MKT00720 Assignment 2: In-depth Report on Aldi Australia's Marketing

This report analyzes the marketing strategies of Aldi Australia, focusing on its launch in 2001 and subsequent growth. It examines Aldi's approach to pricing, product, promotion, and place, highlighting how these strategies have contributed to its success as a discount supermarket chain. The report delves into Aldi's cost leadership strategy, differentiation focus, and its efforts to build long-term relationships with suppliers and manufacturers. It also explores the competitive landscape, recommending marketing options such as eco-friendly products, cost reduction strategies, and value proposition strategies. Furthermore, the report emphasizes the importance of market research, expansion into emerging economies, and the use of digital platforms for future growth. The conclusion summarizes Aldi's marketing strategy, emphasizing its reliance on cost reduction and discount strategies to attract customers and achieve a competitive advantage in the Australian market.

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Marketing

Contents
Introduction...........................................................................................................................................2
History of Aldi......................................................................................................................................2
Marketing strategies..............................................................................................................................2
Nature of Aldi’s marketing strategy..................................................................................................2
Recommended marketing options.........................................................................................................4
Conclusion.............................................................................................................................................5
References.............................................................................................................................................6

Introduction
In the present time, business environment is getting highly complex due to the changing
demand of customers. Several trends in the business and economic environment is also seen
with the advancement in technologies, diversification of workplace and increasing demand of
energy. These significant factors are required to be considering by organisation for gaining
competitive advantage. Relationship management is also proved to be the significant tool for
meeting the challenges faced by competition. In the report, discussion is carried on the
strategic marketing options that should be used by Aldi for moving forward. Discussion starts
by explaining the information of Aldi and how it started.
History of Aldi
Aldi has opened its first Australian chain in the year 2001 in Sydney. Similar to the other
chains, Aldi has also built the discount into its everyday pricing. From the starting only, the
stores range were limited with the bestselling item. In the initial launch of its brand, it has not
given huge emphasis on the advertisement and work of mouth. As compare to this, it used to
gibe emphasis on the lower pricing and home brands. Due to the Aldi huge success, several
stable players such as Coles and Woolworths are required to work on its business model
(Filipe, Marques and de Fátima Salgueiro, 2017, P. 742).
Aldi is an International organisation having around 100 year of experience in retailing. It also
has effective understanding in the area of corporate responsibility. It also ensures integrity in
association with the consumers, employees, society, as well as corporate partners.
Marketing strategies
Nature of Aldi’s marketing strategy
When Aldi entered into the market, it has taken into account the several marketing strategies.
at the beginning, Aldi has adopted the product, pricing and place. With the help of this

strategy, Aldi has given the concentration on investment in order to provide the customers
with huge amount of saving. at the starting, Aldi has only three to eight staff to work in its
entire shop that has proved to be unique strategy in comparison to several other supermarkets.
By working on the simple marketing theory, Aldi has aimed to reduce the cost and ensured to
increase its sales. It also had parking space that tends to attract the customers. Through this
marketing theory within the strategy of price, product, promotion, and place, it used to
embrace the strategy of selling the products. It has also taken into account the competitive
pricing, as it is discount supermarket (Grewal, Roggeveen and Nordfält, 2017, P. 742).
Promotional strategy was also the part of its marketing strategies. The different promotional
strategy includes the advertising of its brand by ensuring the brand comparison. This kind of
advertising is linked with the behavioural theory that explains that its brand is also equal to
the other successful brands. This kind of marketing strategy has further allowed Aldi to create
the slogan of “like brand.” Aldi has also taken into account the weekly broachers’ in order to
promote its brand. In the recent time, Aldi make use of effective social media in spite of the
promotional strategies for communication with its public regarding the products. In addition
to this, Aldi has also established the two segments for its customers that are seen as the
chosen targets within its marketing strategy (Zentes, Morschett and Schramm-Klein, 2017,
P.28). This strategy of Aldi helped it in providing several strategies in distributing the
resources as well as attracting the customers. Business positioning was used as the long term
strategy in order to create the competitive advantage for the business. At the starting, Aldi has
followed several principles including consistency, responsibility, and simplicity. Aldi ensures
the seasonal discount coupons that give emphasis on providing products. by following this
strategy, it has positioned its brand as the everyday discount supermarket. It has also ensured
the clarity, efficiency and simplicity (Dunphy, 2016, P. 742).
Aldi is a German supermarket chain that has around business in eighteen countries of the
world. it was founded by two brother named Theo and Karl Albrecht. Aldi has entered the
Australian market in 2001. With the nominal price, it serves the Australian society. It
believes in building long term relationship with its manufacturers, producers and suppliers for
maintain the sustainability. It also has diversified products including sanitary articles, toilet
paper, food, beverage, and some other household needs (Ghisellini, Cialani and Ulgiati, 2016,
P. 28).
Cost leadership: in this marketing strategy, Aldi produce the goods at low cost. By following
this strategy, it tends to create the revenue by offering huge discount on the purchasing of
goods. Aldi used this strategy because it minimises its cost of transportation (Sullivan, 2018).

Differentiation focus: By knowing the customer satisfaction, firms can use the organisations
to offer differentiation products at the premium prices (Tidd and Bessant, 2018, P. 352). Aldi
target segment also includes the middle class people that give emphasis on the pricing
element as compare to the quality of products.
Recommended marketing options
It is true that the growth of Aldi surely depend on the creation of competitive advantage as
compare to its competitors. Aldi should give more emphasis on the eco friendly products in
order to attract its customers. Aldi can bring growth by ensuring these things:
 Due to the increasing competition, Aldi should implement the cost reduction
strategies. It should not keep the high number of inventory of its product but successfully
determine its variation, size, and quality. It should also choose those suppliers that cab help it
with the right and adequate product in spite of compromising its taste and quality.
 Aldi should also give emphasis on its core business that is the supermarket. The
business segment that does not require too much attention is the retail chain such as liquor,
pharmaceuticals, and petrol (Fronda, 2015).
 Due to the presence of several big players, it is suggested to Aldi for increasing its
prices only when the cost of production increases. Aldi must also create the value proposition
strategy that will not give only emphasis on the low cost but also on the quality and value.
 In order to ensure the high growth in Australia in future, Aldi is required to provide
more fresh food product to its entire customer segment. It should also create the strategic
leadership with its suppliers. It will bring the growth in its product with the condition of
climate (Huddleston, Whipple, Nye Mattick, and Jung Lee, 2009, P. 70).
 Aldi is also required to maintain its store format in such a way that will help it in
engaging the customers toward its supermarket. It should also extend its expertise by
providing the effective LED light, expanded wooden racks, extended chiller in the stores in
order to keep its products fresh every day.
 Excellent strategies are also required to adopt by the Aldi in order to achieve the
competitive advantage over the other competitors. It can also ensure to use the complaint box
in each of its store. This will definitely help it in bringing the required changes in the
concerned problems of the customers. An effective person should be appoint to deal with the

complaints of the customers in order to ensure the smooth functioning in the organisation
(Fronda, 2015).
 Aldi should also include the secondary activities including procurement, human
resource, and technological advancement. By ensuring the well procurement, it can attain the
efficiency recruiting the eligible and efficient workers in several departments. The effective
use of eligible and competent workers with effective knowledge and information is essential
to attain every aspect of the marketing strategy (Teller, C., Wood, S. and Floh, A, 2016, P.
1540).
 By working on the several new aspects, it can also expand its business into the
emerging economies such as China and India. By expanding in these countries, it can hold
the advantages of advertising media and digital platforms. It can also work more on the
online channel where huge opportunities can be developed by it (Voigt, Buliga and Michl,
2017, P. 17).
Conclusion
From the above discussion, it can be concluded that Aldi marketing strategy is based on the
cost reduction. The major profit that Aldi received is by providing the huge discount to its
customers. It believes in adopting discounting strategy for attracting the customers. In order
to gain huge market growth in future, Aldi is required to ensure the proper market research
that will help it in finding out the trends that are going on in the market. By keeping in mind
the future perspective, it can achieve the competitive advantage by expanding its operations.
It can also expand its wings in the emerging economies.

References
Dunphy, S. (2016) Quantity consumer goods pricing: has yesterday’s surcharge become
today’s discount?. Journal of Product & Brand Management, 25(7), pp.721-728.
Filipe, S., Marques, S.H. and de Fátima Salgueiro, M. (2017) Customers' relationship with
their grocery store: Direct and moderating effects from store format and loyalty
programs. Journal of Retailing and Consumer Services, 37, pp.78-88.
Fronda, A. (2015) How Lidl and Aldi found the ingredients for success [ONLINE] Available
from: https://www.europeanceo.com/business-and-management/how-lidl-and-aldi-found-the-
ingredients-for-success/ [Accessed 12/09/2019].
Ghisellini, P., Cialani, C. and Ulgiati, S. (2016) A review on circular economy: the expected
transition to a balanced interplay of environmental and economic systems. Journal of
Cleaner production, 114(1), pp.11-32.
Grewal, D., Roggeveen, A.L. and Nordfält, J. (2017) The future of retailing. Journal of
Retailing, 93(1), pp.1-6.
Huddleston, P., Whipple, J., Nye Mattick, R. and Jung Lee, S. (2009) Customer satisfaction
in food retailing: comparing specialty and conventional grocery stores. International Journal
of Retail & Distribution Management, 37(1), pp.63-80.
Sullivan, R. (2018) Aldi Special Buy sells out in one minute [ONLINE] Available from:
https://www.news-mail.com.au/news/aldis-special-buys-199-rocking-chair-sells-out-in-/
3312456/ [Accessed 12/09/2019].
Teller, C., Wood, S. and Floh, A. (2016) Adaptive resilience and the competition between
retail and service agglomeration formats: an international perspective. Journal of Marketing
Management, 32(17-18), pp.1537-1561.

Tidd, J. and Bessant, J.R. (2018) Managing innovation: integrating technological, market
and organizational change. UK: John Wiley & Sons.
Voigt, K.I., Buliga, O. and Michl, K. (2017) Striving for Customer Benefit: The Case of Aldi.
In Business Model Pioneers (pp. 11-24). Springer, Cham.
Zentes, J., Morschett, D. and Schramm-Klein, H. (2017) Store-based Retailing–Food and
Near-food. In Strategic Retail Management (pp. 25-46). Springer Gabler, Wiesbaden.