Woolworths Marketing Strategies Analysis

This assignment requires a thorough analysis of Woolworths' marketing strategies. Students must examine various aspects, such as their customer relationship management (CRM) practices, brand positioning within the competitive Australian retail landscape, and the ethical considerations surrounding their marketing activities, particularly those targeting children. The analysis should draw upon provided academic sources to support claims and provide a comprehensive understanding of Woolworths' marketing approach.

Running Head: Integrated Marketing Communications
Integrated Marketing Communications
Name of the Student
Name of the University
Author note

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Abstract
The report focuses on Woolworths Group limited and the current challenge faced by the
organisation. The report involves collection of secondary data in this context and analyse the
information to suggest recommendations appropriate to the situation. The challenges faced by
Woolworths are the slowing consumer cycle and market growth and is attributed poor integration
of marketing and communication approaches in different levels of business. For the last two
years, the grocery has been challenging for Woolworth. It is recommended that the company
should consider modulating its marketing and promotional strategies. It must come up with
innovative and competitive strategy to sustain it competitive position. It is recommended to focus
more on the product development by technology integration, information processing model,
financial and strategic integration, lean retail model and gain strong supply chain support.

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Table of Contents
Introduction..........................................................................................................................3
Objectives............................................................................................................................3
Methodology........................................................................................................................4
Results and findings.............................................................................................................4
Analysis of the integrated marketing communication approaches......................................5
Recommendations................................................................................................................8
Conclusion.........................................................................................................................10
References..........................................................................................................................11

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Introduction
The report deals with the Woolworths Group limited an Australia based organisation that
is listed under ASX (Australian securities exchange). It is one of the top 100 companies listed
under ASX (Asx 2018). In Australia the Woolworths Group limited own supermarkets named as
“Woolworths supermarkets”. It was founded in 1924 and currently it accounts to eighty per cent
of the Australian market (Woolworths Ltd 2018). It operates as food and liquor merchandise
retailer. The products offered by the company are packaged food, vegetables, fruits, magazines,
beauty products, baby products, pet supplies and other household products. Woolworth is also
available currently as online shopping portal and there are more than 1000 stores in the country
(Woolworthsgroup.com.au 2018). The aim of the report is to highlight the current challenges
faced by the organisation and managerial implications. The purpose is to apply the theoretical
knowledge in resolving the real world business issue. The report involves collection of secondary
data in this context and analyse the marketing and communication approaches to suggest
appropriate situations.
Objectives
The aim of the research is to learn the current business problem of Woolworths and
analyse approaches taken by the organisation.
The objective of the research are-
 To identify the business problem of Woolworths Group limited
 Analyse the problem using the integrated marketing communication approaches
of Woolworths

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 Recommend effective solutions to resolve the business issue
Methodology
The methodology used for the research is qualitative study. Literature review is used for
collecting the secondary data. It is the tool to gain current knowledge on the chosen topic along
with substantive findings, theoretical and methodological contributions (Neuman and Robson
2014). For this purpose the, review of books, journal articles, and news articles will be
conducted.
The key terms used for the literature search are, “Woolworths Group limited”, “business
issue Woolworths”, “Woolworth’s challenges”, and “integrated marketing communication
Woolworths” and “IMC Woolworths”. Boolean operators such as OR and AND are used for
effective research in database. The inclusion criteria for the literature review are papers and news
articles published in English, in between 2012-2018 and on Woolworths Australia. Australian
based journals are used for this purpose. The rationale for choosing the range of the date is the
availability of the significant data in this period and chance of obtaining bulk of data. Since
recent challenges of the organisation may not be available in journal articles, the news articles
are also considered. Before proceeding with the journal articles, the relevance of each of them is
scrutinised by review of its abstract, full text followed by its references.
Results and findings
The current business problem faced by Woolworths is the slow consumer cycle and
slowing growth in the market. It led to shift of the consumer focus towards fresh foods and
broader grocery categories, which does not appear to be optimistic (Janda 2018). It is due to lack

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of product innovation and creativity, the company is not able to communicate with the
stakeholders. The customers are unsatisfied (HA Bijmolt et al. 2014). There is clearly lack of
integration of marketing communication strategies at different levels of management (Ellis and
Waller 2017).
For the last two years, the grocery has been challenging for Woolworth as the company
has not communicated with variety of target audiences (Pulker et al. 2018). Further, there has
been less volume growth (InsideFMCG 2018). Since, last two years there is no improvement in
the stock loss rates. There is the slowing market growth observed with lack of robust marketing
and communication strategies (Kurnia et al. 2015). According to Irvine and Moerman (2017), the
growing challenges have led the organisation to reduce the price of shares from $30 to $27. As
per the analysts, the margins appear to shrink in the key Australian Food and Liquor division
(Gilbert, Stafford and Sehgal 2016). As per Knox (2015), there is an increasing pressure building
on the margins due to increasing competition from the Coles and Aldi. There is an increase in
pressure to look outside the Australian food and liquor business. The multiple pressures on
earning is evident from the cut on the earnings per share by 2% and 3% in financial year 2015
and 2016 (Janda, 2018).
Analysis of the integrated marketing communication approaches
Integrated marketing communication or IMC is an approach to plan business
communications that yields profitable results. It is possible by reducing the marketing costs and
intense campaigns. Different components of IMC are sales promotion, sponsorship,
advertisements, public relations, product placemats, online marketing and direct marketing
(Barker 2012).

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Analysing the 4 Ps marketing mix concept, promotion is one of the P. Promotions can
be successful using different mix off communication tools, provided they work in harmony. A
maximum communication impact can be achieved by integrating tools such as direct mail, sales
promotions, advertisements, telemarketing, and use of social media. It helps maintain the clarity
with the stakeholders (Armstrong et al. 2014). According to Grimmer (2017) Woolworth takes
approach of too many stock-outs. The company is investing huge amount of money in
advertisements. The primary component of the marketing mix is advertisement as it helps reach
the mass target. It has invested money in various loyalty schemes, such as petrol pump discounts.
It uses intense campaign methods such as Fresh Food People campaign (1987-2012). Other
methods are use of online media for extensive promotions, magazines, and promotion
through newsletters. The company ensures lucrative discounts, and extensive deals,
and also promote through gift cards and celebrities. It has been successful in attracting
huge crowd by online stores. Target segment is reached by extensive promotional
channel. Further, its presence in the market has increased through physical evidence
such as billboards and hoardings and distribution of bags with its name and logo in the
shop. These strategies have markedly increased the sales and popularity of the food
and liquor product.
Analysing the Woolworth’s promotional strategy as a part of marketing mix, several key
issues were identified. There is lack of integration in the head office. In Woolworths, there is
confusion in regards to allocating price investment between promotion and everyday low prices.
As a consequence, the supply chain department and the procurement are not well connected with
the marketing department. Considering the present crisis, its supply chain is not focusing on
efficiency and cost cutting to reduce unnecessary expenses. Currently it is not having the strong
supply chain support. This outcome is surprising despite heavy investment in the different

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advertising streams starting from television ads to lucrative discounts. Thus, the brand image is
lowering and shift in customer focus. The company has not taken steps for promotional uplift or
buy additional products which indicate overlooking the IMC principles (Fernie, Fernie and
Moore 2015).
IMC also requires innovation and accountability integration. This approach was used by
the Woolworths and was evident from the announcement made by CEO in 2016 to recapture the
innovation and customer focus. The company intrinsically focused on its resources and has also
invested 150million dollars to overcome the grocery challenges. However, even after one year
the strategy did not lead to increase in growth in the Australian market. There is no focus on the
product innovation since last two years (Methner et al. 2015). Focusing on the customer contact
and single voice relationships consist one of the distinguishing feature of IMC (Yeshin 2012).
On relating the same with Woolworth it was found that the premium customers were not
interested in the discounts. They were interested in convenience and were major part of the
“Sunday Convenience consumer base” (InsideFMCG 2018). However, Woolworths focused
more on the everyday customers rather than the premium ones. Both the above drawbacks can
be considered the cause of slow consumer cycle and slow market growth rate of Woolworths.
Communications were not wrapped around the buying process of the customers. It consequently
hampered the brand values and client relationships. There is a decreasing market power of the
company with the increasing competition. The company is failing in innovation and sustain its
differentiated image of quality (Bowles et al. 2016). There is a need of company to focus more
on branding and marketing although it had earlier created an image of healthy product range.
Upon analysing the online marketing approach of Woolworth as a part of IMC, it can be
said that online shopping service seems to be incompetent and is diverting the customer’s

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attention to other competitor’s products. The technological factors need to be improved. There
has been an instance where the customer has paid the bill via credit card and the company could
not deliver the desired product. Therefore, online marketing should be more innovative to
enhance the customer retention (Humayun 2016).
Recommendations
Analysing the above approaches of Woolworths indicate managerial implications.
Managers must emphasise on integration during creative sessions and annual reviews. It implies
for the managers to ensure that the different members from advertising, marketing, sales
promotions are integrating their messages. This process requires good internal marketing. The
managers must ensure crystal clear communication strategy linking core values of the
organisation to add brand value (Yeshin 2012).
Applying the innovation adoption model, it is recommended for the company to spend a
huge part of promotional expenses on consumers to share information on products. It can boost
sales by introducing new products and attracting new customers for purchase, by creating
cohesive brand. It is advised to promote using celebrities for premium label products. Since the
quality of the products offered by the organization is same as that of its competitors, it must
focus more on campaigns such as, “Always at Woolworths”, and “iconic Fresh Food People
campaign”. New campaign can be on “drop in product prices” (Yeshin 2012). In addition to the
better convenience, the company must focus on superior freshness of the products. It will prevent
the customers to focus on competitor’s products. The company must continue to deliver the
liquor growth by giving innovative offers for every occasion. Innovation and customer’s trust
will help the company gain the sustainable sales momentum and increase the growth (Keith

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2012). The company must invest highly for promoting through mobile apps, websites with pages
for different products and categories, and virtual stores to promote its presence among new
customers. A regular redesign of websites during occasions such special buys, Father’s day or
special offer week will help retain customer focus and beat the competition. The websites use
more significant potential keywords to increase traffic to site. As per the Ansoff’s matrix,
product development or generating more modified products would beneficial in current situation.
It will increase the market penetration (Methner et al. 2015).
The company has been focusing on lean retail model to sustain competition in new
market since 2015. It is recommended to increase the cost saving initiatives to increase the
customer experience in the non customer-facing areas. There is a need of strong focus on the
capital management for growth. It is suggested to increase the investment in the online pricing
system, online marketing and collection points to increase the multi-channel customer
experiences (Spillan and Ling 2015). It can develop the current market by branding and
extensive advertisement campaigns and through Facebook, Instagram and other social media
platform. This platform is easy way to help existing customers to invite new people, allow
people to post photos of stores or create funny hashtags on Instagram. Social media campaign is
easy way to inform customers about new products now available at stores and keep engaging
them by directing to product survey forms (Keith 2012).
Applying the information processing model, it is suggested to motivate consumers by
providing information that will influence their purchasing decisions. Telemarketing would be
more effective then personal selling and advertising (Batra and Keller 2016). Guerrilla marketing
involving low cost tactics and innovation would give memorable experienced to the customers.
Like ALDI it can engage in email marketing for featuring new products on occasions such as

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mother’s day or offers on chocolates during festival (Leibold and Hugo 2015). Applying the
financial and strategic integration as a part of the four stage of model IMC, the company
must focus on low profit margin. Only by revising the pricing strategy, the company can target
the large segment of the market as it is the capital intensive industry (Kitchen and Burgmann
2015). Changing the pricing and the range strategy may neutralise the Coles and Aldi’s impact
on Woolworth’s sales. The company’s pricing strategy should be changed to accommodate the
customer’s needs, brand awareness and gain cost advantage (Fernie and Sparks 2014). Using
technology integration as a part of this model, the company must use database to track the
customer response to emails or social media updates can help effective IMC. It can design
attractive homepage on mobile like Aldi to increase visitors. This approach will help in
collecting and sharing vital information related to customers throughout the buying life (Kumar
and Reinartz 2012).
Conclusion
The report is the outcome of the current challenge of Woolworth. It has been ranked one
of the most popular retailing industries. However, recently, the challenges faced by Woolworths
are the slowing consumer cycle and market growth due to defective IMC approaches. For the last
two years, the grocery has been challenging for Woolworth and a slowing market growth
observed. The IMC strategies need to be modified as the recent downturn is due to ineffective
integration of the marketing and communication tools in different level of management. The
company must come up with innovative and competitive strategy to sustain it competitive
position. It is recommended to focus more on the product development using innovation model,
information processing model, marketing and promotion, capital management, strong supply
chain support, financial and strategic integration, technological integration, and lean retail model.

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