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5C's of Wesfarmers

Discuss about the Marketing Strategy of Wesfarmers.

Wesfarmers is an Australian stock exchange listed company whose headquarters are situated in Perth, Australia. They started their operations as a co-operative providing agricultural products and services to the western Australian farmers. From being a farmer’s goods company to diversifying themselves into retail, hospitality and industrial sector they have come a long way. There retail segment includes Coles a supermarket chain, home improvement stores Bunnings warehouse, office supplies stores Improvements, Target a discount retail store in the US and Kmart. Their industrial segment includes chemical business, Resources and insurance etc. The primary objective of Wesfarmers is to provide maximum return to their shareholders through integrating sustainable corporate strategies in order to maintain a strong financial position in the market. They are the largest public sector employer in the Australia with around 2, 20,000 people working with commitment in order to provide quality products and services to company’s business as well as their retail customers. Their diversified business portfolio ensures customer satisfaction from all then segments( Wesfarmers, 2017).

Company- The major strengths of the Wesfarmers are their large product portfolio. They strive hard in order to meet the ends of every customer. Also they continuously work hard to fulfill their primary objective which is to provide satisfactory return to their shareholders, in the financial year 2016 they declared a dividend of more than $2 billion. After Coles acquisition the balance sheet of Wesfarmers depicted a very strong financial position as Coles is their largest revenue earning segment. The major weakness is their other business segments which include Target, Resources and other industrial segments which are not showing much signs of financial growth, as a result their slow growth offsets the profitability of Coles. The market base of Wesfarmers is limited to Australia and New Zealand, they can think of expanding into the other developing countries market where they can open their retail stores Kmart and Coles, they can easily achieve economies of scale as the cost of operations will be comparatively low. The major threat is the rival competitor in the retail segment which is Woolworths, as the major business of Wesfarmers comes from the retail segment. Also the return on equity of Wesfarmers is comparatively low than the Woolworths which may bother the shareholders.

Customer- Presently Wesfarmers’s is touching every possible customer segment. From coal business to retail chains they are leaving no stone unturned. They have realized that the most profitable business segment is their retail store business Coles, target and Kmart. The key to the success of these retail chains are inducing customers by offering them heavy discounts. Generally the buying behaviors of Australian consumers are they go shopping once in a week and buy all the necessary items in bulk. Wesfarmer introduced their very famous down down discount campaign in which they cut down the prices of variety of products up to 10 percent, which makes these products irresistible to purchase. At their Bunning warehouse stores they provide best of the hardware at very affordable prices.

Information about the 5C's

Collaborators- Wesfarmers have around 15000 suppliers who support their business (Wesfarmers, 2016). They make sure that the quality of the product should not get affected that is why they choose suppliers not only from Australia but also internationally so that their customers get the best quality products. Coles have signed a deal with sundrop tomatoes to supply truss tomatoes grown using sea water and solar energy (Wesfarmers, 2016). Workwear group have collaborated with indigenous supplier to design their safety range of footwear’s (Wesfarmers, 2016).

Competitors- Their major competitor in the retail segment is Woolworths who holds the dominant supermarket chain position in Australia. Apart from this they also feel Amazon is also their competitor as they provide retail facility 24/7. Also china’s biggest hardware store China Lesso has entered into the Australian market and is giving tough competition to Bunning’s warehouse.

Context- Wesfarmers also operate in insurance business, in 2011 when the states of Queensland hit by floods the company had to deal with various claims and mine situated there were also waterlogged which affected the profitability of the business. Queensland also experienced heavy rains in the year 2010 due to which there Curragh mines operation were temporarily closed, die to which company had to suffer losses (Wesfarmers, 2010). The Australian dollar rate is continuously declining as a result goods sold at a high cost which is attracting fewer consumers (Burrel, 2012). The impact of this can be very much seen in the Industrial and Safety business who have witnessed a $14 million decline in earnings in the year 2016 (ABC, 2016).

The information provided about customers, competitors and about the environment etc. is very important to any company, as these information provide a strong base analyzing future risk and helps to avoid such risks by formulating strategic decision policies in advance (Wesfarmers, 2017). The method of collecting such information differs from organization to organization but the purpose remains the same. Wesfarmers. Personal information about the suppliers, customers, shareholders are fetched through their official websites using server logs and google analytics (Wesfarmers Resources, 2017). Customers who shop in the Coles retail stores are given attractive discounts if they enroll in their loyalty programs also details are collected through flybuy cards, payment cards and online shopping (Coles, 2017). All these programs helps Wesfarmers to analyze the shopping behavior of the customers. Also, information is collected online with the help of Tell Coles in which customers have to enter their bill number and complete a small survey. These types of information collected helps a lot in identifying customer preferences and queries. Wesafarmer discount retail chain Target have a strong online presence over Facebook, linked-in and Instagram where they interact with the customers (Target, 2017). The main aim of collecting such information is to know the taste and preferences of the customer and resolve their queries related to the product or the organization.

Marketing Strategy of Coles

Suppliers are the foundation of any organizations. No company can survive without earning profits and profits can be only earned if the customers are accepting the product in the market. In order to meet the demand for a high quality product at better prices it is very important that suppliers are chosen to meet the demand of the customer. Wesfarmers carefully choose their suppliers by inviting them to share their interest online on the website where they are required to fill up a supplier form. Apart from this they continuously interact with the suppliers over trade fairs in order to know the information about the best of the products available and to know what is new they have to offer (Bunnings warehouse, 2017).

It has been quite clear that the major sources of revenue generators are their retail store Coles. In Australia Coles has been facing a severe competition from its rival Woolworths and they are only operating in Australia. This may pose a serious threat to their profits. So as a result they should try to explore other opportunities in other markets. Developing economy can be a suitable market for the Wesfarmers. Developing countries like India is known to be as the consumption driven economy all over the world. The demand for consumer goods is very high as India’s population is around 1.252 billion as compared to the population of Australia which is 23.13 million. The difference is huge so as the profit earning opportunity (Pawar & Veer, 2015). The Indian economy is expected to grow by 6.3% which means there is a huge potential lies in the Indian market (Goldman Sachs, 2016). Coles can strategically plan to open their stores in the metro cities like Mumbai, Kolkata, Bengaluru and Delhi. The benefits of operating in a developing economy are:

  1. Cost effective and skilled workforce- India is known to be a labor rich country. People over there are qualified and skilled and can be hired at a lower cost as the cost of living is low as compared to the other countries. This can be quite economical for Wesfarmers.
  2. Low cost of operation- Coles main feature is their high quality product at a discounted price. To maintain such low prices it is very important that the cost of acquiring such product from the suppliers and other expenses such as advertising and promotion should also be less. In India suppliers are easily available who are ready to provide quality product at a very affordable rates because of the availability of the substitutes. This will ensure Coles a great profit margin even after selling the goods on the discount. The cost of the land and transportation cost is also quite low.
  3. Liberal government policies- Indian Government always motivates foreign direct investment in the country. The laws and regulations are quite lenient as compared to other countries. That is why Indian is becoming an attractive hub for companies like IKEA, Wal-Mart etc.

All these factors mentioned can help the Wesfarmer to achieve economies of scale. Also people over they are price sensitive in other words they are discount oriented. They want quality product at an affordable price. Personalization is also success factor. By providing customized product by understanding the needs of the consumer can prove to be a success formula. Retail giant like Wal-Mart have entered in India but they are unable to establish themselves yet. Coles can exploit this opportunity by identifying, understanding and analyzing consumer behavior. As the other businesses of Wesfarmers are not generating much profit it is very important to subset their losses of other business segments by earning more profit in their retail sectors. India can be future cash cows for the Wesfarmers.

As discussed above Wesfarmers thinks that their one of the major competitor is Amazon who provides 24/.7 retail facility anytime and anywhere at affordable prices. Presently Coles online offer products at a price higher than what they offer in stores. The reason being their product charges include transportation and delivering cost. So it is very important if they want to give consumer a delightful online retail experience they focus on minimizing the delivery and transportation cost. Apart from this they offer delivery at a particular time and days. Online shopping is another name for convenience shopping where goods are made available at any point of time. So they should try to be more flexible in delivery time.

Product- The major competition in retail sector is not only to offer cheap products at an affordable price but also to provide customer delight by offering them personalized services. Unlike Australia people don’t shop once a week, in India they go shopping on a frequent basis. To make sure people visit the stores again, retail stores should try to provide a shopping experience memorable by providing high quality products, personalized services at an affordable price.

Price- In both the above proposition price plays a very crucial role in the success of the Wesfarmers. India being a price sensitive country is more sensitive towards price rise. They want to have buy the product at the best possible prices otherwise they will switch to some other brand. Coles while fixing a price should research about the prices of the same product offered by other competitors. In the online segment their competitor Woolworths and Amazon is doing quite well as compared to them. In order to reach masses they should try to offer best deals online.

Place- India is a vast country. In order to reach each and every customer segment it is very important that the stores are located at a reachable location. It is also to be kept in mind the stores should be opened in a metro city as people living in the metro city will be in a better position to spend. Which means Wesfarmers should go for intensive distribution strategy. Making the product available not only on stores but online is also important as there are working professionals who do not have time to go shopping even on weekends can order their products online at their convenience.

Promotion- Wesfarmers are entering into a new market; they have to spend a heavy amount on promoting their brand in the Indian market. Going online is one of the best decisions of promotion. By taking help social median sites such as Facebook they can post ads about their opening in India along with giving them special inaugural discounts. They can also tie up with certain organizations or can sponsor events. Big billboards and going digital for advertisements can be an option too (Kotler, 2002).

People- In retail business satisfying the customer in terms of services and product offered at the store is very important. It is the responsibility of people working there to provide customers a delightful shopping experience so that they visit the stores again. Wesfarmers should highly focus on hiring and training staff that are willing to treat customers as their family and provide them with a memorable shopping experience. They should train the staff so that they can maximize customer satisfaction (CIM, 2015).


The report analyzes the marketing strategies of Wesfarmers who is Australia’s largest public company. Being mainly into the Industrial goods segment, they didn’t want to stereotype themselves. They diversified into the retail segment by acquiring Coles and has been running the stores efficiently. This report clearly explains the 4P’s of marketing as a marketing tactic for entering into the new market. The report is prepared to analyze the 5C’s of the Wesfarmers which contribute collectively in order to give the organization a competitive advantage. Also the various marketing strategies related to Marketing strategy for a new segment has been discussed along with the recommendations.


ABC (2016) Wesfarmers posts 83pc drop in profits, flags challenging situation. American Broadcasting Company, Australia. Retrieved from on 1 February, 2017.

Bunning Warehouse (2017) For our suppliers. Wesafarmers, Australia. Retrieved from on 1 February 2017.

Burrel, A. (2012) Weaker coal price plus rising Aussie dollar to hit Wesfarmers. The Australian business review, Australia. Retrieved from on 1 February 2017.

CIM (2015) A brief summary of marketing and how it works. The Chartered Institute of Marketing, UK. Retrieved from on 1 February 2017.

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Kotler, P. (2002) Marketing management millennium edition. Prentice Hall, US. Retrieved from on 1 February 2017.

Pawar, A.P & Veer, B.N (2015) Competitive advantage of India for FDI in Retail: A Porter’s Diamond Approach. Annual Research Journal of SCMS, Pune. Retrieved from on 1 February 2017.

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Wesfarmers (2016) 2016 Annual report. Wesfarmers, Australia. Retrieved from on 1 February 2017.

Wesfarmers (2016) Sustainability report 2016. Wesfarmers, Australia. Retrieved from 1 February 2017.

Wesfarmers (2016) Sustainability report 2016. Wesfarmers, Australia. Retrieved from on 1 February 2017.

Wesfarmers (2017) Privacy and security. Wesfarmers, Australia. Retrieved from on 1 February 2017.

Wesfarmers (2017) The Wesfarmers way. Wesfarmer, Australia. Retrieved from on 1 February 2017.

Wesfarmers Resources (2017) Privacy policy. Wesfarmers, Australia. Retrieved from on 1 February 2017.

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