University Report: Aldi Marketing Analysis and Strategies

This report provides a comprehensive analysis of Aldi's marketing strategies. It begins with an introduction to marketing principles and an overview of Aldi's background, including its origins and expansion. The report then delves into Aldi's marketing analysis, examining its strategies since inception and exploring future marketing options. Part 1 covers challenges faced by Aldi, industry reports, and customer perceptions. Part 2 presents a detailed SWOT and PESTLE analysis, evaluating political, economic, social, technological, and environmental factors. The report also includes a Five Forces analysis, Maslow's hierarchy, BCG Matrix, and future trends, including technological challenges and competitor analysis. The conclusion summarizes key findings and provides references.

Running head: REPORT ON ALDI
Report On Aldi
Name of the Student
Name of the University
Author Note

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REPORT ON ALDI
Table of Contents
Introduction......................................................................................................................................4
Background of Aldi.........................................................................................................................4
Marketing Analysis..........................................................................................................................5
Nature of Aldi’s marketing strategies since its beginning...............................................................5
Strategies marketing options for ALDI moving forward................................................................6
Part 1................................................................................................................................................7
Challenges....................................................................................................................................7
Industrial Reports.........................................................................................................................7
What people say about Aldi?.......................................................................................................7
Where the Business Came from?.................................................................................................8
Part 2................................................................................................................................................8
SWOT Analysis...........................................................................................................................8
PESTLE Analysis........................................................................................................................9
Political/ Legal.........................................................................................................................9
Economic.................................................................................................................................9
Social.....................................................................................................................................10
Technological........................................................................................................................10
Environmental........................................................................................................................10
Five Forces.................................................................................................................................10

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Threat of new entrants...........................................................................................................10
Bargaining power of buyers...................................................................................................10
Bargaining power of the Supplier..........................................................................................10
Threat of substitutes...............................................................................................................10
Competitors............................................................................................................................11
Maslow......................................................................................................................................11
BCG Matrix...............................................................................................................................12
Future Trends.............................................................................................................................12
Technology challenging customer needs...................................................................................13
Competitors Woolworths/Coles.................................................................................................13
Conclusion.....................................................................................................................................13
References......................................................................................................................................15
Appendix........................................................................................................................................17

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Introduction
Marketing is a simple term that can be addressed through offering right products at right
place. However, marketing mix is the basic model to develop a marketing plan for any business.
Product, place, price and promotion are the four basic elements of marketing plan for any
business (Huang and Sarigöllü 2014). In order to offer a successful product application of
marketing tool is important. Such marketing mix tool enables a business to achieve sales target,
consumer satisfaction and profitability. This study deals with the marketing strategy of Aldi that
is a well known retailer of UK. However, marketing has used by Aldi to develop their marketing
strategy, which enables them to gain customer attention. It is important for all business
organizations to carry out a market research before developing any market plan. A proper market
research allows the business organizations to understand the current market demand based on
which they can develop their business strategy. Aldi possesses different sales philosophy that
makes them unique from the other competitors. This organization establishes their stores at the
high traffic areas in UK to increase the customer entry in their shop. This is a unique business
strategy of such organization. Hence, in this study the marketing strategy and relative challenges
will be addressed in context of Aldi.
Background of Aldi
Aldi is one of the largest retailers in the global retail industry. However, it is a grocery
market that established in UK. It is a Germany based company and started its business in 1946
as food store in Germany. In the year 1960 this organization has expanded around 300 stores in
Eastern Germany. The business of Aldi is differentiated into two categories one is called Aldi
Nord and another is called Aldi Sud. In the recent years Adi Sud has expanded its market share

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in United Kingdom. Customers of UK focus on the quality of the product that is bring a big
opportunity for Aldi to expand their business in UK. Aldi is renowned for its low price of the
product. they have adopted every day low price policy and also provide discount over their
product. In the year of 1990 this organization has established 500 stores in UK. Fresh food and
groceries are the main products of Aldi. HRIBO in Germnay, Pickle in Great Britain and
Knoppers in Belgium are the examples of branded products of Aldi. Aldi provides weekly
special offer to the customers to enhance their sales and customer loyalty. Apart from the
groceries they offer electronic products in a reasonable rate. Aldi uses different logos for their
new brand that is vital part of their marketing strategy (Aldi.com.au 2017).
Marketing Analysis
Nature of Aldi’s marketing strategies since its beginning
Aldi was established in 1943 in Germany as a start up organization Aldi focused on the
customer retention strategy. For this reason they offered high quality product with low price.
However, market entry strategy is also developed by them as a new organization. In order get
entry in an existing market a startup organization has to face many challenges. One of the biggest
challenges is to motivate the customers towards the product and to increase the belief of the
customers (Aldi.com.au 2017). For this reason Aldi has carried out a market analysis to identify
the issues that they might face. This organization has adopted go to market strategy to identify
the potential customers and to gain competitive advantages in the new market. Go-to market
strategy enabled Aldi to get a blueprint about how to deliver a product to the customers by
considering the factors such as pricing and distribution.

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Aldi is a retail organization thus as a startup company it required to gather huge
knowledge about the retail business. Hence, for this reason they have carried out a proper market
research to reach the target customers. Therefore, they have used different channels to fulfill the
different ranges of product demands in order to reach their target audience. On the other hand, a
continuous research has been undertaken by Aldi to understand the psychology of their target
customers. However, by observing the consumer behavior they come up with the development of
new sales and extensive retail strategy. This ensured such organization that their products have
penetrated in the target market (Srdjevic et al. 2012).
Strategies marketing options for ALDI moving forward
Aldi follows marketing mix model that is the current marketing strategy of Aldi.
Product, price, place and promotion are the four elements of the marketing mix. Aldi prefers
indispensible investment rather that the superfluous investment in order allow their customers to
get maximum saving form their purchasing. On the other hand, Aldi focuses on the limited
opening hours in their UK stores. Aldi provides quality products and they follow product
differentiation. Next the pricing strategy of Aldi includes low price since its beginnings. Such
low pricing strategy of Aldi enables them to increase the customer’s number and to gain
competitive advantages in the global market. Cost leadership strategy is applied by Aldi to
increase their sales. According to this strategy Aldi offer more local products rather than branded
products that are affordable to the customers belong from all classes.
Aldi has established their stores at high traffic areas, which enables them to deliver
product easily to the target market. Therefore, promotional strategy of Aldi includes online
promotion in the recent years. Their main motto of business promotion is to ensure the

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consumers that can save money from purchasing Aldi’s product. “Only cheaper” is a slogan that
is used by Aldi during their product promotion. In order to get sustain competitive advantages
Aldi provides excellent customer service to satisfy their customers. Therefore, they give their
concentration to meet the demand of existing customers rather than the new customers as
according to them it is easy to retain the existing customers rather than the new customers
(Srdjevic et al. 2012).
Part 1
Challenges
The key challenge for the Organization is to offer the same level of convenience for its
customers both who are online and offline. The offering of the click and collect option will be
costly for the traders and this poses a challenge for the Organization. Aldi is feeling the pressure
due to the increase in the price competition (Huang and Sarigöllü 2014).
Industrial Reports
Aldi has record sales with a yearly growth of 12%. The organization has attracted new
customers into their stores in the current year and has a sale of £66M in the sales of every month.
The Company announced its plan to invest £300M into the stores in U.K. in the coming three
years (Aldi.com.au 2017). This investment will enable the Company to establish around 70 new
stores by the end of the coming year (Armstrong et al. 2015).
What people say about Aldi?
The food and the groceries is the largest item of a household budget and the low price of
the groceries is a noteworthy supplier for the reduction of the living of the households. The
customers flock at Aldi for the value and fresh food appeal. The discounters are popular among

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the young people and the large family units (Aldi.com.au 2017). There is much more of the
positive tone for the company Aldi then its competitors Coles and Woolworths. (Aldi.com.au
2017).
Where the Business Came from?
Aldi is a common brand of the foremost worldwide discount supermarket chains and has
more than ten thousand stores in around eighteen countries. The business organization is based in
Germany and was established by Karl and Theo Albrecht in the year 1946. The Aldi Sud
operates in many countries and Australia is one of them (Huang and Sarigöllü 2014).
Part 2
SWOT Analysis
Strengths  There is the claim that the Business Organization serves products of top
quality. It offers its products and services at very affordable prices.
 The business organization The operating costs are low of the
organization (Görener et al. 2012)
Weaknesses  The company is relatively small-sized compared to the other brands
that are available.
 At times, the company has been alleged to be a store that provides for
cheap and low quality items.
Opportunities  There is the requirement to invest in the field of advertising so as to

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beat the competition with its rivals.
 There is an opportunity to expand in the growing economies as Africa,
Asia and so on.
Threats  The company is able to cater to provide for the complete shopping
experience to the consumers.
 The other traders and the retailers have a huge variety and amount of
the stock-keeping units.
PESTLE Analysis
Political/ Legal
The concern of Aldi is the stability of the rules and regulations as the governments are
changes after every three years. The ARA that is the Australian Retailers Association
encourages, promotes and protects the retailers by providing them with support, instruction and
guide (Srdjevic et al. 2012).
Economic
The low national rate of saving and the low rate of saving of the respective households is
the economic factor. There is the decline in the gross domestic factor and also the high level of
the household debt. These have a unconstructive impact on the spending pattern of the consumer
(Srdjevic et al. 2012).

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Social
The population of Australia is growing and it is a multicultural society. After the second
Great War, there has been heavy migration from various regions and countries to Australia.
There is increase in the number of the people who live alone in the country (Srdjevic et al. 2012).
Technological
Most of the processes are online which are very convenient in nature (Srdjevic et al.
2012). The internet and the e-commerce have improved the international competition nature in
the businesses of Australia.
Environmental
Pollution is a serious problem along with the land being dry in nature. Australia is the
most urbanized and coast dwelling populations in the world.
Five Forces
Threat of new entrants- the industry belongs to the grocery industry and the increase in the
population increases demand in the future (E. Dobbs 2014).
Bargaining power of buyers - the grocery products have low and medium involvement hence,
the bargaining power of the buyers will be high.
Bargaining power of the Supplier- to be competitive in this industry the supplier has to
decrease the cost and increase the quality of the products.
Threat of substitutes- the large-scale supermarkets and the shopping malls are a threat for the
retail stores as the range of the substitutes will be more in the malls. Then the fast food outlets
also act as the substitutes for the groceries.

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Competitors- there are many companies in the grocery industry and they contend well in the
market to provide the finest quality at a low cost. The grocery products are easy to imitate and
undifferentiated in nature (Aldi.com.au 2017).
Maslow
Survival- The basic needs for survival for the employees of the organization are necessary. The
personnel should be paid well in order to survive and keep their job.
Safety- This refers to the economic and the psychological safety along with the physical safety
of the employees.
Social- the organization’s simplified process helps them to work with ease and efficiency
allowing their suppliers to invest back into their businesses.
Importance- They provide opportunities to the Australian farmers and reduce the stress of the
competition.
Self actualization- the organization provides security to the Australian producers and consistent
orders with time, which helps their flow of income. The planned expansion increases the volume
providing opportunities to the new suppliers (Noltemeyer et al. 2012).

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BCG Matrix
Source: (Palia et al. 2014)
Stars- ready to cook Gammon joint with honey, Pesto Rosso, Vine Ripened Tomato and Lentil
Seasonal Soup, Moser Roth Orange & Almond Chocolate and Fiesta Fajita Dinner Kit.
Question marks - flushable wipes as a ‘special buy’
Cash cows- Lacura, Mamia, Expressi and Choceur are the top selling things of Aldi.
Dogs- Aldi Ginger Beer, which was discontinued (Palia et al. 2014).
Future Trends
The company has a determined expansion agenda. Thus, there is a prospect for the future
through the seeking of new property, logistics and opportunities for the employees. The
Company is also making major investments in the new stores. They plan to influence the grocery
prices and improve the perception and the quality of the private labeled goods with their
exclusive brand philosophy (Aldi.com.au 2017). They also plan to introduce market leading
inventiveness in Australia.