Task 5: SWOT analysis of Aldi 2

ALDI ALDI ALDI 2 2 Business and Marketing Communication [Aldi] Name of the student: Name of the university: Author note: Task 3: SWOT analysis of Aldi 2 Task 5: An evaluation of ALDI’s tactical marketing strategies (4P’s) 4 5.1 Product strategy 4 5.1.1 The core product 4 5.1.2 The actual product 5 5.1.3 The augmented product 5 5.2 Price strategy 5 5.3 Place strategy 6 5.4 Promotion strategy 6 Task 6: Recommendations 7 Task 7:

Running head: ALDI
Business and Marketing Communication
[Aldi]
Name of the student:
Name of the university:
Author note:

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Table of Contents
Task 3: SWOT analysis of Aldi.......................................................................................................2
Task 5: An evaluation of ALDI’s tactical marketing strategies (4P’s)...........................................4
5.1 Product strategy.....................................................................................................................4
5.1.1 The core product.............................................................................................................4
5.1.2 The actual product..........................................................................................................5
5.1.3 The augmented product..................................................................................................5
5.2 Price strategy.........................................................................................................................5
5.3 Place strategy.........................................................................................................................6
5.4 Promotion strategy.................................................................................................................6
Task 6: Recommendations...............................................................................................................7
Task 7: Negotiation Tactics.............................................................................................................7
Recommendation.........................................................................................................................8
References......................................................................................................................................10

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Task 3: SWOT analysis of Aldi
This section conducts SWOT analysis on Aldi in specific to its operations in Australia.
Strengths:
The biggest strength of Aldi lies in its capability to operate differently than the traditional
operations style of industry’s major supermarket brands. Interestingly, whatever they do they
ensure the best outcome. First of all, Aldi, unlike other major supermarket brands, has different
stock keeping units (SKUs) (Aldi.com.au, 2019). The number of stocked items is even four times
lesser than the SKUs in major supermarket brands. Additionally, Aldi employee comparatively
fewer employees than major supermarkets. Despite the fact that there can be a temporary switch
over to a task not being assigned earlier to, employees in Aldi are mostly satisfied with the
employee benefits they receive (Cr.aldisouthgroup.com, 2019). It just indicates their ability to
manage operations effectively while also being able to keep the operations cost lower. Secondly,
Aldi is pretty successful in managing an effective relationship with suppliers. They bargain a lot;
however, make payments to their suppliers within just thirty days. Moreover, they demand fewer
products than other supermarket brands. Due to effective supply strategy and due to an effective
relationship with suppliers Aldi ensures fresh products at the lowest possible price (Ayers &
Odegaard, 2017). Shopping happens to be at a comparatively faster rate at Aldi stores. Aldi does
not encourage packaging items for customers. Hence, they save time that could have been spent
over packaging items. In addition, bar codes are available at the various sides of an Aldi product
avoiding unnecessary time consumption in searching for the bar codes. Due to fewer SKUs, the
product wrapping process consumes comparatively low time than other supermarket brands (Van
Heerden & Van Vuuren, 2018). Aldi does not offer any loyalty scheme and discount on fuel
price. They do aggressive marketing in various possible ways. They do TV adverts such as the

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‘Like Brands’ campaign. Newspaper advertisements are also essentially a part of marketing. A
brochure is being used to promote the brands. Facebook and Twitter are used for establishing
two-way communication with consumers (Leung, Bai & Stahura, 2015). These just show Aldi’s
capability to deliver in every aspect of the operations.
Weaknesses:
On comparing Aldi with the likes of Woolworths and Coles, it can be said that the
company has few weaknesses as well. Aldi does not offer too many options for a single product.
It does not offer a free carry bag. Trolleys are also not free. Moreover, unlike in Woolworths and
Coles customers are needed to themselves pack their items. All these may sound a bit
embarrassing to few consumers and they may certainly prefer other supermarket brands over
Aldi (Baviera-Puig, Buitrago-Vera & Escriba-Perez, 2016). However, many other customers are
very much satisfied with things Aldi is good at. Moreover, at the end of the day, value for money
is what matters most to the customers (Baviera-Puig, Buitrago-Vera & Escriba-Perez, 2016).
This is exactly where Aldi is able to deliver.
Opportunities:
In the existing market, Aldi should tap the growing e-commerce market. They can either
go for a third party e-commerce platform or use their own official website. A third party will
help to reach to more customers. On the other hand, the official website can be used to promote
innovative shopping like ‘Social Commerce'. With social commerce, consumers can shop
products by just clicking an image of the product. The product thus clicked is saved on a virtual
Ad-Cart (Lu, Fan & Zhou, 2016).
Threats:

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Possible threats to Aldi is the growing popularity of shopping from e-commerce websites
(Rahayu & Day, 2015). It is more convenient and time-saving as well. E-commerce shopping
cannot fully uproot Aldi as it has its own weaknesses as well. Consumers can never access to
their chosen product in real-time. Rather, they need to wait until the moment it is delivered to
them. The delivery time may be quicker such as within a day; however, this is still behind to
physical stores where consumers can access the product once they have purchased it. The future
of shopping will bring some fresh challenges in the form of ‘Social Commerce’.
Task 5: An evaluation of ALDI’s tactical marketing strategies (4P’s)
This section analyses the tactical marketing strategies of Aldi.
5.1 Product strategy
The product strategy of Aldi is not very different from Woolworths and Coles; however,
Aldi is actually able to deliver better than these two giant retailers. The product strategy of Aldi
is to offer quality and fresh groceries consistently (Spicer & Hyatt, 2017). To ensure fresh
products the concerned management personnel in Aldi do regular testing of every new arrival on
every Monday. They have in place a very effective testing facility, which they use to ensure the
quality of the products. This section further discusses the types of product strategy in regards to
Aldi.
5.1.1 The core product
The core product of Aldi is fresh groceries at the lowest possible price (Freebairn, 2018).
This means customers are not just getting fresh products but are actually getting paid for their
money. Aldi is constantly delivering value to their money by offering fresh groceries at the most
competitive price range. Moreover, the shopping is faster at Aldi as compared to other major

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supermarket brands. It is due to various afore-mentioned reasons. In this way, Aldi is delivering
value to its customers.
5.1.2 The actual product
The actual product of Aldi is fresh groceries mostly. However, it also sells many other
products on a weekly basis. This includes but is not limited to such as kitchen equipment,
bathroom accessories and many other household equipments. Fresh groceries is what they mostly
sell. Apart from this other products are sold on a weekly basis. Store managers do promote other
products with the help of posters explaining to their customers that the listed products will be
available soon in stores (Aldi.com.au, 2019).
5.1.3 The augmented product
Customer service can be called as an augmented product for Aldi (). Aldi has a distinct
strategy than Woolworths and Coles. Aldi does not believe in keeping less qualified people to the
checkup point. Instead, they prefer highly qualified professionals for each of the job positions in
Aldi stores. Aldi is well against hiring people on a temporary basis. Instead, they hire both part-
timers and full-timers on a permanent basis. To ensure a high standard customer service Aldi
also ensures that its staffs get regular training and feedback. Training is given to every employee
no matter they are even the managers. All employees are trained in multi-skills. This means
consumers in Aldi stores will be receiving appropriate guidance in an effective manner without
unnecessarily moving between people for one query (Cr.aldisouthgroup.com, 2019).
5.2 Price strategy
Price strategy of Aldi is very much on the same page with other supermarket brands. Aldi
regularly tries to offer fresh groceries at the most competitive price range. Moreover, it also sells

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private label brands. These products are also priced lower as compared to prices maintained in
Woolworths and Coles (Zorbas et al., 2019).
5.3 Place strategy
Aldi has quite a distinct place strategy as compared to major Woolworths and Coles. The
store size is approximately four times smaller than those of Coles and Woolworths. The stock
keeping units (SKUs) is way much lower as compared to Woolworths and Coles. At the cash
counter, Aldi does not encourage packaging the items as well. Rather, Aldi encourages its
customers to manage it on their own. Bar codes are available at all sides of a product. It helps to
save time on searching for bar codes. The trolleys cannot run unless a coin is inserted in it. Once
the trolley operations are over customers will be able to get their coins returned to them (Edgar,
Huhman & Miller, 2015). By following all such strategies Aldi is able to provide a faster
checkout experience to its customers. To summarise, it can be said that the place strategy of Aldi
is oriented with a faster checkout experience for its customers.
5.4 Promotion strategy
Aldi does an aggressive promotion of its products. In fact, they know how to effectively
utilise various channels of promoting a product. Aldi does use TV advert to make a lasting
impression. They use popular newspapers to promote their product and communicate special
product features. They use brochures for promotion. Printed leaflets are distributed in stores and
to people living near to stores. Aldi uses Facebook and Twitter to an effective note (Liu, Li,
Peng, Lv & Zhang, 2015). For example, Aldi had once used Facebook for allowing its loyal
customers sending Aldi Valentine card. Aldi encouraged its customers by offering them surprise
gifts such as a box of Aldi chocolates (Cr.aldisouthgroup.com, 2019).

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Task 6: Recommendations
One of the recommendations will be for a TV advert using a famous celebrity who has a
global appeal and people can connect with him or her. This strategy is in synchronisation with
one of Aristotle's persuasive techniques in advertising "Ethos” (Rabab'ah & Khawaldeh, 2016).
Ethos encourages to use a popular face as this will encourage consumers to buy that product. No
matter whether the celebrity has himself or herself has used the product consumers will still but it
provided that the promotion stunt is done with a “Standardised Message”. A standardised
approach can be adopted by communicating facts of the product such as fresh groceries to the
target viewers.
The second recommendation will be for uploading a short video on Facebook showing
what freshness means to Aldi. The video in quick time will communicate factors that help Aldi
offer fresh groceries to customers. This advertisement is very much in synchronisation with
“Logos", which is one of Aristotle’s persuasive techniques in advertising (Bell, 2017). The
promotion of the product in this way will use a “Localised Message” as this will connect more
with the target viewers.
Task 7: Negotiation Tactics
Based on the Geert Hofstede’s 6 Cultural Dimension Theory, there are evident cultural
differences between Germany and New Zealand. The cultural differences are as mentioned
below (Hofstede-insights.com, 2019):
The power distance analysis shows Germany has more hierarchy levels at companies as
compared to New Zealand. This means communication will be much more formal in Germany
and also that the communication process will be comparatively slower.

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In terms of individualism, New Zealand scores more than Germany. This means
individual performance is given higher importance as compared to teamwork.
The masculinity figure shows that New Zealand performs better than Germany in terms
of reducing gender inequality in the workplace.
The uncertainty avoidance suggests that plans being made have a high success rate in
New Zealand as compared to Germany.
In Germany, long-term goals are given a higher preference, which is not the case with
New Zealand.
German culture is more a restrained culture whereas New Zealand is an indulgent
culture. This means German people spend very less on leisure moment. They can work for long
hours while not bothering for their desires and all.
Recommendation
Based on the findings of a comparative analysis of Germany and New Zealand, following
negotiation tactics can be recommended to the Creative Director while they meet with the
German owners of Aldi:
One of the recommendations is that the Creative Director should never indulge in
conflicts with the Germans as the Germans are very professional and won’t tolerate any
unprofessional behaviour.
Expressing emotion is another recommendation. By expressing appropriate emotion at
appropriate time Creative Directors will be able to make some sense of the discussion.

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Creative Directors should also be good at attacking the opponent in a very logical way. It
means they should ask countering but sense-making questions. This will help Creative Directors
know about the potentiality of the deal.
Insisting final position should also be one of the negotiation tactics. This will help
Creative Directors stick to their point despite diverting talks from German owners in Aldi.
Creative Directors should have openness to the thoughts of the German owners.
Moreover, they are required to be flexible with the way Germans work. It should be remembered
that as according to the findings of the Hofstede’s Six Dimension analysis of Cultures in
Germany and New Zealand, German owners prefer pure professionalism overtaking some time
out for the leisure moment.

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References
Aldi.com.au. (2019). ALDI Supermarkets - Good Different - ALDI Australia. Retrieved from
https://www.aldi.com.au/
Ayers, J. B., & Odegaard, M. A. (2017). Retail supply chain management. CRC Press.
Baviera-Puig, A., Buitrago-Vera, J., & Escriba-Perez, C. (2016). Geomarketing models in
supermarket location strategies. Journal of Business Economics and Management, 17(6),
1205-1221. [DOI: 10.3846/16111699.2015.1113198]
Bell, J. (2017). 'Setting the joy free'with Cadbury UK: A CDA analysis of how persuasion is
communicated within Cadbury UK's social media discourse, according to Aristotle's'
persuasive proofs'.
Cr.aldisouthgroup.com. (2019). Retrieved from
https://cr.aldisouthgroup.com/sites/default/files/2018-07/ALDI%20SOUTH%20Group
%20CR%20Report%202017_0.pdf
Edgar, T., Huhman, M., & Miller, G. A. (2015). Understanding “Place” in social marketing: A
systematic review. Social Marketing Quarterly, 21(4), 230-248. [DOI:
10.1177/1524500415607453]
Freebairn, J. (2018). Effects of supermarket monopsony pricing on agriculture. Australian
Journal of Agricultural and Resource Economics, 62(4), 548-562.
Hofstede-insights.com. (2019). Country Comparison - Hofstede Insights. Retrieved from
https://www.hofstede-insights.com/country-comparison/germany,new-zealand/

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Leung, X. Y., Bai, B., & Stahura, K. A. (2015). The marketing effectiveness of social media in
the hotel industry: A comparison of Facebook and Twitter. Journal of Hospitality &
Tourism Research, 39(2), 147-169.
Liu, Y., Li, H., Peng, G., Lv, B., & Zhang, C. (2015). Online purchaser segmentation and
promotion strategy selection: evidence from Chinese E-commerce market. Annals of
Operations Research, 233(1), 263-279. [DOI: 10.1007/s10479-013-1443-z]
Lu, B., Fan, W., & Zhou, M. (2016). Social presence, trust, and social commerce purchase
intention: An empirical research. Computers in Human Behavior, 56, 225-237.
Rabab'ah, G. A., & Khawaldeh, M. (2016). Persuasive Appeals in English and Arabic TV
Advertisements: Implications for EFL Learners and Teachers. Dirasat: Human and
Social Sciences, 48(4116), 1-13.
Rahayu, R., & Day, J. (2015). Determinant factors of e-commerce adoption by SMEs in
developing country: evidence from Indonesia. Procedia-Social and Behavioral
Sciences, 195, 142-150.
Spicer, A., & Hyatt, D. (2017). Walmart’s emergent low-cost sustainable product
strategy. California Management Review, 59(2), 116-141. [DOI:
10.1177/0008125617695287]
Van Heerden, S. A., & Van Vuuren, J. H. (2018). Optimisation of stock keeping unit placement
in a retail distribution centre. South African Journal of Industrial Engineering, 29(2), 74-
91. [DOI: 10.7166/29-2-1867]

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Zorbas, C., Gilham, B., Boelsen‐Robinson, T., Blake, M. R., Peeters, A., Cameron, A. J., ... &
Backholer, K. (2019). The frequency and magnitude of price‐promoted beverages
available for sale in Australian supermarkets. Australian and New Zealand journal of
public health.