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Analysis on Woolworths Marketing Mix

Question

Task:
For this assessment task, it is suggested that you select the same company you had chosen for both assessment tasks 1 and 2. As a brand equity manager to a reputed service company/brand, you have been requested to prepare a report suggesting how to enhance brand equity. Your report should include the following key features.

  • Identification: Identify the most important factors that affect service brand equity.
  • Explanation: Provide reflections from literature and in the context of your company/brand and explain how the identified factors would help achieving the brand equity.
  • Formulation: Formulate context specific and realistic strategies for enhancing brand equity for each of the identified factors that are clustered under the 7Ps of services marketing mix elements.
  • Presentation: Present the report in a professional manner, including expression, grammar and sentence, style, format, title page, table of contents, citations and references etc. Provide at least 10 references, including relevant journal articles, books, and authentic Web sources.

Please find below some notes for this task.

  • Consider relevant cases, textbook(s), published research papers, brand equity and behavioural theories, informative YouTube videos, authentic Web sources, reviews and the like. You can also get supplementary information from various secondary sources, including annual reports, trade journals, Websites, press releases, advertisements and News.
  • The Turnitin matching rate must not exceed 20%.
  • The total word limit for this assessment task is 4000 words (max.) including reference.

Answer

Introduction to the Report on Woolworths marketing mix
The current study sheds light on the Woolworths marketing mix and various aspects related to the concept. Retail is one of the largest and the fastest growing industry in the world. With companies like Amazon, Alibaba being the most valuable retail brands in the entire world with a valuation of over US $452 Billion & 145 Billion there is a long journey ahead for Woolworths before its reach its goals of financial and business sustainability(Bailey, 2020). This bring us to the most important and fundamental question? What are the factors of success for a retail brand organization and how the service brand equity of the organization can be increased to achieve a better financial and business growth. Thus, the objective of the report here is to identify of the factors to increase the service brand equity of Australia’s largest Retail brand Woolworths. In order to understand the factors, it will be pertinent to understand the factors important to service brand equity, and the impact and explanation of these factors towards the growth of Woolworths. The factors identified will be studied and applied within the Woolworths marketing mix framework of 7P and suggest the changes required in order to enhance its service brand equity.

Summary of Assessment 2
Woolworths started its journey way back in the year 1924 with the opening of its first store in Australia, and now in 2020 the retail store has over 3000 stores employing over 200,000 people and serving 29 Million customers across the brand every single week. The company in order to adopt the contemporary trend in the retail industry, launched its new concept store in the year 2020(Brown, 2020). The highlights of this new concept store is that it comes straight from the US, UK & Hong Kong Markets which provides its consumers a new experience of shopping and is a big cultural change to the existing stores of Woolworths. These new concept stores were built by identifying the cultural challenges in the retail industry of Australia such as: Shoppers visiting the stores just once a week, lesser innovation and differentiation leads to customer dissatisfaction and a paradigm shift in the customers taste & preferences. The concept store has slowly started to get the attention of the customers, but it needs changes in Woolworths marketing mix to ensure a considerable improvement in its brand equity (Duncan, 2018).

Brand Equity
It is already known that in packaged good, the product is considered as the primary brand, and when it comes to services, the company is considered as a brand. In the case of retail sector it is the amalgamation of both the product and services, which makes the brand (Chi, Huang & Nguyen, 2020). Thus, it becomes extremely important to understand what the factors which affect the service brand equity of Woolworths marketing mix and how these factors can be applied to the organization for enhancement of its service brand equity. Before moving with identification of the factors impacting the brand equity, it becomes important to understand the meaning of brand equity. Brand equity in simpler words can be understood as the premium which a company charges its customers by facilitating excellent quality products with a memorable and great service. Hence, in such a scenario customers are willing to pay a premium for the product, with the perceived notion of superior quality and great customer service. Let us jump right to the factors impacting the brand equity of an organization.

Factors impacting the Brand Equity
There are 5 factors or determinants to Brand equity: Brand Loyalty, Brand Awareness, Perceived Quality, Brand Associations & Other Proprietary brand assets. The section below will also explain how these factors have an impact on the organization.

Brand Loyalty- Brand loyalty is seen as one of the most important construct in marketing for a brand. Brand loyalty is a measure of the attachment a customer has towards a brand, which may be a resultant of many factors. It is the brand loyalty which shows how easy or hard it is for customers to switch to another brand, when the brand makes some changes in Woolworths marketing mix strategy. In simple words, brand loyalty is also one of the most important yardsticks of the company’s success, as with the increase in brand loyalty, the chances of customers switching to competition brand reduces significantly(Alexander & Nobbs, 2020).

Brand loyalty can be increased in a number of ways especially for a retail giant like that of Woolworths, some example of it are giving loyalty cards, membership or gift cards, pushing across personalized content to the customers, promotional emails, remembering them on their birthdays and others, engage them through the gamut of social media marketing, make them feel valued through the interaction with the brand and they will never leave the business. Apple and Amazon are two names when it comes to exceptional brand loyalty, Aldi, a competitor for Woolworths also is known for good loyalty programs. Thus, brand loyalty has a great impact on the business organization (Atzer, Sa & Silva, 2020).

Brand Awareness- It is most often seen that consumers always prefer a brand, which they have heard before, or a familiar with it and know about its product quality and service. Brand awareness is what makes a brand memorable and recognizable to its customers, and this may either happen through various tangible asset of the brand such as its logo, its uniform, its product & services, social media engagement and plethora of other ways. But, what is important to learn here is that brand awareness leads to an exponential increase in the brand equity, which further helps in business growth (Quan, Chi, Nhung, Ngan & Phong, 2020).

A lot of digital media activities besides offline activities can be undertaken to increase the brand awareness for Woolworths. The stress here is more on digital media activities as they are cheaper to execute, give better analytics and can be controlled. Hence, it can be easily said that Brand awareness is another factor which has a significant impact on the brand equity of the organization, in this case of Woolworths marketing mix.

Perceived Quality- It is another important factor towards improving the brand equity of an organization. It is not necessary that the customer need to know the specification of the product or a service to perceive it is superior to its other competitors. It is the perception which is built in the minds of the customers which helps to build a superior perceived quality, next to none. For instance, Apple loyalists have a notion of superior perceived quality of the company’s product, they infract do not even have a global brand ambassadors, it is their products which makes the difference for them (Wahyuni, Akbar & Sukarno, 2020).

Similarly, in the case of Woolworths marketing mix the perceived quality of its product and service can be heighted by variety of ways such as Celebrity endorsement, citing research for the product, branding of the marketing material regarding the product, and sometimes even raising price also gives customers a perception of high perceived quality of a product or a service. Hence, quite an important factor in increasing brand equity.

Brand Associations- The underlying value of a brand is often based on specific association linked to it. In order to understand it in the easiest way, association of Ronald McDonald with McDonald gives a positive feeling to its customers, they feel assured and relaxed and it also makes the brand memorable. For example, the “TuDum” sound of Netflix is again an example of a positive brand association. Hence, brand association leads to positive brand association which increases the brand equity of the organization. Woolworths does not have any such brand association (Kim, Kim & Hwang, 2020).

Other Proprietary Brand Assets- This category under Woolworths marketing mix represent the patents, trademarks of the brands, its channel relationships, symbols and others. Proprietary brand assets help to save the brand by any of its competitors using the symbols or other assets to confuse the customer audience and take unfair advantage of the confusion. Hence, important to have all the proprietary brand assets protected under a legal document (Zhou et.,al . 2020).

Thus, these 5 factors are the most important to increase the brand equity for Woolworth. Now, in the next section, we will understand in detail as to how we can individually apply these factors to different elements of the Woolworths marketing mix.

Strategies to Improve Service Brand Equity
Marketing as we all know off is a method or a way to achieve superfluous sales. It is marketing which assist to increase sales in the market. Brand relies on various tactics mostly concerned with advertising and promotion to increase or boost its sales. Woolworth do the same in order to increase its sales the company promotes discount and offers in its stores, website and social media platforms. Its new Concept store is an innovative way of engaging the customers with its brand, and a store which has started to pick its pace in Sydney (Lee, Siu & Zhang, 2020). It is such innovation and differentiation in the brand offering which makes it deliver not only a unique experience for its customers, but also significantly improves the brand equity. Now, one of the best ways to apply such strategies is to redesign or revisit the entire Woolworths marketing mix. By addressing all the elements in the Woolworths marketing mix service, the gaps can be identified which can then be bridged using new tactics on the basis of factors identified in the earlier section to boost its brand equity.

Woolworths marketing mix - Formulation of New Strategies
As explained in the last section that Woolworths marketing mix consists of 4P’s of Product and 3P in terms of service, which makes it a comprehensive model to evaluate the entire marketing strategy of the company. The Three P’s Process, People and Physical evidence are most important to the service organization, as these are one of the biggest influencers for the customers. Let us formulate a new Woolworths marketing mix which would help in Increasing its Brand Equity.

Product
Woolworths being one of the largest retailers in the world has a vast portfolio of product, which has almost every item in the grocery list of the individuals. It has a vast collection in the category of Apparels, Household, Baby care, Pet, Liquor, Drinks, Frozen Food, Pantry items, Dairy, Bakery, seafood, meet, veg & fruit. Now, this is the entire or we can say the comprehensive list of product at Woolworths. This is ideally same for most of the large retailers such as Coles, Aldi, Walmart or any other store of this magnitude. Hence, why should one choose Woolworths and not the others, in terms of product is the first point we need to address (Govender, 2019).

New Product Strategy
Fill up the shelves after identifying the needs of the customers- Customer feedback collected through various sources such as email, social media or in store should be used to stock up the products in the shelves. It is not important to have every retail item in the store, however it is important to have every item that the customer needs. Hence, create a new product feedback form and asking the customers, what product they would like to buy at Woolworths (Azter, Sa & Silva, 2020).

Citing research on its product- As identified in the brand equity section, customers build a high perceived quality of the product if it is backed up by a solid research. As per the Woolworths marketing mix, the company should start focusing on it and apply the same on its owned products.

Use of Technology to identify and replace the lowest selling product with highest selling– Just like Amazon integrates technology in its fulfillment centres to ship the products according to the order date, Woolworths also has to leverage technology to identify the top most selling product in each product category and replace them with the lowest selling product, as bundled product (Aster, Sa & Silva, 2020).

Price- Woolworths is seen deploying a Premium Pricing strategy, it is more so because the company offers superior quality products in comparison to other competitors. Also, because it products are fresher than any of the competitors due to its fresh farm product. It makes the Woolworths product a little on the expensive side as compared to Aldi and other competitors (Mukonza & Swarts, 2020). Considering the rise in the Purchasing power parity of the middle class segment of Australians, the pricing strategy seems appropriate. However, it is the time that Woolworths also start acquiring new customers who are not just Value buyers. This would help the brand to not only increase its revenue, but would also help it to increase its brand equity. Another fact which Woolworths marketing mix can consider is to tweak its pricing strategy to skim the market especially in its new concept store, and then go back to its premium pricing (Pulker, Scott & Pollard, 2019).

New Price Strategy: Woolworths marketing mix
Value & Price Buy- As of today, customers have a perception that Woolworths is expensive and charges premium for its product, it is most definitely a good perception. But, with this perception a number of potential buyers gets scared to step inside the store. This perception under Woolworths marketing mix has to be tweaked by becoming both a value ad price buyer. The company can clearly identify the products for which it does not have to charge a premium and can be labelled as Price Buy section in the store. Communicating it to the customers would help it in bringing in large number of new customers, which will ultimately impact its brand equity value (De Reuck & Bick, 2020).

Create IP in terms of Discount Days- The world is aware of Amazon Big Billion Day, Or Black Friday Sale and numerous other brands leveraging the holiday season by creating its intellectual property. These IP helps the brand to create a differentiation in the particularly crowded market, thus helping it to increase its brand equity. As more and more customers become aware of this, Woolworths marketing mix will see a considerable rise in its brand equity (De Reuck & Bick, 2020).

Bundled Pricing– Woolworths is already doing bundled pricing to sell of the products which are generally not picking up in the shelves, by combing it with other high selling product of the same brand, thus creating a bundle. However, the idea here is to mix match the brand. For instance, Baby Powder of Unilever can be mixed with company’s owned Fresh farm vegetable or something on these terms. This differentiation will again create an impact of its brand equity (De Reuck & Bick, 2020).

Place- Woolworths operates in New Zealand, Hong Kong, Singapore, South Africa and Australia with its 3000+ stores. The company especially in New Zealand and Australia is a well heard of Brand name, but in remaining parts of world the company still has not been able to create an impact (Naidoo & Varma, 2020). Also looking at competitors like Alibaba, Walmart and others, it can be clearly seen that the brand as of now has not expanded to its true expansion capability. With a brand which is in the industry for over 96 years, Woolworths should start considering countries where there is a scope for retail improvement, which can be bridged by Woolworths. This would also help the retail giant to increase its brand awareness across the globe (Sinclair, 2020)

New Place Strategy
This is a suggested place strategy for Woolworths marketing mix, and the actual decision can only be done by assessing its human, financial and other resource capabilities and also after a careful external business assessment to be done by the management of the company.

India is a growing & a flourishing country- India with a population of over 1.3 Billion people presents multitude of opportunity for the retail giant. The retail industry in India is still not structured and organized despite Walmart, Metro & Carrefour already present in the country. It is mostly so, because India is mostly reliant on its 12 Million small Kirana shops. However, the need for Woolworths marketing mix is to identify the partner with which it can get into a joint venture and enter the Indian ecosystem, as the Indian Retail industry is valued at US $ 600 Billion. Hence, expansion will help the company boost its awareness and also increase its brand equity in terms of its shareholders (Bailey, 2020).

Opening more new concept Stores in Hong Kong, Singapore & South Africa- The idea of the concept store originated from the markets of US, UK and Hong Kong, and it is showing steady progress in the Sydney market. However, the time to act upon is now, as other competitors are getting to notice this brand differentiation created by Woolworth, which is led by significant innovation. Thus, it is required that Woolworths quickly takes the first movers advantage and opens up its New Concept stores in the cities and countries it is present it. This will help to get new customers, with new acquired taste for the brand, thus helping to increase brand awareness and brand equity simultaneously (Bailey, 2020).

Promotion
The company as of now is relying more on traditional media of advertising like TV, Radio, Newspaper Ads and brand activation to reach out to the brand audience. According to the study on Woolworths marketing mix, the company is also seen leveraging Facebook, Instagram and Twitter to engage with its young audience. The online promotions are more beneficial to the brand to due its cost and ability to provide data which can be used by the company. Besides this it also does a lot of personal selling with large sales force to increase its presence in the retail stores (Bourke, Izadi & Olya, 2020). The company in order to promote loyalty is also been giving loyalty cards to its customers to ensure they come back to redeem the points they collected while shopping at the stores. The company does not leverages on doing a lot of brad related activity on the field, which can help it to increase its brand promotions (Woolworths Group, 2020).

New Promotion Strategy
In the Woolworths marketing mix, one thing which Woolworths is doing right is by investing on its capabilities on social media and online promotions. However, it has to start getting influencers on its platform and get them to generate organic content for the retail giant. These influencers along with them will get Hundreds and Thousands of followers, thus increasing brand awareness of the brand and acquiring more potential customers (Bailey, 2020). Another way of accelerating the promotion is to create User Generated Content on its social media platform by pushing across relatable meme and brand related content, so that the followers can start posting on their social media feed. Woolworths marketing mix is really not into quiz and contest on social media, which is another way of acquiring more followers and customers. The company should also start with its blog activities on cooking recipes using its owned products and other content which users find more relevant, keeping in mind its TG and the decision making audience. The underlying idea here is to follow the customer in his online journey using pixels and other tools and getting to understand their shopping and online behavior. This will help the brand to push high targeted and relevant content to its users (Bailey, 2020).

Another good tactic of promotion for Woolworths is in store promotion; it should promote the new offers, trivia about its product on the walls and also come up with New Loyalty cards with added benefits. As explained earlier, the company can identify for itself a Mascot, just like McDonald has Ronald, this will further help Woolworths marketing mix to increase its brand awareness, thereby giving a thrust to its promotion efforts. Overall, the point here is to engage in conversation with its customers and not to leave them looking for another substitute over Woolworths, hence special focus has to be on its Online Reputation Management as well.

3P’s Of Service Marketing
People
People is one of the most important and fundamental component of Woolworths marketing mix service which has helped service organizations to build a fortune for themselves by charging a premium especially by offering high standard of services to its customers. Woolworths has its people working in four core team. One team is working in the field of marketing under the influence of sales team to carve out promotion tactics and other communication material for its TG. The other team is taking care of its customer service, recording the feedback, taking orders and more such jobs. Within this component of Woolworths marketing mix, another team of people is involved in ensuring the efficiency of its supply chain management and lastly the team working in the retail stores. All of these 4 teams are primarily important to the company, but it is the front end staff working at the stores which plays a key hand in ensuring and delivering great customer service (Walter & Helman, 2020).

New People Strategy
Starbucks treats its employees as partners; this is one of the very strong reasons of a high customer satisfaction at Starbucks. As discussed in this aspect of Woolworths marketing mix, the company should also start empowering its People by giving them training, workshops and accentuating their skills not only in customer service but also in behavioral sciences so that they can understand the mood of the customers and according initiate a conversation with them, this will help the brand take advantage of personal selling at its stores. Another thing which the entire team at Woolworths should learn is the corporate values of the company and the same should be reflected in its stores while engaging with any customers. Providing attractive incentives policies for the sales team will motivate them to move towards their goal and also stay committed to the organization, does doing away with the problem of turnover in the industry (Walters & Helman, 2020).

New Process Strategy
Amazon Go Stores are the new age technology advanced retail stores where the customers do not have to stand in a line to pay for the bill and checkout. They have integrated AI and ML to ensure that through a normal bar code scan at the entry and exit the customer can check out without waiting in a queue. This is advanced retailing and Woolworths should start using the same technology to save customers queue time at least some of its stores. Another process which the company can add is by adding Beacon Devices outside its stores, this Beacon will detect the radio waves of the smartphones and push them targeted content when they enter the store, thus virtually assist them to shop and making them realize of the ongoing offers on their favorite product. Woolworths marketing mix is also required to take a step back and analyze its supply chain cycles and bring innovation to save cost and increase efficiency (Gao, 2020).

Physical Evidence
This is one of the impressive strategies of Woolworths marketing mix, selling and placing its products on the shelves in a distinct color makes the product easily identifiable. The uniform with the logo also makes it easier for the customers to interact with the sales and customer service staff. The company’s website which is physical evidence is neat and user friendly, which makes it easier for its customers to place the orders while navigating seamlessly on the platform (Tang & Yang, 2020).

New Strategy
Collecting feedback from its customers on how to make the packaging stand out, more unique and memorable will be a good head start in the direction of increased and distinctive physical evidence, as well as increased engagement. Another thing considered under Woolworths marketing mix which the brand can do is, have stickers on the packaging on the additional research done by Woolworths on its product. This will add on to the company’s brand association and make them stand out from the existing competition (Tang & Yang, 2020).

Conclusion
Hence, with all these new strategies under Woolworths marketing mix, the brand can apply to both of its New Concept stores and other retail stores to enhance its brand equity. It is increased brand equity which separates a good store from a Great store. Woolworths marketing mix also has to ensure that it keeps a healthy and a good engagement on its social media platforms, as due to increased penetration of smartphones, the consumers mostly spend time online. Thus leveraging their online journey will further help Woolworths to increase its brand equity.

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