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Background of Aldi Discount Supermarket

Question:

Discuss about the Marketing Strategies Of Aldi.

This assignment allows thorough application of knowledge, tools, theories, and frameworks involving the strategy and strategic practices of Aldi discount supermarket. Specifically, the marketing-related strategies, as well as their effectiveness regarding the Aldi discount supermarket, are considered (Jürgens, 2014 pp.18). Simply, this paper aims to provide the market analysis, experiences, and practices which cover the marketing theory. Therefore, marketing and management are viewed as a type of an organizational discipline which is concerned with the marketing orientation, methods, as well as techniques within the institutions. Various tools covered within this discipline are obtained from the competitive strategy and economics which analyzes the organizational operations. The consumers have an opportunity in place of competitive markets where they purchase their commodities and services. For Aldi to achieve its business goals, it has to look for the needs of consumers to recognize ways of satisfying their wants (Gómez-Lobo, Jiménez and Perdiguero, 2015 pp.143). The organization should adopt a special  marketing strategy which has clear objectives towards the promotional activities. In this paper, the Aldi situation is considered to respond to questions regarding marketing and management. The marketing managers are obliged to monitor activities which include recognizing the needs of customers, communicating with the customers, promoting organizational sales, and build the online platform for the marketing and management. The success of Aldi is determined through marketing since various operations depend on marketing. Philip Kotler uses his model to explore marketing, and he concludes that marketing involves examining, delivering, and establishing value to satisfy the customer’s needs.

In analyzing the background to the company, it was founded in 1946 by Theo Albrecht and Karl. The name Aldi stands for Albrecht-Discount. It has various shops in various countries like Germany, Europe, Australia, and in the United States. The idea of the founders was to reduce the maximum legal discount of three percent before the products were sold. Therefore, the market managers were obliged to require the customers to take the discount stamps and use them to reclaim their money (Rudolph, Schlegelmilch, Bauer,  Franch and Meise, 2012 pp.10). After some time, Aldi began to expand internationally. The company specializes in the staple items which include the sanitary articles, the cheap households, the toilet papers, beverages, and foods. Most of the products in Aldi make the brand. Aldi employs various marketing strategies to attract and maintain the customers, increasing the customer’s satisfaction, as they increase their sales. The reputation of Aldi was initially criticized due to the low prices, but later the company thrived. The business experienced challenges about staffing and has been accused of low business responsibility despite the positive returns. Therefore, the marketing and management within Aldi are a great concern for analysis in this paper.

Marketing Strategies of Aldi

Since Aldi was created, it has adopted several marketing strategies. To begin with, Aldi adopted the price, product, and place strategies. Through this strategy, Aldi was concerned with investments and aimed to provide the customers with the maximum savings (Morgan, Kaleka and Katsikeas, 2004 pp.105). Rudolph et al, 2012 argued that Aldi estimated thirteen percent procurement prices, two percent of the logistics, overheads, logistics, marketing, and five percent for staff. The Aldi’s opening hour were limited and was seen as an intention to market its products (Assignment, 2009 pp.8). Around Aldi there were various facilities which were not offered such as the play area for children, lavatory, the lottery terminals and the photo booths, hence the supermarket avoided the additional costs. In the beginning, Aldi employed three to seven staffs to be in control of the entire shop which is a unique strategy which differed from other supermarkets (Babin and Zikmund, 2015 pp.15). Based on the basic marketing theory, Aldi aimed to minimize the costs and increase the sales to enhance the consumer’s satisfaction. The marketing theory was evident in the product marketing strategy since it observed cost-effective ways in displaying their products. The company also had a parking space which attracted customers. Through the marketing theory within the strategy of place, price and products, Aldi’s strategic location allows a good view from the road. Based on the value-perceived theory, Aldi has embraced the strategies of selling products which are equal to the brand. The company ensures competitive pricing since it is a discount supermarket. For that reason, Aldi sells the products at competitive prices from the competitors. Aldi also adopted the promotion strategies as marketing strategies. The different promotion strategy that Aldi has adopted is advertising using the brand’s comparison. This type of advertising relates to the consumer behavioral theory since Aldi shows how its brand is equal to others hence ensures the customers’ needs and wants are fulfilled. The advertising allowed the brand to inform the public about the quality as well as the money value. This marketing strategy allowed Aldi to create a slogan called “Like Brands” for easy campaigning of the products. They also produced weekly brochures to promote the products to the surrounding community. Additionally, Aldi currently makes use of social media besides other promotion strategies to communicate to the public concerning their products (Arslanagic-Kalajdzic and Zabkar,  2015 pp.90). Additionally, Aldi established two segments for customers who were seen as chosen targets within the marketing strategy. This strategy provided the business with the opportunity to distribute more resources, attract and maintain customers. At the same time, the marketing managers would implement the target decisions and recognize the desired position of the business to reach the customers. The business positioning was a long-term strategy hence a competitive advantage was created for the business. To conclude about the marketing strategies based on the basic marketing theory, the value-perceived theory, and the consumer behavioral theory, Aldi aimed to sell and increase its popularity to achieve the customer’s satisfaction and increase revenue.

Marketing Theory in Aldi's Strategies

If Aldi wishes to remain successful through the next decade, it has to focus on the marketing options described below. Exploring the circumstances of Aldi in 2016, it is clear that the business needs to adopt new market options to thrive further. For instance, in 2016 Aldi accepted all the four major use of credit cards. Aldi also accepted the Apple Pay Contactless payment system during the same year. Aldi had limited partnership, and it engaged in environmental planning to change the developments (Jones, Reynolds, Arnold, Gabler, Gillison and Landers, 2015 pp.190). The suggested change of development would contribute to the loss of five parking spaces which would have no impact on the organizational plans. Therefore, Aldi filed the application regarding the development changes which held the application. Considering the suggested circumstances in 2016, the proposed development changes would not contribute to further success (Okazaki, 2012 pp.20). For that reason, the Aldi should adopt the marketing options outlined in this paper to maintain success in 2016. For instance, Aldi embraces the tool concerning cost and the time investment. Aldi should consider various ways of advertising their products and services. The suggested marketing option is by using the internet. It is evident that the online advertising which includes affiliate marketing and the email campaigns adds power to the marketing resources of every business (Dahl, 2014 pp.23). People are using the search engines such as Google, to search for the local resources. The other marketing option suggested to Aldi is the Direct Mail. This marketing option appears outdated, and it is rarely used in the modern world. However, it would be a significant step that Aldi would take to avoid the problems experienced in 2016. The direct mails attract attention and call for attention hence it is an effective marketing tool. Signage is another marketing option which Aldi should consider adopting. The signs put infront of the business are a significant way of communicating to the customers. The directory listings, as well as the yellow pages, would be good programs for Aldi. Other marketing options that Aldi should embrace are networking, the customer referrals, and the public relations. All the outlined techniques focus on the same goals of the discussed theories, the marketing theory, the value-perceived theory, and the customer behavioral theories (Wilson, Zeithaml, Bitner. and Gremler, 2012 pp.15). Aldi will hit on the target customers, enhance the satisfaction of customers, and increase their revenue. Aldi will solve the problems experienced in 2016 and also maintain success throughout 2017.

Challenges Faced by Aldi

Conclusion

Aldi takes great strides to venture into the market and works towards increasing revenues as well as enhancing the satisfaction of the customers. The business emphasizes on the quality products and services which ensure the customers are satisfied as the customer behavioral theory indicates. Aldi is obliged to maintain the marketing strategies which it embraces since it was created. The marketing strategies include the promotional and the place, products, and price strategy (Martirano, 2016 pp.94). The business has tope with the competition from other discounting business such as Poundland and Lidi. Morgan et al, 2004 suggest that the quality of products is a significant factor to consider attracting the customers in business. There are many marketing options available that Aldi needs to adopt to maintain success in 2017 based on the circumstances experienced in 2016. The business should adopt the loyalty cards and the reward system which is point-based to ensure Aldi stabilizes the market share. Aldi needs to focus on updating their software and embracing the advances in technology to cope with competition. Aldi plays a great role in the economy of the nation, and therefore it should seek to thrive more than the current situation.

Ododo, C., Mulholland, G. and Turner, J., 2015, November. Can Discount Pricing Be A Comeptitive Brand Strategy? An Evaluation of Aldi. In International Conference on Marketing and Business Development (Vol. 1, No. 1, pp. 241-251). Bucharest University of Economic Studies Publishing House.

Metzger, K., 2014. International Management Analysis of ALDI.

Jürgens, U., 2014. German grocery discounters: dynamics and regional impact. The case of schleswig-holstein (Germany). Quaestiones Geographicae, 33(4), pp.17-26.

Gómez-Lobo, A., Jiménez, J.L. and Perdiguero, J., 2015. The entry of a hard discount supermarket: price effects/La entrada de un supermercado de descuento duro: efecto sobre precios. Investigaciones Regionales, (31), p.143.

Rudolph, T., Schlegelmilch, B.B., Bauer, A., Franch, J. and Meise, J.N. eds., 2012. Diversity in European marketing: Text and cases. Springer Science & Business Media.

Morgan, N.A., Kaleka, A. and Katsikeas, C.S., 2004. Antecedents of export venture performance: A theoretical model and empirical assessment. Journal of marketing, 68(1), pp.90-108.

Assignment, C.M. 2009, Aldi Supermarkets. ??????????? ?????? [????? ???????]: https://www. slideshare. net.

Babin, B.J. and Zikmund, W.G., 2015. Exploring marketing research. Cengage Learning.

Arslanagic-Kalajdzic, M. and Zabkar, V., 2015. The external effect of marketing accountability in business relationships: Exploring the role of customer perceived value. Industrial marketing management, 46, pp.83-97.

Jones, M.A., Reynolds, K.E., Arnold, M.J., Gabler, C.B., Gillison, S.T. and Landers, V.M., 2015. Exploring consumers’ attitude towards relationship marketing. Journal of Services Marketing, 29(3), pp.188-199.

Okazaki, S., 2012. Fundamentals of mobile marketing: theories and practices. Peter Lang Publishing.

Dahl, S., 2014. Social media marketing: Theories and applications. Sage.

Wilson, A., Zeithaml, V.A., Bitner, M.J. and Gremler, D.D., 2012. Services marketing: Integrating customer focus across the firm. McGraw Hill.

Martirano, M., 2016. Effects of Marketing Theories and Customer Relationship Management on Small Colleges. International Journal of Marketing Studies, 8(4), p.94.

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