Suggested Marketing Strategy For ALDI’s Expansion Into New Zealand

History of the company

Globalization has brought about an initiation of a large number of marketing strategies which can be used by the organizations in order to expand their operations and in order to ensure that the different firms are successfully able to increase their market positioning as present in the industry. The case of the ALDI supermarkets has come off as a typical case of how proper planning and differentiation can make about a huge difference in the overall functioning of the firm (Chaffey & Ellis-Chadwick, 2012).  

The company expanded its operations in Australia and even though the market share was in the form of a duopoly by Coles and Woolworths, ALDI maintained its ground and was able to find success in the country. Based on this, the main aim of the report is to highlight the suggested marketing strategy which can be adopted by ALDI in case it plans to explain its operations to New Zealand. The report follows a simple structure whereby each section is divided into different tasks and each task analyses the current operations of ALDI by the means of understanding the current operations of ALDI in Australia, analyzing the competitors as present, understanding the firm`s strength and weaknesses and along with this devising the current strategy for its expansion plan in New Zealand.

History of the company

The company started its operations in the year 1946 after Karl and Theo Albrecht took the control over their mother`s store in Essen, Germany. Initially the store begin its operations as a provincial store but build the store up to make it one of the largest retailers as present around the globe (Aldi.com , 2018). The ALDI has two divisions Aldi Nord which had shops in Germany and Aldi Sud which is based in the south and in the United Kingdom. The name of the company came as a combination of the Albrecht and discount and the main reason why the company became increasingly popular with its `everyday low pricing ` policy which allows the brand to ensure that they are successfully able to account for a larger market share when compared to that of its competitors. The company is based on the mantra that it is relentlessly simple.

Vision and mission

Vision statement

Our vision is to enable Australian shoppers to live richer lives for less. All people, wherever they live should have the opportunity to buy everyday groceries of the highest quality at the lowest possible price. To put it simply, we offer our customers a smarter way to shop. ` (Aldi.com , 2018).

Vision and mission

Mission of ALDI

The mission statement of Aldi seeks to ensure that the company is successfully able to ensure that they are being able to provide high quality products to the different consumers and that they are being able to meet the needs of the different customers consistently thereby ensuring overall success of the firm at large.

Values and Beliefs

The values as well as beliefs based on which Aldi functions have been elaborated on as follows:

1. Simplicity: The Company believes that it needs to center its operations on simplicity which will then ensure that the firm is successfully able to gain a larger market share.
2. Responsibility: The operations need to be based around responsibility as Aldi believes that it is responsible to the different stakeholders as present.
3. Reliability: It ensures that the suppliers as well as the different customers have a reliable relationship with the firm (Chaffey & Ellis-Chadwick, 2012). 

Product portfolio offered

The different products as offered by Aldi comprise of the following:

1. Beauty products
2. Vegetables and fruits
3. Household cleaning supplies
4. Baby products
5. Staple items
6. Electronics
7. Refrigerated items

As ALDI is planning to expand its operations in New Zealand, the company would be required to ensure that it is successfully able to measure the level of competition which is present in the particular industry as it would be required to form certain strategies and other related tactics to combat against the competition.

In the past, especially in the case of Australia, Aldi has been successfully able to combat against the supermarket giants like Woolworths and Aldi and with respect to this it can be stated that Aldi does possess the capability to expand its operations and be successful (Aldi.com , 2018). Hence, the particular table will look out to compare and contrast the different operations as offered by the different supermarket firms as present in New Zealand along with an analysis of their Strengths, weaknesses, features of the product and the promotion strategy.

Competitor	Strengths	Weaknesses	Product features and benefits	Promotion and strategy
Countdown Countdown is a leading supermarket brand as present and provides good quality as well affordable products	The brand is leading in the New Zealand market. It has its own line of products as present	The company faces various employee problems.	The features and benefits of the products offered are as follows: They belong to the home brand. They are healthy and safe They are sourced from the local suppliers.	The different promotional strategies as used by the company are as follows: It uses an extensive pricing strategy to deal with the competition.
New World The new world supermarket chain is a full service supermarket chain which sells the products in New Zealand	The brand is very popular in New Zealand It has a large product offering It offers affordable pricing (Kotabe & Helsen, 2014).	The company has been faced by employee issues. Moreover, the company also faces competition from various online sellers.	The products and benefits are as follows: The products are of the company`s own label Various other products are imported as well.	The company makes use of a differentiation strategy which means by following the wide product based the company aims to ensure long term market success

The SWOT Analysis serves as a useful tool which goes a long way in ensuring that the business is able to understand the different Strengths, weaknesses, Opportunities and Threats which are possessed by it. In this manner, the business will be successfully able to understand the areas where the business would be required to improve its operations and what strategies it can adopt in the future (Aldi.us .2018). The SWOT Analysis of the Aldi supermarket in Australia has been done as follows:

Strengths

The strengths can be stated to be the internal capabilities as possessed by the business which help in ensuring that the business is able to successfully achieve its objectives at large. The different strengths as possessed by the Aldi Supermarkets in Australia can be stated to be as follows:

1. Pricing: the pricing strategy as followed by Aldi can be stated to be very suitable for the different consumers as the company allows the different customers a great extent of discounts which cuts down considerably on their various expenses and ensures that the firm is successfully able to win over the customers.
2. High level of customer support: The customer support as provided to the shoppers is quite helpful in nature as it is successfully able to allow the different consumers to find their products and communicate with them effectively through the online website which further strengthens their relationship with the firm (Aldi.us ,2018).
3. Considerable product mix: The product mix which is offered by the firm is very attractive as the company not only provides in house labels which are of the best price but ensures that I is able to provide the best quality of the products as well. In this manner, Aldi in Australia has been able to build a good base for itself.

Weaknesses

A weakness can be defined as an internal inability of the firm which limits the different operations of the business and along with this hinders its operations considerable. The different short comings of the company as present are as follows:

1. Low employee margins: The number of employees employed in each store is considerable lower. However, it needs to be noted that although this assists in saving the costs of the firm, it may portray itself as a problem in the scenarios where there is a sale and the firm is unable to manage the footfall.
2. Poor retention of higher income group consumers: As the organization makes limited offerings to the different consumers and in addition to this, it offers well of a limited pricing range as well, the firm is unable to ensure all the good quality products these consumers would need.
3. Poor employee satisfaction: The employee satisfaction rate of the store is considerably very poor as the employees feel burdened by the pressure which is placed on them.

Values and beliefs

Opportunities

The opportunities may be stated to the presence of certain external factors which may be useful for the firm and help them to use it to its advantage. The different opportunities as available to the firm can be stated to be as follows:

1. Preference of the customers: The preference of the consumers have been changing and recently, even Aldi has been successfully able to bring about a new line of products which makes it possible for the firm to engage in relations with different consumers.
2. Online presence: The Company can make its presence on social media visible to one another and in lieu of this, it becomes easier for the firm to ensure successful operations.
3. Expansion to New Zealand: The Company can seek the operations and expand its branches in New Zealand as well.

Threats

The threats can be stated to be the presence of certain factors as present in the external environment of the business which may then tamper the overall growth of the company at large. The different strengths as available to the company can be stated as follows:

1. Competition as present: There are a large number of competitors as present for the firm. These competitors are companies like New World and Primark in New Zealand whereas the competitors as present in Australia are Woolworths and Coles.
2. Changing technology: The technology has been changing considerably and the different companies as present prefer to serve the different consumers using the online domain.
3. Changing consumer preference: The consumer preference may change for the negative as well and the consumers may concentrate more on quality rather than on the pricing offered.

The segmentation strategy can be stated to be a crucial strategy which is required to be adopted by the organization and goes a long way by assisting the firm to decide upon the selected target market the firm wants to serve. The segmentation of any organization is done by making use of various segments as available to the firm at large. The different geographic segments which are available are as follows:

• Geographic segmentation: Through this segmentation base the firm usually divides its target market based on the nations as present, regions in the market, the different countries, the population density and other related factors. Aldi uses these factors and segments units Geographic target market by making use of the countries and the population density factors which helps it to ensure success in the long run (Chernev, 2018). 
• Demographic segmentation: The demographic segmentation is the segmentation which is down with respect to factors like the age of an individual, income, gender, size of the family and other related aspects (Foxall, 2014). In case of differentiating the market with respect to the demographic factors, Aldi makes use of the income size and family size as well. The market generally targets the lower and medium segment of the market and offers large sizes of the product which portrays that it is generally targeting the different families as present.
• Psychographic segmentation: The psychographic segmentation generally uses the different factors of social class, the lifestyle of the individual and the personality characteristics (Foxall, 2014). The ALDI supermarket targets its customers by making use of the factors like their social class. The consumers on the medium and the lower segment of the social class generally prefer high discounts as well as offers which then makes it easier for the firm to approach them.
• Behavioral segmentation: In the behavioral segmentation, the different organizations make use of the factors like consumer knowledge, loyalty, attitudes as well as factors like responses to a product in order to choose its target market. In this aspect it can be stated that Aldi makes use of the factors like attitude towards the goods purchased, their knowledge based upon the quality and their loyalty towards the firm as a deciding factor.

Targeting strategy

The targeting strategy helps a firm in deciding upon the kind of audience which they want to attract and the different factors based on which the targeting decision has been made at large. According to Sashittal and Wilemon  (1996), the targeting strategy which is adopted by the Aldi is the undifferentiated targeting strategy. Under this undifferentiated marketing strategy,

the firm may not strongly differentiate between the different customers with respect to the characteristics they possess. Moreover, the cost of developing the different marketing mix may add up to the costs of Aldi which they avoid and develop a single marketing mix for the entire firm as present. There does not exist major segmentation. Hence, it can be stated that Aldi adopts an undifferentiated targeting strategy as it views the market with few visible differences at large.

Positioning strategy

The positioning strategy goes a long way in assisting the company to create a separate position as present in the minds of the consumers for the overall wellbeing of the company. In the given scenario it can be stated that, Aldi aims to create the following positioning for itself in the target market.

Aldi offers good quality in house label products at discounted prices.

This means that Aldi wants to differentiate itself from the competitors like Woolworths and the Coles on the basis of the quality of the products as well as the prices which are offered to them at large.

Competitor

In the previous sections, the overall strategy of Aldi was discussed based on its selection of the target market and other related factors. However, in the given section, the 4Ps of marketing of the firm will be discussed which will help in understanding the offerings as made by the brand (Hamzah & Sutanto, 2016). The four different elements of the marketing mix of Aldi can be stated to be as follows:

Product

The product offerings which the firm offers are goods like the follows:

1. Beauty products
2. Vegetables and fruits
3. Household cleaning supplies
4. Baby products
5. Staple items
6. Electronics
7. Refrigerated items

Using this offering the firm aims to ensure that it is successfully able to meet all the needs of the different customers and ensure that it is successfully able to make a good positioning for itself in the selected target market. The three levels of the product are as follows:

1. Core product: The customers are actually seeking to buy the grocery items and other goods which are available with the supermarket brand at a cheap pricing policy.
2. Actual product: The actual product s high quality goods being offered like eatables, household, beauty and electronics.
3. Augmented product: Lastly, the augmented product in the particular case is the discounts the company provides to the different consumers along with the home delivery service as provided by them (Pine, 2015).

 The price forms a crucial part of the marketing strategy of the firm and with respect to this, it can be stated that Aldi needs to ensure that it engages in a good pricing strategy which will allow it to combat against the different consumers as available.

The main pricing tactic which is used by the company is the Price Adjustment tactics. The price adjustment tactic is the tactic which is followed by the company and through this the firm ensures to maintain the lowest price as possible (Sashittal & Wilemon, 1996). This tactic can be done by maintaining a lower number of staff at the stores, maintaining a limited inventory and ensuring that no wastage exists. The competitors of the company like Coles and Woolworths like to maintain a large inventory which in turn turns up their costs.

Place

  The place strategy decided upon the distribution strategy of the company at large and helps to understand which channels are to be used by the company in question. Aldi in this case makes use of the selective distribution strategy whereby the company seeks to make a parity between the exclusive distribution strategy and the intensive distribution strategy and aims to ensure that it is able to reach out to the designated target market in an easy manner (Hutt & Speh, 2017).  

By making use of this strategy the firm seeks to ensure that although it makes use of more than one distribution channel in order to bring about the products of the company to the different consumers, but does not involve many middlemen and other such parties in this procedure as it tends to increase the costs which are available at large. According to Kumar, and Kim  (2014), Aldi aims to use the strategy of selective distribution strategy by using only certain manufacturers and local suppliers.

SWOT analysis

Promotion

The promotional mix forms an integral part of the organization and by means of this, the Aldi aims to see to it that it is successfully able to engage a large target audience and increase the revenues of the firm as available. The three crucial aspects of Aldi are as follows:

1. Advertising: Advertising is considered to be an integral part of the marketing strategy of the firm (Malhotra & Peterson, 2014). The advertising strategy of Aldi seeks to ensure that it is being able to give out the message that Aldi has the cheapest offerings which can be made.
2. Social media strategy: The social media strategy of Aldi can also be considered to be quite strong and the firm is stated to have a good presence in Facebook and twitter which helps it to generate considerable sales.
3. Mobile marketing: The mobile marketing can be taken to be another useful tool for promotion and goes a long way in ensuring that the daily offers and other such promotional messages are sent out to the different customers as present (Piercy, 1998).

The main purpose of the report was to highlight the promotional techniques which can be followed by the company in order to extend its offerings to the country of New Zealand. The different promotional tactics which are being recommended to Aldi for its expansion to New Zealand has been given as follows:

Social media strategy

In this kind of a strategy, the organization can make use of the medium of social media like Facebook and twitter in order to be able to successfully promote a product. The company can start a hashtag #AldinNZ with the help of which it can use the medium of the two social media marketing websites as selected to promote the products of the company (Sargeant & Macquillin, 2016). This way the firm will be able to keep its promotion strategies systematized but in addition to this it will also be able to ensure that the firm is able to reach through a large customer base.

General billboard advertisement

The general billboard advertisement strategy can be followed by Aldi whereby the company can put up the hoardings of the savings which each consumer might incur once it invests in the Aldi way of shopping (Kumar & Kim, 2014). In this manner, the target market will be able to understand that they must use Aldi for their shopping solution if they want to save their costs.

Persuasive Techniques

Based on the Aristotle’s persuasive techniques, the persuasive mode of Ethos can be used. By using this mode, the organization can build its credibility in the market by ensuring the different consumers that if they shop from Aldi’s they are guaranteed to spend less money on the same product line (Marshall, 2014).  Customer testimonials and brand history do help in this case.

The given chart based on the Hofstede`s cultural model compare Aldi`s original country, Germany and the targeted market of New Zealand. The major differences in the two cultures are as follows:

• The Germans are quite considerate about the long term orientation and the future but on the other hand, people living in New Zealand are more oriented towards present and like to live their life in that manner (Robson, 2015).
• Moreover, the Germans are more inclined towards achievement and success whereas the people in New Zealand are more concerned about the quality of life and wellbeing.
• Where the people in Germany are quite restrained in nature, the people in New Zealand can be taken to be more indulgent and like to spend on their desires.

Hence, in order to bring about a solution for the same, the following negotiation strategies are being recommend:

1. The advertisements should be more inclined towards humor and be open. This is because the culture of the country is more lenient than that of Germany.
2. As the people like to engage in indulgence, the advertisements should make additional item offers so that they make the purchase (Stead & Hastings, 2018).
3. They need to come up with the advertisements which offer a personal touch as it helps to ensure long term success and higher purchases.
4. The arguments and the positioning of the Aldi needs to be supported with factual data so that the audience can make a decision accordingly.
5. Counterproposals need to be offered in order to ensure that if the audience does not like one type of a product it can purchase the other.

Conclusion

Therefore, from the given analysis, it can be stated that Aldi is a supermarket which has been formed considerably later but with the help of its tactics and techniques, the supermarket has been successful in engaging a larger audience and a particular market for itself. In this manner, the supermarket will be easily able to ensure that it is successfully being able to engage in a long term relationship with the target audience. The report outlined the strengths and weaknesses of the company, which was then followed by the analysis of the offerings made by the firm which was then followed by the suggestive promotional mixes to be adopted by the firm in order to expand its operations in New Zealand.

Targeting strategy

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