Marketing Management: Analysis of Aldi Australia's Strategies

This report provides a comprehensive marketing analysis of Aldi Australia, a leading retailer in the Australian market. It begins with an introduction to marketing management and its application to Aldi, followed by an industry and company analysis, highlighting Aldi's strengths, weaknesses, opportunities, and threats. The report then delves into the 5Cs framework (Company, Customers, Collaborators, Competitors, and Context) to examine Aldi's operating environment. It discusses market research and market intelligence techniques used by Aldi to gather information about its market. The report also examines the development of marketing strategies, including target market selection, value proposition, and positioning statement, and concludes with a discussion of marketing tactics related to product, price, place, and promotion. The analysis provides a detailed understanding of Aldi Australia's marketing approach and its strategic recommendations.

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Marketing Management: Aldi Australia

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Table of Contents
Introduction......................................................................................................................................3
Issue 1: Company and Industry Analysis........................................................................................3
Issue 2: 5 C’s of Aldi Australia.......................................................................................................4
Company......................................................................................................................................4
Strengths...................................................................................................................................4
Key Resources..........................................................................................................................5
Weaknesses..............................................................................................................................5
Opportunities............................................................................................................................5
Threats......................................................................................................................................5
Customers.....................................................................................................................................5
Collaborators................................................................................................................................6
Competitors..................................................................................................................................6
Context.........................................................................................................................................6
Political Factors........................................................................................................................6
Economic Factors.....................................................................................................................6
Social Factors...........................................................................................................................6
Technological Factors..............................................................................................................6
Issue 3: Market Research and Market Intelligence..........................................................................7
Issue 4: Developing Marketing Strategies.......................................................................................8
Choice of Target Market..............................................................................................................8
Value Proposition.........................................................................................................................8
Positioning Statement..................................................................................................................9
Issue 5: Developing Marketing Tactics...........................................................................................9
Product.........................................................................................................................................9
Price...........................................................................................................................................10
Place...........................................................................................................................................10
Promotion...................................................................................................................................11
Conclusion.....................................................................................................................................11
References......................................................................................................................................11

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Introduction
Marketing management is the process to direct the resources of an organization to develop and
apply the best suitable strategies so that it can reach to its desired targeted market with the
objective of sales maximization of a particular product or service. This process enables a
company to track, review and evaluate the marketing processes and resources. It includes
different marketing aspects which help the company to enhance its operations. Moreover, it
improves the brand reputation among a large population (Katsikeas et al, 2016).
The primary objective of this report is to analyze different marketing concepts in context of
selected company i.e. Aldi Australia. Aldi Australia is running its business operations as one of
the leading retailers in Australia. The below report is emphasized on the process of marketing
management of Aldi Australia. It analyzes different external and internal factors which may have
large impact on organizational growth. 5Cs framework is used to analyze its different operating
environments from marketing perspective. Furthermore, marketing research and marketing
intelligence process is defined that can be used to collect the information about the components
of 5Cs framework. In the last section, the report recommends marketing strategies and tactics for
Aldi by using the marketing mix framework.
Issue 1: Company and Industry Analysis
Aldi is German Supermarket which has its operations in most of the regions of European Union.
Aldi Australia is a German retailer which was established in the year 1948 by two brothers Karl
and Theo. Now, the company has turned into one of the leading food retailers. This firm has
started its operations in 2001 and now it has developed quickly over the years. By adopting
effective pricing policies, the company is able to develop its brand image as discounted store.
Aldi Australia is operating its business in Australian retail industry. Over the period, the retail
industry in Australia has experienced a positive performance. As of the year 2017, the revenues
of this sector were $20 billion that is continuously increasing with the passage of time
(Euromonitor International, 2018). In this industry, the company offers variety of products like
food and beverage products, household items and sanitary articles. It provides its products and
services by focusing on the middle class people and product quality. With a substantial revenues
and financial growth, Aldi is making efforts to get a better position in the industry.

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The mission statement of the firm is to offer its customers with the products that they buy
repeatedly and make sure that those products are of excellent quality at reasonable rates. It is a
famous retailer in Australia that provides great value and best quality of products (Simply Aldi,
2015). Additionally, it assists society and makes efforts to fulfill its responsibilities towards
suppliers, customers and employees. Aldi Australia is operating its business by using different
slogans like “Good Different”, “Biggest Ever Ad Push” and “Spend a Little, Live A lot”. For its
products and services, Aldi Australia implements customer and competition orientations as it is
very much emphasized on customers. Its strategy directs to the customers over 18 years old, who
are very sensitive towards prices. By adopting competition orientation, the company
continuously enhances its strategies to compete well-established retailers like Coles, Woolworths
etc. Moreover, the organization used online marketing as its strategic action that plays an
important role to reach a larger population. Branding is the most significant part of Aldi’s
marketing strategy as it helps the company to enhance its customer base and increases brand
loyalty to its retail services (Burmann, et al, 2017).
Issue 2: 5 C’s of Aldi Australia
The 5C framework is to conduct the analysis of environment based on five major areas that are
appropriate for market decision making of a firm. It includes different factors like micro-
environmental, macro-environmental and internal factors (Hakala, 2015). The components of
5Cs are like Company, Collaborators, Customers, Competitors and Context. 5Cs for Aldi
Australia are stated below:
Company
Strengths
 Aldi Australia promotes offering higher quality products on reasonable rates.
 It keeps the operating costs very low.
 As a supermarket, the organization is offering a variety of products like household items,
sanitary items, consumer electronics and food and beverage products.
 By using customer orientation, the company is able to develop effective relationships
with its customers and provide them a great experience of shopping (Euromonitor
International, 2018).

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Key Resources
In Australian retail industry, Aldi Australia has various resources which help the company to run
its business operations effectively. It has both intangible and tangible resources such as retail
stores, talented and skilled human resources, customer-friendly behavior of staff, environment,
company’s culture, effective leadership styles, relationship with customers and suppliers, lower
pricing strategy and higher quality of products. The company owns the about resources and it is
able to create sustainable competitive edge and produce significant profits (Nenycz-Thiel, 2011).
Weaknesses
 Aldi is facing fierce competition from other popular brands like Woolworths, David
Jones and Coles (Burrell, 2018).
 Still it is smaller in comparison to other retailers in Australia.
 Aldi Australia makes lower investment on advertising and promotional activities.
 It is not able to influence globally because there are few other retail chains.
Opportunities
 Aldi can make more investment in advertising and promotion to keep up with the
competition.
 It can expand its business operations into emerging economies like Africa and Asia.
 Aldi has the potential to out-perform the biggest two retail giants of Australia
Woolworths and Coles (Knox, 2015).
Threats
 In Australia retail industry, the level of competition is very high for Aldi Australia.
 The organization faces different risks related to suppliers.
 It cannot serve the shoppers who are looking for a complete shopping experience.
Customers
Aldi Australia focuses on the people considering their psychographic and demographic
characteristics like age, income and social class. It offers its products and services targeting the
people of 20 to 50 years old and who belong to the medium level income group. Under
psychographic segmentation, Aldi Australia focuses on the population that is concerned towards
monthly budget. These people desire to buy the products on comparatively lower prices.

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Collaborators
There are various collaborators who work in the partnerships with Aldi Australia. These
collaborators are like suppliers, non-profit organizations, designers, communities, delivery
partners etc. The company is one of the supermarkets which have developed close partnership
with its suppliers. Its suppliers play the role of business partners who help in supplying the
products to the targeted customers (Mortimer, 2016). Additionally, they help the company to
enhance its revenues and profits. By developing this relationship, Aldi is able to provide great
value and quality of retail products.
Competitors
As discussed above, Aldi faces higher level of competition from some well-established
competitors like Coles, Woolworths, Target Australia, Wal-Mart, David Jones, K-mart etc. The
company is developing its strategies and tactics considering the strategies of competing brands.
This competition has a large impact on the growth of Aldi in Australian retail industry
(Weinstein and Pohlman, 2015).
Context
Political Factors
In the country, changes in the regulations and policies are affecting the supermarket industry.
Aldi needs to create better relationships with government, trade unions and foreign nations. The
company has to comply with the different taxation policies and trade restrictions.
Economic Factors
The economy of Australia is strong and well-emerged and standard of living is very high in the
country. The economic growth is profitable for the development of Aldi in the country.
Social Factors
Nowadays, people prefer to purchase their household and other grocery items from supermarkets
so this customer perception is beneficial for the business of Aldi. It provides a great shopping
experience to its customers (Ho, 2014).
Technological Factors
In today’s modern environment, most of the Australian people use advanced technology and they
are actively using social media sites like Facebook, Twitter, Instagram etc. Usage of updated
technology can assist the company to enhance customer’s shopping experience.

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Issue 3: Market Research and Market Intelligence
5Cs framework is a technique that can be used to conduct environmental analysis of the
organization. In this process, one of the most important steps is to identify the research problem.
There are various approaches which are practiced by Aldi Australia to gather the data about
environmental factors of 5C framework. The major techniques are market research and market
intelligence. Market research is one of the major efforts that are used by Aldi to collect the data
about targeted market segment and audiences. Furthermore, market intelligence is the
information which is associated with the company’s market which is gathered and assessed for
the purpose of appropriate decision making so that it can determine its operational and
organizational strategy. With the help of these techniques, Aldi Australia is analyzing its internal
and external environment (Sultan, Wong and Sigala, 2018). The 5Cs framework helps the
company to analyze the market environment as it offers wide-spread data about different
environmental factors. Market research technique assists Aldi Australia to understand the
competitors, customers and collaborators. It is very important to collect the information about the
customers and competitors. This information specifically oriented towards marketing decisions
can be found in the market research reports that offer the market analysis for retail industry.
For international markets, nation reports can be processed as common information source for
macro-environmental factors. By relating the market analysis with the firm’s resources and
capabilities, Aldi identifies and choose more profitable opportunities to offer value to the
customers (RetailWire, 2016). Through market research, the company understands the demands
and needs of consumers by conducting surveys, questionnaires and focus group feedback. It
helps Aldi to know about the tastes and expectations of targeted customers towards retail
products and services. From this analysis, the organization found that people prefer to purchase
their household items on affordable rates. The information related to competitors is collected
from the internet sources and social media sites. The company found that there are some major
competitors like Coles, Woolworths and David Jones which pose threat on Aldi. It helps Aldi
Australia to assess the marketing and competitive strategies of competing brands (Morgan,
2014). Collaborators also play an important role in this process as Aldi Australia collects the
competitors’ information from suppliers. When Aldi plans to expand its business operations in
other nations, it evaluates the political and legal regulations which are imposed in a particular
country. Additionally, Market intelligence is significant process as it assists the company to

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recognize new and changing trends before its competitors can do. Under both techniques,
investor’s report and annual reports play an important role in collecting the required information.
In this way, Aldi Australia uses market research and market intelligence to collect and evaluate
the data of retail market (Sutton-Brady, Kamvounias and Taylor, 2015).
Issue 4: Developing Marketing Strategies
The above analysis states that Aldi Australia is operating its business effectively but still it is
smaller than other retailers in Australia. Considering the market analysis, the company needs to
develop its marketing strategies by emphasizing on three major components such as choice of
appropriate target market, value proposition and positioning statement (Ho, 2014). In the future,
Aldi Australia can create its marketing strategies looking at the below facts:
Choice of Target Market
In Australian retail industry, Aldi Australia is operating its business as one of the leading players.
The organization offers a variety of products to capture a large market segment. It is offering its
products and services on mid-priced and discounted prices. This firm introduces its products in
the market based on two market segmentation characteristics psychographic and demographic.
Under demographic basis, Aldi focuses on income and age of population and targets the
customers of 16 to 50 years old who belong to medium income group (Weinstein and Pohlman,
2015). According to a study in Australia, a significant percentage of Aldi’s customers are
females. Females prefer to do retail shopping on affordable prices. Moreover, it emphasizes on
the people who are cost-conscious and prefer to purchase grocery products on lower costs. In
Australia, this organization is in the category of discounted stores so it is essential to emphasize
on lower income people. It can be stated that it is crucial to choose the most appropriate market
so that company can sell its products directly. So, Aldi Australia is planning to segment the
population who cannot purchase their regular grocery products on higher prices. By using the
low cost model, the company is making efforts to increase its market share (Ho, 2014).
Value Proposition
For an organization, value proposition is a statement that tells how an organization meets the
expectations of customers through its products and services. It states the customers that why they
should prefer to purchase Aldi’s products. Aldi Australia is developing its value proposition by

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including effective leadership, creative thinking and commitment to customers saving so they
can spend a great life (Osterwalder, et al, 2014). The company delivers value to its customers by
making effective relationships with customers and suppliers. For its products, the primary appeal
of Aldi to shopper is its lower prices. This firm is able to maintain its strengths by developing an
effective value proposition which is proving difficult to beat. New value proposition of the
company is an extended product assortment which is enough wide to fulfill all the grocery
shopping needs of a household (Low, 2016).
Positioning Statement
Positioning statement plays an important role in capturing the attention of people towards
company’s products and services. It shows how company’s products can satisfy the demands and
needs of customers (Scott and Walker, 2016). In today’s competitive business environment,
every organization makes efforts to develop attractive positioning statement so that it can grab
the attention of larger population. Aldi Australia needs to position itself as one of the discounted
retailers of the country. The organization uses the positioning statement that shows that Aldi
offers great quality products on discounted prices. For example, the positioning statement of the
company is “Top quality at amazingly lower prices- guaranteed.” This statement can assist the
organization to gain the trust and loyalty of Australian customers in its products (Renton,
Daellenbach and Davenport, 2016).
Looking at the above-mentioned components of marketing plan, Aldi Australia can formulate its
growth and marketing strategies which can assist the company to gain future growth in retail
sector.
Issue 5: Developing Marketing Tactics
To position its products and services among targeted population, Aldi Australia should develop
effective marketing strategies by using 4Ps of marketing mix (Khan, 2014). The recommended
marketing mix strategies are stated below:
Product
Aldi Australia offers a wide range of products in different segments like sanitary articles,
household items, grocery products, fresh fruits, packaged food and beverages. It provides a
diversified range of its brand labels which are inexpensive and more reasonable than other

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retailers. Considering the percentage of female customers, the company should include more
products under its range like jewelry, footwear, personal and beauty care products. In addition to
this, it should offer the products which are related to the season. For example, in the winters it
should offer the warm camping and snow gear to the targeted population (RetailWire, 2016). The
products of the company are available with higher quality and affordable rates. Moreover, the
company should encourage its customers to purchase most of the products from supermarkets. It
should focus on the packaging of products so that it can entice a large population towards its
retail services.
Price
Pricing strategy is one of the most important parts of the marketing mix framework of Aldi
Australia. From the above market analysis, it can be stated the company sells its products on
comparatively affordable prices than its competing brands. Now, it should practice a
combination of pricing strategies such as penetration, competitive and psychological pricing.
Moreover, Aldi should sell the products in combo packs and provide discounted offers so that
customers can save their money. In the festive season, the company should sell its products
through online sale (Ododo, Mulholland and Turner, 2015). The prices of products should be
very attractive so that it can increase its business size. It should keep lower profit margin for non-
food items that can be reimbursed by selling grocery products. Furthermore, Aldi Australia
should give different payment options like debit card, credit card and letter of credit. The
payment via letter of credit will be very beneficial for the firm and targeted population.
Place
Aldi Australia is smaller organization than its competing brands like Woolworths, Coles and
David Jones. Currently, the company has limited presence in international markets so it needs to
establish a large distribution network for its product offerings. It should enhance its distribution
channels so that it can reach to the customers worldwide. In addition to urban regions, Aldi
should supply its products in rural areas as well. It should establish more retail stores in
Australian cities and other nations. It should select the locations which are more convenient to
the people (Pash, 2016). The products should be available on online website so that people can
order their products online. Aldi should motivate its suppliers in an effective way that will help
the company to decrease the shipping cost and time of delivery. It can enter in emerging nations

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by developing strategic partnerships with well-established players. This strategy will assist the
company to gain sustainable competitive advantage against its competitors.
Promotion
Aldi Australia should make more emphasis on the promotion strategy so that it can develop more
brand awareness about its retail services (Cameron, et al, 2015). To promote its products, Aldi
Australia should use different activities like advertising, personal selling, sales promotion and
public relations. It should adopt both offline and online media of advertising. It can communicate
its brand message to a larger population by using television ads. In addition to this, it can post the
ads in newspapers and magazines as well. Under public selling, it should donate the funds to
charitable institutions. These promotional and advertising tools will help the company to attract
more customers towards its products in retail sector (Fassnacht and Königsfeld, 2015).
Conclusion
From the above analysis, it can be concluded that currently Aldi Australia is offering its products
and services by implementing cost leadership strategy. The major focus of the company is on
meeting the needs of customers by offering high quality products by emphasizing on five major
components such as huge saving, higher quality, great value, special purchases and purchase
with confidence. In today’s competitive retail industry, the organizations are upgrading its
strategies so that they can increase their customer base. Till now, the company is unable to
establish a strong brand image in Australia so it is necessary to upgrade its marketing strategies.
The company needs to make investment on advertising and promotional process. It will assist the
organization to attain more competitive edge against its competing brands.