Analyzing Value Proposition and Customer Value for Willworths Supermarket

The objective of this report is to analyze the value proposition and customer value for Willworths supermarket. It discusses the importance of customer value and value proposition, as well as strategies used by Willworths. Recommendations for sustainability in the market are also provided.

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Marketing Management
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Executive Summary:
The objective of this report is to analyse the two concepts, which are value
proposition and customer value and relate it to the Willworths supermarket. Some of the
major findings in the report include establishing the main strategy that is used by Willsworth
in order to market their goods, and the distinction in the strategies used when differentiating
between the different customer segments pointed out later in the paper. One of the biggest
recommendations made for Willworths is for it to constantly innovate and modify their
existing marketing strategies to ensure their sustainability in the market.

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Table of Contents
1. Introduction.........................................................................................................................3
2. Discussion...........................................................................................................................3
2.1. Customer Value...........................................................................................................3
2.1.1. Importance of Customer Value................................................................................5
2.2. Value Proposition........................................................................................................6
2.2.1. Importance of Value Proposition.............................................................................7
3. UK Supermarkets Delivering Value...................................................................................7
4. Willsworth supermarket......................................................................................................8
5. Customer focus...................................................................................................................9
6.Official website.....................................................................................................................10
7.Recommendatio.....................................................................................................................11
References:...............................................................................................................................12

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1. Introduction
Within the world of business marketing, the two terms “value proposition” and “customer
value proposition” are commonly used interchangeably. However, some top business
executives in the industry often argue the subtle difference that exists between these two
terms, and this difference has the ability to determine if a product or service will succeed or
fail in the future, or if the product or service has the ability to become a roaring success for
the organization (Atwal & Williams, 2017). Value propositions lie at the heart of any
business marketing strategies as it helps the marketers identify the needs in the marketplace
and how they can meet those needs. However, is will not be enough to direct these products
towards the market needs, it is also important for the companies to make the consumers
aware of the product, and this is where customer value propositions come in. The purpose of
this report is to analyse the “value proposition” and the “customer value proposition” for the
supermarket called Willworths in the United Kingdoms. The paper will first analyse the
definitions of the two terms mentioned, and then address the importance of these terms with
relation to a firm’s financial success. The next section of the paper will then dive deeper into
the strategies used by Willworths – customer segment, communication of value of the
products. Finally, in conclusion, the paper will make some recommendations to Willworths in
what they can improve in their strategy planning by their marketers.
2. Discussion
2.1. Customer Value
In the recent times, it has become significantly difficult for brands to be able to create and
successfully communicate the value in their brand and products (Kumar & Reinartz, 2016).
With the abundance of choice available to the customers, they have established high
expectations and express little to none brand loyalty to the brands that fail to meet their

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requirements; it has very much become a buyer’s market. For an organization to be able to
communicate value to the customers, it is important for the marketers to understand what the
value of the product is, along with what values it does not have. Customer value is defined as
the benefits received by the consumer when they consume a product after paying something
in return for it (Harmelling et al., 2017). It is essentially the difference between the benefits
experiences and the cost of the product. The cost does not necessarily have to be in terms of
monetary compensation, but it could also be a sign-up, a visit or even just a vote on a specific
matter, and in return the object doesn’t always have to be a tangible product but could also be
a service such as data, knowledge and time.
The creation of value can be contributed to the internal chain that exists in an
organization which includes, sourcing, operations, processes, sales, marketing and customer
service. Support operations like Human Resources and the accounting department also have a
way of indirectly affecting the customers, and their perception of the company and product.
This all comes down to one very important point for marketers – the results of the efforts
made to market a product or service is directly measure against the perception of the
customers of what they think the value of the product or service is (Zhang, Liang & Wang,
2016). Consumers do not buy products because the company likes it, they buy it because they
have established an attachment to that product personally. It is important to keep in mind that
customer value is a subjective concept, and it can only be influenced and not controlled.
The various drivers of the value of a product or service is as follows:
 Function of product,
 Differentiation points of the product,
 Quality,
 Service,

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 Marketing strategies used,
 Branding,
 Price of product or service,
 Existing experience or relationship of the brand and the consumers,
 Formation of personal biases through experience.
2.1.1. Importance of Customer Value
Companies that keep customer satisfaction at the centre of their organization strategies
are almost 60% more profitable than the companies which do not have a significant focus on
satisfying their customers. According to book Value-ology (Kelly, Johnston & Danheiser,
2017), he outlines seven reasons why a company should focus on the customer value of their
organization, but for this paper, only the most important ones will be mentioned.
I. Customers are increasingly looking for a stellar overall shopping experiences
where they are able to learn something new due to the marketing content provided
by the company which educates the consumers, and makes them smarter.
II. Organization that are able to use the “Value-ology approach” to learn more about
their customers through online resources are more profitable than the companies
that do not do the same.
III. It is important for companies to engage with their consumers on an early basis
because a majority of them already have a very clear picture of what they want
before the company even decides to engage with them, which reduces the chance
of influencing done by the company.
IV. Many companies are able to establish a certain value that their products and
services possess, but if the value has not been proven then the majority of the
deals end up generating no sales for the company.

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2.2. Value Proposition
A company’s value proposition is the promise that the company makes to a customer to
assure them that the brand will deliver value goods and services to them. A company’s value
proposition has three distinct components which are, the target buyer who the company is
offering the benefit to, the problem the product or service is trying to solve and the reason
why the specific company is best company to successfully deliver that benefit (Bocken, Rana
& Short, 2015). The value proposition can also be defined as being the declaration statement
made by a certain company to either declare a statement or to introduce the company’s brand
to the consumers by informing them what the company stands for, how they operate and why
the company deserves to keep their business open.
For a company to be able to create an effective value proposition, the company’s
marketing team will need to first start by gathering ideas and developing the focus on which
the company will establish their target group demographic (Yang et al., 2017). This first step
is usually accomplished by the company conducting a market research, with the main goal
being is the discovery of what benefit do the customers want that the company will be able to
deliver to them – basically, what do the consumers consider to be important to them. It is
important to remember the main goal of a value proposition, which is to identify the needs by
the consumers, and what can the company do to satisfy these needs.
A value proposition of a company can be presented as a marketing statement which
summarizes the reason behind a consumer buying a product or the usage of a service that is
provided. Once worded compellingly, the statement has the ability to convince a potential
customer to buy a certain product or service that is being offered by the company, by stating
the value-added or the solution of the problem that is being experienced by the consumer.
The value proposition stands as a promise that is made by the company to their consumers or
their specific market segment. The proposition is usually a basic reason given to a customer

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on why they should buy this specific product or service from the company in question.
Companies use these kinds of statements to better target customers that will be able to benefit
the most from using the brand’s product of service, to ensure that the company is being able
to maintain a competitive advantage.
2.2.1. Importance of Value Proposition
If a company is able to formulate a clear and compelling value proposition for the product or
service then the benefits the company is able to experience are as follows:
I. When researching online, most customers are usually already aware of what they are
looking for so if the company is not able to express the needs of customer that the
product meets, they will end up looking elsewhere.
II. Regardless of what a company is producing, they will always have competitors in the
same field. This is where an effective value proposition will help because it will tell
their ideal customer why they should buy the product or service from their company,
and not the competitor company.
III. A value proposition, as mentioned above, helps the customer realize the true value of
the products and services supplied by the company, and it also help the customers see
why these products will benefit them and is also the best option (Patala et al., 2016).
IV. With this increased understanding as served by the value proposition, the customers
will be able to increase their engagement with the products the company offers.
3. UK Supermarkets Delivering Value
The food and grocery market of UK has been predicted to experience a positive growth of
almost 15% by 2023 (Jones & Comfort, 2018). It has been concluded that the discounter
grocery shops will be experiencing the biggest gain in profit from sales in the next five years.
Discounter retailers are scheduled to have a rapid expansion physically, making it the fastest

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growing channel for gaining cast profits. The top grocery supermarkets in this category are
Lidl, Aldi and willsworth, and what all these three companies have in common is that they
specialise in providing their customers with low price supplies, while keeping up the quality
of the products (Vasiljevic et al., 2018).
The article written by Almoatazbillah Hassan provides a better understanding of the entire
concept of value proposition in companies, specifically from an academic perspective. The
study has taken the four main supermarkets in Southampton, United Kingdom and analyses
the process by which the consumers shop in each of the stores along with the value that these
customers are seeking and what they actually get from each of the stores. It is mentioned in
the study that for a company to be able to deliver value goods to their customers, it is very
important for them to pick the best strategy of pricing their goods.
Most of the supermarkets (Asda, Sainsbury’s and Waitrose) in the UK usually have either
one or follow all the following techniques to deliver valuable goods to their consumers:
 Another tactic of delivering value that has recently become very popular is the
concentration on quality along with low prices that is the driving agent for these
supermarkets’ marketing strategies. The supermarkets that use this strategy to
attract customers must also remember to keep up the quality of the food at the
same time because negative opinions are likely to cause great disadvantages for
the company, in the view of the consumer market.
4. Willsworth supermarket
We go to supermarkets for our daily requirement and we prefer that super market that can
give us some benefit which is not being given by the competitors. Woolworths is the place
that I go because of the adult snacking heaven zone and because children are given free fruits
are the front gate. Woolworths supermarket is one of the most famous supermarkets in

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Australia that meets all our daily needs (Mwai, Ntale & Ngui, 2018). However, Coles gives it
a fierce competition but still Woolworths remains the most preferred because of their
innovative ideas (Hill & Alexander, 2017). We go to a supermarket, which gives us some
value- Woolworths supermarket provides products at cheapest price and recently it has
created a section called adult snacking zone where all the adult snacks are available such as
chips, bottled water, nuts and all those snacks that are preferred by us (Brander, 2018). This
section makes shopping convenient because we do not have to look for the snacks and all are
stacked up at one place. Moreover this section does not have chocolates so if I ever take any
children with me I can freely shop without them disturbing me. Woolworths is also preferred
by parents because there children can get free fruits samples at the front gate (Pulker, Scott &
Pollard, 2018).
5. Customer focus
Woolworths supermarket is focusing on the adult segment of the market
(Woolworthsgroup.com.au., 2019). Adults in Australia skip their meals and go for snacking
more times a day than going for three square meals. This weakness of the customers was
found out by Woolworths supermarket and considering adult snacking as a weakness they
have come up with a new idea. They are now focusing on impulse buying of snacks as a
strategy. Impulse buying means when we buy something more than what we had planned.
Impulse buying happens due to lower prices or because of its strategic positioning in the
supermarket. In Australia it is a common phenomenon for adults to buy more than they had
thought. As adults do not feel guilt for our snacking habits so we want to buy snacks that is
available to us at a low price. Through impulse buying the Woolworths supermarket is
placing itself at an advantageous position than its competitors (Azeem et al., 2018). In the
snacking section more adults preferred consumables are there such as nuts, bottled water
chips, coke and other. The company is not stacking up its snacking areas with chocolates

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because that is not preferred by adults. The company is moving away from the kids snacks
for two reasons: then they can focus more on adult snacks means more adults will be attracted
to the company and secondly when adults go to the supermarket they will not be requested
for treats by children if this snacking section can be removed. However, in order to
compensate the kids for this step, the company has already opened up a section for free fruits
to kids in the front zone. By doing this the kids will not ask for anything at the end of the
store (Kumar & Reinartz). In the whole food market, it is like an adult heaven zone because
all the snacks are of adults preference. These acts of the Woolworths supermarket is acting as
engagement strategy for the Australian shoppers. Many Woolworths supermarket of different
places are shifting from shopping done weekly to ready meals that the customers can easily
pick for dinner there (Luiz, 2016). The Woolworths supermarket gives many offers that
compels the customers to buy them out of an impulse. This act of super market of creating a
different zone brings convenience to the adult segment of the market because children will no
longer annoy the adults with their continuous requests for treats. Moreover, parents also like
going to Woolworths super market because their children will be given free fruits at the entry
and in the snacks area the children will not get chocolates so this is also a healthy step of the
Woolworths super market according to the parents.
6.Official website
Woolworths website provides for all the recent offers that the customers can see and
they can be affected psychologically to buy the product. They have a number of offers being
displayed in their websites for different occasions such as Easters and other. The websites
shows divisions of different sectors such as food, baby products, beauty products and others
this makes the experience of the customers worthwhile because they can easily understand
everything. There is area called customer services, which includes any customer feedback,
product safety, product, recalls, help and support and this shows how the company values its

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customers in case of any problem that the customers are facing they can deal with it
effectively. Customers feel that their feedback is being valued due to this segment.
7.Recommendation
Woolworths super market can provide better values to its customers by providing
more value than the cost that they have to pay for the product or service. Cost is the main
technique for attracting customers and making them feel that they are being benefitted.
Woolworths can do better in attracting customers and defeating competitors if they can apply
any mechanism for reducing their costs even more. They have recently entered into a deal
with the suppliers if the suppliers can provide them bulk of materials at minimum cost then
the sale price will also be less or they can adopt a system of internal supplying system under
which all the goods will be produced by them as a result there costs will go down. Since they
have already adopted a technique of attracting the adults in the market so they can make
further modifications to their idea for making the experience of their customers better. They
can create some playing areas for the children that the adult bring then they can also earn
some money out of it and the customers can do shopping properly without any disturbance
from the children. Their idea of impulse buying can also be improved because the company
has not yet mentioned any particular strategy for the same so maybe they can give some
offers for that or maybe they can change the setting of organization so that the snacking zone
is easily visible.
6.

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