ALDI Marketing Strategy Analysis

This assignment delves into the comprehensive marketing strategy employed by ALDI. It examines key aspects such as pricing, product placement across over 10,000 stores globally, and promotional tactics, highlighting their minimal advertising spend. The analysis also includes a breakdown of ALDI's marketing budget across five years, covering various categories like promotion, sales publicity, and direct selling. Finally, the assignment emphasizes the importance of monitoring and controlling marketing activities to ensure effectiveness and address any discrepancies.

MARKETING ESSENTIALS

INTRODUCTION
The concept of marketing can be defined as a social process that is mainly undertaken by
every company in order to create and exchange value with their target audience. It deals with
satisfying customer needs and want profitably (Arguello, 2013). It includes activities related to
advertisement, selling, packaging etc. that helps in transferring the goods from producer to
ultimate consumer. Marketing umbrella usually comprises of public relation, advertising, sales
and publicity. The chosen organization for this report is ALDI, which is a leading supermarket
store in Germany that mainly deals with providing goods and services to potential buyers at
relatively discounted rate. The report covers different roles and responsibilities of ALDI’s
marketing function, how other organisational departments are inter-related with marketing
function and marketing mix of two companies and lastly marketing plan that represents their
marketing tactics throughout a year.
TASK 1
P1. Roles and responsibilities of different functions of marketing
Marketing is a social process by which Organisations and individuals obtain what they
need and desire through creating and exchanging values with others. It mainly deals with
identifying, forecasting and satisfying customer requirement profitable. It stimulates the interest
of potential buyer and enables them to purchase that particular product or service to facilitate
their needs more effectively. Organisations make goods and services in order to earn high profits
but for this they must sell their products to ultimate consumer who actually wants it. It serves as
a bridge between company and potential buyers as it mainly emphasizes on meeting the necessity
of both parties in a proper manner. With the help of marketing, business can take the advantage
of high competitive edge in overseas market. Following are the various roles that ALDI has
performed towards their different marketing function which are discussed as below:
1. Marketing Information System: This system is mainly used by companies in order to
determine the actual needs and requirements of target customer which keep on changing
frequently (Baker and Magnini, 2016). It refers to the system that assembles, analyse and
distribute information concerned with distinct choices of customer to administrator who further
aid in making effective decision for the entity. According to Henry, in order to manage the
organization effectively, it is important to manage their future as well and for that it is required to
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handle the information effectively in a structured and systematic manner. ALDI is getting hold of
high competitive advantages because of this system as it enables them to identify what are the
current likes and dislikes of their target audience so that they can fulfil them by providing with
the same. For example: Through this system, the company figured out that people get easily
attracted to such products which are available at discounted or lower rates.
2. Product or service management: Once the company is done with identifying its target
market and setting the price for their product or services, the next step is to effectively manage it
(Blythe, 2012). This includes communicating to the buyers, responding to their needs and
maintenance of goods and services. ALDI is a leading discount Supermarket chain that offer
products or services at relatively lower or discounted rate. By keeping low price of the product
there is certain assumption that it is of poor quality. In order to eliminate this perception of
customer, the company decided to take feedback from buyers. As a result, the company attained
positive response and built its goodwill amongst consumers.
3. Distribution channel: It is related to companies selling strategy of the goods and services to
the consumer. ALDI buys product in bulk from their suppliers and they stock up it in their
warehouses. It mainly sells its products through company’s outlets and mobile application.
4. Financing: It takes money to make money. From a business owner’s view, it is the most
important marketing function as it deals with how a firm is going to manage their funds or what
are the sources available in the market which can provide adequate funding for smooth and
effective business operation. ALDI manages their funds through investment, share capital, loans,
angel investors etc.
5. Promotion: It deals with how company introduced or advertise their products or services in
the market. It creates awareness among customers which stimulate them to buy that following
product or service. Mostly, it is the voice of the organization which effectively sends their brand
message amongst target audience in a clear and profound manner. In order to target the right
audience, it is essential to have structured marketing and promotional strategy to give best
solution in satisfying customer needs. The common tool of promotion includes personal selling,
sale, publicity and advertisement (Brassington and Pettitt, 2013). ALDI promotes their product
through social networking sites such as face book, Instagram etc. In UK, Australia and US, they
advertise their product and services through electronic, digital and print media. In addition to that
they also offer some super buyer’s offers that help in achieving the attention of customer
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effectively.
6. Pricing: Setting the right price for the product or services can sometimes become challenge
for the company. If the price is too high, then there might be chances that customer may shift to
some another brand who serves the same product but at lower cost. ALDI gained strong
customer base because it offered low price along with quality product to buyers (Brooks and
Simkin, 2011). The company mainly used unit pricing strategies for groceries product so that the
customers can easily compare their product and prices with that of other competitors available in
the market.
7. Selling This is closely related with the marketing function. Once the company is done with
identifying the ultimate needs and desires of target audience, they become liable to deliver right
product at right place within stipulated time frame that satisfies their need in a cost effective and
timely manner. Selling concept deals with positioning of business entity in a systematic manner
to sell maximum number of products. It is the only way through which products can be delivered
among target audience who actually needs it. Thus, selling function aims at maximizing overall
profitability ratio of the company by promptly meeting the requirements of customer. ALDI sells
their product through its outlets, online and by home delivery.
TASK 2
P2. The way roles and responsibilities of different organisational department is inter-linked with
marketing function
Organisations are using the concept of marketing so as to identify diverse requirements of
customer that further help them in making effective decisions towards satisfying numerous
choices of their clients. With the help of marketing, a company can achieve both its long as well
as short-term objectives in an effective and efficient manner. The heart of every company lies in
its marketing process. This not only helps the business entity to promote its product in the market
but also delivers it to the potential buyers as per the requirements. Also helps to assist
in managing and controlling the functionality of other organisational departments (Brooks and
Simkin, 2012). Different departments such as human resource, sales, IT, research and
development plays a significant role in producing and promoting respective goods and services
in the given market that yields profitability ratio for the firm.
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Marketing and Human Resource Department: The main function of HR department is
to recruit and select most talented and skilled employees for the company who assist in achieving
their objectives effectively. A business mainly emphasizes on attracting profitable customer to
attain decent number of sales. Thus, in order to get such sale figures, company must hire
competent employees (Cabrera and Williams, 2014). With the help of marketing tool, HR
manager of ALDI attracted large number of candidates and stimulate them to apply for latest job
vacanies in the company. Generally, there are two sources namely internal and external, through
which firm can recruit candidates. Marketing function provide assistance to external source of
recruitment. With its help, company can endorse about latest vacancy on various channels to
seize the attention of numerous applicants. For example: If there is any vacancy in ALDI, then
can post on social media or company’s websitfthe same.
Marketing and information technology department: ALDI uses advance and
innovative technology which aid them to capture large market share. Innovative technology
assistant formulating plans and policies more effectively. The company had launched its mobile
application and website for both company and customer to connect with each other easily. In
addition, it assists in building strong brand image over rivals in the market. With the help of IT
department, marketing manager is able to set up single viewpoint of customer which mainly
outlays busting my profile, past purchasing pattern, digital media interaction and other important
information that is concerned with the buyer but you might help ALDI in taking effective
decision regarding fulfilling their requirement.
Marketing and sales department: These two act as mediator between production and
customer. Consumer generally discuss their needs or desires related to particular product with
the sales manager of the company who further passes this information to other different
organisational department such as manufacturing so they can start make product as per the
requirement. With the help of this department, accompany can effectively convert the demand of
client into particular product specification. Moreover, with the assistance of different types of
promotional tool sales manager can alert production department according to the increase
demand of specific goods in the market. (Caragher,2016). Therefore, both sales and marketing
function are interlinked with each other.
Marketing and Finance department: Marketing and finance are considered as two
main pillars of the company on which the entire profitability of the firm depends. The term
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finance consists of feasibility of cost or project whereas marketing comprises of sales target,
sales volume, advertising, publicity etc. Without suitable advertisement, the sale of a product
cannot be increased and without sales, business cannot make adequate profit (Coast, 2014).
Therefore, in order to increase overall profitability ratio of the firm, marketing function plays
significant role. With the help of marketing, ALDI measured its internal and external sources
through which company arranged its sufficient funding which was required to carry out day-to-
day business operation in an effective manner.
Marketing and Research and Development department: In modern era, marketing is
often referred as R&D in terms of product or services that fulfil the demand of end users. Earlier,
demands of buyers were usually interpreted through traditional marketing techniques such as
focus group, observation, survey etc. However, in today's era, companies use social media
platform to determine the actual likes and dislikes of target audience that keeps on changing
frequently. According to the statistic report, 85% of the population having at least one social
media profile on which day are highly active and enough to put about its latest choices. For
example: ALDI figured out that the customers were easily attracted towards such products that
are available on discount or at low cost. This is why ALDI offered its product and services at
relatively discounted rate.
Marketing and Customer Service Department: In order to yield high profitability
ratio, it is largely important to fulfil customer needs. Most of the marketers are taking the help of
social media platform to provide better customer services to end users. With the help of
marketing function, company is able to have better understanding regarding consumer personas.
ALDI provides product at discounted rate which makes customer think that they might be selling
low quality products (Daniel, 2011). Therefore, to clear their image, the company started taking
client’s feedback and putting it on different social networking sites. This helps in building
goodwill and brand image as well
TASK 2
P3. Marketing mix of two different organizations
ALDI rarely change its food product but keep on experimenting with its non-food items.
For example: During winter it offers warm camping gear and snow gear, thus changing its
product line as per seasonal demand. In Germany, Australia and Netherlands ALDI has a mobile
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virtual network operator. The Company have a strong customer base because of its cheap price
and quality that they offer under their own label which aren't available with the other
competitors. In addition to that, ALDI is the only store that offers goods and services at same
prices for groceries items throughout the world.
Therefore, ALDI and LIDL both organisation are use marketing mix elements which is
important and essential for them to innovate their new products and services at marketplace. It is
also essential for both businesses to maximise customer base in the company by providing
quality products and services at reasonable price.
Basis ALDI TECSO
Product ALDI claims to offer affordable food product
that are of same quality as compare to other
branded product. The product sold at ALDI's
are sourced from selected suppliers in bulk
quantity and then branded under their own
private label so as to possess great control over
the production. Other than beverages and food
products, it also stock fresh vegetables and
fruits, electronic products, household goods,
stationary, clothes and soft tools.
Tesco is a retail company which
delivers general utility products
like clothes, home utility
appliances, electronic
equipment’s etc. Tesco is offering
a wide range of products through
which it can attract many
customers in no time which helps
it to generate high revenue and
earn more profit. General utility
goods are used by the world,
which gives an opportunity to
diverse their business in different
countries. Due to effective
business activities and efficient
management Tesco can create its
own brand image.
Price It mainly uses unit pricing strategy for
groceries items so that the consumer can easily
compare it with other brands. In case of high
competition, they use competitive pricing
strategy in which they keep the product prices
Tesco follows pricing strategy of
economies of scale which enables
the company to charge less for its
products but produce and sell
large number of units of their
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below the competitors so as to grab the
attention of large number of buyers. In
addition to that they also uses psychological
pricing in which the offer product is presented
in an intelligent way such as 3.78$ instead of
4$.
products and it also offers
schemes of discount coupons and
gift vouchers through which it
attracts many customers and
hence results in achieving high
revenue targets.
Place ALDI group has more than 10000 stores in 20
countries and roughly every week a new store
opens in Britain. The company gained high
competitive advantage for its simple store
layout. They procure the entire product in bulk
quantity from different suppliers and store
them at local warehouses. It also ensures that
product quality is highly maintained in
warehouses. Along with this, it ensures
minimum waste disposal during transportation
of products and uses eco-friendly equipment in
its store. Also tries to maintain a regional
appearance and thus name its stores on the
basis of the country. For instance, In
Switzerland, ALDI is known as ALDI Suisse.
Other than physical stores, the company has its
online presence as well which allows
consumers to check product details and locate
the nearest store conveniently.
Tesco distributes its products not
only by manual tools but also
with the help of online tools.
Tesco has created webpages
where customers can order their
products with a click which is
beneficial for company and
convenient for customers too.
Tesco maintains a unique position
in customer's mind and in
industry. Thus it can generate
more profits.
Promotion ALDI's promotional activities are
comprehensive. The company spends very
negligible amount for promoting their
products. In fact, in Germany, it does not have
its marketing department. It offers "Super Buy
offers” that are only available till the stock
Apart from manual and digital
promotion, Tesco also offers their
club cards which provides
services of discount if goods are
purchased of high value. They
uses attractive and innovative
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lasts. In UK, US and Australia, they promote
its product by using print, digital and
electronic media. Moreover they also make an
extensive use of email marketing as well to
aware customers about new product or
"special buys" offers
promotional; strategies to attract
more customers so that they can
earn trust and interest of buyers to
ultimately earn high revenues and
more profit.
People The company has lower customer service as
compared to its competitors. This is mainly
because its employees help the consumer in
selecting the product. Also because of its store
layout which is divided into proper sections
which automatically reduces the number of
workers needed or required on every floor.
ALDI generally pays higher to its workforce
and provide job training to new workers.
Tesco appoints highly skilled staff
which can convince prospect
customers to buy the products as
Tesco is not a labour intensive
company but they also need
managers who can manage and
motive their employees to work
more efficiently.
Process ALDI gained popularity by its complete layout
which helps the customer to find products
hassle free. ALDI's customers select product
on their own which automatically decreases
the number of employees required to assist
them. Moreover, the company keeps high
quality product preventing buyers in getting
confused. Their products have large barcodes
for quick identification which saves time and
energy for both consumer and employees.
Tesco deals in delivering various
products, due to diversity in
variety of their products,
company has appointed staff
which can guide the customers on
which product is appropriate for
them and can aware them about
benefits of those goods. Tesco
uses a customer friendly process
to achieve their goal of customer
satisfaction which lead them
towards profit earning.
Physical
Evidence
The company globally gained popularity for
its simplest business process, global pricing,
store layout and standardization. Almost 85%
of the stock at its stores has items under their
Tesco maintains different shelf
for various products in order to
help customers in finding what
they want, in minutes.
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own private home brand and the rest they are
offering are from well-established and
recognised brands. They are providing their
product at generally 30% cheaper rates and
their everyday low prices strategy remains the
same globally.
TASK 3
P4. Marketing Plan of ALDI
Marketing Plan is a business proposal involving blueprints of firm’s marketing strategy
over a specific period of time. It consists of vision, mission, SWOT Analysis, STP, marketing
mix, marketing budget and controlling and monitoring.
Company Overview: ALDI is a leading discount Supermarket Chain operates in 20 countries
with more than 10, 000 stores. It is a Germany based company and was founded by brothers Karl
and Theo Albrecht in 1946. This mainly deals in food, beverages, household goods and sanitary
articles.
STP Approach Segmentation: Consumer looking out to purchase all grocery items at competitive prices. Targeting: Households
 Positioning: ALDI gain popularity for its own private label product. It is strongly placed
in Germany and now trying to establish in overseas market
SWOT Analysis:
Strengths:
 Claims to offer high quality products
 Offers goods at discounted rate
 In Germany, market share is strong with more than 2500 stores
 Operating cost is low as compare to other competitor’s brand, who gives a high
competitive edge in the market.
 Strong customer and market base in Europe, UK and Australia.
 Currently, the company is operating in more than 20 countries.
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 Gain high competitive advantage in overseas market because of its store layout, global
pricing and simple business process.
Weaknesses:
 Market presence is still relatively low as compared to other well-established competitor’s
brands.
 It hasn’t been able to impact global market because of its low presence in overseas
market Criticism faced due to bad and cheap quality products offered.
Opportunities:
 They need to spend more in advertising in order to beat competition that exists in the
market.
 The company need to grow its operations in developing countries like Asia, Africa etc. Must use the advantage of social media platform as well, ALDI can easily increase the
number of their target audience.
Threats:
 It is not suitable for buyers who are looking for complete shopping experience.
 ALDI’s private label can easily be tossed away by other competitors existing in the
market.
 As the company does not have a marketing department in Germany, rivals can take the
advantage and seize the attention of ALDI’s target audience which may affect its overall
profitability and growth.
Marketing Mix:
1. Product: ALDI offers products at relatively low or discounted rates. They purchase
goods in bulk quantities from supplier and store them in their warehouses. Other than
food products, it also offers non-food items include clothes, stationary, electronic
products, soft tools, fresh fruit and vegetable and health and beauty products.
2. Price: The company gained popularity for its unit pricing strategy which is user friendly
to find products. In addition, they adopted competitive pricing strategy as well as they
offer their product to end user at comparatively low rates compared to its competitors.
3. Place: Currently, the company is operating in more than 20 countries with over 10, 000
stores all across the world. All the product that they offers purchases in bulk quantity
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from suppliers and store them in warehouse ensuring all the time their quality as well.
Other than its physical store, ALDI’s products are also available on online application.
4. Promotion: ALDI spends very less on their promotional activities. They believe that
their unique pricing strategy is enough to seize the attention of customers. The only offer
they provide is “Super Buys” offer. However, in UK, Australia and US they are
promoting their products or services through various promotional channels such as
electronic, print and display media.
Marketing Budget:
Marketing budget
Particulars 1st year 2nd year 3rd year 4th year 5th year
Initial money 6000 8500 12000 14500 18350
Investment 14000 25500 32000 13500
Total 6000 22500 37500 46500 31850
Marketing outlay
Promotion 6500 3200 4300 3300 3250
Sales publicity 2200 2100 3300 2200 2000
Direct selling 4200 2500 6000 3000 4650
Total 12900 7800 13600 8500 9900
Monitoring and Controlling: At this stage, marketer of ALDI needs to measure if all the
activities are going on effectively or not (Desai, 2013). If any variation is found, then it should
be solved by applying best possible solution.
CONCLUSION
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According to the above mentioned report, it can be concluded that marketing function
plays a significant role in organisational growth and success. The heart of every business lies in
its marketing process. With the help of this concept, companies are able to fulfil customer
requirement in an effective manner which in turns creates higher profits for them. Marketing
function not only assists in generating higher profitability ratio but it also plays a key role in the
smooth functioning of other departments as well. In addition to that, firm can take the advantage
of high competitive edge in the market because of marketing function.
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REFERENCES
Books and Journals
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