Woolworths Supermarkets’ Consumer Behavior

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Market Segment Profile

Market segmentation is always very important, especially when a firm’s product faces a huge competition in the market. By segmenting the market, Anderson (2011, p. 78) notes that it would be possible for an individual firm to come up with products that would best meet the targeted market. The firm would find it easy to specialize in this segment and provide products that best meet the expectation of the market (Evans 2010, p. 56).

With the improved quality of the products due to specialization, it would be much easier to have a pool of loyal customers who would be able to act as evangelists of the firm’s products. These firms have adopted segmentation as a method through which they can best meet the demands of their customers. Grunig (2002 p. 121) observes that other large firms however, have specialized in a broader lines of products. Woolworths is one such firm.

Woolworths has managed to edge out all other supermarkets to emerge as the leading supermarket in this country. This supermarket has managed to segment the Australian market into different segments, each with specific characteristics, which makes it differ from others (Klein, H 2009, p. 51). It deals with various lines of products, each with a different target market. One of the main lines of products in this giant supermarket is the green (vegetables and fruits). This product has been associated with the poor, especially due to its price. However, a new market segment for this product has come up.

This product is currently very popular among the middle class and the rich. This new market segment is keen to maintain a healthy lifestyle, and with the fact that the green are considered healthy foods, most of them have increased their consumption of this product (Sharma 2008, p. 114). This has seen many supermarkets in this country; including Woolworths stock this product for this particular target market. In this study, the researcher would focus on the greens sold in this giant supermarket.

Preliminary Profile of Consumers in That Segment

Barthe (2010 p. 131) observes that the world is increasingly getting knowledgeable. The emerging technologies in the form of mass and social media have rendered most consumers very knowledgeable. People have becoming conscious of their health. They are very keen on what they eat, as they want to maintain a healthy lifestyle (Charantimath 2006 p. 19). They are therefore very keen to avoid foods that have been known to be rich in calories.

Some popular fast foods the humbuggers have been criticized of the effect they have on people. As such, consumers have been avoiding them and in their place taking healthy foods. The greens have gained favor in the face of these health sensitive individuals.

Consumers in this segment are mostly in the middle-class and high-class members of the society. Consumers in this market are mostly married individuals who are of middle age. According to Daft (2009, p. 41), most of these individuals are young families who are out to ensure that they avoid junk food that may have risks on their health. They stay in middle and high-class suburbs of the cities, as most of them prefer staying in the urban centers than in rural set-ups (Huber & William 1993, p. 89). The few who stay in rural areas have well-organized families and staying in established houses.

One special characteristic of this category of customers is that they are quality sensitive of the products they buy. They are do not give so much thought about the price of the products they buy, and therefore care should be taken to ensure that products targeted at them are of quality, irrespective of the price. These individual would easily switch from one firm to another to another if they feel that they have not been satisfied with the product of the firm. However, they can also turn out to be very loyal customers if they get somewhere where their interest is well taken into consideration.

Giddens (2009, p. 48) argue that the size of this market is relatively big.

Product Profile

Vegetables and the fruits, herein referred to as the greens, are becoming very popular across many families in Australia. People have come to appreciate the importance of the vitamins gotten from the greens and have therefore turned to its consumption in place of such means as the red meat. This product is highly perishable and therefore it should be handled with a lot of care. The greens would require cool storage, and above all, it should be consumed as soon as it is taken from the firm (Gorchels, Marien & West 2004, p. 17). This means that it should have a ready market. it does cases where the market is unpredictable. Because of the fact that it is perishable, the product requires as minimal handling as would be possible to ensure that it remains fresh and with good shape. It would also require handling equipments.

The Alignment between the Product and the Consumer Profile

It is always very important to align the product and consumer profile. Kurtz (2008, p. 141) says that for a product to succeed in the market, it should be aligned to the target market as they will make the product popular among the target consumers. There is a perfect alignment between the green and the target consumers. The greens have not only been considered as healthy, but also medicinal.

The target group includes individuals who are health conscious and they would always avoid meals that may jeopardize their health. They therefore find the vegetable and the fruits very appropriate. Because majority of this class are the middle class, they find the price of this product very attractive in this supermarket. In Page (2010, p. 72) words, the consumers of this product find total satisfaction from this product not only from the quality they get, but also psychologically, given the fact that they have internalized the fact that this product is medicinal.

A validated consumer profile

Australian is a considerable developed nation. However, the social class exists and there are the classes discussed above. The consumers targeted in this profile are those who are aged 18 years and above. Kabani (2009, p. 45) reports that the biggest subsector in this market segment are those aged 25-39 years who make about 48 percent of the market. Those aged 40-54 years make 27 percent of the market, while those aged 55-65 make 11 percent. The least groups are those aged 18-24 at nine percent and those above 65 years at 3 percent.

Most of the consumers in this segment are married. They account for 61 percent of the market. Those who are living with partners make 23 percent, single and never married are 5 percent while the divorced make 4 percent. These families also have children. Kotler (2003, p. 97) observes that most of the families have two children. In this target market, majority (66 percent) are employed, while others are in self or informal employment. Majority of the target market stay in urban centers. The few who stay in rural areas are practicing agriculture and therefore they are the source of the vegetables and fruits. They therefore do not make up the target market.

A detailed analysis of the buying trends influencing their market segment

The emerging technologies have changed the buying trends of customers in the market. It is through advanced technologies that health experts have come to confirm that vegetables and fruits are healthy for the body. They are therefore encouraged for consumption. McGriff (2012, p. 36) this has changed the buying trend of consumers, from people who heavily relied on meat and oily foods to people who prefer the greens. The improved technologies have also had positive impact on the volume of purchase of these products. Consumers can now afford to buy foodstuffs in large quantities and keep them under refrigeration (Harvard Business School Press 2009, p. 59).

This has seen such retail stores like Woolworth make huge profits from the sale of vegetables and fruits in the Australian market. The emerging technologies have also made marketing a lot much easier. Marketers can easily reach out for the customers through the social media with proper adverts, besides using the conventional mass media advertising. This way, it becomes easier for a firm to develop a pool of loyal customers.

A detailed analysis of consumer behavior

Understanding consumer behavior is one of the most important tasks of a marketer. Through this, it becomes easy for a marketer to predict how a product would perform in the market. Consumer behavior, as Shelley and Maria (2011, p. 34) affirm, also makes it possible for a firm to come up with products that would be able to meet market expectations. In this market, customers are not highly price sensitive.

Although they would definitely prefer relatively cheaper products, they do not give price precedence to quality. They highly value quality products from every item they purchase. From a research done by Proulx (2011, p. 45), the scholar reports that in the interview conducted from a sample of consumers, quality of the products was given a priority. The respondents clearly stated that they highly value products with unquestionable qualities. Given price and quality to choose from, this scholar notes that most respondents preferred quality to price, meaning that they would be willing to pay more for a product, which is of high quality.

Another important behavior of the consumers in this market segment is that they are not easily convinced by firms to become loyal customers. However, once they become loyal customers of a particular brand of products, they would most definitely stay with the product or the brand for a long time. Oppenheim (1992, p. 38) observes that they may only change their loyalty when convinced that the product or the brand no longer offer products that are able to meet their needs.

Given these factors therefore, a marketer would have to understand this target market and ensure that they are consistently provided with desirable products and in the right manner that would help retain their trust.

An evaluation of the influence of previous marketing activities

Marketing activities would always affect business ether positively or negatively, depending on the approach taken by the firm. Marketing of a product is always meant to help ensure that this particular products gains positive image in the market in order to ensure that its sale is increased. Marketing activities of this firm has ensured that this product is very popular among the customers within this country.

Woolworths has particularly been keen on marketing the greens both in the social media and in the conventional mass media. In the social media, majority of the visitors are the youths. This is a very attractive market segment, but they are not easily attracted to the greens. The population of the youths who visit the social media in this country is about thirty percent of the population of Australia.

Being able to capture this market can be very beneficial and various firms have made efforts to ensure that they capture this market. The problem is that the youths are attracted to the fast foods like the humbuggers, and not vegetables. Moreover, most of them are not responsible for budgeting in their respective families and therefore may not be attractive segment for the vegetables (Doorley & Garcia 2011, p. 28).

However, they have the capacity to consume many fruits, especially for leisure. Woolworths have therefore been keen to attract them for this product. The move by this firm to advertise the fruits as products that can be taken for leisure has greatly attracted the youths who like leisure products. This has greatly influenced the youths who currently prefer fruits to other carbonated drinks that many health experts have criticized as being hazardous health wise. In essence, the market for fruits has greatly increased among the youths. The vegetables are also getting increasingly popular in the market.

A statement that identifies the legal and ethical standards that applies to the organization and their marketing place

In every industry, and for every firm, some forms of ethics that have to be followed for the firm to be considered legally operating (Cummings & Worley 2008, p 64). Genetically modified products are considered controversial and therefore it is required of the retailers that they avoid stocking this product, and if they have to, it should be indicated clearly on the product

A situational analysis of their organization’s capabilities and ability to respond to any changes in the marketplace or in consumer demands

Woolworths is the leading supermarket in Australia. It has managed to maintain the market lead for a number of years due to its strategy in the market. In order to be in a position to analyze critically the organization’s capabilities and ability to respond to changes in the marketplace, a SWOT analysis would be very useful.

Strength of this company comes from the fact that it has a very strong brand in the market. The brand Woolworth is very strong in the retail market, as many people have come to trust this firm to deliver value to its customers. This trust makes it very easy to win trust of the market, and this enhances the ability of the firm to meet the demand of the market (Armstrong, Harker, Kotler & Brannan 2009, p. 80). The financial base of this firm is also relatively big. As such, it has the ability to meet the various projects of the firm. It can also sponsor various research meant for improving the services of the firm. The workforce of this firm are also dedicated to their task. They have work hard to ensure that the customers are served in the best way possible.

Despite the above strengths of this firm, it has some weaknesses that have made it face a number of challenges in meeting customer needs. One such weakness is the flexibility of the firm. This retail outlet is very large, and this has posed a challenge when it comes to changing from one strategy to another. This is very dangerous as it may render the strategies of this firm irrelevant in the current competitive market.

Opportunities in this market come in a number of ways. Australian as a country has most of its population living well above the poverty line. This therefore means that they have the capacity to buy these products. The emerging technologies are also bringing new products into the market, thereby expanding the product lines of the supermarket. Technological improvements have also made management of the outlets much easy, as the management can easily track down operations of the firm, and detect shoplifters, hence reduce such incidents.

Threats within the market cannot be avoided. The main threat in the market is competition. Many other firms in this country stock this particular product. The product in Woolworths is therefore perfectly similar to products of other firms. For this reason, the competition is very stiff (Blackwell, Miniard, Engel 2006, p. 21). Another threat also comes from the emerging technologies. The emerging technologies have left this firm guessing what tomorrow would look like. This forces the firm to increase its expenditure in research and development.

A report on the recommendations for a focused marketing strategy for the product or service

Woolworths as a retailer would therefore have the obligation to estimate the level of consumption per day, and supply an amount of this product that would all be consumed within that particular date. Care should also be taken to ensure that these products are kept under refrigeration to avoid cases where they get perish within the stores as this may result in massive loss to the firm.

The products are generally cheap as compared to other alternative products like meat, in place of vegetables, and quencher drinks, in place of the fruits. They do not have complex processing but require close care to avoid damage.

Although there are no exact, statistics that can clearly state the size of this market, on average it accounts for about one third of the Australian market. With the growth of the economy of this nation, this market is expected to expand, as more people are getting concerned of their health. If the current trend is anything to go by, then this market is expected to reach up to half the total market for this product in this country. It is important to note though, that the low class individuals, who make another very attractive market segment for this product, is not analyzed in this study

Woolworths stands a better chance of winning this market if it implements proper strategies in the market. The market is increasingly competitive and it would require this giant firm to implement some strategic programs that would help ensure that the market remains favorable to it. The following are some of the recommendations that this firm should observe in order to remain competitive.

Understanding the market is the key to success of any firm in the current competitive market. An outward-in approach to marketing must be employed in the market in order for this firm to be sustainable. The firm must first start by understanding the forces in the market and then provide products, which would meat market demands.
It is important for this firm to realize that other firms within this same market stock this product. However, there must be differentiation in this market in order to convince consumers that this firm offers a superior value to other firms. This may demand that this firm develops different ways packaging to make their products look superior to those stocked in other retail stores.
Strict laws and regulations that every firm must observe guide the industry. Ethics must also be maintained in order to operate successfully in this market. The management of this firm therefore has a responsibility to ensure that it works within the code of conduct. This retail outlet should particularly avoid stocking genetically modified food contrary to the law. This would help maintain good reputation in the market.
In its competitive strategy, this firm should avoid taking the pricing strategy. It would be better for this firm to add more value to the products and make them appear unique so that they may attract premium prices, than reduce their prices below the market value.

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