Strategic Marketing Analysis and Recommendations for Kogan Pantry

This report provides a strategic marketing analysis of Kogan Pantry and Alcohol, an Australian retail brand operating in the pantry and alcohol sectors. The report begins with an introduction to strategic marketing and an overview of Kogan Pantry's background, including its founding in 2006 and revenue in 2019. The main body includes a PESTLE analysis of the external environment, examining political, economic, social, technological, legal, and environmental factors impacting the company. Porter's Five Forces are used to analyze the competitive landscape. A company analysis is performed, including Porter's Value Chain. A SWOT analysis is conducted to evaluate the company's strengths, weaknesses, opportunities, and threats, followed by a TOWS analysis. Finally, the report provides recommendations for Kogan Pantry to improve its strategic marketing efforts, including recommendations to address weaknesses and threats and leverage strengths and opportunities. The report aims to provide insights into how Kogan Pantry can enhance its market position and achieve its business objectives.

STRATEGIC MARKETING

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Part 1 Background:......................................................................................................................3
Part 2 External environment analysis..........................................................................................3
Part 3 Company analysis.............................................................................................................5
Part 4 SWOT analysis..................................................................................................................7
Part 5 Recommendation:..............................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Strategic marketing refers to the marketing process in which the company use to maintain
new strategies to improve there marketing process and develop the business in wider context and
improve working of Kogan Pantry and Alcohol. Kogan Pantry and Alcohol works in pantry and
retail sector and they are providing the retail services from 2006 and keep on growing with the
quality services and providing the variety of range product to the audience. The report will
explain all the process of strategic management and company background, external environment
of company.
MAIN BODY
Part 1 Background:
Kogan Pantry and Alcohol is one of the Australia brands which is working in the retail
sector and providing all the pantry items and alcohol to their customers. They are providing
product and services related to the pantry and alcohol sectors in their stores and helping in giving
the best services ot the audience in market within such huge competition. The net worth of the
company revenue is total of $438.7 million in 2019 (Samani and et.al., 2017). The headquarter
of the company is in Melbourne, Victoria, Australia. The company was founded in 2006 and the
founder of the company is Ruslan Kogan. The company works in online retail, consumers and
electronics, travel, mobile etc.
Part 2 External environment analysis
Pestle Analysis is conducted for the determination of external macro environmental factors that
impact its competition, profitability, turnover and situation in the market (Perera, 2017).
Political factors: The political stability of country of operation, i.e. Australia impacts the
profitability of e-commerce site Kogan pantry as retailing involves systematic risks of supply
chain, taxes and quotas which are influenced by the policies present in Australia. The level of
corruption and trade regulations, tariffs, price regulations can influence the company in
maintaining its position in the market.
Economic factors: Macro economic factors like savings rate, inflation rate, foreign
exchange, the aggregate demand and supply, income level of consumers and labour costs directly
affect the Kogan pantry. If there is high cost of labour, the delivery system gets impacted and the
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company is unable to give discounts. If the income level of consumers decreases, the sales drop
low (Wu and et.al., 2020).
Social factors: The demographics, trends, preferences, behaviour of consumers directly
influence the target market for Kogan pantry. If the consumers don’t prefer online market and
instead prefer bricks and mortar store for grocery shopping, the sales of Kogan pantry will be
affected. More young people tend to buy from e-stores while elder generations prefers traditional
way of purchasing groceries (Godrich and et.al., 2020).
Technological factors: The RFID technology incorporated in the store of Kogan pantry
can significantly improve its in-store and warehouse operation, leading to customer satisfaction.
The rate of technological diffusion also impacts the product offerings, value chain structure,
supply chain and logistics infrastructure which is the core business component of the company.
New technologies can help the company in saving costs.
Legal Factors: The legalities in terms of employee legislation, food health and safety
regulations, discrimination laws, intellectual property rights, data protection laws, consumer
protection laws Anti-trust laws of retailing industry can influence Kogan pantry and lead to hefty
fines and law suits in cases of non-adherence. There the company has to comply with all
regulations for the smooth functioning of the operations.
Environmental factors: The emergence of eco-friendly regulations for conduction of
businesses and pressures for reducing the carbon footprint and pollution created in the business
processes have influenced the functioning of Kogan pantry. The company has to indulge in
environment friendly packaging, investment in recycling, waste management, positive attitude
towards renewable energy usage for business procedures (Teeter and Sandberg, 2017).
Porters five forces will be used for analysing the competition that Kogan pantry faces across
multiple areas. It will evaluate the sustainable competitive advantages that are present for the
company and development of strategic position in the retail market.
Threat of new entrants: The entry of new companies in retailing of general merchandise
and grocery can bring innovative approaches and low pricing strategies which can increase the
pressure on Kogan pantry for reducing its costs and offer new value propositions or value-added
services and discounts. Presently, in Australia, many new emerging online retail businesses are
gaining market share, therefore this threat can be termed moderate. The only way to counter this
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threat is development of economies of scale and indulging in innovation (ÖNEREN, ARAR and
YURDAKUL, 2017).
Bargaining power of suppliers: Retail industry depends heavily upon suppliers and
outside vendors who provide wholesale products. If the suppliers have advantages or more
negotiating power, they can increase the pressure on Kogan pantry and decrease its profit
margins. This level of threat can be termed moderate. The ways to counter it are development of
efficient supply chain infrastructure and have relationships with multiple trustworthy suppliers.
Bargaining power of buyers: The availability of multiple options tends to increase the
dominancy of customers in the market. They prefer offerings and discounts and want to pay
minimum prices, therefore can easily shift to businesses offering those. This level of threat for
Kogan pantry can be termed as high due to its high rivalry in the industry and presence of major
e-commerce sites. To counter this, Kogan pantry should build a large customer base, do intensive
marketing, innovate new products, gain uniqueness in offerings (Lok, 2017).
Threats of substitution: Substitute products or services for Kogan pantry are bricks and
mortar stores, which follow a different consumer base. This threat can be termed low, as the
existing consumers might not be able to completely shift to physical store for all products that
are available online (Ahmad, 2019).
Industrial rivalry: The overall industrial competitive situation for Kogan pantry is high
as there are major e-sellers like Amazon, Walmart and other local websites likes Coles and
Woolies who provide best online grocery services for Australian people. This threat can be
termed moderate as the current consumer base of Kogan pantry is high but needs strategies like
collaboration, sustainable differentiation, building up economies of scale to counter the existing
competition (Jin, 2017).
Part 3 Company analysis
In this dynamic and modern world, Kogan Pantry & Alcohol is a very reputed brand in
Australia, and top-level management of this venture fully focuses on more and more expanding
its business operations in marker place. Basically, currently expansion strategy of Kogan Pantry
& Alcohol company is very excellent, and that’s why this is company’s strength. On the other
side, each organisation always faces many conflicts in workplace, in which upper management
of this company is not able to systematically handle these all conflicts just because of own weak
conflict management strategy, so that this is a weakness of company.
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PORTER’S VALUE CHAIN
Porter’s value chain is basically a very productive combination of various systems which
has used an organisation for gaining huge profit and money. It includes the process of a company
from began to finish (Razumova, 2018). It will show the primary and secondary activities of
Kogan Pantry & Alcohol.
Primary Activities
Inbound logistics: The company has maintained an effective relationship with its suppliers by
using contract law in order to receive raw-material always on time.
Operations: It uses different operations management techniques, like; TQM, JIT and lean
productions to maintain effectiveness in its daily operations.
Outbound activities: It has a very productive supply chain that helps to venture for distributing
and delivering its developed product and services to customers on time.
Marketing and sales: Kogan Pantry & Alcohol mostly depends on modern marketing and sales
strategies for effectively promoting its brand at the large scale in market place, like; digital
marketing, e-sales etc.
Services: Company focuses on providing quality services to customers in order to odder them
very positive experience and satisfaction.
Secondary Activities
Procurement: Kogan Pantry & Alcohol invests huge fund in order to acquire lots of resources,
raw-material etc. for production process. The main objective of company behind this process is
to gaining better output in workplace.
Human resource management: Currently it has an effective work force of many skilled and
talented employees just because of its effective human resource management practices.
Infrastructure: Top-level management at Kogan Pantry & Alcohol mostly focuses on
developing such infrastructure which will provide a safe and secure work culture to all
employees. Basically, infrastructure which has effective architecture and security.
Technological development: Top-level management of Kogan Pantry & Alcohol believes in
investing huge fund in the development of technologies also in the workplace (Pokumensah and
et.al., 2018). This is very necessary to improve organisational performance and productivity.
Evaluation
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On the basis of Porter’s value chain application, the Kogan Pantry & Alcohol company is
on its progressive path, that growing day to day in market place. Last year, the company was
generated A$438.7 million of revenue, which is really a great thing about company. It is taking
huge advantages from own strength of effective business expansion strategy. On the other side,
the company have to focus on developing weakness of poor conflict management strategy. After
analysing these all-mentioned factors, Kogan Pantry & Alcohol will gain huge profit margins
and competitive advantage in market place.
Part 4 SWOT analysis
Strength- The biggest strength of company is
it has efficient distribution network that helps
in reaaching majority of its potential market by
which company constantly focuses on product
innovation where it also accounts to realiable
suppliers of raw materials which enables
company to face any issue that comes in way
of supply chain. Company employes skilled
workforce who are constantly updated with
training and development programs which as a
result help in building expertise to enter new
markets and making grow business in terms of
generating higher revenues. Company
strengths lies in its products which helps in
deriving customer satisfaction.
Weakness- It refrs to areas where
improvements need to be made as in certain
case company is not being able to tackle
challenges presented by its competitors which
results in loosing market share for company. It
has high rate of attrition in its workforce as
compared to its competitors where it has to
spend huge amount of money to train and
develop its employees as compared to its
competitors. Marketing of company is not
efficient, although it accounts to high sales
volume but its USP and positioning is not yet
clearly defined which may affect target
segment of company.
Opportunities- It can capture new customers
from online platform as it has subsequently
invested huge amount of money in online
platform. By coming up with strategies to
expand into new market it leads to dilution of
competitive advantage which will help kogans
Threats- New technology developed by its
competitors can turn out to be huge threat for
company in long term process. It also account
to threats where growing strengths of local
distributors are considered heavily as they are
paid with high margins by company
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to build competitiveness as compared to its
competitors. The company should also come
uo with new technology which will enables
firm to maintain loyal customers and help in
deriving value proposition for same.
competitors which results in diminishing
relationship (Kogan.Com Ltd SWOT Analysis /
Matrix,2019).
TOWS analysis
Strength /opportunities- This involves internal strength of company to take advantage of
opportunity which states that it employees who are highly trained and serves as strength to
company can take advantage of oppporunity to utilise technology in efficient mannner to attract
customers.
Strength/ threats – This involves using strengths to minimise weakness where its strength such
as strong distribution channnel helps in tackling challenges possessed by its competitors and
helps in removing threat of satisfying its distributors with high margin and building relationship.
Weakness/opportunities- It involves improving on weakness by taking full advantage of
opportunities where it states that marketing of company can be improved by taking advantage of
opportunities such technology which provides edge for company to win in marketplace.
Weakness/threats- It refers to elimination of weakness to avoid threats in company which can
be understood as company not able to meet challenges possessed by new entrant when
understand same helps in fighting with threat that helps in meeting with changing behaviour of
consumer towards online shopping and protecting same with existing physical infrastructure to
support its suuply chain.
Appropriate generic strategy for Kogan pantry is
Cost leadership – It involves gaining competitive advantage by lowering down cost which
kogan uses in various consumer markets. This helps to expand share in market by targeting
middle class which makes huge proposition of consumer market where it major focus shift on
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affordability by its consumers which lowers down production cost & helps in maximising supply
chain efficiency .
Differentiation - Kogan's uses differentiation strategy along with cost leadership to achieve
growth where it emphasis to expand market base by providing unique features in product by
embedding continuos innovation which helps in creating position for its product and to stand out
with that of its competitors.
Focus- It adpopts to focus strategy which is both in terms of low cost and offering best value
where by its low cost it serves the need of target segment that is middle class and by providing
best value in terms of design, taste, size and many other things in its products (Michael Porter
Generic Strategies.2018).
Part 5 Recommendation:
Recommendation on the 7ps of marketing mix to Kogan Pantry and alcohol are as follows: -
Product: Product refer to the service and products company is offering to its customer in terms
of services. Kogan Pantry and Alcohol are producing a lot of product and they are offering
product to their customer in huge number include all the electronic, pantry and alcohol product.
But they can expand the business in new ways and also provide the customer new product
including the heavy products and natural products as the people and trend of market is shifting to
green revolution (Ndofirepi, Farinloye and Mogaji, 2020). They also need to expand business in
producing their own brand product and they need to develop the product range to al type of
people to reach the best of business.
Price: Price recommendations are that the company need to make strategies of low price for
there product and services as they are having a bit of high price in their product. The Kogan
Pantry and Alcohol need to make strategies so that they can attract more customer and can reach
to more and wider number of people in business. Price is one of the important factors in business
which can give a great impact in business growth and success.
Place: Place need to be developed and they need to make new ways in developing the business
in new areas and expansion of business so that Kogan Pantry and Alcohol gets new market and
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new places to provide and sale service to the people and help can expand the business in wider
context.
Promotion: promotional activities need to be developed by the marketing team of Kogan Pantry
and Alcohol as they need to cover more wider audience to improve the business and developed
the growth of company in providing a wider advertisement to people and awarding them about
the company product and services.
People: people and employees of the company need to be trained and developed so that they can
provide better services to there customers. The Kogan Pantry and Alcohol need to provide more
better services to their employees and also need to train and provide a particular development
program for there people so that they can advance the business in profit (Ravangard, Khodadad
and Bastani, 2020).
Physical environment: Physical environment refer to the location and physical structure of the
Kogan Pantry and Alcohol which provide a perception of the people after looking at the
company for the first time and they need to invest a lot of money in making the structure and
process of working in a better way so that all the audience can make the utilisation of services in
better ways.
Process: process of working in Kogan Pantry and Alcohol is one of the major factor they are
lacking in as they are trying hard to developed the process of working in the company and they
are developing the process in making of providing a better payment method and fast service in
product delivery and fast bills so that they does not need to wait in lines.
CONCLUSION
The report concluded that working in business need a great marketing strategies and business
need strategies so that they can improve the working of business and develop the business
profitability and growth. The report further concludes the pestle and porter five forces in which
they are providing the external analysis and internal analysis of environment of business which
directly affect the business in its working and goals.
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REFERENCES
Books and Journals
Ahmad, S.M., 2019. Market Research: Demand & Business Models for an Online Grocery
Shopping service in Porvoo.
Cloutman, N., 2017. Consumers beginning to embrace the convenience of online grocery
shopping.
Godrich, S., and et.al., 2020. Australian consumer perceptions of regionally grown fruits and
vegetables: Importance, enablers, and barriers. International Journal of Environmental
Research and Public Health, 17(1), p.63.
Jin, T., 2017. Post-entry operation of foreign firms in a host country: the role of mutual
forbearance and organisational learning in their product segment entry choices.
Lok, K.H., 2017. Differentiation strategy: how to create a competitive advantage in online
groceries.
Ndofirepi, E., Farinloye, T. and Mogaji, E., 2020. Marketing mix in a heterogenous higher
education market: A case of Africa.
ÖNEREN, M., ARAR, T. and YURDAKUL, G., 2017. Developing competitive strategies based
on SWOT analysis in Porter’s five forces model by DANP. Journal Of Business
Research-Turk, 9(2), pp.511-528.
Perera, R., 2017. The PESTLE analysis. Nerdynaut.
Pokumensah, J. B., and et.al., 2018. Use of Public Relations Events as Strategic Marketing Tool.
Ravangard, R., Khodadad, A. and Bastani, P., 2020. How marketing mix (7Ps) affect the
patients’ selection of a hospital: experience of a low-income country. Journal of the
Egyptian Public Health Association, 95(1), pp.1-8.
Razumova, S. V., 2018. Strategic Marketing: syllabus for Master's Degree Program in the
Specialization 1-26 81 05" Marketing".
Samani and et.al., 2017. INVESTIGATING THE RELATIONSHIP BETWEEN MARKETING
MIX ELEMENTS (7PS) AND IRANIAN EFL LEARNERS’CHOICE OF
LANGUGAE INSTITUTIONS. European Journal of Foreign Language Teaching.
Teeter, P. and Sandberg, J., 2017. Constraining or enabling green capability development? How
policy uncertainty affects organizational responses to flexible environmental
regulations. British Journal of Management, 28(4), pp.649-665.
Wu, J., and et.al., 2020. The economic policy uncertainty and firm investment in
Australia. Applied Economics, pp.1-25.
Online
Kogan.Com Ltd SWOT Analysis / Matrix.2019 [Online]. Available
through<http://fernfortuniversity.com/term-papers/swot/nyse/6099-kogan-com-
ltd.php>.
Michael Porter Generic Strategies.2018[Online]. Available
through<https://www.essay48.com/8313-Kogan-Com-Ltd-Porters-Generic-Strategies>.
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