queries are not effectively answered by the ASDA customer services department. There are some other discrepancies like ASDA offers their customers money back guarantee or they provide them facility to exchange their product for any other product if they are not satisfied with their product but when the customers desire to return to exchange their products they are not able to get alternatives (Matusitz and Leanza, 2011).
In case of traditional stores of ASDA, it has been seen that people mostly complain about the lack of staff and hassle in the stores. Owing to lack of staff in ASDA stores so much time of the customers is wasted in waiting in long queues to purchase something. ASDA needs to recruit new counter staff, so less time for the customers is wasted. Another most important discrepancy is a lack of variety of their online store and no synchronization between the stock and stuff on the online store (Smith et al., 2004). According to customers, some products on ASDA online store are written to be in stock but when they try to order, then they come to know that these are not present in stock. Another major problem is with their delivery system when customers order any product online then they are not able to get it in time. Some of the time it happens that they offer some other product and what they get is totally some other product.
Another major discrepancy that has been reported by the customers regarding the online services of ASDA is that they do not have an effective payment system. Even if the payment in the account of the customer is enough to make a purchase still, they are not able to process on ASDA online store and would not be able to get their product on time. One of the major discrepancy reported by the customers regarding the ASDA home delivery service is that most of the time customers get damaged product and they are not even able to get its replacement and are forced by ASDA to keep the and pay for damaged stuff (Setó-Pamies, 2012).
Effects of Discrepancies on ASDA
According to Smith et al., (2004) efficient and excellent customer services is considered as key to the success of every retailing organization. According to research study, there have been many discrepancies in the customer services of ASDA not only in the traditional stores but also on their online stores and delivered system. The main reason behind the lack of customer attraction towards the online stores of the ASDA is the problems faced by the customers while shopping online that is why fewer customers are attracted towards the online stores of ASDA. Problems and discrepancies in customer services of ASA can severely damage the reputation of the organization and would also decrease in the large amount of customer base. The customers are the only key to the progress and revenue generation for any retail organization according to Setó-Pamies, (2012) opinion. If ASDA is not able to provide effective customer services and its customer base kept reducing then, its profit ratio will also fall.
Recommendations
Below are some recommendations for ASDA to improve its customer services and e-commerce issues.
The greatest complaint about ASDA by its customers is bad customer services. ASDA must provide its staff training to deal with customers and improve their customer services.
Lack of staff is another problem found in the ASDA stores. ASDA must recruit new staff to facilitate their customers so that they could save more time while purchasing any product.
ASDA offers money back and product exchange guarantee to their customers but still customers are deprived of this facility. ASDA management must ensure that if they offer money back and product exchange facility then customers must get it.
Online stores are ASDA do not have product variety. ASDA must increase the variety of products in its stores.
Moreover, there is no synchronization between stock and the products listed on the website. ASDA must create effective synchronization between stock and products on the website if it is written on the website that the product is in store then they must get it.
ASDA must give their customers compensation or replace the product if the product gets damaged during the delivery.
The payment system of ASDA must also be made efficient so that customers do not have to face payment processing problems.
Conclusion
ASDA is considered as one of the best retail stores in the UK but like many other retail stores it also has discrepancies that have very drastic effect on not only customer base and revenues of ASDA but they are affecting its reputation too. ASDA is also having many discrepancies in its e-commerce that is why it is not able to attract more customers to its website and create enough customer base for its e-tailing services. The report was based on the identification of problems in e-commerce of ASDA from both operational and marketing perspective. Operations and marketing of every organization are directly proportional to each other. If there is a problem in operations of the organization, then it effects the marketing of organization too. The impact of discrepancies on the customers and organization too was evaluated, and some recommendations were also given to improve the discrepancies found in the operations and marketing of e-commerce business of ASDA. In the nut shell if the ASDA wants to increase its customers base for its online business and traditional business then it must improve its operations of customer services so that effective results could be yielded and if ASAD fails to do so then its marketing strategies would also be badly affected and would not be able deliver good results no matter how efficient they are.







References
ASDA Ltd., (2015). History of ASDA Group Ltd. – FundingUniverse. [online] Fundinguniverse.com. Available at: http://www.fundinguniverse.com/company-histories/asda-group-ltd-history/ [Accessed 30 Jun. 2015].
Burt, S. and Sparks, L. (2001). The implications of Wal-Mart's takeover of ASDA. Environ. Plann. A, 33(8), pp.1463-1487.
Burt, S. and Sparks, L. (2002). Corporate Branding, Retailing, and Retail Internationalization.Corporate Reputation Review, 5(2/3), pp.194-212.
Corporatewatch.org, (2015). Asda " Corporate Watch. [online] Available at: http://www.corporatewatch.org/company-profiles/asda [Accessed 30 Jun. 2015].
Doherty, S. and Nelson, R. (2010). Using projective techniques to tap into consumers' feelings, perceptions and attitudes . . . getting an honest opinion. International Journal of Consumer Studies, 34(4), pp.400-404.
Graves, D. (2014). STAFF SCHEDULING AND CUSTOMER SERVICE AT ASDA. International Journal of Retail & Distribution Management, 18(1), pp.365-389.
Gummesson, E. (1994). Making Relationship Marketing Operational. International Journal of Service Industry Management, 5(5), pp.5-20.
Hutcheson, G. and Moutinho, L. (2010). Measuring Preferred Store Satisfaction Using Consumer Choice Criteria as a Mediating Factor. Journal of Marketing Management, 14(7), pp.705-720.
Kerin, R. and Peterson, R. (2010). Strategic marketing problems. 12th ed. New Dehli: Pearson Education, p.313.
Kirby, A. (2000). Retail Insights Wal Mart's takeover of Asda. International Journal of Retail & Distribution Management, 28(3), pp.1-22.
Lambin, J. (2008). Market-driven management. Milano: McGraw-Hill.
Lambin, J., Chumpitaz, R. and Schuiling, I. (2007). Strategic and operational marketing. Basingstoke [u.a.]: Macmillan, p.92.
Macaulay, S. and Cook, S. (2001). Rewarding service success. Measuring Business Excellence, 5(1), pp.4-8.
Matusitz, J. and Leanza, K. (2011). ASDA: Organic Growth of a Retailer in the United Kingdom?.Journal of International Food & Agribusiness Marketing, 23(2), pp.128-150.
Setó-Pamies, D. (2012). Customer loyalty to service providers: examining the role of service quality, customer satisfaction and trust. Total Quality Management & Business Excellence, 23(11-12), pp.1257-1271.
Smith, A., Sparks, L., Hart, S. and Tzokas, N. (2004). Delivering customer loyalty schemes in retailing: exploring the employee dimension. International Journal of Retail & Distribution Management, 32(4), pp.190-204.
Whysall, P. (2001). Wal Mart's takeover of Asda: what the papers said. British Food Journal, 103(10), pp.729-743.
Xie, Y. and Allen, C. (2013). Information technologies in retail supply chains: a comparison of Tesco and Asda. IJBPSCM, 5(1), p.46.