MKT10725 Strategic Marketing Plan: Wesfarmers Case Study Analysis

This report presents a strategic marketing plan for Wesfarmers, an Australian retail conglomerate. It begins with background information and identifies Kmart as the Strategic Business Unit (SBU). The report then conducts a PESTLE analysis of political, economic, social, technological, legal, and environmental factors impacting Wesfarmers, followed by a SWOT analysis to identify strengths, weaknesses, opportunities, and threats. Marketing objectives and goals are established, leading to the formulation of strategic alternatives, including expanding internationally and changing store layouts. The marketing mix (product, price, place, promotion) is addressed, and an implementation plan with timelines and responsibilities is outlined. Finally, the report details monitoring, evaluation, and control measures to ensure the plan's success, offering a comprehensive overview of Wesfarmers' strategic marketing approach.

Strategic Marketing

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Table of Contents
Introduction................................................................................................................................2
Background Information on Wesfarmers...............................................................................2
Identification of the SBU.......................................................................................................3
PESTLE Analysis...................................................................................................................3
SWOT Analysis.....................................................................................................................5
Marketing objectives and goals..............................................................................................6
Strategic Alternatives Formulation........................................................................................6
Marketing Mix.......................................................................................................................7
Monitoring, Evaluation, and Control.....................................................................................8
Conclusion..................................................................................................................................9
References................................................................................................................................10

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Introduction
One of the most important factors that are required to run a successful business is the power
or strength of the strategic marketing plan. Performing market research disinfecting the
findings and working on the recommendations in the marketing plan support business in
defining the products or services that business will sell, the target market, the promotional
means, and the time to do all the specified things. Strategic marketing importance is
dependent on setting clear business outcomes (Oliveira, 2015). This paper intends to present
the strategic marketing plan for one of the Australian form that is Wesfarmers with the
motive to form the strategic alternatives. The entire procedure of selecting the possible
alternatives is comprised of selecting an SBU, conducting the environment analysis, framing
the goals and objective and then forming the strategic alternatives and presenting the
implementation plan. In the end, the paper is highlighting the monitoring, evaluation and
controlling activities that can be adopted by the business.
Background Information on Wesfarmers
Wesfarmers Limited is an Australian firm with headquarter in Perth. The key business
operations of the company are in New Zealand and Australia under the product line safety,
chemical products, retail, coal mining, fertilizers, and industrial products (Wesfarmers, 2019).
In 2016, the company earned around AU$65.98 billion revenue by which it overtook BHP
and Woolworths. Wesfarmers is also considered to be the largest employer of Australia by
offering jobs to around 220,000 people (Wesfarmers, 2018). In 1914, the company was
founded as the co-operative to offer merchandise and services to the farmers of Western
Australia. The company is listed as the major conglomerate on the Security Exchange of
Australia in the year 1984.

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Identification of the SBU
An SBU is composed of the product lines with recognizable individuality from other services
or product lines in regards to the competition, product’s substitutability, and influence of the
product withdrawal. A division can also be comprised of diverse product lines however only
differ from other SBUT in the thrust (Wheelen, Hunger and Bamford, 2010).
Wesfarmers is the retail conglomerate that is involved in selling different types of products
under different segment. Different segments and businesses of the company are operated
under different SBUs. The retail business of Wesfarmers is operated under the name Kmart.
Kmart is the retail store chain of Australia offering low price products to the customer and
owned and managed by Wesfarmers. The company is involved in operating around 228 stores
all over New Zealand and Australia, with head office in Melbourne (Wesfarmers, 2017). This
SBU of Wesfarmers was established with a joint venture between Coles and S.S. Kresge
Company in the US with Kresge holds 51% of the share in the business. In the year 1968,
both the companies started developing the Kmart stores in the Australian market. The first
store of this company was introduced in 1969 in Victoria (Kmart, 2019).
Analysis of Environment
PESTLE Analysis
Political Factors - The political forces generally have a higher influence on the retail industry
of Australia. The augmenting business and dominance of the self-governing retail businesses
like Kmart, BigW, Aldi have increased the competition for the small retailers in the market
and therefore to restrict this the government has introduced different policies. The
government has introduced policies to safeguard the rights of the shareholders and restricting
monopoly in the market (Fuchs and Kalfagianni, 2010).

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Economic Factors – The Australian retail market’s economic condition approximately impact
the performance of the Kmart as well as its parent company that is Wesfarmers in
consideration to the buying behavior and demand of the consumer. In the year 2009, there
was a global crisis which influenced the consumption behavior of the market resulting in
reducing the disposable income (McDonnell and Burgess, 2013). Similarly, the retail
business of the company was impacted because of natural calamity and climate change.
Social Factors – Kmart and its parent company is the key employer of Australia with a huge
employee base and shareholders in the company. The company is involved in taking several
initiatives for the development and growth of the society, for instance, it provides jobs to the
Aboriginal and Torres Strait Islander people, encouraging diversity and gender balance
(Wesfarmers Limited, 2019).
Technological Factors - Technology performs a major role in the success of Kmart in the
Australian market. In order to deal with the intense competition, the company has invested in
the stores that are also called as smart i.e. through ‘One-Shop' and a new point of the state of
technology.
Legal Factors - Legal inference about the carbon emission limit has resulted in restricting the
manufacturing in some of the industries comprising Wesfarmers all over in Australia. The
government and the related authority has introduced the Carbon Tax and fair tax policy have
influenced the production as well as the performance of Wesfarmers and its SBUs (Dreyer
and Walker, 2013).
Environmental Factors – In the entire portfolio, Wesfarmers has taken special defensive
measures to limit its negative cause to the environment. Wesfarmers has invested in advanced
technologies in order to avoid resource wastage, enhancing the pliability of climate change,
passable usage of water, etc. The company has installed these advanced technologies in all its

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SBUs too to attain the goal. Therefore, it holds high standards towards safeguarding the
environmental damage.
SWOT Analysis
Swot analysis is the internal environment analysis tool that is used by the business to identify
its strength, weaknesses, opportunities as well as threats to take preventive measures in
advance (Gürel and Tat, 2017). The company identifies its strength in order to overcome its
threats. The application of the SWOT is presented below:
Strength – Wesfarmers has a huge number of stores, in-store staff and developing the
workforce of 220,000 employees (Wesfarmers, 2016). The company also pick huge sales
volume through its online business. Besides this, customer loyalty towards its Kmart SBU is
high. The company is involved in offering high returns to the shareholders which have
supported in growing in the market.
Weaknesses – As Wesfarmers is the market leader in different sectors it's different SBUs deal
with the tight scrutiny of the government and other regulating bodies. Besides this, apart from
Australia, Kmart only has its presence in New Zealand which is considered to be a limited
scope; hence the limited expansion can result in stiff competition for it.
Opportunities – The possible opportunities for Wesfarmers as well as for its SBU that is
Kmart is expanding business operations in different areas of the world like its competitors
such as Wal-Mart, Sainsbury’s, Aldi, etc. By expanding business operations in different
segments of the world, the company will be able to increase its sales volume and customer
base and strength to give strong competition to other players in the market.
Threats – The major threat for the Wesfarmers as well as Kmart is the increasing intensity of
the competition in the Australian market (Eslake and Walsh, 2011). The development of Aldi

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and other close competitors are impacting the sales and revenue margin of the company
through their low-cost offering in the market.
Marketing objectives and goals
The marketing objective for the Kmart is to grab the focus of the target audience towards its
product's quality and price. Through marketing, the company wants to attract the maximum
number of customers by offering high-quality products at low prices. This will help it in
increasing the customer base as well as sales of the business. Further, this marketing
objective will help Wesfarmers in giving strong competition to strong competitors such as
Aldi the discount retailing chain, Woolworths, and Coles.
Strategic Alternatives Formulation
Alternative 1: One of the strategic alternatives for Kmart is expanding the business operations
in different segments of the world such as Asia. If the company will expand its operations in
the Asian market such as Malaysia, China, or India the company will be able to contribute to
the development of the society by offering employment to job seekers. Besides this, the
company can get low-cost labor in the Asian market which will help the company in
maintaining the price of the operations as well as products. Wesfarmers has a strong financial
position but expanding business in a new market can be very expensive. But, the stakeholders
and society will allow the company to expand operations as it will provide increased returns
and well as contribute to the development of the society.
Alternative 2: Another strategic alternative for Kmart is changing the layout of its stores.
Changing the layout of the store will allow the customer to gain marvelous experience of
shopping. The company has to improve its product offerings by including organic food
options because customers in Australia are becoming health conscious and preferring healthy
products in place of products with high fat and sugar content. In addition to this, the company

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can offer these healthy options to the customers under its private label which will not just
increase the customer base but will also improve the brand image in the eyes of the society.
Considering both the alternatives, it could be said that the company needs to focus on
changing its store layout in order to provide a better experience to the customer. Besides this,
it can offer health product options under its private label to improve its brand image. If the
company plans to adopt market expansion in the Asian market it will cost higher in
comparison to changing the layout of the business and adding health options in the existing
offering.
Marketing Mix
Product – Kmart is involved in offering different products at its stores however the old
infrastructure impacts the experience of the customer. Therefore, the new layout of the store
will improve the customer experience. Besides this, including healthy options for the
customers will increase the length of the product portfolio of the company.
Price – The price strategy that the company will adopt is the economy pricing strategy. Under
this pricing strategy that company will offer low price healthy products to the customers
under its private label to give strong competition to the existing players in the market.
Place – The strong distribution network of Wesfarmers has allowed the company to offer its
products across Australia and New Zealand (Wesfarmers Sustainability, 2018). The suppliers
of the company offer it low-cost products such that the company can offer high-quality
products to the customer at low prices.
Promotion – In order to promote the healthy options to the target audience, Kmart will market
its products through different elements of the promotional mix such as advertisement, direct

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marketing, digital marketing, personal selling, etc. As all these selected elements have a wide
scope and reach will help the company in having a larger customer base.
Implementation Plan
Implementation of Plan Responsible team Time Duration
Market Research Research and Development 3 months
Allocating Responsibilities Top Management 1 week
Recruitment of employees Human Resource Department 1 Month
Execution of Plan
(Changing Layout)
Store Designing and
Marketing Department
2 Months
Execution of Plan
(Developing Health options
under the private label)
Product Development and
Packaging Team
2 Week
Promotion of the products Marketing Department Repeating promotion after
every 6 months
Monitoring, Evaluation, and Control
The monitoring of the plan will be done by the supervisors of the company who will daily
check the progress of the plan in order to identify the required guidance to the employees
working on the plan. The supervisor will evaluate the results of the plan to identify whether
the final product is providing expected benefits or not. The evaluation will be done
continuously to avoid any deviations. Further, the expected performance will be measured
with the actual performance if there will be any deviations corrective actions will be taken to
improve it.

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Conclusion
The above report has provided a detailed analysis of the strategic marketing plan for the SBU
of Wesfarmers that is Kmart. The analysis has highlighted that the company is dealing with
increased competition from the existing players which is impacting its performance. Hence,
in order to overcome this, the report has recommended the company to change the layout of
the stores and add some healthy options in the product portfolio as it will help in giving new
experience to the customer and will also increase the customer base for the company. The
report has provided the implementation plan for the same to have a defined result.

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References
Dreyer, S.J. and Walker, I. (2013) Acceptance and support of the Australian carbon policy.
Social Justice Research, 26(3), pp.343-362.
Eslake, S. and Walsh, M. (2011) Australia's productivity challenge 2nd ed. Melbourne:
Grattan Institute.
Fuchs, D. and Kalfagianni, A. (2010) The causes and consequences of private food
governance. Business and Politics, 12(3), pp.1-34.
Gürel, E. and Tat, M. (2017) SWOT analysis: A theoretical review. Journal of International
Social Research, 10(51).
Kmart (2019) About us [Online]. Available from https://www.kmart.com.au/about-kmart
[Accessed 26 September 2019]
McDonnell, A. and Burgess, J. (2013) The impact of the global financial crisis on managing
employees. International Journal of Manpower, 34(3), pp.184-197.
Oliveira, E. (2015) Place branding as a strategic spatial planning instrument. Place Branding
and Public Diplomacy, 11(1), pp.18-33.
Wesfarmers (2016) Annual Report [Online]. Available from
https://www.wesfarmers.com.au/docs/default-source/reports/2016-annual-report.pdf?
sfvrsn=8 [Accessed 26 September 2019]
Wesfarmers (2017) Kmart Group [Online]. Available from
https://www.wesfarmers.com.au/our-businesses/kmart-group [Accessed 26 September 2019]

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Wesfarmers (2018) Annual Report [Online]. Available from
https://www.wesfarmers.com.au/docs/default-source/asx-announcements/2018-annual-
report.pdf?sfvrsn=0 [Accessed 26 September 2019]
Wesfarmers (2019) About Wesfarmers [Online]. Available from
https://sustainability.wesfarmers.com.au/ [Accessed 26 September 2019]
Wesfarmers Limited (2019) Indigenous Engagement [Online]. Available from
https://www.wesfarmers.com.au/our-impact/indigenous-engagement [Accessed 26 September
2019]
Wesfarmers Sustainability (2018) Our Performance [Online]. Available from
http://2018.sustainability.wesfarmers.com.au/ [Accessed 26 September 2019]
Wheelen, T.L., Hunger, J.D., and Bamford, C.E. (2010) Strategic management and business
policy 1st ed. New Jersey: Prentice Hall.