Marketing Management Report: Woolworths Ice Break Coffee Strategies

This report provides a comprehensive analysis of Woolworths' marketing mix strategies, with a specific focus on their Ice Break coffee product. It delves into the application of the extended marketing mix elements, including product, price, place, promotion, processes, physical evidence, people, and partnerships. The report examines Woolworths' approach to each element, such as their market penetration pricing strategy, selective distribution, and Omni-channel promotional activities. It evaluates how these strategies contribute to the overall marketing objectives, particularly in targeting a wide customer base. The report also offers recommendations for optimizing Woolworths' marketing mix, suggesting improvements across various elements to enhance business opportunities and customer engagement. The analysis considers the company's position in the competitive Australian retail market, highlighting the importance of effective marketing in maintaining and expanding market share.

Running head: MARKETING MANAGEMENT
Marketing management
Name of the student
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Executive summary
The aim of this report is to discuss about the marketing mix strategies followed by Woolworths.
This report considered the extended marketing mix elements of Woolworths for critically
analyzing their effectiveness. This report also concluded a few recommendations for Woolworths
in view to their respective marketing mix elements. Number of recommended steps is discussed
that will further help Woolworths to enhance their business opportunities. Ice break coffee is
selected as the chosen product for the analysis in this report.

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Table of Contents
1. Introduction..................................................................................................................................3
1.1 Company................................................................................................................................3
1.2 Product portfolio....................................................................................................................4
1.3 Consumer...............................................................................................................................4
2. Analysis.......................................................................................................................................5
2.1 Product...................................................................................................................................5
2.2 Price.......................................................................................................................................6
2.3 Place.......................................................................................................................................7
2.4 Promotion..............................................................................................................................8
2.5 Processes................................................................................................................................9
2.6 Physical evidence.................................................................................................................10
2.7 People..................................................................................................................................10
2.8 Partnerships..........................................................................................................................11
3. Recommendations......................................................................................................................11
3.1 Product.................................................................................................................................11
3.2 Price.....................................................................................................................................12
3.3 Place.....................................................................................................................................12
3.4 Promotion............................................................................................................................12
3.5 Processes..............................................................................................................................13

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3.6 Physical evidence.................................................................................................................13
3.7 People..................................................................................................................................14
3.8 Partnerships..........................................................................................................................14
Conclusion.....................................................................................................................................14
Reference.......................................................................................................................................16

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1. Introduction
The current business scenario is much more dependent on the effective marketing
strategies. This is due to the reason that the competition is much higher in the current business
scenario and it is important for the business organizations to come up with effective and efficient
marketing strategies. The more effective will be the marketing strategies, the more will be the
probability for the business organizations to stay ahead in the competition (Cuadros &
Dominguez, 2014). It is important for the contemporary business organizations to cover all the
elements of the marketing mix in order to have holistic implementation of the marketing
activities.
This report will discuss about the initiation of the marketing mix strategies by
Woolworths. All the elements of the marketing mix will be evaluated along with identifying the
concepts they are following. In accordance to their current marketing mix strategies,
recommended 8Ps of marketing mix will also be discussed.
1.1 Company
Woolworths is one of the leading retail chains operating on the Australian region. They
are founded in 1924 and are one of the two big brands in the Australian retail scenario. It is
reported that currently they are having more than 1000 stores across Australia. Thus, the market
penetration for Woolworths in the Australian market is favorable (Dos Santos, Svensson &
Padin, 2013). The major competitor for them is Coles, which is having the market leadership
status in the Australian region. Moreover, in the recent time, there are number of newer and
smaller retail chains have entered in the Australian region. Thus, it is important for Woolworths
to have effective marketing mix strategies in place.

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1.2 Product portfolio
Woolworths is having huge and diverse product portfolio as their offerings. The core
offerings of Woolworths are mainly the grocery products including the fruits, vegetables and
meats. Apart from these, they also offer household products, beauty products and processed food
products. In the recent time, they also came up with their own privet label brand in different food
category (Arli et al., 2013). One of the most popular and innovative products they launched in
the recent time is the Ice break coffee. This product is considered as an innovative one due to the
reason that ice break coffee is targeting both the customers willing to have milk or coffee. This
report will discuss about the marketing mix strategies for ice break coffee.
1.3 Consumer
Woolworths operates in the mass market and thus they cater to huge and diversified
customer segments. This is due the reason that that they are in the retail business and thus
majority of the retail items are bought as necessary items rather than luxury items. Thus, the
customer segment for Woolworths is vast and wide with having different and varied
requirements (Valentine & Powers, 2013). Customers willing to have daily products under one
roof and at affordable price tag are the target customers for Woolworths. Therefore, the
demographical segmentation of the customer segment for Woolworths is also wide and vast due
to the fact that larger section of the customers across all age groups is being targeted.

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Customers from different age groups in Woolworths
2. Analysis
2.1 Product
Product is the first element of the marketing mix strategy. It denotes the core offerings by
the organization to the customers. Product is the element, which creates value for the customers
and which provide value to the organizations. In the case of Woolworths, ice beak coffee is
selected as the product. The major objective in offering this product is to cater to the gap in the
current market of health drinks. This is due to the reason that customers were having the options

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of milk or coffee or tea as their morning drink. By offering ice beak coffee, Woolworths targeted
both these customer segments at once. It also helped them in having distinctive offerings in the
market. Ice beak coffee can be termed as convenience product due to the reason that it is
affordably priced and are being bought for repeated times (Watson et al., 2016). Thus, the
strategy of Woolworths in targeting more customer segments in the beverage category go fit with
the introduction of ice beak coffee. Introduction of ice beak coffee is helping Woolworths to
have larger section of target customers along with creating a completely new product category.
2.2 Price
Price is the next element in the marketing mix strategy that denotes the value of the
product. In the case of the ice beak coffee, Woolworths initiated the strategy of market
penetration pricing strategy (Schmidt, Spann & Zeithammer, 2014). This due to the fact that the
objective of Woolworths is to cater to maximum number of customers and thus initiation of the
market penetration strategy is helping them to maximize the sales volume from the initial stage.
In addition, due to the fact that Woolworths operates in the mass market retail sector, market
penetration pricing strategy is more effective and fit with their overall strategic approach. One of
the major advantages that are being gained by Woolworths by initiating the market penetration
pricing strategy is managing enough potential customers and visibility for their new products.

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Marked price of Ice Break coffee
According to the above example, the price set by Woolworths for their Ice break coffee is
at par to the market price. Thus, offering distinctive products of ready to drink coffee and milk
blend in same price level of the conventional competitors enabling Woolworths to target the
same customer segments in the market (Spann, Fischer & Tellis, 2014). Thus, the strategy of
initiation of market penetration strategy is beneficial for them due to the reason that it helped
Woolworths to enhanced the reach and market exposure of the product in its initial stage.
2.3 Place
Place in the marketing mix strategy defines the distribution of the products across the
value chain to the customers. The more effective will be the distribution network, the more
effective will be the reach of the products to the target customers. Woolworths maintain selective
distribution strategy for the Ice break coffee (Shi, Liu & Petruzzi, 2013). This is due to the
reason that initiation of the selective distribution strategy helps them to sell their products only
through their retail outlets. Moreover, this also helps them to have the reach of the product to the

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potential customers through all their retail outlets across Australia. In addition, there are no
intermediaries present between Woolworths and the manufactures. This helps them to have less
cost involved in the sourcing process.
According to the strategy of Woolworths in relation to the market penetration of Ice
break coffee, selective distribution strategy along with having no intermediaries in the sourcing
process is well fitted. This is due to the reason that having no intermediaries in the process of
sourcing helps Woolworths in regulating the cost and offer the product in the market in lowest
possible price. On the other hand, initiation of the selective distribution strategy also helps
Woolworths to maintain the exclusivity of the ice break coffee. This helps them to compete
effectively with the conventional products in the market. It can be concluded as a good idea due
to the reason that to have successful market opportunities for the newly launched customer
products, it is important to have some sort of distinctiveness along with having favorable pricing
(Martin-Herran & Taboubi, 2015). Thus, Woolworths through their selective distribution
strategy is being able to meet both the criterion.
2.4 Promotion
Promotion refers to the marketing activities being initiated in order to promote the new
products in the market and make the customers aware about the products. The more effective
will be promotional strategy, the more market reach will be gained by the offerings among the
customers. Woolworths initiates Omni Channel marketing and promotional strategies for all their
offerings including the ice break coffee (Verhoef, Kannan & Inman, 2015). With the help of the
Omni Chanel promotional strategy, they are being able to cater to the different customer
segments. Some of their promotional strategies include offering seasonal discounts and rebates

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on the products and product bundling strategy. Initiation of the product bundling strategy also
helps Woolworths to offer the ice break coffee along with some other related products.
On the other hand, online promotional activities for Woolworths include social media
marketing for their different products. In case of the ice break coffee, the discounts and offers
given are promoted through the use of the social media. The core objective of Woolworths in
having the maximum market reaches for ice break coffee is well fitted by their promotional
activities (Ashley & Tuten, 2015). This is due to the reason that initiation of the seasonal
discounts and offers further reduce the price of the products and thus the level of target customer
segments get further increased. On the other hand, initiation of the extensive marketing and
promotional activities also enable them to reach out to maximum number of potential customers.
This is well related and associated with the strategy of market penetration of Woolworths.
2.5 Processes
Process refers to the service delivery approach of the organization in delivering the value
for the customers. Thus, effective service delivery process in the organization will help to
enhance the value for the customers along with enhancing their level of satisfaction. In the case
of Woolworths, they are having both online and offline mode of payments and shopping
conveniences (Villamagna, Angermeier & Bennett, 2013). For instances, customers are having
the options to buy ice break coffee from Woolworth through their online marketplace as well as
through their retail stores. On the other hand, in case of the offline service delivery, customers
are having the options of online payment system. This helps in having lesser queue in the store.
Woolworths are also having customer help executives in their retail stores that help the
customers in having the brief idea about the product.

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In accordance to the market penetration strategy of Woolworths, offering different types
of the payment options along with having both online and offline mode is helping in reaching
and targeting the maximum number of customers. Thus, this strategy is also well fitted in line to
the overall marketing strategy of Woolworths.
2.6 Physical evidence
Physical evidence refers to the physical value including the aesthetic value and touch and
feel that are gained by the customer from having the access to the products. Ice break coffee is
having different sizes of pet bottle. All the bottles are designed aesthetically along with having
the color that denotes the content (Khan, 2014). Availability of different sizes of ice break coffee
helps Woolworths to target different requirements of the customers. In accordance to the market
penetration strategy of Woolworths, the physical evidence is well fitted due to the reason that
availability of different sizes of pet bottles is helping in targeting customers with different
requirement level.
2.7 People
People refer to the internal stakeholders involved in the service delivery of the offerings
to the customers. Effectiveness and efficiency of the people determines the quality of the service
delivery. Woolworths is having well skilled and trained employees in place and in different
service levels (Elnaga & Imran, 2013). This helps them to enhance the value creation process for
the customers. For instance, customers are having the option to seek the help of the sales
executives in having the brief about ice break coffee prior to their buying decision and they will
be given services by the trained employees in case of any grievances. Thus, effective access to
the human resources is helping Woolworths to provide favorable service to the customers.