Marketing Management: Analysis and Strategies for Woolworths

This report analyzes the key macro and micro factors of Woolworths and develops appropriate marketing strategies and tactics. It includes a 5C analysis, customer preferences, and development of marketing strategy and tactics.

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MARKETING MANAGEMENT
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5/30/2019

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Contents
Introduction......................................................................................................................................2
Company background......................................................................................................................3
5 C’s of Woolworth.........................................................................................................................3
A. Company.................................................................................................................................4
B. Customers................................................................................................................................5
C. Collaborators...........................................................................................................................5
D. Competitors.............................................................................................................................5
E. Context....................................................................................................................................6
Collection of information................................................................................................................6
Customer preferences..................................................................................................................7
Threat of competitors...................................................................................................................7
Change in a business environment..............................................................................................8
Development of marketing strategy.................................................................................................8
Target market and segmentation..................................................................................................8
Demographic segmentation.....................................................................................................9
Behavioral segmentation.........................................................................................................9
Psychographic segmentation...................................................................................................9
Positioning.................................................................................................................................10
Development of marketing tactics.................................................................................................11
Product strategy.........................................................................................................................11
Pricing strategy..........................................................................................................................13
Distribution strategy..................................................................................................................14
Promotional strategy..................................................................................................................15
Conclusion.....................................................................................................................................16
References......................................................................................................................................17

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Introduction
The report purpose is to analyze the key macro and micro factors of an organization and develop
appropriate marketing strategies and marketing tactics for the same. This would also include
using tools like 5C analysis that would include key stakeholders and their impact over the
business. The organizational case considered for this report is Woolworths (Rialp & Rialp,
2007).
The relevance of the marketing management has been found to be enhancing due to changing
external environment especially social trends, increases in technological advancement, and
mainly increase in international expansion by the company that has increased the competition in
the domestic and international market for the companies. This has increased the options for the
customers and has decreased the switching cost for the company making effective marketing
management more important for the companies (Kaplan, 2015).

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Company background
Woolworths is an Australian major supermarket chain founded in 1924. The retail industry in
which the company exists is one of the major competitive industries in Australia. The vision
statement of the company is to become the most responsible retailer around the globe and
denotes the strong commitment of the company for conducting business for people, customer,
and the planet. The key mission and objectives of the company includes adding quality to life
that reflects the company objective to offer customer the extraordinary quality through each
product and service and the experience of the customer to be excellent for the customers and
people associated with the company that is the staff, employee, and shareholders
(woolworthsgroup, 2018).
The company is offering grocery products, household products, and food products. The company
has been expanded the stores to the large number that is more than 3000 stores around the globe.
The company has been associated with thousands of employees and a large number of
manufacturers and suppliers (woolworthsgroup, 2016).
5 C’s of Woolworth
For considering the right decision regarding the marketing management of the company, it is
relevant for the company to identify the related business environment and develop the marketing
strategies accordingly. For this, the 5C analysis would be helpful, which will analyse the five
major stakeholders or associated partners for the company (Reid, 2015). These five elements
include

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A. Company
To analysis, the company internal environment of the company, one of the strategic tool would
be used that is SWOT analysis to assess the major strengths, weakness, opportunity, and threats
of the company.
Strengths
 The second largest retailer in Australia
 Economies of scale
 Customer tracking (woolworths, 2019)
Weakness
 No specific targeting and positioning strategy
 Price wars (Fan & Lau, 2015)
Opportunities
 Experience-oriented
 Product differentiation
 A business diversification strategy (woolworths.co.za, 2018)
Threats
 Increased competition
 Increase in health-conscious population (Esmaeilpour, 2015)

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B. Customers
Customers are the key stakeholders for the company as the success factor of the company and
sale of the company depends on the customers of the company. The customer for Woolworths is
expected the grocery shopping to be done from the place which would be convenient, providing
everyday goods at the lowest prices possible with a good quality product. Moreover, the
customer must be expecting the large variety of good to be available at one location for grocery
and supermarket products. Another major expectation from the customer is the services of the
company and friendly staff to help them at the store. The key customer of the company are
women, as in general women are more attracted towards searching for the places to get cheaper
prices for good quality products (fin24, 2019).
C. Collaborators
The company is associated with various manufacturers, suppliers, and distributors and the
retailing sector require a large distribution center to reach out to the maximum customer with
convenient locations. Woolworths claims to have sustainable business practices with their
supplier due to which the company is able to provide goods at reason le price. Therefore, it can
be said that the suppliers are the major stakeholders who are responsible for the profit margins of
the company. The distributors are also major stakeholders the reason being these are the
intermediaries who are serving goods to the store of the company make the goods available at the
store on time (Gong & Yi, 2018).
D. Competitors
Competition is very high in the retail industry as the switching cost for the customers are
negligible. The key competitors of Woolworths are Amazon when it comes to the online

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presence of the company and Wal-Mart, Wesfarmers, Cole, Aldi’s in Australia, as these are other
large retailers in the nation. Moreover, the competition is so high due to a similar expectation of
customer and similar target customer of the company. The price wars are the major threat with
increasing competition in the industry. Moreover, due to increasing opportunity for the
companies in this sector has increased the threat of the new entrants for Woolworths as well
(fin24, 2019).
E. Context
These factors assess the legal, political, technological, and social factors that will affect the
Woolworth’s business and strategy.
Political factors – the political stability of the country would be influencing the business cycle of
the company, which would be a threat for Woolworths in Australia due to the instability of
political environment and high corporate tax (theglobaleconomy, 2019).
Legal factors – The legal rule and regulation associated with Woolworths that has to be abiding
by the company to work in the nation include employment laws, labor laws, food and safety laws
and various other laws which could be challenging for the company.
Technological factors – This would include technological advancement of the company, as
Australia is one of the top six nations in technical advancement (Kaplan, 2015).
Collection of information
The relevant data and information collected to assess the 5C’s of the company are the qualitative
and the qualitative data collected through the market research. The company to assess the major
environmental factors to understand the business environment to develop more appropriate and

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reliable must collect the primary and secondary data in order to make the information more
relevant. The surveys have been conducted related to customer satisfaction to understand
customer preferences. Moreover, the marketing audit, financial report and benchmarking are
another relevant aspect to collect the data (Harrigan & Choudhury, 2014).
Customer preferences
The customer preference are the most relevant information to be collected for the company to
target the market on the basis of the income, age, gender, behavior and other preference of the
customers to be targeted. The preferences of the customer could be collected through the
customer feedback taken offline or online by the company.
Through this survey, clients had been in my view wondered through
surveyors to determine which another supermarket chain possesses
aggressive threats to Woolworths. Biggest call that comes forward in this
survey as a competitor to the enterprise is Aldi Supermarkets. Woolworths
which declaring their 3-yr advertising and marketing approach said that they
are implementing new pricing and fee strategy to minimize Aldi’s impact on
the income of the business enterprise.
Threat of competitors
The competitor’s information has to be followed and collected in order to strategies for
Woolworths to gain competitive advantage. The reason being the competitor's strategies could be
ahead of the company and can attract the customers and make Woolworths unable to retain the
customer that is very important for the company. The collection of data could be through

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analyzing the competitor’s announcement in the market related to the goals of the company or
the actions taken by the company.
Change in a business environment
The business environment is changing very rapidly, which reflect s that the company needs to
have continuous follow up on the external environment and internal environment on
Woolworths. This could be done using various tools like PESTLE analysis to analyze the latest
political, legal factors of the nation in which the company is performing.
It turned into evaluated with the aid of the corporation with the help of
survey that due to development of era customers are extra inclined towards
online spending. Woolworths is making an attempt to take this as a
possibility to develop an an online marketplace. Implementation of click on
and collect is a great instance of the advancement of the era within the
company.
Development of marketing strategy
one of the foremost factors that influence the advertising and marketing
approach of retailers is the selection of the target marketplace. The target
market needs to be decided on in line with through expertise client desire
and a spread of products supplied by way of enterprise. Woolworths has a
huge variety of merchandise to be provided to its consumers. Consequently,
the company would have a wider target market. Data collected through
organization inside the previous stage concerning client behavior and needs
may be used to create an enterprises marketing strategy.

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Target market and segmentation
The target market for Woolworths is the Australian market and people looking for price effective
grocery stores for everyday purchase.
Because of the extensive variety of consumers, Woolworths implemented
consumer segmentation as one of the strategies for the marketing plan.
Corporation has separated the clients into specific homogeneous groups on
the idea of the area, age institution, income capability and buying command
of consumers. This method has provided the outcome in terms of higher
operative overall performance and higher attainment to consumers. The
recommended customer segmentation for Woolworths would be based on
Demographic segmentation
As per the basis, the key element would be age factor, gender – the age factor to be targeted for
the marketing plan by Woolworths would be young to old age people, and the gender would be
females as the women are majorly interested in shopping. Another factor in this basis include
income group, this would include the middle-income group for everyday products and high-
income group.
Behavioral segmentation
This would include usage frequency factors, which would include the frequency of use of the
products. The target segment of the Woolworths would be regular users. The reason being the
customer products generally include the grocery products this would include regular shopping by
the customers.

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Psychographic segmentation
This would include factors like lifestyle, personality traits, and social status of the customer
group. The college student would be targeted by Woolworths, the reason being the college
students are very must interested in purchasing cost-effective and cheap products. Another group
would be working women that would include that need convenient shopping and online grocery
shopping which could be targeted by Woolworths.
Positioning
Value proposition refers back to the value the client receives from the
company, its services, and its merchandise. It could form a foundation on
which a consumer can opt for specific services or products to be brought by
a particular company instead of other competitors. Over time, Woolworths
has evolved cost propositions in diverse factors of business like online
buying, periodic discounted deals, free doorstep delivery, and concentration
to satisfaction of the customers. One of the remarkable features of
Woolworths is the integration of online and offline purchase that is online
ordering and offline takeaway, which is one of the key competitive
advantages for the company (Bakir & Rose, 2015).
The brand positioning would include:

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 High quality and cost-effective product – This is the major mission of the company to
provide a good lifestyle to people of Australia by offering a good quality product to the
customers. Moreover, the key element is the price in the retaining industry to offer the
lowest possible prices by the company.
 Convenient experience – The service orientation would be the strategy for the company
to create the brand positioning of Woolworths as the convenient experience that the
company offers to the customers.
The marketing strategy of Woolworths would also involve the staff performance review, as
the key strategy of the company would be to increase the services provided to the customer to
enhance their experience. This would also include focusing on the training and development
of the employees of the company (Mitchell, 2018).
Development of marketing tactics
The key marketing objective is to enhance the customer satisfaction of Woolworths consumers
and increase the sale of the company through various marketing tactics. The marketing mix of
the companies includes 4P’s and the plans for the company to promote the services and the
products. These four P would include
Product strategy
The product strategy can be analyzed through the matrix presented below. Four alternative
product strategies are diversification, market penetration, market development, and product
development. These strategies are based on the market to be targeted by the company and the
products that the company would be offering.

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Figure 1:(Source: (Goffin, 2017)
The recommended product strategy that this marketing plan would be the focus is product
development strategy. The reason being the company is targeting Australian market, which is the
existing market for Woolworths but the products and services that the company is going to offer
to the Australian customers would be different, new and innovative. Various tactics that this
strategy would be
 New product development – The strategy would include introducing a completely new
product line. This may also include introducing the prepared food delivery range of
product and services. This would include entering of Woolworth incompletely new
industry that is the food and beverage industry but this could be helpful for the company
to increase the sale of the enterprise (Calboli, 2015).
 Service orientation – another aspect of product tactics is shifting the product orientation
to the service orientation. The value creation would be the key through this tactic that will
help to achieve a high level of customer satisfaction. This would improve the customer

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visit and experience at the store and the fast services availability through online shopping.
This would increase the sale of the goods by decreasing the administrative cost.
 Product innovation – Innovation is the major key to attract the customer and retains the
existing ones. The innovation could be in the form of updated or new packing of the
products. For instance, the company can go for non-plastic packaging to increase the
CSR of the company and as a part of sustainability goals.
 Healthy product range – The population is shifting towards health consciousness. For
this, the company could focus on offering customer organic products or health beneficial
products to promote better health of the customers and attracting the health conscious
customer segment (Petersen & Kumar, 2015).
Pricing strategy
Pricing is the key decision in the marketing mix for the Woolworths due to the threat of price
war. The pricing strategy of the company would be a price penetration strategy, as presented in
the matrix below.

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Figure 2: (Source: (Chu & Liu, 2017)
Price penetration strategy is most appropriate far Woolworths as the company would be targeting
to provide a high quality product with economical pricing that is the lowest price possible. The
reason being the key competitors of Woolworths would be following cost focus strategy or the
low-cost strategy that needs to be implemented by Woolworths as well to gain competitive
advantage. Moreover, the customers are becoming smarter they check for different source to get
the price of the product and rationally compare the prices collected from a different retailer and
selected the brand, which would provide them the lowest price for value products (Menon &
Edison, 2015).
Distribution strategy
The three distribution tactics would include

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1. Online channel
2. Offline channel
3. Click and pick option (hunter.tafensw, 2018)
Promotional strategy
The promotional tactics would include various promotional tools for woolworths to reach to the
customer
1. Sales promotion- This would include the discounting offers for the customer as the price is the
key element for the purchase decision of the customer. Moreover, the loyalty points would be
another sale promoting techniques to make customer loyal and regular customer of the brand
through providing them the company card and adding points on every purchase that can be
redeemed in the form of a reduction in next bill (Jawoski, 2018).
2. Social media marketing – This would include reaching to the customer through online mode at
social media platforms with all the campaigns to be visible at these platforms and offers to
remain the customers to visits the store (Hu et al., 2016).
3. Advertisement – this is the major promotion step the company to reach maximum potential
customer across the nation. This would be considering television add with some of the popular
Australian celebrities to attract maximum customer and increase customer trust in the company
(Hudson & Roth, 2016).

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Conclusion
From the discussion, it can be sum up that Woolworths is an Australian major supermarket chain
founded in 1924. The retail industry in which the company exists is one of the major competitive
industries in Australia. Customers are the key stakeholders for the company as the success factor
of the company and sale of the company depends on the customers of the company. The
customer for Woolworths is expected the grocery shopping to be done from the place which
would be convenient, providing everyday goods at the lowest prices possible with a good quality
product. The company is associated with various manufacturers, suppliers, and distributors and
the retailing sector require a large distribution center to reach out to the maximum customer with
convenient locations.
The key competitors of Woolworths are Amazon when it comes to the online presence of the
company and Wal-Mart, Wesfarmers, Cole, Aldi’s in Australia, as these are other large retailers
in the nation. The relevant data and information collected to assess the 5C’s of the company are
the qualitative and the qualitative data collected through the market research. The marketing
audit, financial report and benchmarking are another relevant aspect to collect the data. The
competitor’s information has to be followed and collected in order to strategies for Woolworths
to gain competitive advantage. The target market for Woolworths is the Australian market and
people looking for price effective grocery stores for everyday purchase. The target segment of
the Woolworths would be regular users. The college student would be targeted by Woolworths,
the reason being the college students are very must interested in purchasing cost-effective and
cheap products. Another group would be working women. The product strategy recommended to

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Woolworths was product development strategy and the price penetration strategy was also
recommended.
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