Woolworth Market Report
The report analyzes Woolworths Company, which is one of the leading retail stores in the Australian market. The firm has established over 3000 major retail stores in main towns and cities in the country. In addition, the firm has over 200,000 employees across the different stores. The business was founded in 1924 in Sydney to offer consumers in the market unique shopping experience and meet their unfulfilled needs (Mitchell, 2014). The following analysis entails examining the industry and the firm target market to determine its consumer characteristics. The analysis will also cover market segments and a PESTLE analysis of the industry. This report also covers buyers’ behavior and customer analysis to determine their unique characteristics. The report also examines the customers’ relationship needs and preferred type to determine the type of relationship that the company wants to have with its consumers. The final part of the report covers a SWOT analysis of both the industry and customers to determine any opportunities, strengths, weaknesses, and threats facing the company in the market.
Industry and Target Market Analysis
Woolworths has opened various stores across the Australian market targeting consumers in city or town areas. The objective of the supermarket is to ensure that it increases its potential market by opening branches in areas where there is dense population. The social economics of the country is relatively stable, meaning that the consumers have more purchasing power. The objective of market segmentation is to group consumers based on their shared characteristics to ensure that the firm offers products and services that meet the needs of the market segment. One of the market segment is based on the market demographic since they affect their purchasing pattern and the types of products purchased. The firm has no specific consumers’ demographic target in the market. The firm offers products in some stores targeting consumers based on their lifestyle. This aims at influencing the purchasing patterns of the consumers of specific economic and social class to increase its sales revenue.
The retail industry in Australia has unique characteristics, which can be examined by undertaking a PESTLE analysis. The political environment of the country is stable hence enabling the growth of the industry. The country has a stable economy, which is shown by high per-capita income for the consumers. The social environment of the market is favorable for the business since the market has recognized the specific or unique services offered by the retail stores across the country. Australian legal environment is favorable for business, however, firms have to keep monitoring any legal changes to determine how it affects the business. The final aspect is the business environment, which is relatively stable but competitive due to the different players that offer similar services (Wedel & Kamakura, 2000). The firm should utilize the consumer purchasing power opportunity by providing more high-quality products. These products should fulfill the lifestyle needs of the market.
Woolworth’s customers are grouped into two broad segments, which are economic, and lifestyle segmentation. The economic segmentation groups consumers based on the purchasing power. If the consumers have a high purchasing, then a firm can offer products at a relatively high price. Most of the products offered across the different stores target high-class consumers since they have the more purchasing ability. The country has an effective economy, which enables the business to grow in the market. In addition, the government offers financial support for business and people residing in the country. Lifestyle segmentation aims at providing products that meet certain lifestyle taste and preferences in the market. Due to the improved state of the economy, consumers have more disposable income, which enables them to grow their business. Consumers driven by lifestyle needs often buy expensive products from recognized brands. In addition, they tend to purchase new products that may be offered in the market to fulfill the lifestyle needs (Wowlink.com, 2015). Economic segmentation provides a broad view of consumer purchasing power meaning that the firm can determine what to stock in its stores based on the product prices.
Buyer behavior Analysis
The following table analyzes consumer behavior based on the identified classification.
|Analysis of :|
|Buying process||The first step is need or problem recognition by the customer hence purchase can only occur after recognition of the need. Some of the consumers undertake information search where they search for remedies after recognizing there is a problem. After gathering information on possible remedies, the consumer then evaluates the alternatives to determine what is best for them (Wedel & Kamakura, 2000). This enables the consumer to make a purchasing decision.|
|Decision-Making Unit||DMU relates to the individuals involved in buyer’s decision process. The firm has influencers who try to influence consumers purchasing patterns. Initiators are also involved in DMU where they determine any need to be satisfied in the market and provide a solution to the need. They are crucial for the business growth since they ensure that needs of consumers are identified and satisfied by the company|
|Buying Criteria||This entails information required by consumers to enable them to make a purchasing decision. The firm should focus on providing adequate information to consumers such as product pricing to shorten the sales cycle. The second step is providing information on the functionality of the product in the market.|
|influences||The key influences in consumer purchasing decision are price and quality. If the product is of high quality, then the consumer will be willing to purchase it. Price is also a key determiner in the market due to high competition from other retail stores.|
|Buying classification||Buyers can be classified in two three major categories, which include, wholesaler, user, and retailer. Lifestyle segment ensures that the products demanded by all the three classifications are available. In addition, segmentation based on the purchasing power of the consumers affects the all the buying classifications since it affects the prices of the products in the market.|
Customer relationship model enables the firm to learn more about the customers need to enable the firm to make adequate steps to fulfill the needs. The goal is to ensure customer satisfaction hence encouraging customer loyalty. Woolworth ensures that consumers are provided with after sales services, adequate information about the product, convenient way to pay their goods, and quick services.
|Lifestyle||Consumers demand recent products that meet their desired quality. Price is not an issue for this type of consumers. Their goal is to get satisfaction from the product. The firm provides after sales services and a wide range of payment method that can be used by the company.|
|Social- economic||This market segment is driven by quality and quick service delivery. Price is also a factor in when making a purchasing decision.|
The firm has an opportunity to capture the demand for lifestyle products by increasing its product range to ensure it addresses the needs of the consumers. In addition, Woolworth can increase its market influence by opening more stores to provide specialty products for consumers demanding lifestyle products. The firm can also promote its brand name through different market promotion strategies such as advertising to increase its market size. This will also enable the business to reach its potential consumers. The firm also needs to monitor changing lifestyle needs to enable it to provide the required products by the consumers (Wowlink.com, 2015). The main threat faced by the organization is high competition level from other established firm in the market such as Coles supermarket. This affects its market growth since they both compete for the same consumers. Lifestyle products market is very competitive since there are a number of firms offering similar goods based on the consumers’ needs.