Success Strategies for Woolworths International Marketing Analysis

This report presents a comprehensive analysis of Woolworths' international marketing strategies. It begins with a PESTLE analysis to examine the differences between domestic and international marketing environments. The report then assesses the contribution of international marketing to the world economy, using Woolworths as a case study. The application of the Uppsala School of Thought is analyzed, along with the benefits and challenges of Woolworths' chosen market entry mode. Furthermore, the report identifies and critically analyzes two key international marketing trends impacting Woolworths and explores emerging marketing opportunities in the Asia Pacific region. The report utilizes academic literature to support its arguments and provides a detailed overview of Woolworths' international operations and strategic considerations.

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Name of the Student
Name of the University
Author Note
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Table of Contents
Task 1.............................................................................................................................2
a) Critical analysis of the differences between domestic and international marketing
environments of the selected organisation using PESTLE analysis......................................2
b) Critical analysis of the contribution of international marketing to the world
economy. Analysis will include two contributing factors of Woolworths.............................3
Task 2.............................................................................................................................4
a) Application and critical analysis of the use of The Uppsala School of Thought as
an internationalisation theory. Analysis of the internationalisation process of Woolworths.4
b) Critical analysis of the benefits and challenges faced by Woolworths based on
the mode of entry into international markets.........................................................................5
Task 3.............................................................................................................................6
Critical analysis of two international marketing trends that can influence
Woolworths based on the case study provided......................................................................6
Task 4.............................................................................................................................7
Critical analysis of two emerging marketing opportunities in the Asia Pacific region
that can be beneficial for Woolworths...................................................................................7
References......................................................................................................................9
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Task 1
a) Critical analysis of the differences between domestic and international marketing
environments of the selected organisation using PESTLE analysis
Woolworths is a multinational grocery or supermarket based store that operates under
the Woolworths Group. The organization is mainly known for selling of the groceries, DVDs,
magazines, baby and pet supplies, beauty and health based products. Currently Woolworths is
operating more around 1000 stores in various parts of Australia. Woolworths had been
established in the year 1924 and the company has gained more than 80% of entire retail
market of Australia along with its major competitor Coles (Woolworths.com.au. 2019). The
international and domestic marketing based environment of Woolworths can be analysed
with the help of PESTEL framework in the following way,
Political factors – The regulations and government policies based on the agricultural
products have an impact on the decisions that have been made by the farmers related to
maintenance of agricultural products. The incentives and policies of the government have an
impact on the sales of dairy products and Woolworths has to comply with regulations of the
Australian government in order to maintain its international and domestic operations
(Aguinis, Edwards & Bradley, 2017).
Economic factors – The retail industry is influenced by levels of purchasing power of
the economy of Australia. Retail and grocery based products are considered to be important
for the daily lives of individuals. The increase in levels of purchasing power is considered to
be a key aspect that can have an influence on the revenues of Woolworths. The levels of cost
competitiveness have led to the growth in number of foreign organizations that are aiming at
entering the country. The economic condition of New Zealand has also been able to provide
growth opportunities to Woolworths (Bai, Holmström Lind & Johanson, 2016).
Social factors –Attitudes of the health conscious customers in New Zealand towards
obesity is also considered to be an important factor that can influence the perceptions related
to dairy and food based products that are offered to them. The levels of social stratification
have an impact on the products which the firm is able to provide to the customers in Australia
(Buckley, 2016).
Technological factors – Technology is able to enhance the capability of retail product
manufacturers so that they are the market various types of products along with the variants of
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the products that are already available. Technological advances are now embedded in various
farming practices that are a part of the retail industry. Woolworths has also implemented
many different types of technological practices in order to maintain the operations and
manufacturing process as well (Beamish & Lupton, 2016).
Environmental factors – The organizations in retail industry are highly dependent on
availability of local growers in New Zealand. Changes in the climate is also considered to be
an important factor that can influence the farming practices in different countries. The
products lines that are offered by Woolworths are influenced hugely by the climate of New
Zealand and the other countries as well. The climate changes also have an impact on the
farming activities in Australia (Brannen, Piekkari & Tietze, 2017).
Legal factors – The legal environment in New Zealand is mainly influenced by the
regulations that are developed by the government. Corruption rates in the society have been
reduced in the last few years due to steps that have been taken by the government of the
country. The international expansion of Woolworths from Australia will also be affected in a
huge way by the legal condition that is developed in the home country (Cascio & Boudreau,
2016).
Domestic operations of Woolworths are supported by the regulations that have been
develop by the government of Australia and the population as well. The social environment
also has major influence on the firm and the product line that has been developed as well. On
the other hand, international operations will be affected by the business environment that is
provided to Woolworths in New Zealand and the various external factors that are a part of the
country (Frow, Nenonen, Payne & Storbacka, 2015).
b) Critical analysis of the contribution of international marketing to the world economy.
Analysis will include two contributing factors of Woolworths
As discussed by Helfat and Martin (2015), international marketing of the global
organizations has an impact on the economic conditions of various countries in which they
operate. The global business environment is influenced in a huge manner by the operations of
international organizations and the policies that are developed by them as well. The firms in
this case collect information related to different macro environment based factors and thereby
develop the product line that can be offered to customers. The contribution that is provided
by global organizations are based on revenues that are earned by them on a global basis (Hitt,
Ireland & Hoskisson, 2016).
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Woolworths is a multinational organization that functions in the retail industry and
has offered a wide portfolio of products to customers in diverse parts of the world. The two
major contributing factors related to the operations of Woolworths in the industry are as
follows,
 Woolworths is able to offer major contribution to the growth of local farmers
and growers in its domestic and international operations as well. The
operations of Woolworths are able to play a key part in the improvement of
the economic condition of countries in which the company operates (Hitt, Li
& Xu, 2016).
 Woolworths is a part of the retail sector of Australia and the industry has been
able to earn more than 101 Billion Dollars in the year 2016. Woolworths has
been ranked 26th on a global basis. Woolworths will be able to provide high
levels of contribution for improvement of dairy sector of the other countries in
which it operates (Woolworths.com.au. 2019).
Task 2
a) Application and critical analysis of the use of The Uppsala School of Thought as an
internationalisation theory. Analysis of the internationalisation process of Woolworths
According to Hohenthal, Johanson and Johanson (2015), the Uppsala
Internationalization model is considered to be a dynamic theory that has been able to explain
internationalization activities that are performed by the organizations in modern business
environment. The proper internationalization of the organizations is a major activity that is
performed by firms in the new era of globalization. The model was developed by taking into
consideration various issues that are related to cultural differences in a different country
which can be faced by the firms. The internationalization based on this process is thereby
related to different steps that can be taken by the firms before they aim at establishing its
operations in a foreign market (Lindstrand & Hånell, 2017). The steps that can be
implemented by organizations as a part of their internationalization process are,
 Step 1 – No regular export based activities.
 Step 2 – Exporting via the independent representatives.
 Step 3 – Creating the foreign sales based subsidiary.
 Step 4 – Manufacturing and foreign production (Neelankavil, 2015).
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Woolworths has also implemented the Uppsala model of internationalization in order
to start its operations in a foreign market or country like New Zealand. The organization has
entered the market with the help of acquisition of the Progressive Enterprises that is a New
Zealand based firm. The organization is aiming at understanding the new market area before
taking the decision of starting the manufacturing process. The development of acquisition
based operations can help the firm to understand demands and needs of the customers and
offering the suitable products to them as well (Prajogo, 2016).
b) Critical analysis of the benefits and challenges faced by Woolworths based on the
mode of entry into international markets
Woolworths has implemented joint venture and acquisition as its market entry
strategy in order to start its operations in the other countries. Joint venture can be defined as
the business arrangement that involves two or more than two parties in order to develop an
agreement based on the usage of the resources and maintaining the operations as well (Wolf
& Floyd, 2017). The major benefits that are provided to Woolworths by development of joint
venture are as follows,
 The management of Woolworths is able to gain major insights based on the
foreign market and the employees will also achieve new expertise.
 The company has been successful in the development of better partnership
related to the methods by which resources of a firm can be used.
 The partners of Woolworths who are a part of the joint venture also have to
face similar types of risks based on the amounts of risks and costs that it faces.
 The levels of flexibility that are gained by Woolworths in case of joint venture
development are more.
 The investment based on advertisements and usage of resources of
Woolworths are also quite low in the process of joint venture development
(Zander, McDougall-Covin & Rose, 2015).
The risks that are faced by Woolworths based on development of joint ventures are as
follows,
 Woolworths has to face major liability of the operations of its partner in New
Zealand as a part of the joint venture agreement that is developed by the
organization.
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 The time period of joint venture based agreements of organizations is
considered to be quite limited and Woolworths will need to make changes in
the agreement after a certain period of time.
 The development of joint venture can raise huge number of conflicts among
the organizations that are a part of agreement. The employees of Woolworths
and its partner in New Zealand can face major conflicts in this case (Zhang &
Guttormsen, 2016).
Task 3
Critical analysis of two international marketing trends that can influence Woolworths
based on the case study provided
According to Katsikeas (2018), the international market operations have started
gaining immense levels of importance in the last few years and have an impact on the
performance levels of the organizations. The ongoing operations of foreign market have been
able to play a key part in enhancing the presence and revenue of the firms operating in
various industries. Increased globalization has further led to the improvement of international
activities that are performed by organizations. Woolworths has also been influenced in a huge
way by the international marketing operations that are performed by the firm (Bai,
Holmström Lind & Johanson, 2016). Two major international marketing trends that have an
influence on the operations of Woolworths are as follows,
Global engagement of customers – This is considered to be a major trend that is able
to influence the processes and the profitability of Woolworths. The firm aim at engaging the
customers in various activities, processes and the value creation process as well. The
economic and cultural aspects of various countries have to be understood by Woolworths in
order to enhance the presence of the firm in different parts of the world (Woolworths.com.au.
2019). The engagement of customers in operations of Woolworths on a global level is mainly
based on the differences that exist in the cultural factors. Behaviour of the customers is
influenced in a huge way by the changes in culture that take place between the two countries.
Woolworths has always placed the customers at its top priority and the firm has aimed at
increasing its presence in various countries with the support that is provided by the
engagement of customers in a proper way (Brannen, Piekkari & Tietze, 2017).
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Marketing capabilities in the international marketing – The marketing capabilities that
have been developed by organizations in the global business environment are able to
influence the expansion and operations in a foreign market. The comparison of marketing
capabilities of the firm on a domestic and international basis is based on the methods by
which it is able to maintain its place in the industry. Woolworths has been able to develop its
marketing capabilities in Australia in order to reach the customers and increasing awareness
based on the products as well (Aguinis, Edwards & Bradley, 2017). The company has been
using the traditional and digital marketing capabilities in order to enhance perception of
products and services that are offered by Woolworths. Woolworths has also gained the
insights based on the degrees of the international operations and the effective marketing
capabilities as well. The differences between the retail industry of Australia and New Zealand
have an impact on the organization and its operations that are developed as well. The
marketing and promotional activities in New Zealand are also based on relationships that
Woolworths aims at developing with the customers (Buckley, 2016).
Task 4
Critical analysis of two emerging marketing opportunities in the Asia Pacific region
that can be beneficial for Woolworths
The Asian markets have been able to drive the growth of international retail
organizations that have origins in different countries of the world. The growth of automation
in the industry has also led to the enhancement of e-commerce based transactions. The Asian
countries have become pioneers in the operations of e-commerce and m-commerce based
firms as well. Woolworths will also be provided by different countries in the Asia Pacific
region including, India, China and Southeast Asia in order to improve its revenues and
presence in various countries as well. The high levels of population in countries belonging to
this region have been able to provide huge customer base to Woolworths as well (Frow,
Nenonen, Payne & Storbacka, 2015). The two major emerging marketing based opportunities
that are provided to Woolworths in order to start its operations in the Asia Pacific region are
as follows,
Competitiveness and strategic position – The strategic positioning has to be decided
by Woolworths before the organization aims at making investments in the Asia Pacific
region. The company can also aim at enhancing its position in the countries belonging to this
region with the help of internet or e-commerce based platforms as well. The entry of huge
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number of organizations in the retail industry of countries like China and India has been able
to enhance the levels of competitiveness in a huge manner. Woolworths needs to gain
extensive levels of knowledge based on the needs of consumers in the market and the
implementation of various local practices as well (Cascio & Boudreau, 2016).
Usage of social networks – The success that can be gained by Woolworths in the
Asian market is based on the communication that is developed by the organization with the
customers. The social networks have been able to play a key part in the methods by which
Woolworths can understand the customers and develop relationships with them as well. The
social networks can play a key part in increasing related to the products and services offered
by Woolworths among the customers who are a part of the retail industry of Asian market
(Woolworths.com.au. 2019). The customers can also share their experiences based on
products of the firm with the support that is offered by the social media platforms. The
company will be able to use the social media platforms in order to influence the consumers
and their choices as well. Woolworths can thereby use social networks with the aim of
developing its customer base in the retail industry within less amount of time (Brannen,
Piekkari & Tietze, 2017).
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