Analyzing Marketing Plan Strategies of Woolworths with Product Innovation Charter

This report analyzes the marketing plan strategies of Woolworths with the implementation of Product Innovation Charter (PIC) and its impact on the organization. It includes a situational analysis, market segmentation, alternative marketing strategies, and short and long-term projections. The report also discusses the challenges and opportunities faced by Woolworths in implementing PIC and its potential to increase sales and profitability.

Running head: MARKETING MANAGEMENT
Marketing Management
Name of the Student
Name of the University
Author note

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Table of Contents
I. Executive Summary................................................................................................................2
II. Challenge...............................................................................................................................2
III. Situational Analysis.............................................................................................................3
Company Analysis.................................................................................................................3
Customer Analysis.................................................................................................................5
Competitor Analysis...............................................................................................................6
Collaborators..........................................................................................................................7
Climate.......................................................................................................................................8
Macro-Environmental PEST Analysis...................................................................................8
SWOT Analysis.....................................................................................................................9
IV. Market Segmentation.........................................................................................................10
V. Alternative Marketing Strategies........................................................................................10
VI. Selected Marketing Strategy..............................................................................................11
VII. Short and Long-Term Projections....................................................................................11
VIII. Conclusion.......................................................................................................................12
References................................................................................................................................13
Appendice................................................................................................................................14
Appendix 1...........................................................................................................................14
Break Even Analysis........................................................................................................14
Appendix 2...........................................................................................................................14
Sales Forecast...................................................................................................................14

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I. Executive Summary
The report has thrown light on analyzing the marketing plan strategies of Woolworths
with the innovation of the Product Innovation Charter in the organization. From the report, it
can be explained that there are various challenges which can be faced by the organization
after the implementation of PIC that is required to be reduced after the analysis of SWOT
analysis effectively. The internal and external analysis has been conducted to understand the
political and social pressures along with analyzing the inner strengths and weaknesses.
Additionally, the collaboration aspects have been identified along with generated results of
the revenues earned by the organization through break-even analysis and sales forecast which
has been produced by the company.
II. The Challenge
The Product Innovation Charter is the innovation which is being applied by
Woolworths which can include various kinds of threats and opportunities for the company in
implementing the PIC in informing the new product strategy which has been introduced by
them in the company. With the usage of the same, the core competencies of the company can
be identified as PIC is a road map that helps in analyzing the marketing capabilities of the
firm. The organization is utilizing the PIC in the strategic planning phase wherein relevant
technologies and market development opportunities are considered which will be making
them different from the other competitors in the market (West, Ford & Ibrahim, 2015).
Associated Strategic Goals and Sales Forecast

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 Firstly, presenting road map upfront to the company along with the customers at every
stage of the project and this outlines the significant aspects of the innovation strategy
of the company (Tomczak, Reinecke & Kuss, 2018)
 PIC will be useful in commercializing the new product along with budgeting required
for the development of a new product which will be the initial road map of the project
 The sales of Woolworths have been A$56.726 billion till the year 2017, however with
the implementation of the PIC; there can be a rise of more than 25% of the profit
which will be beneficial for their growth and compete against the other competitors in
the market
III. Situational Analysis
Company Analysis
Goals
The primary goals of the Woolworths Company are inclusive of the following:
 Firstly, Woolworths aims to provide the customers with personalized experience
along with convenient shopping experience (Woolworths.com.au., 2019)
 Furthermore, accelerating the innovation in the drinks business which will unlock
value in the portfolio (Sargeant & MACQUILLIN, 2016)
 Woolworths need to build great retail system through the utilisation of the E2E
process which will be better for customers and more straightforward for the stores
Focus
The focus of Woolworths Supermarket is to be one of the world's most responsible
retailers who will be helpful in reflecting their passionate commitment to perform business
for the customers and the planet as well. Woolworth's primary focus is to provide and add

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quality to life in every product which is being delivered by them to the customers in the
market.
Culture
In Woolworths, the organizational culture is strong, and the employees are always
encouraged to reach their productive potentials at the workplace. The corporate culture of
Woolworths is being analysed with proper reference to the leadership as the leadership
aspects of the company is strictly based on ethical principles. Due to motivation being
provided to the employees, the performance of the organization and this has led to the overall
success of the firm appropriately.
Strengths
Woolworths is one of the pioneers, and it is one of the oldest companies to introduce
modern retail trade model. The company has more than 100000+ employees, and they try to
serve the customers by providing them with different kinds of products and services.
Woolworths has decided to earn their strong brand image due to the organizational culture
which is being followed by them. With the implementation of PIC, the company can
introduce different new products, and they can inform different departments regarding the
same with the help of the strategic document which will lead to success (Proctor, 2014).
For instance- When organic food is launched by Woolworths, the PIC will play a
significant role as it is the heart of organized effort as to commercialize new product among
the different employees who are the part of the company. Through this technique, everyone
will be providing their opinion on the product which will be sold by them as to understand
the viewpoints of different members regarding the increase in sales and profitability gained
by the business.
Weaknesses

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On the other hand, Woolworths have limited global presence in the competitive
business environment which is one of the major flaws. While introducing the organic food in
the market, Woolworths may not gain presence as it is a niche market which can create
restrictions on the growth of the firm and this will reduce the effectiveness of the firm
negatively (Piercy, 2016). There is a different online brand in the market which have created
a restriction for Woolworths, and their aspects of using PIC can be helpful in managing their
effectiveness.
Market Share
The Woolworths Supermarket holds more than 37% of the grocery market of
Australia which is according to the IBISWorld report. Woolworths has focused on revamping
the offerings of the food, and it has beaten the Coles supermarket which is competitive. The
respective market share can be increased to more than 50% with the help of using the PIC as
this will improve their view on understanding the usage of the similar products by other
competitors, and they can innovate as per the same (Weinstein & Pohlman, 2015).
Customer Analysis
Number
The estimated number of customers of Woolworths include 21,000,000 number of
customers which is being served by them on every week which counts to 3 million customers
per day on an average (Wagner & Eggert, 2016).
Type
Woolworths tries to target both men and women who are working along with the
ones who are bachelors. The different individuals and households with low incomes and the

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middle class will be targeted which will be appropriate for handling their business
appropriately (Villeneuve & Pasquier, 2017).
Value Drivers
Product Innovation Charter is one such value driver which can increase the value
towards customers. Woolworths can use the PIC which will differentiate their products from
competitors and make them appealing towards the customers (Shaw, 2016).
Decision Process
The working individuals who are both men and women are required to be targeted as
this will help Woolworths in influencing their decision-making aspects appropriately as they
are loyal customers.
The concentration of Customer Base for Particular Products
Woolworth's target both male and female as their target customers as the company
sells the different products which are used by both of them and they are delivering the
products through the company directly or through online channels (Sargeant &
MACQUILLIN, 2016).
Competitor Analysis
Market Position
The major competitors of Woolworths are IKEA and Home Depot which are proved
to be having the large market share in the competitive business environment. IKEA has been
acknowledged dramatically in Germany, and the United States as the company is contributing
to 18% of the revenues and sales in both countries (Moor et al., 2015). Both the companies
did not introduce PIC; therefore, Woolworths can gain strong market position to improve
their brand image and increase profitability.

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Strengths
Firstly, Woolworths is the pioneer, and this is the first company which have
introduced retail trade model. With the introduction of the Product Innovation Charter, this
will create a strong brand image of the company in comparison to the other competitors such
as Home Depot. PIC will be helpful for Woolworths in enjoying a high level of customer
satisfaction by providing proper product quality appropriately (Miquel-Romero, Caplliure-
Giner & Adame-Sánchez, 2014). The feedback tracking mechanism in Woolworths will be
appropriate for handling the issues related to marketing and provide a detailed view of the
products which are being sold by the competitors.
Weaknesses
There are various competitors of Woolworths such as Home Depot and Amazon
which can affect the overall profitability of the organization. Walmart has a huge online
presence which can be a significant threat for replacement of company with other competitors
that can impact their overall efficiency negatively. The company needs to maintain quality
which is required such as the introduction of PIC which will be helpful for them to compete
against Coles as it is one of the severe competitors (Marshall, 2014).
Market Shares
Particulars Market Share Percentage
Woolworths 37%
Home Depot 23%
Amazon 28%
Others 12%

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Collaborators
Woolworths have different collaborations with various agencies such as Local
Designers and collaboration with Safe Fashion Week. The company has followed the Joint
Venture approach which helps in providing support for generating sustainability in the
market. Furthermore, CEO of Woolworths has announced the partnership with Grammy
Award Winning Musician which is the strategic collaboration to align their values and
actions to create a difference in lives of people and planet to generate sustainability (Malhotra
& Peterson, 2014).
Climate
Macro-Environmental PEST Analysis
Political and Legal Environment
There is enormous stability in the political environment which is regarded as an
opportunity for Woolworths to expand their business operations successfully. The other
opportunity which can be gained by the Woolworths is the political support towards
globalization which has allowed the company to become more competitive. On the other
hand, there are different food safety rules and regulations which is one of the significant
opportunities for Woolworths to be successful in a competitive business environment.
However, the tax law reforms are threats as this can lead to high tax rates (Kotler & Keller,
2015).
Economic Environment
There is enormous stability in major economies which is the opportunity along with
the continued growth of developing nations can be one of the opportunities which will
increase the overall emphasis on growing economies. This is one of the positive signs for the

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growth of the retail sector which will be expected to develop positively in recent years
(Foxall, 2014).
Social and Cultural Environment
The healthy lifestyle of the customers in the market is one of the significant
opportunities for Woolworths wherein they can include the different kinds of cultural
diversity trends which will be appropriate for increasing the array of selling the healthy
products in the market which will be suitable for the business (Chernev, 2018).
Technological Environment
The increase in business automation which is the most significant opportunity for
Woolworths which will be regarded as the chance for increasing their presence in the market.
Furthermore, PIC can play a vital role in the Woolworths Supermarket which will be
appropriate for communicating with others inside the organization and to deliver the changes
to the customers in the market (Bresler & Lubbe, 2014).
SWOT Analysis
Strengths
The company has more than 100000
employees working in the supermarket, and
the company have different brand loyalty
schemes for the customers
Woolworths have a strong brand name
with efficient kinds of operations (Bresler
& Lubbe, 2014)
Weaknesses
The company have limited global presence
in the market which can be a huge threat for
them as there are other competitors
There is massive growth in the online
brands which can prove to be a threat for
Woolworths (Bresler & Lubbe, 2014)

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This is one of the most famous retail brands
in more than 900 stores
Opportunities
The company can promote a brand through
advertising and sales promotional activities
There can be the inclusion of PIC which can
inform the different employees regarding
the different kinds of elements which are
crucial
Threats
The economic recession can hinder the
overall growth of the company negatively
There is enormous competition among
players that affect the Woolworths business
IV. Market Segmentation
Segment 1
The first aspect of segmentation is based on demographic elements in which the
primary approach is towards the males and females who have low incomes and middle-class
families as well. The percentage of sales in the respective segment wherein more than 10% of
the profit is being generated from them. These customers prefer the different utility products
and services at reasonable pricing as they use such products on a daily basis (Achroll &
Kotler, 2014). These customers can be reached through newspaper and billboards which will
be apt for attracting them.
Segment 2
The second segment is based on behavioural aspects as they target customers who are
loyal towards a brand. With the implementation of the same, the company will be able to

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provide a cost advantage, and they can target cost-conscious customers in the market (Foxall,
2014).
V. Alternative Marketing Strategies
There are different alternative marketing strategies which can be adopted by
Woolworths as to improve their customer presence in the market. The alternatives include the
following:
 Rebranding- This can assist the company in making the company more profitable
 Positioning as Premium- With an introduction to the PIC, the company can position
itself as a premium brand (Foxall, 2014)
 Value Product- When the setting of a price for the product depends on the costs of
production
VI. Selected Marketing Strategy
Woolworths can include re-branding of the products and services with the usage of
the Product Innovation Charter which will be beneficial for the growth and increasing their
profitability. With the utilization of the same, this can increase engagement among
customers, and the supermarket can achieve new goals that will prove to be beneficial for
their success (Foxall, 2014). With the inclusion of PIC, Woolworths can attract new
customers as they can introduce organic products of top quality with low pricing aspects in
comparison of the competitors.
Marketing Mix
Product- There are different ranges of products starting from apparel, accessories
along with household products which are being provided by the company to the customers.
The scope of the product line is substantial, and the packaging is adequate.

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Price- The company has termed themselves as customer focused company as they
provide the different elements appropriately at convenience prices (Marshall, 2014).
Place- The Woolworths Company has set up the popular chain, and they try to
operate in 976 supermarkets along with 19 convenience stores. In the present scenario, the
company has launched online and mobile applications for shopping from home.
Promotion- The company has maintained brand visibility in the consumer market
wherein they use radio, magazines along with promotional tools for further brand awareness.
VII. Short and Long-Term Projections
Break-Even Analysis
From the break-even analysis, it can be indicated that Woolworths needs to reach
$24,857 on a monthly basis to reach the break-even point. From the diagram, it can be
analyzed that break-even point is wherein line intersects with 0, and this can be seen from the
diagram (Refer to Appendix 1).
Sales Forecast
From the sales forecast analysis, this can be analyzed that Woolworths will be
attaining 90% of the sales through online sales along with the inclusion of PIC. The research
indicators have explained that the after implementation of the PIC in the organization, there
can be the inclusion of the analysis of the various aspects which will ensure that the company
gains profitability in the market in comparison to the other competitors (Refer to Appendix
2).

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VIII. Conclusion
Therefore, from the above, this can be concluded that marketing strategy plays a vital
role in managing the different operations of Woolworths successfully. With the situational
analysis, the brief description relating to the competitors and customers have been considered
which assisted in leading the market share in the market which is competitive. The
collaboration technique which has helped the company in including different sustainability
programs to become more competitive and save the planet and people. Additionally,
marketing mix aspects have been considered to gain the projected results, and the individual
actions have been analyzed.

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References
Achroll, R. S., & Kotler, P. (2014). The service-dominant logic for marketing. The service-
dominant logic of marketing: Dialog, debate, and directions, 320.
Bresler, M., & Lubbe, I. (2014). Marketing management.
Chernev, A. (2018). Strategic marketing management. Cerebellum Press.
Foxall, G. (2014). Strategic Marketing Management (RLE Marketing). Routledge.
Kotler, P., & Keller, K. (2015). L.(2006) Marketing management. Praha: Grada Publishing.
Malhotra, N. K., & Peterson, M. (2014). Basic marketing research. Pearson.
Marshall, G. (2014). Marketing management. McGraw-Hill Higher Education.
Miquel-Romero, M. J., Caplliure-Giner, E. M., & Adame-Sánchez, C. (2014). Relationship
marketing management: Its importance in private label extension. Journal of Business
Research, 67(5), 667-672.
Moore, R. S., Moore, M. L., Shanahan, K. J., & Mack, B. (2015). Creepy marketing: Three
dimensions of perceived excessive online privacy violation. Marketing
Management, 25(1), 42-53.
Piercy, N. F. 2016. Market-led strategic change: Transforming the process of going to
market. Routledge.
Proctor, T. 2014. Strategic marketing: an introduction. Routledge.
Sargeant, A., & MACQUILLIN, I. (2016). Marketing for nonprofit organisations. In The
Marketing Book (pp. 555-576). Routledge.

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Sargeant, A., & MACQUILLIN, I. (2016). Marketing for nonprofit organisations. In The
Marketing Book (pp. 555-576). Routledge.
Shaw, S. (2016). Airline marketing and management. Routledge.
Tomczak, T., Reinecke, S., & Kuss, A. (2018). Marketing Implementation and Management
Control. In Strategic Marketing (pp. 223-244). Springer Gabler, Wiesbaden.
Villeneuve, J. P., & Pasquier, M. (2017). Marketing management and communications in the
public sector. Routledge.
Wagner, S. M., & Eggert, A. (2016). Co-management of purchasing and marketing: Why,
when and how?. Industrial Marketing Management, 52, 27-36.
Weinstein, A., & Pohlman, R. A. (2015). Customer value: a new paradigm for marketing
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Woolworths.com.au. (2019). Woolworths.com.au. [online] Available at:
https://www.woolworths.com.au/ [Accessed 17 Jan. 2019].

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Appendices
Appendix 1
Break-Even Analysis
Break-even Analysis
Monthly Revenue Break-even $17,576
Assumptions:
Average Percent Variable Cost 30%
Estimated Monthly Fixed Cost $17,400
Figure 1: Break-Even Analysis
(Source: Created by Author)
Appendix 2
Sales Forecast
Sales Forecast

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2016 2017 2018
Sales
Sales of Products Through
Usage of PIC
$169,469 $371,454 $411,014
Other $19,930 $40,860 $45,212
Total Sales $189,399 $412,314 $456,226
Direct Cost of Sales 2016 2017 2018
Sales of Products Through
Usage of PIC
$50,841 $111,436 $123,304
Other $5,979 $12,258 $13,564
Subtotal Direct Cost of Sales $56,820 $123,694 $136,868