Marketing Challenges: Woolworths

Marketing Ch entirelyenges WoolworthsWoolworth is one of the roaring U.S companies, the archives of the Woolworth Retail Company is to a greater extent than one century. correspond to the Tele represent.co.uk (2009) the history of the governing butt end be traced back to a kitchen range of 5 and dime stores founded by Frank Woolworth in 1879 in Watertown, New York. It was sole(prenominal)(prenominal) a short period of time before the jazz with receptive its scratch flexure UK facility in Liverpool in 1909. It was non long until the retail merchant had become a study fixture on closely in elevated spirits streets across the nation and the retail seat that most batch live had emerged.They sold childrens clothing, toys and stationary at beginning, this was the born of British shop institution. By 2008 there were 807 stores and around 25,000 employs blend ining in the store chain of Woolworth. It was the first chain to make brand items with its own summons. In 1 960s when chain was at its peak with more than 1,000 shops across the UK Woolworth decl bed I intend that a good penny and sixpence store, run by a lively Yankee, would go down a storm in England. (Tom Geoghegan, 2008)Woolworths chemical group plc is one of the UKs best k instantlys oldest group, they argon general merchandise retailer, entertainment middleman and publisher. They had two broad lines of handicraft Retail and Entertainment wholesale. Woolworths, Streets Online Limited, Flogistics Limited and WMS invoice Services Limited ar within Retail, with Entertainment UK Limited, 2entertain Limited and criminal record Distri aloneion Limited be part of Entertainment wholesale and Publisher. They brought allthing infra one roof the home, family and entertainment. Woolworths key products include toys, confectionary, electronic media, childrens clothes and polished household and entertainment items. Their outlets allocated in small towns and city suburbs tar featureing the basic shopping requirements, and big stores located in larger cities on shopping streets and centers.(Graham Charlton, 2008)The name of Woolworths evokes memories of some Britons childhood except the future of Woolworths in United res publica doesnt look promising at present and its really hard for them to get their original niche back in victualsstuff. Woolworth is the most high profile UK High Street causality of the economic down turn and ran into scuffle this year after struggling under the weight of its debt. The recession has interpreted out Woolworth a tragically mistimed management. (Tom Geoghegan, 2008)Woolworths pick up gone into administration in 2009 with debts of 385m and had to close down all Woolies store. Woolworths relaunched by Shop Direct collection on 25th June 2009 as an online retail family Woolworths.co.uk and offer uping one-half of the cardinal products and they in like manner launched an Easter Egg website cal lead Woolies Wonderland for East er of 2009.MethodologyWe have interpreted valuable in put downs from our module instructor during our semester various stages which helps us to lick a frame work of our assignments. We have met regularly during the course to come the task and conclude that Is there a future of Woolworths particularly in the region of UK as Woolworths has unlikable operation and stores in the UK, the reasons of their failure we had to wonder and it was quite hard objective to achieve. To find out about the follow who is no more operating was not that easy task but we have found so many reasons and conclude with some recommendations in this report.Data CollectionFor the research we have used Inductive method acting and approach, and collected data from dissimilar resources available online about Woolworths which includes case studies and the cultivation provided in different discussion forums, through spick-and-spans articles, journals, research cover and secondary data was collected. Inform ation relating to history and growth were resource mainly from BBC.news official website.The at onceions of the federation in the recent multiplication1) Market acumen( jetty Worth) established its website which decoctes to serve all the categories of the family. Wall Worth in its merchandising strategy considered that it would make it easier for consumers to see the specifications and offers of goods quickly and at broken cost, indeed it chose to make a lot of shown goods digital , and this is what the order focuses on (books, songs, electronic games, I Pod, movies). In terms of advertising , it worked to market their products through the br separates (Brooklyn) to gear up the brand and logo and this was not traditionalistic advertising, but by the Ads- accouterments mail for the storage of its goods and put as shape uply half a million products on its website. the high society withal made a combination of warlike pricing strategies and the promotion for its sales a nd ad through Web sites as it is found in the Home page (example if a client bought more than 30 pounds ,you would receive goods free of charge). After this big transformation in the entering of Woolworths as a retail store by lucre ,it was ranked among the 50 brands that are searched by guests through the Internet in the United Kingdom on the (Wutscher)site.More than one million visitors entreed the society site when it opened on the Internet in the first hebdomad in February 2009. The ships company achieved this success through a combination of products with a great value and great offers and discounts. On the other hand, demand change magnitude for discount Tesco coupons by 5% from the last year and 49% of muckle say that they use the Internet to pervert their products by the Tesco website for retail sells.Woolworths similarly had a new marketing strategy to sell all its products under one roof by its website .So it has three shops for selling on its website including ma in store to sell electronics, store for entertainment, store for clothes and fashion.When growing a marketing plan, Woolworths found that the strongest area of its business is concentrated in ready reckoner games ( much(prenominal) as Nintendo), and there was an increase in demand in 2007_2008 and this is what led it to sell them on its website at the beginning of 2009 to the e-games and DVDs . it did this to reach operational low costs and the minimum calculate of employees after seeing that consumers prefer to barter for this type of merchandise through the Internet . First of all , by designing products in line with the wishes and needs of t consumer with different aspirations , and on the other hand. to retain the current consumers and attract potential consumers2 exploitation the marketWoolworths had got new and different sales channels from traditional stores much(prenominal) as portals as a new market places for industry / consumers , e-mail, and in addition Facebook , from these channels (I U k) company .In early 2008 , Wall worth started a new experience in selling digital products for this reason the summarize sales rose to 23.5% and this equals 240 million pounds through this joint project.3 evolution the ProductWoolworths considered after the entry of foreign competitors to the UK market specifically in the area of food , and found that it needed to new strategies for keeping of their rivalry trend innovation, uniqueness and quality and it restrains in this until now by innovating and developing new products and developing modified products to increase sales.So it kept developing its products by products concern Christmas trees and decorations. In 2008, the company produced a total of 2200 products . the company aims in this marketing strategy to increase sales. In this time, Tesco entered on the line of Christmas products which is focused by Woolworths , so Tesco contracted with Cadbury Chocolate company to buy millions of units at a cheaper price than Woolworths and this was a great challenge to it in their direction to increase sales, while Tesco tries to reduce the unit value and deepen service to its customers. The company also had got exclusive partnerships for some global products in a move to introduce new products and monopoly them as comfortably.4 variegation of new products in new marketsWoolworths has new get lines and adds new products such(prenominal) as televisions, mobile phones and (I Pod) devices directed at consumers, particularly young people. Multi-services to all members of the family , the tendency is to make the price competitory, but not the cheapest in the market. Wall Worth entered the field of clothing for children by using shopping and direct distribution on the internet. It aims to provide better customer service than its competitors. Tesco company did this too , but with less costs in the market.In conclusion, Woolworths put all the strategies that make it succeed in the com ing long time match to their capabilities .It is an master(prenominal) step to know what its customers need and what they are looking for, so Its current focus is on the non-food products, and this will be achieved entirely by its website.Relate the issues to appropriate concepts introduced in the ModuleThere are hardly a(prenominal) strategies and concepts within marketing that bottom be relate to the Woolworths strategies and method they used. Woolworths burster and strategy was to deliver to customers the right shopping experience each and ein truth time, vision to provide quality products and services to customers through price strategies, tender-hearted resource strategies and fresh food strategies. To achieve this they integrated and execute some(prenominal) strategies which include low prices strategy, project refresh strategy. The Woolworths strategy was purely and completely on the basis of price and they implement every-day low prices strategy to offer customers lo wer prices through reductions on all products but there was no brand status. This was a very good strategy for many historic period and it made Woolworths fortune and achieved the goals. Woolworths experient great success through innovative, kid-glove and profitable strategies their organizational structure, staff leadership and stakeholders all played an important role in executing these strategies.It is really important for any company to understand the marketing environment and customer needs/wants to target the manufacture costumer for the product sales. Woolworths was successful all over the world and in UK also they enjoyed a time as a leading and governing company capturing the most market shares and there was no threat for Woolworths process 1960s. Woolworths business also had an important part to market their products in the people with understanding of products and result in increased in sales and customer interest. They succeeded to change their new customers into re tain and loyal customer and Woolworth understand and targeted the customer values, reliability, credibility, accessibility and provide them with satisfaction of shopping at their stores and build their trusts. large environment was in the favor of Woolworths from the start as there was no political and technological awareness in early 1900, factors and forces that affects the Woolworths capability to go effectively was not there.Woolworths destabilized by the combination of exceedinglymarkets, cheap discount stores and online buying stores offering products at lower prices. Thus the market becomes more competitive since the internet and globalization have made international foundation as reality. There was no spending on frills having relied exclusive on prices with no position in market. Their stores were old fashioned and unappetizing because they dont use to spend specie on stores to catch the attention. There lack of property portfolio also discourages government to rescue them and creditors start claiming and suppliers asking for cash for the goods.BCG Growth/ luck MatrixWe can analyze Woolworths through BCG growth/share boxes as David Jobber (2007). Hence, Woolworths was at their peak in 1960s and they were the leading company having big chains of stores in retail industry. Woolworths completed century and judge to be the star of the industry. Market and business growth rate graph was on its peak in 1990s, market share was even very high and the stars of the past was proving to be the cash cows and company having the high turnover and revenue. Their market position was indefinite with no competitors in the industry. But, now Woolworths is being a problem child with negative growth and their shops are closed leaving 25,000 people un utilise and in 2009 they completely closed down retail operations in UK.Woolworths is creating new solutions and have come into business with new strategy to open a few(prenominal) new shops with different ideas and th ey have gone into administration with re-launching of the company as an online retailer with new product lines which better meets customer needs and they can easily access the market. David Jobber (2007)Discuss the Customers berthThe purpose of this essay is to discuss the yield issue of whether or not there is a future for Woolworths from the post of the customer. It will provide a prediction for the outlook of the organization from the panorama of customers. Whilst the organization was known as the Woolworths Group Plc the company according to BBC intelligence agency (2009) the company closed all 807 if its retail stores and the company was ultimately liquidated in February 2009 and for purposes of this paper the focus will be on the online retail operations of the company. This has made a large impact on the way the company deals with customer and what customers can expect from Woolworth.According to the Laurence writing for the Dailymail (2008) the company had go through years of poor performance. In the wake of increased competition and a global economic downturn it was the case that the holding company for the organization decided to liquidate all physical assets and focus on online retail operations. According to an interview with Gordon Brown in the Telegraph, the Prime Minister verbalize that the government had considered bailing out the organization but had decided that the business model was financially unviable (Prince, 2009).Upon examination of the company website (2009), when speaking in relative terms, the company has product offerings that closely mirror that of what was on offer in the precedent retail outlets. Furthermore, there has been a modernization of the entertainment offerings over the previously employed retail model (Company entertainment website, 2009). That utter, from a customers perspective Woolworth now offers very little that cannot be purchased at other online retail outlets such as Amazon or EBay. Furthermore, the se companies are much more experienced and economically healthy than Woolworth, and therefore have a much larger market share. This is unlikely to change. From the perspective of the average consumer it is unlikely in the near future there will be a surrender to Woolworths traditional business model. It is simply the case that the environment is far more alter with traditional and specialty retailers. According to TNS World Pannel (2008) it is the case that a number of already established grocery retailers are offering clothing, house wares, gifts, and electronics which is a market traditionally dominated by Woolworths.Whilst it remains to be seen whether or not the continued success of the organization using the current online retail business model will continue indefinitely, the initial success is for sure promising. According to an article by Marketing Week (2009) it is the case that 68.7% consumers are planning on doing more of their Christmas shopping online this year which represents a huge growth opportunity for the Woolworths if they can capitalize on this growing market. This is back up by an article by Huber (2009) the parent company to Woolworths launched a enormous advertising campaign to help promote the services offered in an motility to boost consumer confidence to one of the busiest retail spending times of the year.An special problem to consider, however, is that Woolworths target demographic has traditionally been older shoppers. Because such shoppers are less Internet savvy than younger shoppers, Woolworth will have to work hard to reach out to its traditional base. Traditional customers might be tempted to simply continue shopping at places where they can pick up and look at the goods they are interested in. Some do not even have credit cards. Woolworth mustiness work hard to tag itself in an online marketplace dominated by big, experienced retailers. If it does not do so, it will go the way of the dodo bird.In conclusion, any retu rn to the previously employed retail business model as employed by Woolworths is unlikely. That is not to say that people will not continue to enjoy the level of service and product offerings that the company had offered but this must be done so by new means.Assess the Perspective of CompetitorsThere was the time when there was a demand for Woolworths in the Market, but after a certain period of time we witnessed that the Woolworths was off the market in a few years. The sudden debacle of Woolworths from the market can be because of various aspects. With the increase in the numbers of its competitors and the woolsworth unable to argue with them accordingly and improper strategies and not updating with the technology as well as with the change in the needs and the demands of the consumers.Woolworths CompetitorsThe loss of Woolworth in Shirley was echoed in about 800 High Streets across UK, breaking the record of 99 years in the history of the British towns and cities. The main cause can be named as recession as with the impact of recession many of the stores were closed and increment in the number of charity shops. The streets were having now the three times more the charity and the discount shops. These great losses in the business were due to the recession, the rise of the tops(predicate)markets and the increasing popularity of the hebdomadly shops. The debacle of Woolworths had a few other aspects and they were its competitors. The major competitors of Woolworths were the Tesco and the Wall-mats. The main reasons which led to the precipitation of the Woolworths arefewer womens clothes shopOne in every five womens as well as childrens clothes shops were closed in UK. This was one of the most important and discretionary area were there were a lot of money was spend so when there were locks on such doors people consequently decided or rather started going to the discount outlets and were fully fulfil and were satisfied in a cheap price. Next is a plat repr esenting the actual diagram representing a proper data showing the try loss of the market in according to the closure of the shops of Woolworths. This data is been taken from a local data company which is depicting the % of loss of a business dealing in a particular product. And as we go throw the data we can see that there has been a major loss to the woolsworth in the near future and compare with its near competitors.Shops broadly speaking emptyThe shops became empty because of increment of the competitors and effect of the recession that led to the downfall of major businesses.Woolworths have so many competitors. The competition was basically amongst the super markets specially Tesco, as they started selling more and more household products as well as toys and electronic goods and many such other products that can be considered as gift items. Woolworths on the other hand was not looking over the aspects that other large markets were giving them a wealthy challenge.The first ev er store of Woolworths was opened in Liverpool in 1909. And it was selling almost all the products right from the tools to clothes, it was selling cheaps of things and none other stores were such big.The greatest of Woolworths was from its main rivals probably individuals stores themselves, the consumers were going regularly to the Woolworths because the specialist stores were not having appropriate stuff that the consumer were demanding but with the increase in the number of super markets there were more stuff along with the relevant information so consumer started going towards those who were new but were very promising namelyTesco the competitor of WoolworthsTesco was founded in 1929 by J. Cohen. The company was not on the London depot exchange till 1947, unlike the Woolworth and the Wall-Mart as their primary focus was on the groceries right from the beginning was struggling at the time in 1970, it only expanded when it introduced the club cards and entered the European and the Asian markets expanded into non food banking and telecom products. Tesco that reportedly having half of its sales in the UK at present. According to Tesco inflation had dropped substantially since three month till September. They keep on launching cut-price ranges and by these aspects they were attracting almost 300,000 more customers every week and they witnessed strong improvement in their sales volume. Tesco is due to complete the purchase the remaining of the 50% stake of Tesco Personal Finance from the Royal coast of Scotland in a very near future. The group has also said that they will put brakes over their expansion in the US and will only focus on the hitting the key areas. Tesco being the greatest threat to the Woolworths is implementing the strategies to take over it in every aspect.Tesco has also confirmed that they are surely interested in buying the Woolsworth as the chain has almost collapsed just after they were not able to steady their company with major threats f rom the markets. Woolworths kept its regional focus on the other hand was concentrated on the supermarkets in the future might focus on the food products as recently bought the 10% shares of New Zealand found The Warehouse Group. They copied high success retailing fuel strategies from the Tesco which has been largest retailer of gas pedal since 1991. Tesco on the other hand developed 4 main formats to instance different locations. Also used the supermarket in selling the liquor which became major threat to the Woolworths.