Comparative Analysis: Lidl & ASDA - Context, Porter's 5 Forces Model

This report provides a comparative analysis of Lidl and ASDA, two major players in the UK retail market. Lidl employs a cost leadership strategy targeting lower-income consumers with budget-friendly grocery products, while ASDA focuses on differentiation, offering higher-quality and a wider range of products, including vegetarian, vegan, and organic options, appealing to a broader customer base. The context analysis examines political, economic, social, technological, legal, and environmental factors impacting both retailers. Porter's 5 Forces analysis assesses the competitive intensity, threat of new entrants and substitutes, and the bargaining power of suppliers and buyers for each company. The report also discusses targeting and positioning strategies, SWOT analysis, and provides recommendations for enhancing marketing strategies and overall efficiency, including influencer promotions, customer experience management, target market evaluation, and creative content marketing. The conclusion summarizes the key findings and emphasizes the importance of strategic marketing in maintaining a competitive edge.

Marketing

Executive Summary
The following report will examine the context analysis and Porter's Forces analysis of both retail
management name Lidl and ASDA. It involves the management of Lidl uses cost leadership
strategy that concentrates on offering lower-priced grocery goods and it will directly targets on
lower income based users. On the other hand, ASDA uses differentiation leadership strategy that
provide high quality goods for high cost. It also offers wider manner of the products in terms of
vegetarian, vegan and as well as organic goods that are rapidly exist effective position in the
field of UK marketplace.

Table of Contents
Executive Summary.........................................................................................................................2
INTRODUCTION ..........................................................................................................................4
TASK...............................................................................................................................................4
Context Analysis for Lidl.......................................................................................................4
Context Analysis for ASDA...................................................................................................5
Porter’s 5 Forces Analysis of Lidl..........................................................................................5
Porter’s 5 Forces Analysis of ASDA......................................................................................6
Targeting and Positioning.......................................................................................................6
SWOT analysis and recommendations...................................................................................7
Recommendations..................................................................................................................8
CONCLUSION .............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Marketing is termed as activities of the management that are related with selling and buying of
good and services. It involves buying, purchasing of the goods at the area of market place.
Marketing is the process through which the company and employees will determine their needs
and wants and will proceed their dealing in creating and exchanging the values in order to satisfy
their requirements (Bergkvist, and Eisend, 2021). The following report covers the management
of Lidl. It is a German international discount retailer series that functions over 11,000 outlets
across worldwide. Management of Lidl supply wider term of grocery products. On the other
hand, another management consider in this report is ASDA. It is a British supermarket series,
headquartered is in Leeds, England. ASDA supply vegetarian, vegan and as well as organic
goods.
TASK
Context Analysis for Lidl Political – Income and government approaches will directly affect the number of
monetary fund that are spent on groceries. Cost of imports in the UK will be high and not
clear law that will cut off the flow of market. It will strengthen the thought of idea of
spending on food and will change in the taste and preferences of the customers choices. Economical – The retailer section have higher term of variations. Lidl was expected to
have high term of sales by maximising strategic position. It is stated to be 10 per cent
development in the sales. Social – Lidl has been concentrates on targeted lower class users from last few years. At
present, management shifting towards middle and upper class to create and compete with
their challengers. Technological – Management of Lidl require to concentrates on technological
enhancement to manage their place and market share (Cao, Tian, and Blankson, 2021).
Lidl doesn't provide an online facilities to their users in the UK and it will termed to their
drawback. Legal – It deals with the legal issues that involves to the laws and regulation to ignore
negative outcomes and reputational price.

 Environmental – Users are now becoming highly aware about carbon footprints and
sustainability that have become a manner for business to distinguish. Management is
concentrating on maintaining their advantages in relation to promote their message of “A
Better Tomorrow”.
Context Analysis for ASDA Political – ASDA offers advantages from a comparatively stable political situation in the
UK. In this, Brexit had developed higher term of uncertainties in which UK and EU have
been managing the issues in the management. Economical – ASDA require to evaluate economical factor like pay level, cost of credit,
competitive pressures, labour supply & demand, energy prices and so on. Social – By knowing social factor it will support in presenting new goods and facilities in
the field of marketplace. It also supports the management to create segmentation tactics
(Czinkota, and et.al., 2021). Technological – Supermarket are continuously performing on how suitably management
can make use of technology in the favour of business. Legal – ASDA should continue to follows the rules and regulations of the nations in that
they functions with suitable term of authorities.
 Environmental - In contemporary world, individuals are aware of the effects of
management that have significant number of business to functions in an environmentally
friendly way.
Porter’s 5 Forces Analysis of Lidl Industry rivalry (high) – Lidl have many challengers in the marketplace of UK like
Aldi, Morrisons, etc., who follows same tactics. It involves cost leadership strategies that
might cover high risk situation as profit margin breakable. The threats of new entrants (low) – The threat of new entrants is generally lower as the
cost of primary capital to entrance in the sector is basically high (Hopkins, and et.al.,
2021). Management have to deal with UK legal needs for product security that are
discourage various structure from entering in the sector. The threat of substitutes (medium) – Lidl does not invest in consumer loyalty and
substitute goods that can be shifted to other shop. As Lidly manages this threat by
executing suitable marketing tactics.

 Bargaining power of suppliers (low) – This force is low when it is effective to shift
supplier and goods are not significantly diverse from each other (Kim, and Moon, 2021).
Lidl will buy larger amount from suppliers and directly it will be advantageous for the
suppliers.
 Bargaining power of buyers (medium) – The price of shifting for buyers are generally
low or medium because alternatives will provide same goods and the cost between
discount outlets have low differentiation.
Porter’s 5 Forces Analysis of ASDA Industry rivalry (high) – ASDA faces higher level of competitive challenges as the retail
industry is full of challengers who provide competitive cost with same products. The threats of new entrants (moderate) – The goodwill that ASDA holds in the sector
will make this threat as moderate and it will be hard to break the loyal consumer base. The threat of substitutes (high) – ASDA being a retail brand faced high term of threat of
substitution that are easy and effective to copy techniques and get same products at
lower-priced. Bargaining power of suppliers (low) – It involves lower supplier power in ASDA as
competitive pressure develop the management to rely on outsourced suppliers with
moderating prices (Nurjaya, and et.al., 2021).
 Bargaining power of buyers (high) – In relation to ASDA, buyers have shifting power
due to which there are many challengers in the retail sector and by this threat will be
high.
Targeting and Positioning
Lidl ASDA
Segmentation
Cost sensitive users who deals with quality
over the cost.
ASDA's user base is made up of budget
conscious stores who worth to the quality and
customers will looks for discounts and
bargains.
Target

Students, large social unit, lower income, units Most of of the users come to ASDA with the
aim of seeking the similar thing that are lower
in cost and it will resulted as ASDA as a cheap
retailer to serve a wider amount of consumers
who are middle class.
Positioning
At shops and structure At the shops and online purchases
SWOT analysis and recommendations
SWOT matrix
Lidl
Strength Weakness
 Consumer satisfaction
 Low cost
 Own brand
 High distribution of outlets in the
United Kingdom
 Lidl makes utilisation of technology
that has been a strength that help the
business in enhancing user shopping
experiences and enable the business to
satisfy consumer requirements in a
frequent manner in the field of area.
 Lower quality of foods products that
are compared with another business of
management (Patel, Feng, and Guedes,
2021).
 Bad goodwill in terms of ethical
manner
 Lidl development in multinational
management have resulted in an
effective dependency in the market of
UK marketplace that have source of
weaknesses for business.
Opportunities Threat
 Online selling
 Accession new section of the goods
 The trend of new generation that are
cost sensitive in terms of shopping
(Peterson, 2021).
 Higher competition in the United
Kingdom as Sainsbury and as well as
Morrison are cutting their costs.
 Adverse term of goodwill in the
common perspective

 By the use of Big data technology, Lidl
can effectively understand their
customer and try to meet their
demands.
 New terms of laws that are directly
relates to Brexit.
ASDA
Strength Weakness
 Higher base of consumer loyalty
 High quality of the organic and as well
as vegan products
 High goodwill of their brand in the
field of the market place (Salem, and
Salem, 2021).
 ASDA have a wider amount of outlets
in the UK that have presented the
corporation as a benefit in terms of
distribution of strength.
 Due to there deficiency of small
supermarkets and convenience stores it
will directly term as their drawbacks
 Management of ASDA not have the
flexibility of some of its highly focused
rivals.
 The financial profitability of ASDA has
been negatively affected as a result of
their high term of debt and credit card.
Opportunities Threat
 Multinational field of the advancements
 Leading brand in organic and as well as
vegan food products
 Users can shop their products from
varied online websites.
 Brexit laws and taxation costing
approaches
 Discontinuous series of imports after
the manner of the Brexit
 High market competition is other aspect
that will have an impact on managerial
profitability, long term viability and
success (Saura, Palacios-Marqués, and
Ribeiro-Soriano, 2021).

Recommendations
There are some of the recommendations that will support the management of Lidl and ASDA to
enhance their marketing strategies and their efficiency that are as follows - Influencer promotions – Social media has spread worldwide and it is one of most
efficient manner to hold consumer attention and create strong base of consumers. For
example, Lidl should analyse their goods and facilities by coordinating with influencers
that have the skills to have a positive effects on the business of management (Stremersch,
2021). On the other hand, ASDA help in attaining a competitive sections and also by
hiring of users from greater and wider demographical sections. Managing customer experience – The management should focuses on enhancing
consumer experiences and it will help to develop the managerial goodwill in the sector.
For example, Lidl should maintain their functions to satisfy user demands by providing
theme desirable products on regular basis. Such sort of techniques will help to enhance
consumer experiences. The management will also place a superior on the quality and
amount of facilities that are offered by the business. It will support to enhance consumer
experiences by strengthen the brand goodwill, creating image, producing leads and
managing larger amount of users. Evaluating target market – In respect to develop an effective marketing plan in relation
to Lidl the management should first identify the target audience. On the other hand,
ASDA will concentrates on helping the business in creating an effective marketing plan
that will help in satisfying customer demands, that can maximise the consumer loyalty,
retention and offering advantages to the business as globally in an effective and efficient
manner.
 Creative content marketing – It involves Lidl who effectively focuses on their content
marketing by managing efficient writing and offering opportunities that will be
advantageous at the time of managing the issues (Warren, and et.al., 2021). On the other
side, ASDA holds or capture the longer term base of loyal consumer or user retention in
which it involves most suitable terms of the marketing. It deals with the fundamental
terms of the plan of action for efficient marketing in the field of the area. Lidl and as well
as ASDA should recruit staff members who are able of presenting all required actions

that will offers the business with suitable competitive boundaries in the manner of
providing profitability and as well as productivity to the business of management.
CONCLUSION
From the above mentioned report it has been concluded that, marketing is termed to be a
business strategy that will help them in promoting and positioning their goods and facilities in
respect to hold competitive edge and try to maintain commercial success. It can be stated that
marketing is the managerial action that can be presented in respect to advertise their products and
produce high profitability.

REFERENCES
Books and Journals
Bergkvist, L. and Eisend, M., 2021. The dynamic nature of marketing constructs. Journal of the
Academy of Marketing Science, 49(3), pp.521-541.
Cao, G., Tian, N. and Blankson, C., 2021. Big data, marketing analytics, and firm marketing
capabilities. Journal of Computer Information Systems, pp.1-10.
Czinkota, M.R., and et.al., 2021. Marketing Management: Past, Present and Future. Springer
Nature.
Hopkins, C.D., and et.al., 2021. Changing Perceptions of Marketing Ethics and Social
Responsibility in Principles of Marketing. Journal of Marketing Education, 43(2),
pp.244-259.
Kim, K.H. and Moon, H., 2021. Innovative digital marketing management in B2B
markets. Industrial Marketing Management, 95, pp.1-4.
Nurjaya, N., and et.al., 2021. The Effect of Product Promotion and Innovation Activities on
Marketing Performance in Middle Small Micro Enterprises in Cianjur. Budapest
International Research and Critics Institute (BIRCI-Journal): Humanities and Social
Sciences, 4(1), pp.528-540.
Patel, P.C., Feng, C. and Guedes, M.J., 2021. Marketing capability and new venture survival:
The role of marketing myopia. Industrial Marketing Management, 93, pp.307-326.
Peterson, M., 2021. Teaching the online marketing research course for MBA students. Journal of
Marketing Education, 43(3), pp.371-385.
Salem, S.F. and Salem, S.O., 2021. Effects of social media marketing and selected marketing
constructs on stages of brand loyalty. Global Business Review, 22(3), pp.650-673.
Saura, J.R., Palacios-Marqués, D. and Ribeiro-Soriano, D., 2021. Digital marketing in SMEs via
data-driven strategies: Reviewing the current state of research. Journal of Small
Business Management, pp.1-36.
Stremersch, S., 2021. The study of important marketing issues: Reflections. International Journal
of Research in Marketing, 38(1), pp.12-17.
Warren, N.L., and et.al., 2021. Marketing ideas: How to write research articles that readers
understand and cite. Journal of Marketing, 85(5), pp.42-57.