Marketing Case Study: Product Line Expansion at LuLu Hypermarket

This case study examines the marketing strategies of LuLu Hypermarket, focusing on product line expansion and competitive positioning. The analysis covers the company's background, external environmental factors, and competitive stance within the retail industry. Key aspects include product diversification strategies, such as the introduction of new flavors for Galaxy Choco Jewels, competitive pricing, and sustainable marketing practices. The study also evaluates the effectiveness of current competitive approaches, including rebranding, online shopping, and promotional campaigns. The conclusion emphasizes the importance of innovation, direct marketing through online services, and strategic planning for future growth. The document highlights the significance of digital marketing, employee training, and supply chain expansion through offshoring and outsourcing. Comparisons are made with competitors like Carrefour and Abu Dhabi Co-operative Society, emphasizing LuLu's advantages in price and quality, and the importance of customer feedback for future business development. The study is supported by references to relevant sources and provides a comprehensive overview of LuLu Hypermarket's marketing dynamics.

Marketing: A case study of LuLu hypermarket

Group members’ name
Serial no. Names of the
team members
Activities
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2
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Introduction
 Marketing is one of the aspects, which enhances the stability in the
relationship between the buyers and sellers.
 Tactful approach of the sellers is effective for achieving the satisfaction,
trust, loyalty and dependence of the buyers
 Strategic approach towards marketing of the products is effective for
achieving the desirable outcomes.
 Product lines are expanded for broadening the scope and arena of the
brand image.
 This assignment intends to shed light on the ways and means adopted by
the LuLu hypermarket for increasing the product line.

Background of the company, LuLu
 Type- Hypermarket
 Industry- Conglomerate
 Number of locations- 188 stores
 Operational areas- Asia, Africa, Europe, America
 Annual revenue- $6.3 billion (according to the reports of 2016)
 No of employees- 57,000
 Key Products- Food, beverage, household appliances, electronics,
beauty, pet foods among others
 Customers- 1,100,000
 Tagline- “Where the world comes to shop”

External environmental analysis
of LuLu hypermarket
Political • Tax obligations
• Political unrests
Economic • High exchange rates
• Fluctuation in the prices of the
raw materials
• Inflation
Social • Changing needs of the customers
• Increasing population rates
Technological • Digital marketing

Competitive stance for the
product line
 Retail division- high contributor towards
productivity
 188 Stores and 23 shopping malls- diversifies
the supply chain network
 Competitive pricing strategies- market
penetration into UAE, India, Saudi Arabia,
Bahrain, Kuwait, Oman, Qatar, Egypt,
Malaysia and Indonesia.
 Product diversification and differentiation

PORTER’S FIVE FORCES
Competitive rivalry High (5)
Threat of new entrants High (4.5)
Threat of substitutes High (4)
Power of suppliers Medium (3.5)
Power of the customers Low (2)

Strategic group map
Price
Quality
LuLu
Carrefour Abu Dhabi Co-
operative
Society

Competitive conditions
LuLu Carrefour Spinneys
Market share
(UAE)
32% 24% 19%
No. of outlets 106 30 30
Online presence Strong Moderate Too weak
CSR activity Very high moderate Low
Global presence Strong in GCC Strong Low in GCC
Product line All All Groceries

Growth strategies
 Product differentiation and diversification
 Competitive pricing
 Sustainable marketing practices
 Cost, quality and availability

Market development
 Product diversification in the products like Galaxy Choco Jewels would
influence the tastes of the clients and customers. Different flavours
already exists, therefore, plans can be made of bringing fusion
flavours, which would enrich the quality of the chocolates.
 Along with this, competitive pricing strategies would be effective for
luring premium clients to the brand image
 Advertising campaigns for the newly introduced chocolates would be
productive for achieving better placement and positioning
 Positive response from the clients and customers would increase the
product line and market share.

Effectiveness of the current
competitive stance  Rebranding- an opportunity
to standardize the
operations for achieving
higher competitive
advantage
 Product price booklets and
advertisements- addresses
the specific queries of the
clients and customers
 Online shopping-
concretizes the experience
of the customers
 Sponsoring in the festivals
 Adopting gluten free, sugar
free and organic ingredients

Conclusion
 LuLu hypermarket needs to be praised
for diversification in the products and
services. Plans of bringing fusion
flavours in the Galaxy choco jewels
would add innovation into the products,
luring more clients and customers to
the brand image. Online shopping
services and stores are a means of
direct marketing, the nature of which is
B2C, expanding the scope and arena of
the business. This diversification is also
an indication for expansion in the
supply chain network, which is
conducted through the means of
offshoring and outsourcing of the
operations.

Summary
 This presentation sheds light on the business dynamics of LuLu
hypermarket, with special emphasis on the expansion of the
product lines. Product differentiation and diversification in the
Galaxy choco jewels is effective for adding innovation into the
products. Competitive pricing strategies and sustainable
marketing strategies assists in achieving higher competitive
advantage as compared to the brands of Spinneys, Carrefour and
others. Social media marketing is effective for increasing the
trafficking of the audience towards the brand image. Strategic
planning is needed in terms of systematising the activities
according to the priorities. Introducing quality training programs
for the employees is effective for enhancing their awareness about
the business trends and the ways to implement them into the
business. Digital marketing strategies is productive in terms of
increasing the trafficking of the audience towards the brand
image. Offshoring and outsourcing the operations would be
effective for expanding the scope and arena of the supply chain
network. Competitive pricing strategies is effective in terms of
maintaining the stability in the competitive rivalry. In terms of
price and quality, LuLu hypermarket attains a higher position as
compared to the brands like Carrefour and Abu Dhabi Co-
operative society. Tracking the response of the customers is
effective in terms of estimating the nature of the business in the
future years.

References
 Lulugroupinternational.com 2020. About us. Available at:
https://lulugroupinternational.com/ [Accessed on 24th Feb 2020]
 Mullakhmetov, K.S., Sadriev, R.D., Gabidinova, G.S. and Akhmetshin, E.M.,
2016. Control in marketing-based management. Academy of Marketing
Studies Journal, 20(2), pp.13-19.
 Wagner, S.M. and Eggert, A., 2016. Co-management of purchasing and
marketing: Why, when and how?. Industrial Marketing Management, 52,
pp.27-36.
 Walle, A.H., 2017. Rethinking Business Anthropology: Cultural Strategies in
Marketing and Management. Routledge.