Coles Supermarket: International Marketing Strategy in Hong Kong

This report presents a comprehensive marketing analysis of Coles Supermarket's expansion into the Hong Kong market. It begins with an executive summary and introduction, followed by a detailed market analysis that examines market size, growth rates, population demographics, market barriers (such as tariff and administrative policies), and market drivers. The organizational analysis delves into Coles' history, current strategies, customer audit, buyer behavior, and the marketing mix (4Ps). A competitor analysis identifies key players like Tesco, Aldi, and Walmart, assessing their strengths and weaknesses and positioning Coles' unique selling proposition. The macro environment is assessed using PESTEL analysis, Porter's Five Forces, value chain, and the BCG matrix. A SWOT analysis summarizes the company's strengths, weaknesses, opportunities, and threats. The report concludes with recommendations for Coles' successful entry and competitive advantage in the Hong Kong market, supported by appendices including customer audit and buyer behavior.

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

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Table of Contents
Executive Summary...................................................................................................................3
1. Introduction............................................................................................................................4
2. Market Analysis.....................................................................................................................4
2.1 Size of Market and Growth Rates....................................................................................5
2.2 Population........................................................................................................................6
2.3 Market Barriers and Market Drivers................................................................................6
3. Organizational Analysis.........................................................................................................8
3.1 Customer Audit and Buyer Behaviour.............................................................................9
3.2 4P’s...................................................................................................................................9
3.3 Competitor Analysis.........................................................................................................9
3.4 Competitor Advantage of your Product.........................................................................10
3.5 Positioning Map of Competitors....................................................................................11
4. Macro environment..............................................................................................................11
PESTEL Analysis.....................................................................................................................11
4.1 Porter five forces model.................................................................................................12
4.2 Value Chain....................................................................................................................13
4.3 BCG Matrix....................................................................................................................14
5. SWOT Analysis...................................................................................................................14
6. Conclusion............................................................................................................................15
7. References............................................................................................................................16
Appendix..................................................................................................................................19

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Appendice 1.........................................................................................................................19
Appendice 2.........................................................................................................................19

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Executive Summary
The report has helped in analysis of the international marketing strategy of Coles supermarket
while expanding their business in Hong Kong market. Furthermore, the different kinds of
analysis are required to be done which has helped the company in gaining competitive
advantage in the entire market. This has been seen that the internal and external
environmental analysis has helped the company in managing the differences effectively and
solve the same in such a manner in which this has helped Coles in gaining a strong market
share effectively.

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1. Introduction
The report helps in the analysis of the critical evaluation of the international
marketing opportunities along with the marketing analysis of the company in an effective
manner. The size of the market and the rate of growth is required to be analysed in an
effective manner which helps in discussing about the market barriers and market drivers of
the respective company.
The company which will be analysed in the report is Coles Supermarket which is
based in Australia and the company will be expanded in Hong Kong which is in Asia. The
marketing mix along with the competitor analysis of the company is required to be done in an
effective manner wherein the strengths and opportunities of the company is required to be
done in an appropriate manner to gain competitive advantage.
The positioning map along with situational analysis of the company is required to be
done along with various other theories and approaches such as Porter’s Five Forces and
SWOT along with Value Chain analysis which will be effective in nature to gain competitive
advantage.
2. Market Analysis
Market analysis is essential in nature as this helps in studying the attractiveness along
with dynamics of the special market with the special industry. The global environmental
analysis is required to be done in order to understand and analyse the different kinds of global
environmental analysis effectively. The global market analysis is required to be done for
Coles Supermarket which will help in managing the entry of the supermarket into the other
international markets in an effective manner (Al-Dmour et al., 2016).
The main aim of the Coles Supermarket in order to expand their market in Hong
Kong is to provide the different customers in the market with best quality products, values

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along with services. The circle for the success of Coles is such that wherein this has been able
to help Coles in moving forward in direction of their mission which is to serve their
customers with appropriate quality products and services and gain more competitive
advantage in the entire market (Ortega et al. 2015).
Figure 1: Circle for Success of Coles
(Source: )
2.1 Size of Market and Growth Rates
The market size of Coles Supermarket has raised from 0.8% points to 12.1% in the
entire Hong Kong market and this will help Coles in gaining competitive advantage.
Furthermore, in the year 2017, this has been analysed and seen that there is huge rise of about
28.8% of the entire market share in Hong Kong market and this will assist Coles in gaining
huge market share in comparison to the other competitors. For Coles, there will be moderate
growth in the entire Hong Kong market as the growth of the supermarket in Hong Kong is
less in nature.

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2.2 Population
The population in the Hong Kong country is 73.5 lakhs and the Coles can create a
unique position in the market of Hong Kong. In regards to the population, the Coles
supermarket can gain huge profit and market share in the country by targeting the different
individuals of different age groups who can be the buyers and this will increase the entire
profitability of the company effectively as well. Furthermore, Coles needs to analyze the
culture of Hong Kong which will assist them in focusing on preferences of the customers and
this will help in managing the sales of the company effectively as well.
2.3 Market Barriers and Market Drivers
Market Barriers
There are different market barriers which can be faced by Coles Supermarket while
expanding their market to the Hong Kong market. The different market barriers are as
follows:
 Tariff Barriers is the first issue which has to be faced by Coles Supermarket in which
this was seen that Coles can face and indicate various taxes and duties which are
being imposed on imports. Coles will find it difficult to promote the different products
as there are different tariff policies which restricts the international marketing
activities in a negative manner.
 Administrative Policies is the second issue which can be faced by Coles as it has been
seen both host and guest countries make the international marketing harder in nature.
There are different lengthy formalities in Hong Kong market along with in Australian
market which can create problems for Coles to expand their business.
 Political Instability is the other issue in which this has been seen that government in
Hong Kong have different philosophies and priorities for the international trades. The

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approach which is being used by Hong Kong government is restrictive and these
dominants the position of the international business operations as well.
 Place Constraints is the last barrier which is required to be analyzed in which this has
been seen that in Hong Kong, both export and import of the different products via sea
route is challenging and there are different risks such as segmenting the market in an
effective manner (Ellickson, 2016).
Market Drivers
There are different market drivers which is required to be analyzed by Coles while
entering into the Hong Kong market and this helps in maintaining the different kinds of
factors which has to be ascertained:
 Consideration of the local situation is the first driver which is required to be
ascertained by Coles in Hong Kong market as the culture of Australia and Hong Kong
is different from one another. In Hong Kong, the customers prefer the quality
products at lower prices unlike Australia and this can be a challenge for Coles (Choi,
2017).
 Financial Resources is the other factor which is required to be ascertained by Coles
in Hong Kong as the company with high equity capital are successful in abroad. The
reliable financial resources of Coles in Australian market will help them in being
successful in nature in the Hong Kong market.
 Personal Resources is the other factor which is required to be analyzed by Coles in
Hong Kong market. The personal resources include experienced and skilled staffs in
Hong Kong market can be difficult in nature to find such reliable staffs in the
respective market.

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3. Organizational Analysis
Coles Supermarket is Australian Supermarket which was founded in 1914 and the
company is operating in more than 800 locations. The number of employees working in the
organization includes 100000 and the key people of the company is John Durkan who is
managing director of Coles (Coles.com.au, 2018).
The current strategies which are used by Coles is to bring back the unhappy customers
by improving the quality of products and gain competitive advantage. The expertise of the
company is to provide the customers with quality products at a cheap rate and the
management of the company is strong (Kasiri et al., 2017).
John Durkan and Curtis Stone manage the different activities of Coles effectively by
introducing different kinds of services and products which will be efficient to gain
competitive in nature. The market share of the company in Australia is huge and there has
been more than 0.2% increase in the same (Huhman, Kelly & Edgar, 2017). The performance
of the company has become effective and the profitability which has been gained by the
company has helped them in managing the activities efficiently.

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Figure 2: Performance and Profitability of Coles
(Source: Cameron et al., 2016)
3.1 Customer Audit and Buyer Behaviour
Refer to Appendice 2
3.2 4P’s
Product- Coles helps in offering fresh food and groceries to customers along with
financial services. There are different kinds of product segments such as general
merchandise, liquor and financial services. The company tries to sell fashionable clothes to
the different customers in the market (Noyan & Şimşek, 2014).
Price- Coles is the cost-leader and this helps in offering the customers with different
kinds of products with the best quality and at lower rates as well. This helps the customers to
gain the quality products at a lower price (Izogo & Ogba, 2015).
Place- The Coles has more than 2300 outlets and with the help of the same, the
company tries to reach to the different customers with the different products at different
central location. Coles has tried to create better store network which has helped them in
targeting different customers (Lien, Cao & Zhou, 2017).
Promotion- The advertising strategy helps the company in becoming more popular
and this helps the supermarket in highlighting the different kinds of offers to attract
customers (Orel & Kara 2014).
3.3 Competitor Analysis
There are different competitors of Coles Supermarket which are Tesco, Aldi and
Walmart.

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Competitors USP
Walmart Strengths- Offers the customers with similar
kind of products however the promotional
strategy is effective and better than Coles
Weaknesses- Walmart pricing strategy is
not effective and is high in nature
Tesco Strengths- The everyday low pricing
strategy helps the company in becoming
more competitive in nature in comparison to
other supermarkets (Hegner et al., 2017)
Weaknesses- The quality is compromised at
times which is being sold to the customers
3.4 Competitor Advantage of your Product
The main unique selling proposition of the company Coles Supermarket is to bring
the different middle-class products and services into the working-class homes and this helps
the company in gaining competitive advantage in comparison to the other competitors in the
market (Dhar, 2015).

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3.5 Positioning Map of Competitors
Figure 3: Positioning Map
(Source: Hamari, Hanner & Koivisto, 2017)
With the help of the positioning map, this can be analysed that the Coles is in the low
price and brand product range in which this helps the company in managing the different
kinds of the needs of the customers (Mardani et al., 2015). Furthermore, the Tesco and there
are other competitors like Coles in which this has been seen that Coles is performing in an
effective manner. The market opportunities which are being adopted by Coles is attract more
customers.
4. Macro environment
PESTEL Analysis
Political Factors – The government creates a direct impact on supermarket industry
in regards to the trading hours and there are different kinds of other political instabilities such