Analysis of Woolworths Retail Management and Business Strategy

This report provides a comprehensive analysis of Woolworths' retail management practices, focusing on its business environment within the Chadstone shopping centre in Melbourne. It examines Woolworths' marketing mix, including product offerings (groceries, stationary, etc.), pricing strategies (competitive pricing, loyalty programs), promotional activities (loyalty schemes, social media), and location. The report delves into customer service aspects, emphasizing customer loyalty, store layout, and merchandise presentation. It further analyzes Woolworths' business environment, including competition from other supermarkets and retail stores, its target market (high-income earners), and consumer buying behavior. The report highlights Woolworths' strategies for maintaining market share, addressing challenges, and adapting to technological advancements and customer needs.

Running Head: RETAIL MANAGEMENT
Retail management
Names
Institutional Affiliations
Woolmart’s business environment

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Product
Woolworths is the leading retailer store in Chadstone shopping centre in Melbourne.
The company provides all sorts of grocery items as part of its marketing mix (Andrew, 2011).
Some of the grocery products comprise of fruits, vegetables, meat, packed products among
others. The company has also started selling stationary items, DVDs, and magazines. In each
category, Woolworth allows its customers to have large variety of choice relating to local
produce, brand, and international cuisine. This means its management values customer
satisfaction as one of the key factors of maintaining good performance of the business.
To ensure continuous customer loyalty and satisfaction, the management ensures its
products are tested and approved by experts to maintain good quality. The company has
diversified range of products ranging from furniture, bags, housewares, beddings to clothing
and accessories (Stanton, 2012). The diversified range of products has assisted its
management for to cater the all-around needs of the consumers because it enables them to
have all they need under one roof.
Price
Woolworth has been trying to maintain similar or slightly higher prices than its
competitors. Having learnt that, it offers a wide variety of premium brands in food chain as
one of the strategies to keep the prices competitive in the market. The company uses various
pricing strategies to ensure it serves people of different levels of income (George, 2013). The
company also uses other unique tactics to ensure its pricing strategy attracts as many
customers as possible. For example, frequent club is a reward program which provides $20
vouchers for every 200 points gathered. The customers are also provided with Woolworths
shopping cards which automatically track various aspects like purchases, meaning its
customers do not need to retain paper receipts.

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Recently, Woolworth has introduced a new pricing strategy known as round numbers.
Although various people including retail experts have criticized this strategy, Woolworth
believes it certainly makes it easier for its customers to identify prices, and also creates
references prices (Louis, 2011). The strategy was aimed at moving more than 20,000 of its
products to round dollars and no cents. The company believes this pricing strategy provides
customers with simpler price points to assist them in adding the cost of weekly shopping and
in managing weekly budgets easily.
Promotion
Promotion is always of keen prominence for this company (Louis, 2011). Recently, its
management has been using it to attain some of its business goals. The company offers
different loyalty schemes which comprise of petrol pump discounts to its consumers as one
way of keeping long term relationships with them. Woolworth uses various media including
magazines, newsletters and social media for efficient promotion.
Woolworth gives extensive deals and offers including gift cards to its customers as
one way of making its customers realize why they should be associated with the company.
Having realised that most of its customers are in one or more social media platforms, the
company carry extensive promotion through the online media (Dee, 2011). The strategies of
promotion correspond to every mean which this company uses to communicate the values
and benefits of its products.
Although this company has tried to incorporate promotion in its marketing mix, it is
yet to use it effectively to assist it in maintaining as many customers as possible (Ene, 2014).
The company should incorporate as many promotional tools as possible in order to attain its
targets. Some of these tools should include advertising with several channels, sales
promotions among others.

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Location
This shopping store is located in Chadstone shopping centre in Melbourne (Kaifi,
2012). The company has also realised that with the current technological advancements and
the desire for every person to me digitized, its business can thrive online and therefore its
management has considered operating through different online platform. Alongside operating
on these platform, the company has recently development a mobile app for the purchases to
continue making itself more available to its consumers.
Just like other big firms, Woolworth has realized the importance of using social media
platforms to stay relevant to the lives of its customers around Chadstone shopping centre and
in other parts of the country. To become widely known and available to most customers, the
company has made itself available to different social media platforms. Like for example, it
has a very popular Facebook page with more than 800000 followers (Gupta, 2011). The
company is also available through various other platforms like Pinterest, Instagram,
YouTube, twitter, among others. The kind of feedback which its consumers provide through
these social media platforms helps its management to determine the kind of experience with
they have with its brands.
Customer service and selling
Woolworth serves more than 18 million customers every week (Louis, 2011). Its
Customers are one of the most important assets because they play a significant role in the
performance and existence of the company. Its customers comprises of people of different
age groups, gender, and social class. To ensure its customers maintain loyalty with the
company, Woolworth ensures its products are of good quality and customer satisfaction is
valued in everything the company does.

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The company has various strategic objectives aimed at improving customer
experience. For example, it aims at being a customer centric business. With this objective, it
has been trying to define who its future customers are and what can be done to ensure their
needs are addressed (Louis, 2011). The company has defined business-wide view of the
Woolworth’s customer, which is based on customer’s mind-set, and their wants and needs as
informed by lifestyle segments.
The company also has various strategies to build and maintain strong customer
relations. For example, it uses its WRewards programme to ensure its customers have the best
experience than the one they can have from its competitors (Gupta, 2011). This programme
has remained Woolworth’s key strategy to increase the lifetime value for its consumers. The
program enables the company to reward loyal customers and gather information to further
understand the needs of its clients and align them with its total customer proposition.
In Woolworth, offering real value goes beyond offering its consumers with quality at
a reasonable price. Woolworth always puts the customer first because it believes they are the
reason the company is in business (Dee, 2011). Its management values customer feedback
regarding their experience and views regarding what the company does best, and what should
be changed to improve their satisfaction. Although this company tries to maintain its
relationship with customers, competition makes it to experience challenges in maintaining its
market share.
Store layout and design
One of the recent aims of Woolworth is to ensure its stores meets the needs of its
consumers (Kaifi, 2012). The store front is well painted with the store name well displayed
to create good impression to the customer. The entrance door is big enough to allow free
movement. The windows are designed in a manner which can make the customers to view

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products from a distance. The store has enough parking space located at the rooftop and
around the store.
Although the store has large exit door, there are no enough emergency exits. Having
as many emergency doors is important because they assist the customers and staff to escape
easily when an emergency occurs. Considering the large number of customers who show up
in this store per day, the walks around the store are not big enough to allow free movement of
customers and trolleys.
The front side of the store is uniquely designed with colours which all Woolworth
store use in their buildings. For better customer experience, the company has considered
placing enough spaces between the shelves to ensure the customers can spot their desired
products from a distance (Gummesson, 2012). The stores are also deigned with considering
security features like several emergency exit doors and CCTV cameras to monitors all
activities around the premises. Although the store is fitted with air conditioning gadgets, the
windows are not enough to allow free circulation of air.
The stores are cleaned from time to time to ensure the customers experiences high
level of hygiene while shopping (Gummesson, 2012). The interior area of the store has
various shelves with products arranged according to their category. The shelves also have
price tags which enable the customers to know the cost of each product. The floors are tiled
and walls painted with attracting colours. Although the floors looks attractive, they are too
slippery and can make the customers to slide and fall down while moving around the store.
The store personnel in the store are not enough to serve the large number of
customers. The escalators available in the store are also not enough considering the fact that
Woolworth is among the leading retail stores in Chadstone and therefore it experiences large
number of consumers.

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Merchandise
Woolworth places various commodities in its stores to allow the customers have a
wide range of selection and its aim of making all products under one roof to become a reality.
The company places its products in a manner that can aid in making the consumers to have
the best experience (Arun, 2015). The products are organized according to their category to
assist the consumers to access them without difficulties. The use of tags placed at strategic
points where customers can see them has also assisted its clients to have easy access products
around the stores.
Placing a wide range of commodities allows the company to realize high customer
turnout because consumers like obtaining products from places where they can get all what
they need without wasting time (Ene, 2014). The manner in which the company presents its
products in its stores has also promoted its sales because it brings some sense of attraction to
the consumers.
Review and analysis of your Woolworth’s business environment
Business environment
Woolworth operates retail industry and competes for market share with several other
stores and small business (Trevor, 2010). Operating in this industry has made the company to
attain a significance level of dominance position in the Australian retail industry. The primary
reason that leads to highly efficient position is because of the business strategies utilized by
the company. Some examples of these strategies comprise of extending leadership in all

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segments, maintaining good track record of growing business and looking for higher overall
future growth of the company among others.
In Melborne, the bargaining power of buyers is significantly high because there is
there are various big supermarkets as well as retail stores that provide similar products as
those that Woolworth deal with (Margetts, 2011). The fact that consumers have wider option
to select from, they choose where to shop from based on various factors like prices, the
quality of products, company-customer relationship among others. Shifting from one
company to the other makes companies like Woolworth to attain a significant market share.
The company competes with not only big supermarkets and stores, but also with
other small enterprises in Chadstone shopping centre and others outside Melbourne because
customers seek to shop where they get satisfaction irrespective of the distance. Some of the
big stores and supermarkets which compete with Woolworth like Asda, Wesfarmers, Coles
supermarket among others, have been trying their best to ensure they dominate the largest
market share (Ertekin, 2015). Competition has been one of the major challenges that impact
Woolworth from realizing high sales volume. The stiff competition in the retail industry
makes Woolworth to continuously establish strategies which can make it to maintain
customer loyalty
Target market and consumer buying behaviour
Woolworth’s current target market is the high income earners and the LSM (living
standard measure) group 8 to 10. The company also have plans to target the low LSM groups
as well as the growing black middle class because they expect them to have high demand for
purchasing food and clothes from stores (Garg, 2016). The fact that Woolworth deals with

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most of the basic commodities, it should not only target the high income earners because all
people require these commodities irrespective of their level of income.
Although some of its customers are loyal, others shift from one organization to the
other because of various factors (Katole, 2012). Some of these factors include change of
residence, promotions and discounts from competitors, changes of pricing strategies, desire to
have new experience among others. Other factors like economic condition and accessibility
also makes the consumers to change their buying behaviour from time to time.
Emerging trades
In Chadstone shopping centre, very many firms including large and small business
enterprises compete. This means the nature in which business is done changes from time to
time. The fact that every firms wants to implement the best strategies to ensure they satisfy
their customers, will make the industry to continue changing from time to time (Chowdhury,
2013). The frequent changes of consumer behaviour has also had a significant influence in
the manner in which businesses are done. As time goes on, each companies wants to
incorporate new strategies to ensure their customers feel valued and their needs are catered
for.
The continuous emergence of new technologies has also impacted the manner in
which businesses are operated in the Melbourne retail industry (Hadjicharalambous, 2013).
When some firm adopts new technology before its rivalries, the scope of business changes
because that technology makes the firms to realize benefits which others do not.
Challenges and opportunities
The retail industry in Australia indicates a positive growth potential and other factors
such as computerisation, advancements supply chain and consumer lifestyle changes have all
impacted the abilities of retailers and given good opportunities to grow (David, 2010). The

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company has the opportunity of embracing this option through adapting the strategy of multi-
option retailing in order to address the changing needs of its consumers.
One of the major challenges which Woolworth faces is the ever increasing pressure
from its competitors (Hunter, 2013). Apart from Coles which is the main competitor,
Woolworth competes with other companies as well as small businesses which offer similar
products. Apart from competition, Woolworth growth is being impacted by government
interventions. The ever increasing changes of consumer behaviour is also a challenge
affecting Woolworth because it must adjust its strategies from time to time to address those
changes.
Current retail strategy mix and positioning
From its marketing mix, Woolworth tries to portray itself as a premier enterprise that
is focused in ensuring customer satisfaction. Woolworth also portrays itself as the only
organization that minds the prices that their consumers spend on their products. The company
offers discounts and uses pricing strategies which it feels will be friendly to its customers
(Louis, 2011). The problem with this strategy is that its competitors are also using the same to
present themselves as cost friendly to the consumers.
The nature of its store layout and presentation makes the consumers to have the notion
that Woolworth is the best place to shop. The colouring and the nature in which the products
are presented in the stores gives the customers the desire to experience more with the
company. Its large stores and high stock level gives its consumers the belief that Woolworth
is a premier organization (Hadjicharalambous, 2013). The issues with its store layout and
presentations is that there are various issues which can make the consumers feel the company
does not concerned with some aspects. For examples, failure to have several exit doors may
make the customer feel insecure while shopping.

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Although Woolworth positions itself as a premier retail store in Chadstone shopping
centre, some consumers do not have an experience with it because of location issues (David,
2010). To become well known and allow many consumers to experience its services, the
management should consider expanding to as many places as possible. The location
challenges makes some consumers especially those who live far away from where the stores
are located know about the company by name but fail to have shopping experience with it.
Recommendations
Although Woolworth has been doing well in its business, there are various challenges
that impact it from attaining its objectives (Katole, 2012). One of these challenges is stiff
competition which comes from both large and small businesses. To address the issue of
competition, the management should come up with good marketing strategies. These should
comprise of proper market segmentation, right customer targeting, among others.
The company should also identify who are its consumers and identify their needs and
expectations. This would assist the management to make its decisions based on customer
expectations in order to ensure they lead to satisfaction. It is also advisable for the marketing
team to identify who are its core competitors, the strategies they use to challenge Woolworth
and what the company can do to surpass those strategies (David, 2010). These could be
things to do with pricing, product qualities, and promotions among others. To address
competition, the management should consider coming up with strategies that can improve
customer satisfaction. This can be through ensuring the goods sold are of high quality and the
prices are relatively friendly.
Expanding to as many places as possible is advisable for Woolworth so as to allow
many consumers to have shopping experience with the company (Garg, 2016). Expanding to
as many places as possible will also attract customers who seek their basic products from

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alternative companies to purchase products from Woolworth stores. The management should
also come up with unique pricing strategies to make the customers feel the difference
between buying their basic commodities from other stores and purchasing the same from
Woolworth.

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