Marketing and Management

This paper explores the marketing strategy of Woolworths through the 4Ps method showing its strategy to strive in the ever changing global market. The paper also shows the negative impact that the lack of political factor has provided and recommends to a better position.

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Marketing and Management
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Executive Summary:
The external environmental analysis of Woolworths shows the factors that directly make an
impact in the marketing and management of the macro as well as micro environment of the
company. This paper also explores the marketing strategy of Woolworths through the 4Ps
method showing its strategy to strive in the ever changing global market. The paper also shows
the negative impact that the lack of political factor has provided and recommends to a better
position.

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Table of Contents
1. Introduction:................................................................................................................................3
2. Marketing Environment of Woolworths:.....................................................................................3
2.1 Macro Environment:..............................................................................................................3
2.2 Micro Environment:...............................................................................................................3
3. The Four Ps of Woolworths:........................................................................................................3
3.1 Product:..................................................................................................................................3
3.2 Price:......................................................................................................................................3
3.3 Place:......................................................................................................................................3
3.4 Promotion:.............................................................................................................................3
4. Recommendation:........................................................................................................................3
5. Conclusion:..................................................................................................................................3
References:......................................................................................................................................4

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1.Introduction:
Australia has its very own largest supermarket in the name of Woolworths. It has overall
of 995 stores across the country with staff members counting up to 115,000 to support offices
and also to provide services and convenience to its customers (MBA Skool-Study.Learn.Share.,
2019). The pride of Woolworths lies in the fact that it works very closely with the Australian
farmers and growers to ensure the customer with the best products. It is Australia’s Fresh Food
People since it provides fresh fruits and meats to the customers. Being an innovative retailerin
Australia, Woolworths knows its customers very well and are always looking simple yet new
ways to keep their customers engaged in shopping through their App which can be easily
accessed from anywhere, be it from home or in a journey on the way to their home through a
train. They have accessibility that straight away delivers fresh products from its shelf to the
customer’s kitchen.
The current status of the competition in the grocery industry of Australia is gigantic. The
external environment of the Woolworths can be categorised into two parts which are macro
environment and micro environment. The micro environment consists of the factors that have a
direct influence on the performance of the organisation through suppliers, customers,
competitors, intermediaries and also the public. On the other hand, the macro environment
analysis can be gained through a simple PESTEL analysis (Knox 2015). It is important to
analyse the Marketing mix strategy of Woolworths too to have a proper notion of its position in
the market. The strategies that Woolworths have taken for its Price, Place, Promotion and
Product will help to determine it.

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2. Marketing Environment of Woolworths:
2.1 Macro Environment:
In order to analyze the market for its macro environment, a tool called PESTEL analysis
is used. It stands for Political, Economic, Social, Technological, Environmental and Legal
factors that impacts the macro environment of the Woolworths company of Australia.
o Political Factors: Woolworths is exposed to different types of political environment as
well as political system risks, therefore before investing in a certain market, Woolworths
should analyze the political stability and the vitality of the food retailing industry in the
economy of the country (Arli et al., 2013). It should also analyze the level of corruption
in the sector as well as the risk of the military invasion. Along with it, the tax rates and
incentives plus the pricing regulations should also be looked after carefully.
o Economic Factors: inflation rate, interest rate, savings rate, economic cycle and more
are some of the macro environment factors that determine the aggregate investment and
demand in an economy (Kennedy 2016). Woolworths should also use the economic
factors such as inflation and growth rate to forecast the growth route of the company.
Woolworths should carefully gather the analysis of government intervention in the
market, the labor cost and productivity in the economy and more that is related to the
economic factor of Woolworths Limited.
o Social Factors: society’s culture, shared beliefs and attitude make a vital impact on the
marketers in Woolworths Limited as well as the culture inside the organization.
Therefore, Woolworths should always analyze the demographics and the level of skilled
population; they should keep track of the power structure of the society in which they live
along with the education standard in the Woolworths industry. All the social factors

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mentioned above along with gender roles, entrepreneurship spirit, leisure interests and
more should be kept a good track of by the Woolworths for efficient running of the
business.
o Technological Factors: nowadays when majority of the business depends upon the
technology then it becomes necessary to analyze the technological factors that has an
inevitable impact on the company, like Woolworths needs to know the recent and
updated technological developments; its impact on the structure of the cost in food retail
sector and also the rate of the technological dissemination.
o Environmental Factors: the environmental standards of a place where a company
aspires to establish itself, should be evaluated properly in order to operate in the markets.
Some common environmental factors like weather, the climate change, the laws guarding
the environmental pollution, the steps taken to regulate Air and water pollution in the
retail sector and more should be kept in mind by Woolworths and other companies to
function smoothly.
o Legal Factors:legal factors are of utmost importance before setting any kind of business
in the country. Woolworths Limited have also considered such aspects and considered the
discrimination law, employment law, intellectual property law, health and safety law and
more before settling down in a place and run the market. All these must be followed to
avoid a competitive edge.
2.2 Micro Environment:
Micro environment analysis includes the analysis that directly impacts the organizational
performance and to analyze such environment a tool named Porter’s Five Forces is used. This
tool is used to examine the on going situation and the performance of the company. Porter’s Five

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Forces assesses five areas of the market that directly effects the company, here Woolworths;
these five areas are:
 Buyers and their bargaining powers: the retail trade of Australia has consumers who
have a wide variety of services and products from where they can select anyone they like
to (Fern Fort University, 2019). The arrival of new supermarkets in the areas have stirred
the competition between Woolworths and others that gives the consumer more advantage
of having the power to bargain.
 Suppliers and their Bargaining Power: just like the buyers, suppliers’ power of
bargaining has also increased in an alarming rate due to the increment in the competition
of the retail trade. Whenever there is a shortage of supply during irrelevant season, this
bargaining power deliberately increases (Khan 2014). Woolworths has the willingness to
adopt an effective supply chain management so that they reach customer satisfaction.
 The constant Threat of a New Entry: seeing the profit one can gain from the retail
industry, many new firms have started showing a desire to enter the industry, however
they can not since the larger companies are already seen to dominate the markets.
Therefore, for a large company like Woolworths, this threat is not yet big enough to
worry about. Yet companies like Aldi have entered the retail market and became a close
rival of Woolworths which has brought its profit level to a significantly lower level.
 The problem of Rivalry among the Existing Firms: nowadays, the rivals of
Woolworths have increased which includes companies like Aldi, Cole market, Asda and
more. These companies aim for high market share just like Woolworths which has
visually affected the profitability of the company.

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 Threat of a substitute: substitute products are always handy and they come t a cheap
price which is preferred by the maximum population (Eagle et al., 2013). To thrive in
this condition, Woolworths is trying to apply differentiation strategy to accept the
diversification and has offered more variety of products to select from in order to win
over the trust of the customers. This strategy has the capability of increasing the sales of
the company.
3. The Four Ps of Woolworths:
The marketing mix that Woolworths follows is that of the 4Ps, which are Product, Price,
Place and lastly Promotion.
3.1 Product:
Woolworths provide wide range of products as a part of their marketing mix strategy so
that the customer does not stay dissatisfied. Providing products ranging from shampoos to
groceries are a part of their marketing mix to keep the customers engaged (Manzaneque 2014).
In order to spread more products wise, they have started to sell magazines and stationary items as
well. A standard quality is maintained by them, which is judged by Woolworths experts. The
diversified product that Woolworths are selling have helped in all the round needs of the
customers.
3.2 Price:
Woolworths has their own pricing strategy for the survival in the market. Its aim is to
maintain prices that are similar to the product or slightly higher, in the market. The prices
assigned by them are kept in a competitive mode in the market once they the customers learn
about the offers that it gives for the various premium brands in the food chain. At Tasmania

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stores, a reward is given to the frequent shopper club that offers a certain amount of money for a
particle number of points gathered, like one can get 20$ for every 2000 points that they collected
(King and Thobela 2014). The store even provides the customers with shopping card of
Woolworths that has a specialty of track purchasing automatically and it also offers applicable
fuel discounts hence barring the need for retaining paper receipts.
3.3 Place:
The Four Ps point of Place is the distribution strategy of an organization. The strategy
that Woolworths follow for this is as follows: Woolworths currently have operations around in
1000 stores in Australia (Dos Santos, Svensson and Padin 2013). Among these thousand stores
more than 950 are supermarkets and the others are various types of convenience stores (Dos
Santos, Svensson and Padin 2013). There are some stores that operate as Safeway in Victoria,
Melbourne. Operating through online platforms is also an option for them, which is now much
easier considering the fact it recently developed a mobile app for its own purchases. Woolworths
have their private label brands like Woolworth Select, Woolworths Fresh, Woolworth
Homebrand, and Woolworths Gold. The trading of Countdown goes on in New Zealand and the
retail chains with the similar name of the brand are also located in countries like Austria,
Mexico, the UK and Germany (Dos Santos, Svensson and Padin 2013). It must also be noticed
that it a continent like South Africa which is situated so far away from Woolworths homeland,
this company runs stores like Marks N Spencer, indicating the success in their distribution
strategy. They have a wide distribution network all around the world and its outlets are spread
across various regions.

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3.4 Promotion:
Promotion or the advertisement of any company is an important aspect of the business.
Similarly, for the Woolworth’s advertisement and promotion is of extreme importance, which
they have been constantly innovating and re-innovating (Londhe 2014). There are various
Loyalty Schemes that Woolworths offer to customers that also include discounts in petrol pumps.
A campaign called Fresh Food People was launched in the year 1987 that continued till the year
of 2012 (Woolworthsgroup.com.au, 2019). For efficient promotion of their business, online
medias, newsletters and magazines are put to well use. The option of easy accessibility and
availability is the reason that Woolworths have got some loyal customers, which is why they
offer some exclusive deals and offers for the customers and the shoppers including the giving
away of gift cards that makes the customers stay loyal to them. The promotion done for the
Woolworths via the online media is very extensive, which includes the existence of online stores
along with discounts to attract a large mass of customers (Helm and Gritsch 2014). In order to
earn profit in the retail market as well as other convenience stores, Woolworths have their own
extensive promotional channel which helps the company to reach their desired target segment
and have a constant maintenance of profit.
It must be kept in mind that Woolworths is a brand in service marketing, therefore it
allows the analysis of 7Ps of marketing mix strategy. Woolworths currently have People of 2000
employees and are intending to increase it to 1600 more. They have excellent sales worker who
assist for its success to a great extent. The bond between the employees is healthy, competent
and they bond well with the customers. Everybody is ensured to contribute equally and zero
harm to employees and environment policy is implemented. Woolworths have a customer
friendly Process that solely focuses on the satisfaction of the customer (Mashhadi and Ijaz-Ur-

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Rehman 2012). The supermarket follows the Process of speed in billing through technologies or
software and it is important to have efficient support staff. The feedback from customers is taken
seriously by them and put to use in an innovative way.
Finally analyzing the Physical Evidence, it can be found that Woolworths have stores that
are clean and eye-catching. The navigation through the stores is made easy by the customer
friendly employees; topping that they offer products that attract customer in large masses. Even
the website of Woolworths is made attractive yet easy to operate; the retail stores convey the
physical evidence of the presence of Woolworths as friendly and clean as it claims (Zeriti 2014).
All the above facts analyses the Marketing mix of Woolworths and the data are appropriate to
rely upon.
4. Recommendation:
Woolworths with all its strength and strategies have continued to withstand the evolving
market pressure and still stand straight as one of the top retailers in the country. However it is
recommended that Woolworths should frame its strategy in such a way that it stays consistent
with the political conditions of the area they are situated in, or are planning to invest in. they
must have proper notion of the political aspect of the place that is prevalent across the country.
Once they do that, their aim should then focus on the adaptation of the fair price policy which is
a good strategy to gain customers.
Woolworths must have detailed information on the Trade and Tariff regulations that are
related to the food retailing sector for the smooth running of their business far and wide so that
they can extend their business to far grounds than it already is. In order to do so, the company
should also have favorable trading partners with whom they can share their trust and business

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keeping all the political factors in consistence. These recommendations would bring more
profitability level to the company than it already has.
5. Conclusion:
It can be concluded that the marketing analysis carried on upon Woolworths has assessed
important strategies that was undertaken by the company to improve its overall performance. The
overall analysis of the marketing mix and environmental strategies of the company has indicated
that Woolworths is dedicated to attainment of growth in its marketing and management system.
This higher level of growth that Woolworths desires for can be attained through strong
commitment towards the employees and the customers. The analysis of the macro environment
of the Woolworths has revealed the condition faced by retail industry of Australia and how the
political factors like governmental influences, change in social pattern, even the ever changing
trends that customers follow along with the adverse economic conditions have somehow
implemented a negative impact on the business of the company.
However the marketing mix strategy of the Woolworths are seen in the bright side; the
4Ps have indicated the dedication with which Woolworths have run the sector far and wide
keeping in mind the convenience of not only the customers, who are the biggest asset for their
business, yet also the interests of the employees have been taken into account. There are
potential possibilities and opportunities for the company to attain higher growth in the market
which Woolworths seems to be striving for.

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References:
Arli, V., Dylke, S., Burgess, R., Campus, R. and Soldo, E., 2013. Woolworths Australia and
Walmart US: Best practices in supply chain collaboration. Journal of Economics, Business &
Accountancy Ventura (JEBAV), 16(1).
Dos Santos, M.A., Svensson, G. and Padin, C., 2013. Indicators of sustainable business
practices: Woolworths in South Africa. Supply Chain Management: An International
Journal, 18(1), pp.104-108.
Eagle, L., Dahl, S., Hill, S., Bird, S., Spotswood, F. and Tapp, A., 2013. Social marketing.
Pearson Education.
Fern Fort University. (2019). Woolworths Limited PESTEL / PEST & Environment
Analysis[Strategy]. [online] Available at:
http://fernfortuniversity.com/term-papers/pestel/nyse4/4816-woolworths-limited.php [Accessed
6 Sep. 2019].
Helm, R. and Gritsch, S., 2014. Examining the influence of uncertainty on marketing mix
strategy elements in emerging business to business export-markets. International Business
Review, 23(2), pp.418-428.
Kennedy, A.M., 2016. Macro-social marketing. Journal of Macromarketing, 36(3), pp.354-365.
Khan, M.T., 2014. The concept of'marketing mix'and its elements (a conceptual review
paper). International journal of information, business and management, 6(2), p.95.

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King, L. and Thobela, S., 2014. Woolworths farming for the future. International Food and
Agribusiness Management Review, 17(1030-2016-83014), pp.161-166.
Knox, M., 2015. Supermarket monsters: The price of Coles and Woolworths' dominance (Vol.
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Londhe, B.R., 2014. Marketing mix for next generation marketing. Procedia Economics and
Finance, 11, pp.335-340.
Manzaneque Corona, E., 2014. Comparison of marketing policies applied by the same company
in different countries and analysis of the reasons for the differences.
Mashhadi, A.H. and Ijaz-Ur-Rehman, Q., 2012. Impact of external environment on the
performance of the fast food industry. International Journal of Management, Economics and
Social Sciences (IJMESS), 1(1), pp.19-25.
MBA Skool-Study.Learn.Share. (2019). Woolworths Marketing Mix (4Ps) Strategy | MBA Skool-
Study.Learn.Share.. [online] Available at:
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2019].
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https://www.woolworthsgroup.com.au/page/investors/our-performance/reports/Reports/
Annual_Reports [Accessed 6 Sep. 2019].
Zeriti, A., Robson, M.J., Spyropoulou, S. and Leonidou, C.N., 2014. Sustainable export
marketing strategy fit and performance. Journal of International Marketing, 22(4), pp.44-66.