Woolworths Fake News and Marketing Strategy: A Detailed Report

This report provides a comprehensive analysis of Woolworths' marketing management in the context of a fake news campaign involving hoax vouchers. It begins with an introduction to marketing management and the specific case of Woolworths, an Australian grocery chain. The report summarizes ...Read More

MARKETING MANAGEMENT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
SUMMARY OF FINDINGS ON FAKE NEWS............................................................................1
CASE ANALYSIS..........................................................................................................................3
History....................................................................................................................................4
Products..................................................................................................................................4
Financials................................................................................................................................4
Distribution.............................................................................................................................4
Competitors............................................................................................................................4
Claims made in fake news......................................................................................................5
PROPOSED MARKETING STRATEGY......................................................................................5
Product/Brand strategy...........................................................................................................5
Positioning..............................................................................................................................6
Message strategy....................................................................................................................6
Advertising and promotion.....................................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Marketing management is a practice or discipline which focuses on market orientation
activities of organisation. The report will outline marketing management of Woolworths which is
one of the leading Australian grocery chain experience fake news scam of Hoax Vouchers. The
study will outline reviews of different authors on fake news and its significant impact on
consumer behaviours and brand reputation. Further, the assessment will outline marketing
strategy which will be initiated by Woolworths to minimize the impact of fake news.
SUMMARY OF FINDINGS ON FAKE NEWS
Study of Ordway, (2017), was focus on fake news and spread of wrong information
where aim of the study was to identify whether Facebook and Google are the reason behind
increasing false news and significant impact on minds of people. Fake news is the term
which means different things and different context which can be hazardous for people, society,
organisations and for everything. In accordance with the findings of study, it can be said that
most of the fake news is flooded during time of election. This news consists of perpetuating
conspiracy theories and false information. As per the views outlined in the study it is identified
that amount of spread of wrong information among people gives them right to believe and fight
against it.
According to Lazer et.al., (2018), fake news has become a global problem because
increasing vulnerabilities of people and manipulation of society. It is important to bring in the
change of system to safeguard society and reputation of organisations. As per the findings of
study it can be said that Fake news has a long history but still people focuses on unanswered
scientific questions which are raised by false creation.
However, Pennycook and Rand, (2018) outlined about inaccurate beliefs which are threat
to spread and impact of fake news. In this article scholar presented three studies on the basis of
cognitive psychological profile of people. It is found out that false statement in fake news is
consistently correlated to perception of accuracy of fake news. In addition, the correlation is
negative to individual ability to understand and differentiate between real and fake news. Thus,
as per the analysis it can be said that beliefs and involvement of people in fake news play a
crucial role in recognition and spread of false information.
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As per the views of Duffy, Tandoc and Ling, (2019) fake news is affecting democracy
and are considered as threat to interpersonal relationships. On the basis 12 focus group, it has
been found out that users of social media reacts to misleading information and is sole reason
behind spread of untrue information and impact on interpersonal relationships of receiver and
sender. It is outlined that sharing of negative or fake information is threat to beliefs of society.
On the other hand, Visentin, Pizzi and Pichierri, (2019), articulated on presence of fake
news on social media platforms in relation with marketing activities. It is observed that effect of
fake news is high or seen only when the brand reputation by company is build on same webpage.
Therefore, to fill this gap scholar conducted empirical investigation for determining whether
perception of individuals over fake news is transferred to brand advertisement. From the
manipulation of news and sources it has been found out that objective truthfulness of news does
not impact intention of consumers towards brand. Thus, it can be said that there is no harm of
fake news to brand reputation until the source of information is credible.
Focus of Kim et.al. (2018), was to outline crowd powered procedure to reduce
misinformation and fake news. In accordance with this procedure spread of untrue information
can be stopped because as per this when user post any information the users of site can flag it as
misinformation or real. The number of flags presented accuracy of information. Thus, as per
experiment on two real data set it is outlined that scalable online algorithm will be able to reduce
fake information. In this, stories uploaded undergoes fact checking procedure with the help of
marked temporal point process.
Apparently, Quintanilha, Silva and Lapa, (2019), stated about fake news and its impact
on trust of people on news. In accordance with digital news survey report in article, it can be said
that the people lacks ability to differentiate between real and fake news. Internet users lack trust
on media and therefore believes the news which offers high level of trust on the basis of their
security and safety.
According to Guess, Nagler and Tucker, (2019, fake news has renewed prevalence and
effects of misinformation therefore researcher in this study conducted a survey on the basis of
sharing activity in Face book profile data. It is found out that on average users over 65 shared
almost 7 times more articles from fake news in comparison to youngest age group.
In contrast, from the views of Waszak, Kasprzycka-Wasza and Kubanek, (2018), it can be
stated that majority of misleading news and data is regarding health and is posted on social
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media. It is identified that 40 % of cases on health contain wrong information and the news
shared was 451272 times during period of 2012 to 2017.
Considering the study of Guess, Nagler and Tucker, (2019), the dissemination of fake news
has boosted with social media and its impacting organisation and its stakeholders. The scholar
tested 2 hypothesis via online experiment via Qualtrics From the study it has been found out that
increased level of fake news impact credibility of organisation and its services because of
increased believe of people in rumours.
Ruths, (2019) articulated on presence of misleading news via internet media to understand
the consequences of marketing activities. The study was empirical from where it is found out that
whether individual perception of fake news to adjacent to advertisement of brand.
Vafeiadis et.al., (2019), focuses on impact of fake news and its truthfulness where it has
been found out that popularity of fake news is based on two tendencies that is fuel and crave for
fake news.
On the other hand, Visentin, Pizzi and Pichierri, (2019) stated that about spread of fake news
by social bots which is global risk. In this study, scholar analyses 14 million messages spreading
claims on twitters in 2016. From study, it is found out that social bots are effective mitigating
strategy spread of fake news online.
As per the views of Berthon, Treen and Pitt, (2018), countering fake news a survey of recent
global initiatives. From this, it has been out that legislation, crisis communication and checking
measures should be the first step to minimize impact of misleading information. Apparently,
Shao et.al., (2017), outlined about spread on online fake news which is challenging for
society across the globe. The study was based large scale evaluation game with 15000
participants. It is found out that ability of people to spot fake news improves spread and
understanding of fake news.
CASE ANALYSIS
Woolworths is Australian supermarket store chain founded in 1924. The company has
duopoly with Coles and both the firms are accountable for their services in 80 % Australian
market. The company has tremendous increased in market and profits because of market
acceptance like in Australian food market the company has string sales of 4.3 % and total
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revenue was 3.5% that is $57.19 billion. The focus of organisation is on keeping its customers
first and therefore company keeps its buyers updated about every change.
History
The first store of Woolworth was opened by Frank Winfield on 22nd February 1879.
Presently the company is located at 995 locations and employed 115,000 employees. The
organisation was developed by two brothers via direct purchasing, sales, customer services
practices and merchandising.
Products
The company deals in wide range of products like clothing, accessories, groceries,
beauty, footwear, financial series and home ware. Total revenue of organisation in 2018 was of $
70.5 Billion, net income was $ 3.55 Billion and Operating income was $ 5.26 Billion. As per the
views of Mitchell, 2019, it is identified that Woolworths has strong control over consumer
confidence and 70 % of its earning come from groceries and food and 10% from poker
machines, hotels and liquor.
Financials
Woolworth was rewarded by its shareholders with increase in dividends by 22.6 % that is
to 103 cents of shares inclusive of 10 cent special dividend. The company is known for its
strongest sales growth from past few decades. Full year net profit of organisation after taxes was
of 12.5 % that is $1.724 billion. According to Mitchell, (2019), it is outlined that from
continuous operation net profit of Woolworths excluding petrol increased by 2.1 % that is to
$920 million. Whereas, earnings before tax and interest increased by 1 % that is $1.4 billion.
However, as per consensus forecasts the earning have fallen short $1.51 billion (Woolworth
Group. 2019).
Distribution
The company has Distribution centre replenishment department with its logistic group.
The team works responsible for replenishing stock in distribution centres. The team is
responsible for creating thousands of purchase orders for delivering services across international
boundaries. The Woolworths Distribution Centre worth $90 million employs more than 400
people and has turns over of around $2 billion of stock every year.
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Competitors
The company is ahead of its biggest competitor that is Coles with sales growth of 2.1 %
where sales growth of Coles was 1.1%. The grocery chain faces increasing competition from
international companies’ like Aldi, Tesco. The major reason behind continuous competition is
quality of products and services and consumer acceptance. Further, to minimise impact of
competition the company offers products at competitive pricing and also offers discounts and
vouchers on bulk shipping. This is the strategies which act as strength for the company for
gaining attention of buyers. However, the fake news of Hoax vouchers by Woolworths led to
change in consumer behaviours and perception which becomes a major barrier to competitive
advantage of supermarket chain.
Claims made in fake news
Fake news pay crucial role in influencing behavioural perception of customers. This is
experienced by one of the leading grocery retail chain of Australia that is Woolworth where
number of customers received fake messages regarding company giving way free ZAE20
vouchers to celebrate its 87th Anniversary. The fake news claimed that it is online crime by
Woolworths to access financial and person information of consumers. This hampered the
corporate reputation of business. Also, the Hoax vouchers led to threat among regular shoppers
(HOAX ALERT] Woolies is not giving away R250 vouchers, 2019). However, the information
spread when the consumers start posting about the vouchers and scam. The claim of fake news of
that the company is emailing and messaging people for sharing their person information to
redeem vouchers. The claim in news was also about the winning prizes by Woolworth where the
customers were offered free gift cards. Thus, in this people started receiving fraud automated
calls claiming that it is from Woolworths and consumer just need to their financial and person
information to get access to vouchers and gift cards.
PROPOSED MARKETING STRATEGY
Product/Brand strategy
It is the long term plan which will be incorporated by Woolworths to protect its brand
reputation from fake news and misleading information. In this focus of firm will be meeting
emotional and needs of consumer to achieve competitive advantage. The hoax voucher campaign
hindered trust of consumers on company.
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 Brand strategy of Woolworths will be focused on developing trust of consumers which
will be done via content marketing. In this the marketing team of company will aim at
sharing valid information with customers like its vouchers details, details of site,
information required by organisation, etc. This will reduce the risk of fraud in the name
of company.
 Brand positioning: In this will focus on sharing relevant information with about its
services to maintain transparency with consumer and it’s to protect them from fake news
and misleading information (Ruths, 2019). The details about vouchers and gift cards will
be shared by customer care team of company and also customers will be provided 24*7
assistance.
Positioning
Woolworths will focus on problem solving positioning where focus of brand will be on
assisting consumers with every query with regard to products and services. The company will
focus on pin point areas and challenges the consumers face in their
communication and other marketing strategies. This will be done to develop
brand reputation and enhance communication with customers and to protect
them from misleading information like scams for seeking access to personal
information.
Message strategy
Message strategy of Woolworths will be focused on emotions and brand image. In this
the company will focus on content like trust, satisfaction, beliefs, etc. Key message of company
will be “Consumer are the first priority of us ad their satisfaction is of utmost importance”
“Ready to help when you need”.
Advertising and promotion
Advertising and promotion will be focus on digital and direct strategy where in digital the
company will focus on marketing its message and assistance on social media platforms.
Marketing team of Woolworths will focus on promotion on social media platforms like
Facebook, Linked In, Instagram, etc. During social media promotion focus of team will be on
making consumers aware about vouchers services and plans of Woolworths in order to protect
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consumers from scams. Marketing content will be drawn in context to value of consumers like
the company will never ask access for person information of consumers. The company believes
in maintaining confidentiality of information.
On the other hand, in direct marketing on television the organisation will develop
advertisement on the basis of role play which will comprise detailed view of fake news and
scams. Also advertising will be with the purpose to make consumer difference between real and
fake information.
CONCLUSION
The report concluded views of different scholars on fake news ad how its impact brand
reputation by misleading consumers. The study outlined case of Hoax vouchers which was scam
fake news against Woolworth which is Australian Supermarket chain. Thus, it concluded with
marketing plan consisting of promotion advertising, positioning of brand, etc, to increase
consumer awareness and gain their trust and loyalty.
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REFERENCES
[HOAX ALERT] Woolies is not giving away R250 vouchers. (2019). [Online]. Available through:
<https://ewn.co.za/2018/06/05/hoax-alert-woolies-is-not-giving-away-r250-vouchers>.
Berthon, P., Treen, E. and Pitt, L., (2018). How truthiness, fake news and post-fact endanger
brands and what to do about it. GfK Marketing Intelligence Review, 10(1), pp.18-23.
Duffy, A., Tandoc, E. and Ling, R., (2019). Too good to be true, too good not to share: the social
utility of fake news. Information, Communication & Society. pp.1-15.
Guess, A., Nagler, J. and Tucker, J., (2019). Less than you think: Prevalence and predictors of
fake news dissemination on Facebook. Science advances. 5(1). p.eaau4586.
Kim, J., Tabibian, B., Oh, A., Schölkopf, B. and Gomez-Rodriguez, M., (2018). Leveraging the
crowd to detect and reduce the spread of fake news and misinformation. In Proceedings of the
Eleventh ACM International Conference on Web Search and Data Mining (pp. 324-332). ACM.
Lazer, D.M., Baum, M.A., Benkler, Y., Berinsky, A.J., Greenhill, K.M., Menczer, F., Metzger,
M.J., Nyhan, B., Pennycook, G., Rothschild, D. and Schudson, M., (2018). The science of fake
news. Science. 359(6380). pp.1094-1096.
Mitchell, S., (2019). Woolworths to return up to $1.7bn to shareholders as interim profit edges
up to $979m. [Online]. Available through: < https://www.afr.com/companies/retail/woolworths-
to-return-17b-to-shareholders-as-interim-profit-edges-up-to-979m-20190219-h1bgwy >.
Ordway, D. M., (2017). Fake news and the spread of misinformation. [Online]. Available
through: <https://journalistsresource.org/studies/society/internet/fake-news-conspiracy-theories-
journalism-research/>.
Pennycook, G. and Rand, D.G., (2018). Who falls for fake news? The roles of bullshit
receptivity, overclaiming, familiarity, and analytic thinking. Journal of personality.
Quintanilha, T.L., Silva, M.T.D. and Lapa, T., (2019). Fake news and its impact on trust in the
news. Using the portuguese case to establish lines of differentiation. Fake news and its impact on
trust in the news. Using the portuguese case to establish lines of differentiation. (3). pp.17-33.
Ruths, D., (2019). The misinformation machine. Science. 363(6425). pp.348-348.
Shao, C., Ciampaglia, G.L., Varol, O., Flammini, A. and Menczer, F., (2017). The spread of fake
news by social bots. arXiv preprint arXiv:1707.07592, pp.96-104.
Vafeiadis, M., Bortree, D.S., Buckley, C., Diddi, P. and Xiao, A., (2019). Refuting fake news on
social media: nonprofits, crisis response strategies and issue involvement. Journal of Product &
Brand Management.
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Visentin, M., Pizzi, G. and Pichierri, M., (2019). Fake News, Real Problems for Brands: The
Impact of Content Truthfulness and Source Credibility on consumers' Behavioral Intentions
toward the Advertised Brands. Journal of Interactive Marketing. 45. pp.99-112.
Waszak, P.M., Kasprzycka-Waszak, W. and Kubanek, A., (2018). The spread of medical fake
news in social media–the pilot quantitative study. Health Policy and Technology, 7(2), pp.115-
118.
Woolworth Group. (2019). 2019 Annual Report. [PDF]. Available through: <
https://www.woolworthsgroup.com.au/icms_docs/195582_annual-report-2019.pdf>.
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