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The next stage of the marketing audit is for you to consider the market for your organisation and evaluate the opportunities and threats that exist for your chosen organisation. NB: if you have a number of markets it is a good idea to focus on just one.Incorporating theoretical concepts into your discussion from chapters 2, 4, 5 and 6 (are these in relation to the new or the old version of the book) of the text, and with the use of other theoretical sources and secondary research, please discuss the following( file attached).

Choose Australian Company that is COLES which is a supermarket.In the first part of the introduction clearly, say that the company is Coles in which location it is at. The location, for example, can be a Southern cross station. It should be in Melbourne. Also, mention about the consumers. And please be specific about the consumers like office workers. Also, include the pictures of consumers.

In the first part of the Body that is the industry market take the data from IBIS report for PESTEL which is relevant to the Coles. And after knowing the PESTEL relate each how that affects your consumer or product of the business. (see the paper attached for more information). In the second part of the question mention all the competitors but the analysis of only one competitor. In the third question please include pictures. In the 4th question talk about the 5 steps of buying and also say whether it was high or low.

Industry Market

Coles supermarket is an Australian supermarket chain that is owned by the Wesfarmers. The origin of this supermarket was in 1914 in the Collingwood, Melbourne and it was founded by George Coles. It has approximately 776 supermarkets in all over Australia. Even the employees are in huge number in this company. Around 100,000 employees work in this supermarket and together with its competitor that is Woolworths it accounts for the maximum market in Australia. Main headquarter is in Hawthorn east, Melbourne, Australia.

John Durkan is the managing director of Coles. This supermarket comes under the industry of retail supermarket and the consumer services (Lucobucci, 2009).  Besides all this there are seven levels of generic or private label brands that this company owns and it even has a private clothing brand. Coles takes care of their customer and understand the needs of the customers. Customers find it easy to shop in this supermarket as it has made several list of services. These services include carry to car service where the employees guide the customers in taking the groceries to their respective cars. This company provides many payments methods so that it become easier for the customer to pay the bill.

The report of the IBIS world’s supermarket and the grocery stores market describes latest statistics of the industry and the trends happening in the industry (Clemons, 2015). This report further allows people to identify about the products and the revenue growth and profitability of the customers. IBIS report also analysis the companies that are leading and further offer them the industry analysis that influences the market.  One of the most fiercely competitive industries in Australia is the supermarket and the grocery stores industry (ATC, 2014). One of the supermarkets called Aldi has grown largely over the years because of the discounts it provides on the products.

This company forced the two major industry giants Woolworths and Coles to cut down their prices.  On the other hand small players struggle to survive in this price intense industry. To stay competitive in the markets many brands have reduced their prizes and are dealing with low margins and hence profit margins of industry have also fallen down. Market share of coles in the grocer industry is 31% this is the reason it is leading supermarket of Australia.  But as compared to Woolworths it has less market share.  Coles supermarket has contributed economically to Australia. Direct value added of this brand was $4.5 billion and its indirect value added was way more. It was around $20.8 billion in 20111-2012 (Mack, 2017).


The nature of Coles is defined as the oligopoly market that is the market presence is defined of the few sellers in the overall market that sells the products those are close substitutes of each other. Coles in the market defines and determines the prices and that of the assumed of the close substitutes in the particular industry. The oligopolistic market has such product differentiation that is distinct and it is created by applying various advertising methods. Also, the features of the oligopoly market are detailed as below:

The economy of Australia is growing at a rapid rate along with the development and eventually the expansion in the market. This expansion has been developed at a growing rate in the late 1950’s in Australia. This development led to growth of Coles and Woolworths in the year 1960. During this time period the demand for the discounted stores highlighted during this span. Hence it led to the emergence of the retailers like Bi lo, Franklins as well as but these grocery retail stores are not the leaders and as successful as Coles and Woolworths.

From the diagram above it is clearly observed that the Coles and Woolworths face neck to neck competition in the market. According the financial reviews and reports of the year 2013, it has been concluded that the Woolworths is the market Leader of this sector in the Australian market with 39.0 percent as the total market share. While Coles has hooded the market share in the Australian supermarket by being the market follower by 33.5 percent (IBIS world, 2014). The same can be observed with the other minor competitors as Aldi, it owns the market share to 10.3 percent in the whole Australian supermarket.  Based on the comparison of the market shares, it is analyzed that the Coles limited and Woolworths limited are the great competitors and are successful in keeping an excellent hold in the Australian supermarket by using the changing marketing strategies to have such large market share with this extent of effectiveness.

 The strengths and weakness of the Coles and Woolworths that are analyzed are stated as below:

Strengths and weaknesses of Coles

Strengths and weaknesses of Woolworths

The strength that can be listed for Coles is that it is introduced as oldest companies of Australian market. This is a well-recognized brand in the UK with more than 30000 employees being employed and over 800 stores. Also, the efficient marketing operations prove to be strength for Coles (Deloitte, 2012).

The weakness of Coles when compared to other competitors is that is does not lead the market when compared in a global context. Coles has not sustained in the competitive advantage.

The major strength of Woolworths is that it is the market leader with huge market share in the Australian retail industry. This makes it the market leader, which further enhances the ability to adopt such ever changing strategies for maintain the market share (Mitchell, 2015).

The weaknesses to Woolworths are majorly caused by the external environmental conditions that exist by the dominating markets of Australia. For example, keeping the high prices is restricted by the Australian government.

Market segment plays an important role in any business as it helps in understanding the needs and the behavior of the customer (Recklies, 2015). In the market segmentation it is very important to know the motive and behavior of the customer and understand the customer in a better way. Market segmentation helps in identifying the different needs of the customer even though the customers are shopping are at the same retail outlet (Market segmentation, 2017). There are basically six market segments that define Coles supermarket and these are:

Consumer Behaviour

This is the market segmentation that shows the grocery shopping as a hard work because it requires much time and effort to shop. So to overcome this Coles supermarket is seeking to reduce the time, effort and cost that are related with the shopping. Coles has also many sub branches that are located in different parts of the locations and they have a clear display about the products and it becomes very easy for the customers to find information about the products or the services that Coles is providing. Coles has always been loyal to the brands that it purchases for its superstore.

The name itself suggests that this market segment includes the main grocery buyers and has a parent behind it and is basically buying the products on behalf of its parent company. Most of the purchases in this segment are regular at its core and includes number of varieties because these have impact of the end users which can often be the children in the house.  This segment includes the snacks like biscuits which can be eaten at home. Those who have children at home generally tend to buy these in large quantities. So Coles have many such brands that attract customers and are not price sensitive.

The consumers of this market segment generally have busy lifestyles and are always involved in their work or travelling and it can be even in sports activities also. Hence this market segment generally has the purchasers who are above average than the other market segments. Because of the habit of moving around in places to places these customers visit the large set of retailer. These customers also have different and reasonable degree of varieties in the purchasing manner which also depends on the mood and the other factors of the customers (Spenner, 2014).  Because of the busy lifestyles these customers have they are involved in the online shopping which takes less time and effort.

This is the market segment that has very less loyalty for the brand and they tend to enjoy the different retail experiences, taste and food choices. Hence these are mostly engaged in the promotion of the sales and basically offer the new products especially in the case when they are released on the first place. This proves that this segment can be considered as easier to win segment and it cannot retain for the long term and hence contribute for the short term sales promotions

Market Segmentation

This segment is mainly considered with the health and environment and that have a huge impact of the purchases that are made by the customers and are mostly environmental friendly retailers as well. This segment only has products that are natural, fat free, has low carbs, gluten free and also includes more health attributes. Consumers that are involved in this segment are usually diet consciousness and want to have a healthy lifestyle. These customers are also brand loyal and always buy the product that they trust and follow all the ethics means.

This particular segment tends to be more attractive towards the quality to both the retail environment and the brands that that involved in this supermarket. In this segment consumers are fewer prices sensitive and usually opt for the higher quality of food. People that are involved in this segment go for the high quality image that product has which also includes the higher price products.

The main buyers of coles supermarket are its elite customers as this is an expensive superstore and includes all the expensive brands. Hence all the customers who are not prize sensitive buy products from this supermarket. Other buyers include the customers who are health and brand conscious and choose particular products for themselves. This also includes the organic foods and coles is the only supermarket that produces organic and environmental friendly products (Taylor, 2015).

The responsibility of market is to sell the goods in the market and for this the marketer should have deep knowledge about the customers and how these customers make their choices while buying (Mack, 2017). There are 5 steps that help to understand this:

The buying decision process of the customer mainly starts with the recognition of need (Brosekhan, 2014). Hence it is the duty of the marketer to recognize the needs of the consumers and to satisfy them.

This comes at second position in the buying decision process. This is the stage where a customer basically gets information about the products from various sources such as family, friends, through advertisements or simply by using the product or the services that are provided by the organization (Jisana, 2014).

In this stage customers usually evaluate the alternatives after gaining the desired knowledge. This evaluation is dependent on the wants of the customers, quality and other features. A customer has to be fully satisfied to buy a certain product from the brand (Speener, 2012).

Strengths and Weaknesses

After the evaluation of the alternatives has been done buyer buy the product that they feel satisfied with. Sometimes there are also some reasons that customers postpone the buying process. Hence in this case marketers try to understand the customer and also try to remove them by giving them the sufficient details about the products or also by giving them the guarantee regarding the product.

This is the stage where customers either feel satisfied or dissatisfied after buying the product. If the customer is not satisfied with the buying then disappointment arises. If the customer is satisfied than there is definitely word of mouth of that brand so it becomes very important for the marketers to satisfy their customers.

This is the positioning map of coles. Coles supermarket here is represented by circle. This comes in the third quadrant where the quality of the product and the prices of the product both are high. Other competitors who come under this category are Woolworths and Flannerys. Hence these are the brands that attract elite customers which further increases their sales in total.

To have an independent supermarket and to operate it is not an easy task. Coles has around 3 other big stores nearby. According to this report Cole’s contribution is 31.7% to the total industry.The parent company of Coles has 50% interest in the banking sector and also in the advisory services. It also has around 24.7% of stake in the BWP trust. Beside all this there is 50% of interest in the westpine industries.

Adopting a healthy alternative and increasing consciousness towards health has become a major social trend and this trend actually provides the opportunity for Coles supermarket as they provide organic foods which others fails to do. But beside this there is a major threat to the farmer market and the environment. Another trend is that consumers do not have time so Coles provides convenience by expanding its product range and by creating a new business.

It is very important to use technology in the business as without this a business fails to have competitive advantage with the other brands. Coles has also adopted technology and launched new online shopping technology so that it can connect more with the customers (AFN, 2015). Coles is also willing to try an online shopping tool that will recognize the voice of the customer.

Coles is a supermarket that has brands to attract the different kinds of customers. For the customers that are highly health conscious Coles make sure to provide them organic food products. These products are environmental friendly and have no side effect on the customers. Coles itself follows environmental friendly practices that do not harm the environment (Kotler, 2009).


The ACCC has launched a legal action against Coles as this supermarket has demanded money from the suppliers which was not at all lawful (Sarina, 2014). It was claimed that the superstore tried to take $16 million from the suppliers.


Coles is one of the major leading superstores of Australia. It contributes immensely to the economy of the grocery industry. Although it is a leading brand but Woolworths give a tough competition to this brand and has more market share when compared to coles. The comparison was between the coles and Woolworths in this report and a detailed analysis of the coles superstore was done with the help of IBIS report. The market segmentation of coles was also done in this report which describes that coles fulfill the demands of the customers and meet the expectation of the customers. Five major steps of buying that also includes the decision making are also described in this report.


Australia: Deloitte Access Economics Pty Ltd.

Australian Food News, (2015).Coles develops world-leading online grocery delivery technology. [Online] AFN. Retrieved on: 4 april 2017. From:

Australian Trade Commission, (2014). Australian Industry Capability: Food and Beverage. [Online] ATC. Retrieved on: 4 april 2017. From:

Brosekhan, A. A. (2014). Consumer Buying Behavior –A Literature Review.IOSR Journal of Business and Management(IOSR-JBM).  8-16.

Clemons, R. (2015). Supermarket-brand groceries' country of origin labeling.[Online] choice.Retrieved on: 4 April 2017. From:

Deloitte, (2012). Analysis of the Grocery industry; Cole Supermarkets Australia, Sydney,

Iacobucci, D. (2013). MM4 Marketing Management, South Western, Cengage Learning, Mason, OH, USA.

IBIS world, (2017).Supermarkets and Grocery Stores in Australia. [Online] IBIS world. Retrieved on: 1 april 2017. From:

Jisana, T.K. (2014). CONSUMER BEHAVIOUR MODELS: AN OVERVIEW. Sai Om Journal of Commerce & Management.1(5).

Kotler, P., Keller, K., & Burton, S (2009). Gathering information and scanning the environment, Marketing Management.FrenchsForest, Pearson Education Australia.

Lee, M.Y.  (2006). Competitive Analyses between Regional Malls and Big-box Retailers: A Correspondence Analysis for Segmentation and Positioning. 13(1).

Mack, S. (2017). Role of Selling Within the Marketing Concept. [Online] Chron. Retrieved on: 4 april 2017. From:

Market segmentation, (2017).A customer's view of segmentation — meet my needs!. [Online] Market segmentation.Retrieved on: 4 April 2017. From:

Mitchell, S. (2015). Coles, Woolworths urged to target Aldi's weaknesses. [Online] The Sunday Herald. Retrieved on: 5 April 2017. From:

Recklies, D. (2015). Market Segmentation – Why is it Important? [Online] The Manager. Retrieved on: 4 april 2017. From:

Sarina, L. (2014). Competition watchdog launches new legal action Coles supermarket alleging more misuse of market power. [Online] NEWS.Retrieved on: 4 April 2017. From:

Speener, P. (2012). To Keep Your Customers, Keep It Simple. [Online] HBR. Retrieved on: 4 april 2017. From:

Taylor, J. (2015). Coles pays $12 million to Australian suppliers after investigation finds buyers 'threatening'. [Online] News. Retrieved on: 5 April 2017. From:$12-million-to-suppliers/6583524

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