Developing Effective Marketing Strategies For ALDI Supermarket

Discuss About The Develop An Effective The Marketing Strategy?

analyze the importance of marketing strategies in an organizational setup. Particularly, this report will analyze the marketing strategies applied by ALDI supermarket which is among the leading discount offering supermarkets. Apart from the low price strategy, the report will also elaborate on other marketing strategies option that can be initiated by adopted by the supermarket. Aldi is a supermarket that was founded by the family of Albrecht; their first store was opened in Germany in 1961. Its headquarters are in Batavia. Since its operations, the company has opened over 1600 branches in the thirty-five states. It has a total of 25000 employees. The huge high workforce managed by the Aldi Supermarket can be attributed to its positive growth.

The company great progress has been contributed by its robust and effective marketing strategies (Aldi, 2016). Besides aiming for higher profits and business growth, the other main objective of every organization is to ensure that it satisfies the needs and the wants of its customers. The satisfaction of the customers is deeply rooted in marketing activities applied by the company. In fact, marketing it is the backbone of every organization, and therefore, it has become the ingredient that will result in the success of every business (Furrer et al., 2012, p. 163). Marketing helps by ensuring that the need of the target consumers is met. Secondly, marketing is the only activity that will ensure that company realizes revenue by making as many sales as possible. The success of Aldi Supermarket is greatly tied to effective marketing strategies by ALDI. This has placed the supermarket to be the leading position. In the following discussion, this report will explore, establish and analyze the marketing strategies behind the success of Aldi supermarket.

Aldi is a private company comprising of two companies which are Aldi Nord and Aldi Sud. The company business activities are concentrated in Germany as well other regions of the European Union. It is a company in the groceries industry whereby due to its progression it was labeled as the Germany’s most an aggressive expansionary supermarket. It comprises of a hundred grocers who are under operation which is clean, price friendly and also quick in services offered. Findings reveal that Aldi is the leading private company in globally. This research has supported the survey that was carried out and ranked  Aldi Supermarket number eight among the stores in the world of all retailers (Mullin, 2015). On the company performance aspect, the organization has announced its plan of growth in the next five years and is hoping that by 2018, it will have opened more 2000 stores. This strategic plan will more than 10,000 job opportunities. In March 2016 the company promised to open their sore in California and by July the same year, they had opened more than 25 stores. Analyzing from the Aldi’s starting point to its current position, it is evident that the customer has been focusing on expanding its marketing activities to claim a large market share.

Marketing Analysis

In business, marketing is the fundamental part of the company anticipating to operate in the foreseeable future (Adams, 2017). Business success will be largely determined by its marketing strategies (Olenski, 2017). Similarly, Aldi Supermarket recognizes the importance of the effective market, and therefore, it has established and utilized marketing strategies for the benefit of both the company and the customers. The company operates with the philosophy of acquiring and the same time engaging in activities that will retain the customer. The common and effective marketing strategies practiced by the company include price strategy, the place strategy, product strategy and promotion strategy.

One of the philosophies of Aldi is to ensure that this gives maximum savings to their customer through discounted prices and provision of high quality products. The company pricing usually based on 13 percent of the price incurred during procurement, 2 percent for the logistics and 5 percent for other expenses. Unlike its competitors who extend their working hours, this does not apply to Aldi, instead its carries out its operation during its working hours which is 11 hours every day. This practice is evident almost in all the Aldi Supermarket stores. The company is very keen on working hours because the facilities used in business operations bear the cost which could be used to terminate the customer's cost. Additionally, there are 3 to 7 members who run the operation in the groceries. However, this is a different case in the company’s mother supermarket store which involves a large number of employees in running the organization (Schaulis, 2017). This enables Aldi to achieve a payroll that is low towards their sales turnover, and as a result, there is a reduction in their prices. According to Lutz (2015), the Aldi success is widely associated its price strategy.

The place strategy enables the companies to reach all target markets efficiently and effectively (Kartawinata & Wardhana, 2015, p. 71). The Aldi Supermarket employs this approach to limit the assortment activities in their stores. Usually, the Aldi Supermarket stores are relatively small when compared to other stores bared by other supermarkets. Their floor space is 650m by 100m. Their store's layout bears only four aisles. The company displaying strategy appears to be effective regarding cost. The stores bear some parking space for its customers.  This is also a strategy of attracting customers. The study also reveals that when Aldi is selecting a site for their store, the take into account of the area population which is expected to be 30000 and above (Gupta, 2016). In addition, they ensure that their stores are visible and are located near the main road to enhance the accessibility.

Price Strategy

The Aldi’s selling philosophy appears to be different from that of others; this is because the products which have been branded have less operational profit. However, Aldi engages in the selling of the products which are equal to the brand. Aldi being a retail chain business, it lays emphasis their core price competition philosophy. Therefore, in order to sell their products at discounted prices, the company engages in buying products in large quantities to bargain for the best price that will enable them to sell at a price affordable to their customers (Fitzpatrick, 2015). Aldi Supermarket engages in availing different products to their customers every week. The company customers’ are usually excited by the availability and also the affordability of products. In order to promote the products, they use posters to give the customers ideas of the products which will be availed.

Among the strategies adopted by Aldi, its promotion strategies appear to be unique. This is because there is a correlation between its brands and the promotion techniques. The company promotion approach is based on the notion that their brands are equal in terms of quality to other existing brands. For example, Heinz tomato (Mckeown, 2015). This type of promotion enables the company to focus promotion activities on quality of their products and also the value it has towards money. The company also uses humor in their advertisements to convince their target market.

The Aldi stores have progressed effectively in its marketing strategies thereby taking the largest market share in Germany amongst other countries. It is clear that model being applied by Germany retailers provide room for success. Through the internationalization of the various concepts which had been brought into use in the retail market of Germany have facilitated to the supermarket success. The marketing strategies are largely linked to internationalization theory (Manfred & Julia, 2012). The internationalization approach has not only led to high turnovers but also to relative cost to the penetration of the market externally. This has helped the company to save costs associated with entrepreneurship risks and products’ distribution.

Currently, the main objective concerned with marketing is to ensure that the company reaches many markets in the international arena. Their main emphasis will be focused on providing products that are of a higher quality to their customers to maintain continuous purchasing behavior. This will be accompanied by producing products and services that are equivalent to the money value of their customers. Another marketing strategy is to offer their products to customers at affordable prices.  Besides, the Aldi Supermarket is currently supporting the environment, the nutrition, and health. The company does this by ensuring that their products reach in the remote regions as well engaging in business activities that are friendly to the environment. They are also concerned with the elderly whereby they avail them with the affordable products. The Aldi's performance strategies seem to be competitive and are accompanied by implementing a method that will enable it to survive in the competitive market (Gale, 2017). The competitive advantage of Aldi Supermarket is associated with the strategy of product differentiation and effective business operations.

Place Strategy

From the analysis of other marketing tools such as the PEST analysis, it evident that Aldi is largely concerned with its business environment. This evident from the fact that, the company assess its environment and recognizes negative environmental impact as it arises.  For example, Aldi Supermarket strategies to take care of factors such global recession which motivates customers to buy products that are not expensive but are of high quality. In the event, this occurs Aldi engages in attracting their customers through extensive promotion activities.

For Aldi to be assured of success, it can initiate the strategy of selecting its policies effectively; this is because for every organization to run smoothly, the rules governing them must be effective to enhance the management functions. They must also ensure that they pay high wages to their workers, this is because fair compensation usually motivates the employees to work towards the success of the organization. This means that the company employees will be encouraged to take part in the marketing of the company brands. The company should also delegate responsibility in order to capture the commitment of the employees towards the overall business operations (Dunford et al., 2012, p. 22). The company should get workforce in order to create a continuous progress. Having embraced the above strategies, Aldi will be able to remain at the leading position despite the stiff competition in the market.

Conclusion

The retail supermarket industry in Australia is turning out to be very competitive and also concentrated. Despite the stiff competition, Aldi Supermarket has been able to show a continuous growth. The success has been associated with its marketing strategy whereby the company has employed strategies that are unique from their competitors. Aldi has also engaged in product differentiation, a strategy that has enabled their products to have the largest market share. In conclusion, the Aldi's effective marketing strategies that comprise provision of products of high quality, products at lower prices, and the elimination of unnecessary functions and the establishment of many stores in different parts of the world are creating long-term relationships with their customers.

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