Coles Supermarkets Market Strategy

This assignment delves into the strategic positioning of Coles Supermarkets. It conducts a comprehensive situational and SWOT analysis to outline key factors influencing Coles' market performance. The analysis identifies Coles' target audience, primarily households with middle-level income, and highlights their emphasis on fresh produce as a core product offering. Furthermore, the document explores various marketing strategies employed by Coles, including promotional techniques and pricing adjustments, aimed at driving sales growth within a competitive retail landscape.

Running Head: Report
Contents
Introduction...........................................................................................................................................3
Situation Analysis..................................................................................................................................4
Company Analysis.............................................................................................................................4
Environmental Analysis....................................................................................................................5
Competitors Analysis........................................................................................................................6
Customer Analysis.............................................................................................................................7
SWOT Analysis.....................................................................................................................................8
Potential target market...........................................................................................................................9
Positioning of the product................................................................................................................10
Marketing Mix.....................................................................................................................................11
Budget.................................................................................................................................................12
Conclusion...........................................................................................................................................13
References...........................................................................................................................................14
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Introduction
This report is conducted to strategize the marketing plan for the Coles Supermarket. The
purpose of this report is to outline the complete marketing strategies that will be required for
achieving its marketing objectives. The rise in the retail and food industry in Australia has
increased the level of competition, which becomes necessary for the organizations to define a
particular marketing strategy. This report is based on the Australian organization, i.e., Coles.
Coles is the largest chain of supermarkets in Australia. Coles was founded in the year 2014,
where it opened its first store in Melbourne, Australia. Coles is a wholly owned subsidiary
organization of Wesfarmers. The Organization belongs to the Retail and consumer services
sector of Australia and is considered as the largest Australian supermarket chain. This
organization has over 800 stores operating across Australia and has more than 100000
employees working in their stores. The Coles supermarket holds around 45% of the market
share of Australia and has revenue of around A$ 38 billion in the year 2016. This
organization has recently completed its 100 years of service in the year 2014. Coles
supermarket has various rivals, but they still have managed to compete with the competition
from the rival firms and is known as the leading supermarket in Australia. Coles has a wide
range of products like groceries, liquor and meat and this organization aim at selling its own
brands. The Coles has been able to satisfy a large number of customer base with its wide
range of products and services (Commonwealth of Australia, 2011). Coles has also opened its
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online grocery store in order to provide better quality services to its clients. Coles serves
around 1.2 billion of customers through its various outlets. Coles has been supported by the
industry in which it belongs as this industry has huge growth that has helped Coles in
managing and sustaining its brand image and position. The Mission of Coles: “To give
people of Australia a shop they trust, delivering quality, service and value”. The Corporate
vision of Coles is to establish itself as a world class brand and also aims at growing a
sustainable future of Australia by providing the proper means. The report states complete
analysis of the market in order to formulate the best marketing plan for the Coles
Supermarket (Coles Supermarkets, 2017).
Situation Analysis
Company Analysis
The Coles supermarket has a great influence on the market share of the Australian markets.
The company contributes to the growth of the economy. The product line of Coles is daily
products, meat, liquor, apparels, bakery products and many more. The company has been
following the policy of low price as their marketing strategy for a past few years in order to
attract and induce the customers to buy its products and services. Fresh produce is the chief
element of the Cole’s product range. The main competitor of Coles is Woolworths with a
40% market share in the industry. Coles aims at gearing its marketing strategies towards the
food, fuel and liquor services (Bloore, 2015). The organization aims at selling the best quality
products to its customers through all stores. Coles has appointed talented staff at all its outlets
in order to handle the customers and their feedbacks.The Coles supermarkets target the
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customers of different income groups. In concern to the promotional activities, the Coles
makes use of media like radio, TV, newspapers and internet in order to attract the customers.
Environmental Analysis
This part of the report will help in analyzing the possible external factors in the industry in
which Coles operates.
Political factors: The political situation of Australia affects the retail industry. The
Government regulations against the duopolistic market of Australia affects the other small
enterprises. The logistical policies of the government in the retail sector has been faced by
Coles. No other such political problems with regard to the produce of Coles has been faced.
Economic factors: A considerable decrease in the economic market conditions has caused
problems to the Coles supermarket. The reduction in the currency has also decreased the level
of spending from the Australian consumers. The bargaining power of the suppliers have been
drastically changed in the recent years, which brings problems for the Coles supermarkets.
Social factors: The retail industry has been affected adversely from the social aspects of the
external environment. The Australian people tend to expect more from the supermarkets. It
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becomes the duty of the Coles to produce that ordinarily develops the society as a whole. The
recent trends in the society states that they expect a societal organization in their country.
Thereby, Coles is implying to take societal initiatives in order to attract customers.
Technological factors: The technological advancements have caused great impact on the
Coles supermarkets. The application of the green refrigerators in the grocery stores in order
to protect the fresh produce. The use of the internet by the coles customers and the
advancements in the payment facilities affected the Coles markets. Adding the self checkout
facilities will also help in speeding up the process of shopping at Coles Supermarkets.
Legal factors: The law of carbon tax has been implemented in the retail industry of
Australia, which creates an impact on the Supermarkets like Coles and Woolworths. The
implementation of the ACCC regulations affects the operations of the Coles supermarkets.
Also, the strict rules are applied in the coding system of the supermarkets that adversely
affect the Coles (Team, 2012).
Environmental factors: The environmental factors of the country create impacts on the
retail industry of Australia. Coles is being affected by the environmental issues. The produce
of liquor through the Coles have caused an impact on the environment adversely. The
supermarkets are forced to use sustainable products. Thereby, the Coles supermarkets use
sustainable products and have established eco-friendly supermarkets.
Competitors Analysis
The grocery produce of the Coles has the most number of competitors in the retail industry of
Australia. Every brand aims at positioning their brand on top by promoting and delivering the
best services to the customers. The biggest rival to the grocery and fresh produce of the Coles
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supermarket is the Woolworths and Aldi. The same products are offered at Woolworths and
Aldi, the competition is very high based on the timely delivery, price, promotion, added value
service and etc. Aldi is the biggest rival as it lower its prices at any point of time in order to
capture a huge market share, which creates problems for the Coles supermarket to ascertain a
specific price for their grocery products (Woolworths Limited, 2014). The Coles delivers the
best fresh fruits and vegetables, thereby, Woolworths has also started to induce the customers
by giving the best fresh produce to the Australian customers. The immense level of
competition is faced by the Coles in the retail sector as any change in one supermarket
adversely affects the strategies of the other supermarkets.
Customer Analysis
The grocery items or the fresh produce of the Coles supermarket is the highest selling
product. The customers that have the highest purchase of the fresh produce of the Coles
supermarkets is the humans of the middle level income group (Keith, 2012). The target
customers of the Coles supermarkets are the median income group of customers in order to
provide them with the basic necessities of life. Since, Coles has aimed at growing the future
of the Australian people, they produce high amounts of grocery products that are necessary to
lead a life. Thereby, the middle level and low level income group of people are targeted. The
buying behavior of the customers is changing with the change in the social trends.
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SWOT Analysis
This part of the report considerably aims at defining the core competencies and weakness of
the Coles Supermarket pertaining in the retail industry of Australia.
Strengths Opportunities
Second largest producer in the grocery sector
of Australia
Trying to sell private label products in order
to increase more sales
Delivers combinations of products and
services, which are different from other
supermarkets
An opportunity to capture huge market share
in the liquor market
Consumables sold by Coles are indigenous in
nature
With the availability of huge customer data,
coles have the opportunity to establish
insurance policies
Provides cost savings goods and services Has the opportunity to scan the market for
expansion in sectors of Asia
Weakness Threats
Problems from the suppliers Regulatory actions of the legal department
Attitude problems from the suppliers Actions of ACCC have brought problems in
the relationship with the suppliers and Coles
Management problems in the supply chain Competition from Woolworths has increased
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Issues in managing all the outlets at various
locations
Change in the eating and spending habits of
customers
Threats from competitors in insurance and
liquor sector (Rawal, 2013).
Potential target market
The Coles group aims at satisfying a large customer base through their wide range of
products and services. The Coles has also aimed at targeting a specific market segment in
order to increase its sales and customer satisfaction. For an effective marketing plan, it is
important for the organization to determine its target audience and their buying behavior
based on the various factors. The demographic, geographic, psychographic and behavioral
factors of the target market are briefly outlined.
Demographic Factors: The Coles supermarkets aims at targeting the customers of on the
basis of gender also. The females of age group 18 to 35 are targeted in order to produce and
sell the most of the grocery products to them. The males of the age 18 to 25 are targeted and
also the young children are targeted in order to sell the various bakery and confectionery
items. The customers are targeted and welcomed for all cultures. The middle and low level
income group of people are targeted the most.
Geographic Factors: The Australian customers are targeted by the Coles group, which live
in the cities of Australia. Also, the customers who live in the coastal areas of the Australia are
also targeted with their wide range of product line. The outlets have been opened at almost
every city of Australia in order to induce the customers from all the areas.
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Psychographic Factors: The Coles aims at selling the grocery and fresh produce to the
targeted customers that are males and females in order to motivate them to eat fresh that will
cater to increase their well being. The household sector has been adversely impacted through
the policy of producing the fresh fruits and vegetables as this helps the customers from
preventing themselves from any health problems. The targeted audience’s psychographic
needs are also considered (Murray, 2014).
Behavioral Factors: The targeted customers have unique behaviors. They tend to buy the
products that are high in quality depending on the price of the product. The customers aim at
getting timely delivery of the grocery products and due to this, the online store of Coles
guarantees quality and timely delivery of the products. The customers also seek convenience
and comfort levels to be increased while shopping, thereby, Coles has aimed at providing
smooth automate trolleys at the store, which provide comfort to the customers.
Positioning of the product
The Coles offers the most wanted and necessary product, i.e., the fresh fruits and vegetables
in the middle and low level income group of customers in order to increase their standard of
living. The main feature of their product is that it is a fresh produce with the help of the
Australian farmers. The customers buy this product because it is highly fresh and the Coles
maintains low price. The grocery products are also combined with the fresh produce in order
to help the customers in saving the cost. The future trend of this product will continue to
remain the same as it is highly demanded product and the customers are attracted in large
volume due to its price, taste, quality and delivery (Goyder, 2007). The fresh produce of
Coles has positioned itself at a very high level apart from its competitors by describing its
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attributes to the customers and the use through the advertisements. The Coles has managed to
position itself due to the quality of products and services offered by them.
Marketing Mix
Product: The core product in the Coles supermarket is the Fresh produce i.e., fruits and
vegetables, the grocery items that have considerably increased the sales. The product is
highly fresh and contains all the necessary vitamins that are necessary for the intake of the
customers. The product is grown in an indigeneous manner by the Australian farmers. The
product has attained high levels of sales at all the outlet of the Coles supermarket.
Price: The Coles supermarket sells their product at a lower price in order to attract the middle
and lower level income group. The company has adopted the “down down” strategy in order
to compete with the prices of the competitor’s product. The product lies in the reasonable
amount, therefore, it attracts mostly the household sector of the Australian people (Singh,
2012).
Place: The Coles supermarkets are located at the places where there is high traffic. The
outlets are situated near the residential areas in order to attract the large customer base. The
outlets are located at the reach of every customer. The distribution and supply of the products
and services is very good and smooth.
Promotion: Coles supermarket aims at promoting their products through various means of
media. Radio is the most important means as Australian customers make use of radio in their
day-to-day life. The use of TV is very high among the household sector and youngsters,
thereby, the products should be promoted through advertisements on the TV. Also, due to the
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increase in the use of social media, the Coles can aim at promoting their products and
services on Facebook, Twitter and by also, established their own website (CIM, 2009).
Budget
The aim of the budget is to spend amount at the necessary activities in order to achieve its
goals. The market plan is devised to ensure that every activity has sufficient amount to
perform its function. If the budget for promotion for Coles supermarket is $250000, then
following will be the budget.
Production Media Total
Radio
Radio advertisements 50000 50000
Events 25000 25000 50000
Point of Sale
Incentives 10000 10000
Samples 10000 15000 25000
Display 10000 20000 30000
Social media
Social media sites 50000 50000
Google 20000 20000
Others 10000 10000
TOTAL 250000
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Conclusion
The report has highlighted the major situational and SWOT analysis in order to plan the
market strategy. It has been found that the Coles targeted audience is its household sector and
middle level income group. The Coles main product is the Fresh produce, which is highly
fresh and best in quality and by implementing lower prices and various promotional
techniques, the sales will increase. The various customer factors and external environmental
factors have also been discussed in order to formulate better marketing strategies.
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References
Bloore, R., 2015. Case study Coles Supermarkets, Available at:
http://www.brassrazoo.com.au/casestudy/Brass_Razoo_Fujitsu_Case_Study_Coles.pdf
CIM, 2009. Marketing and the 7P's: A brief summary of marketing and how it works,
Available at: http://www.thensmc.com/sites/default/files/CIM%207Ps%20Resource.PDF
Coles Supermarkets, 2017. About Coles: official website. [Online] Available at:
https://www.coles.com.au/about-coles.
Commonwealth of Australia, 2011. Economic Structure and Performance of the Australian
Retail Industry, Available at:
https://www.pc.gov.au/inquiries/completed/retail-industry/report/retail-industry.pdf
Goyder, R., 2007. Recommended Offer for Coles, Available at: http://media.corporate-
ir.net/media_files/irol/14/144042/pres2007/7_2.pdf
Keith, S., 2012. Coles, Woolworths and the local. Locale: The Australasian-Pacific Journal
of Regional Food Studies, 2, pp.47-64.
Murray, D., 2014. Response to Financial System Inquiry (Interim Report) - Coles, Available
at: http://fsi.gov.au/files/2014/09/Coles.pdf
Rawal, D., 2013. Company Spotlight: Coles Group - SWOT analysis, Available at:
https://www.scribd.com/document/350942971/SWOT-analysis-pdf
Singh, M., 2012. Marketing Mix of 4P’S for Competitive Advantage. IOSR Journal of
Business and Management (IOSRJBM), 3(6), pp.40-45.
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