Company
Discuss About The Important Business Organizations Marketing.
The current business scenario is much more dependent on the effective marketing strategies. This is due to the reason that the competition is much higher in the current business scenario and it is important for the business organizations to come up with effective and efficient marketing strategies. The more effective will be the marketing strategies, the more will be the probability for the business organizations to stay ahead in the competition (Cuadros & Dominguez, 2014). It is important for the contemporary business organizations to cover all the elements of the marketing mix in order to have holistic implementation of the marketing activities.
This report will discuss about the initiation of the marketing mix strategies by Woolworths. All the elements of the marketing mix will be evaluated along with identifying the concepts they are following. In accordance to their current marketing mix strategies, recommended 8Ps of marketing mix will also be discussed.
Woolworths is one of the leading retail chains operating on the Australian region. They are founded in 1924 and are one of the two big brands in the Australian retail scenario. It is reported that currently they are having more than 1000 stores across Australia. Thus, the market penetration for Woolworths in the Australian market is favorable (Dos Santos, Svensson & Padin, 2013). The major competitor for them is Coles, which is having the market leadership status in the Australian region. Moreover, in the recent time, there are number of newer and smaller retail chains have entered in the Australian region. Thus, it is important for Woolworths to have effective marketing mix strategies in place.
Woolworths is having huge and diverse product portfolio as their offerings. The core offerings of Woolworths are mainly the grocery products including the fruits, vegetables and meats. Apart from these, they also offer household products, beauty products and processed food products. In the recent time, they also came up with their own privet label brand in different food category (Arli et al., 2013). One of the most popular and innovative products they launched in the recent time is the Ice break coffee. This product is considered as an innovative one due to the reason that ice break coffee is targeting both the customers willing to have milk or coffee. This report will discuss about the marketing mix strategies for ice break coffee.
Product portfolio
Woolworths operates in the mass market and thus they cater to huge and diversified customer segments. This is due the reason that that they are in the retail business and thus majority of the retail items are bought as necessary items rather than luxury items. Thus, the customer management for Woolworths is vast and wide with having different and varied requirements (Valentine & Powers, 2013). Customers willing to have daily products under one roof and at affordable price tag are the target customers for Woolworths. Therefore, the demographical segmentation of the customer segment for Woolworths is also wide and vast due to the fact that larger section of the customers across all age groups is being targeted.
Product is the first element of the marketing mix strategy. It denotes the core offerings by the organization to the customers. Product is the element, which creates value for the customers and which provide value to the organizations. In the case of Woolworths, ice beak coffee is selected as the product. The major objective in offering this product is to cater to the gap in the current market of health drinks. This is due to the reason that customers were having the options of milk or coffee or tea as their morning drink. By offering ice beak coffee, Woolworths targeted both these customer segments at once. It also helped them in having distinctive offerings in the market. Ice beak coffee can be termed as convenience product due to the reason that it is affordably priced and are being bought for repeated times (Watson et al., 2016). Thus, the strategy of Woolworths in targeting more customer segments in the beverage category go fit with the introduction of ice beak coffee. Introduction of ice beak coffee is helping Woolworths to have larger section of target customers along with creating a completely new product category.
Price is the next element in the marketing mix strategy that denotes the value of the product. In the case of the ice beak coffee, Woolworths initiated the strategy of market penetration pricing strategy (Schmidt, Spann & Zeithammer, 2014). This due to the fact that the objective of Woolworths is to cater to maximum number of customers and thus initiation of the market penetration strategy is helping them to maximize the sales volume from the initial stage. In addition, due to the fact that Woolworths operates in the mass marketing retail sector, market penetration pricing strategy is more effective and fit with their overall strategic approach. One of the major advantages that are being gained by Woolworths by initiating the market penetration pricing strategy is managing enough potential customers and visibility for their new products.
Consumer
According to the above example, the price set by Woolworths for their Ice break coffee is at par to the market price. Thus, offering distinctive products of ready to drink coffee and milk blend in same price level of the conventional competitors enabling Woolworths to target the same customer segments in the market (Spann, Fischer & Tellis, 2014). Thus, the strategy of initiation of market penetration strategy is beneficial for them due to the reason that it helped Woolworths to enhanced the reach and market exposure of the product in its initial stage.
Place in the marketing mix strategy defines the distribution of the products across the value chain to the customers. The more effective will be the distribution network, the more effective will be the reach of the products to the target customers. Woolworths maintain selective distribution strategy for the Ice break coffee (Shi, Liu & Petruzzi, 2013). This is due to the reason that initiation of the selective distribution strategy helps them to sell their products only through their retail outlets. Moreover, this also helps them to have the reach of the product to the potential customers through all their retail outlets across Australia. In addition, there are no intermediaries present between Woolworths and the manufactures. This helps them to have less cost involved in the sourcing process.
According to the strategy of Woolworths in relation to the market penetration of Ice break coffee, selective distribution strategy along with having no intermediaries in the sourcing process is well fitted. This is due to the reason that having no intermediaries in the process of sourcing helps Woolworths in regulating the cost and offer the product in the market in lowest possible price. On the other hand, initiation of the selective distribution strategy also helps Woolworths to maintain the exclusivity of the ice break coffee. This helps them to compete effectively with the conventional products in the market. It can be concluded as a good idea due to the reason that to have successful market opportunities for the newly launched customer products, it is important to have some sort of distinctiveness along with having favorable pricing (Martin-Herran & Taboubi, 2015). Thus, Woolworths through their selective distribution strategy is being able to meet both the criterion.
Promotion refers to the marketing activities being initiated in order to promote the new products in the market and make the customers aware about the products. The more effective will be promotional strategy, the more market reach will be gained by the offerings among the customers. Woolworths initiates Omni Channel marketing and promotional strategies for all their offerings including the ice break coffee (Verhoef, Kannan & Inman, 2015). With the help of the Omni Chanel promotional strategy, they are being able to cater to the different customer segments. Some of their promotional strategies include offering seasonal discounts and rebates on the products and product bundling strategy. Initiation of the product bundling strategy also helps Woolworths to offer the ice break coffee along with some other related products.
Customers from different age groups in Woolworths
On the other hand, online promotional activities for Woolworths include social media marketing for their different products. In case of the ice break coffee, the discounts and offers given are promoted through the use of the social media. The core objective of Woolworths in having the maximum market reaches for ice break coffee is well fitted by their promotional activities (Ashley & Tuten, 2015). This is due to the reason that initiation of the seasonal discounts and offers further reduce the price of the products and thus the level of target customer segments get further increased. On the other hand, initiation of the extensive marketing and promotional activities also enable them to reach out to maximum number of potential customers. This is well related and associated with the strategy of market penetration of Woolworths.
Process refers to the service delivery approach of the organization in delivering the value for the customers. Thus, effective service delivery process in the organization will help to enhance the value for the customers along with enhancing their level of satisfaction. In the case of Woolworths, they are having both online and offline mode of payments and shopping conveniences (Villamagna, Angermeier & Bennett, 2013). For instances, customers are having the options to buy ice break coffee from Woolworth through their online marketplace as well as through their retail stores. On the other hand, in case of the offline service delivery, customers are having the options of online payment system. This helps in having lesser queue in the store. Woolworths are also having customer help executives in their retail stores that help the customers in having the brief idea about the product.
In accordance to the market penetration strategy of Woolworths, offering different types of the payment options along with having both online and offline mode is helping in reaching and targeting the maximum number of customers. Thus, this strategy is also well fitted in line to the overall marketing strategy of Woolworths.
Physical evidence refers to the physical value including the aesthetic value and touch and feel that are gained by the customer from having the access to the products. Ice break coffee is having different sizes of pet bottle. All the bottles are designed aesthetically along with having the color that denotes the content (Khan, 2014). Availability of different sizes of ice break coffee helps Woolworths to target different requirements of the customers. In accordance to the market penetration strategy of Woolworths, the physical evidence is well fitted due to the reason that availability of different sizes of pet bottles is helping in targeting customers with different requirement level.
Marked price of Ice Break coffee
People refer to the internal stakeholders involved in the service delivery of the offerings to the customers. Effectiveness and efficiency of the people determines the quality of the service delivery. Woolworths is having well skilled and trained employees in place and in different service levels (Elnaga & Imran, 2013). This helps them to enhance the value creation process for the customers. For instance, customers are having the option to seek the help of the sales executives in having the brief about ice break coffee prior to their buying decision and they will be given services by the trained employees in case of any grievances. Thus, effective access to the human resources is helping Woolworths to provide favorable service to the customers.
Partnership refers to the strategic alliances between the different entities in delivering the value to the customers. In selling the ice break coffee, Woolworths is having partnership with ice break. This is due to the reason that ice break is the manufacturer for the ice break coffee and Woolworths are their retailing partners (Iyer, 2013). This partnership between them is having benefits for the both the entities due to the reason that Woolworths are gaining the benefits of having innovative products by selling ice break coffee and on the other hand, ice break is leveraging the vast retail network of Woolworths in order to increase their sales revenue. Strategic partnership between these two organizations is helping to target the maximum customers by offering innovative products and through wide and vast network of retail chains.
The product being offered by Woolworths is innovative and distinctive in the market. However, the innovation will be less viable in the long term due to the reason that entry of new competitors with similar value proposition will reduce the distinctiveness of ice break coffee. Thus, it is recommended that Woolworths should initiate the strategy of product diversification and increase in product line. This is due to the reason that ice break coffee is currently available in one flavor. Thus, with the initiation of the product diversification strategy, Woolworths should have different flavors in place based on the customer feedback. They can also offer other substitute brands that are available in different flavors. This will help Woolworths in having more options to target more diversified set of customers.
Currently, Woolworths are having market penetration pricing strategy for ice break coffee. This strategy is effective and proper and it should not be changed. However, it is recommended that the price should be at par to the market standard. This is due to the reason that offering aggressive pricing for the ice break coffee much below the market determined price will create negative brand value in the market. It will be perceived as cheaper alternative to other substitute products. Thus, market penetration pricing should be there in place but it should be competition based. This will enable Woolworths to offer the product in competitive pricing without reducing the brand value and image.
Promotion
The current selective distribution strategy is also the most proper strategy for Woolworths for ice break coffee. However, it is also recommended that Woolworths should make the ice break coffee well available across all their retail stores. This is important due to the reason that selective strategy of distribution will only be successful if the products are widely available at any point of time. However it should also be noted that ice break coffee is not only available in the retail stores of Woolworths rather they are available in other retail outlets also. Thus, it is recommended that Woolworths should increase the availability of the product in both offline and online medium in order to cover the larger section of the market.
Currently, Woolworths are having extensive strategy of promotional and marketing activities. It is recommended that Woolworths should initiate promotional campaigns in different locations. This is important due to the reason that in order to target the customers from the conventional brands, they should provide the customers real experience and taste. Thus, Woolworths can conduct promotional activities for their newly launched products, which will aware the potential customers about the availability of the new products. Moreover, it is also recommended that social media should be used by Woolworth not only for promoting their products but for garnering feedback from them. The promotional activities should be more aligned to the market feedback and trend. This will ensure that the promotional activities of Woolworths will be more effective and will be in line to the current market preferences.
The current service delivery process for Woolworths is quite effective and efficient. However, it is recommended that they can initiate the process of virtual shopping experience for the customers. This will help to enhance the customer’s shopping experience along with reducing the requirement of staying in queue for longer hours. Moreover, automated checking mechanism can also be initiated in order to overcome the issue of time consumption in the checkout process. These steps will further enhance the service delivery process of Woolworths and will help them in staying ahead in the competition.
Majority of the aspects in relation to the physical evidence of ice break coffee is not with Woolworths due to the fact that they are not the manufacturers. However, it is recommended that Woolworths can specifically design the physical environment of their stores particularly for the ice break coffee. Store ambience can also be enhanced in order to create a positive impression among the potential customers. For instance, having the color of the entire section similar to the brand color of ice break coffee will enable the customers to relate more.
Already Woolworths are having skilled and trained human resources in place. However, it is recommended that the training process should be initiated more frequently and in periodical manner. This will ensure that employees are well adhered to the latest market and business development. Thus, the more updated will be the employees, the more will be the effectiveness of the in dealing with the change in the expectation of the customers. In addition, it is also being recommended that Woolworths should equip their front line employees in garnering feedback from the customers. This will help in ensuring that the customer service provided will be more effective and in accordance to the customer’s requirements.
It is recommended that Woolworths can have their partnership with other coffee brands similar to the ice break. This will have dual advantages for them. One of the major advantages for them will be the increase in the number of variation in the offerings with offering different bands. Moreover, it will also help Woolworths to reduce the dependency on the single brands that will further increase the competitiveness of the organization.
Conclusion
Thus, it can be concluded that Woolworths are already having effective policies and strategies in relation to the marketing mix strategies. This report discussed about the extended marketing mix elements for Woolworths. Different marketing theories and concepts used by them are evaluated in this report. This report also discussed about some of the recommended steps in relation to their extended marketing mix elements. There are number of recommended steps are being discussed in this report. It is expected that the effective implementation of the discussed steps will help Woolworths in enhancing their business effectiveness and performance.
Reference
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