Morrison Supermarkets Company Marketing Planning

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Table of Contents

Executive Summary
Situational Analysis
Reference List

Executive Summary

WM Morrison Supermarkets PLC is a leading market player in the arena of stores and supermarket chains in the United Kingdom. At the close of the previous financial year (2012/2013), it had an overall turnover of 18,116 million pounds and a net profit of 1206 million pounds.

Whereas this turnover was an indication that it had dropped from the previous year’s 1217million pounds in profits, the encouraging factor was that the turnover for 2012 had been at 17663 million pounds, which was marginally lower than that of 2013.

Morrison supermarkets are markedly different from the ordinary department stores with a limited customer base of close to five million United Kingdom dwellers and daily traffic of over one million in the chains. The chain deals mostly in fresh foods, which include fish, meat, vegetables, coupled with wine and children’s cloak thing, among other products generally offered in a supermarket.

In light of the current horsemeat scandal that rocked the foundations of most fresh meat supply stores in the UK when their meat was found to have been adulterated by horsemeat, Morrison Supermarkets Plc. was one of the few players left standing. The Food Standards Agency carried out rigorous tests on Morrison, but they came out clean and so this element is evidence of uniquely high standards in the chain.

This bit of positive media coverage boosted Morrison’s public image, and the staff notes that customer traffic has increased in the recent past. However, this paper focuses on the proposed grocery.com program that Morrison supermarket intends to launch by January 2014.

This program shall boost Morrison’s appeal as an outlet as it shall enhance online purchase and convenient delivery of affordable food products. The service is worthy of the attention and excitement that it is already causing among Morrison’s consumers and shareholders.

Situational Analysis

As aforementioned, Morrison Supermarkets Plc deals mostly with fresh foodstuff, which is the brand that the chain sells to its customers, viz. the one stop shop for all the meats, vegetables, fruits, grains, and herbs. However, in addition to these products, Morrison Supermarkets Plc also has an active service and product provision in various sectors including clothing for children by Nutmeg, which is a collection of affordable suppliers of varied types of children clothing.

In a bid to boost this service and products, Morrison Supermarkets Plc has regular competitions in which it launches a new “Face of Nutmeg” by engaging parents and children in a photo shoot to determine the new face. Additionally, Morrison has a fuel saver by the name of Morrison’s Fuel Saver, which is an innovative and elaborate way of guaranteeing customer loyalty by providing an incentive as a bonus on fuel.

Additionally, the supermarket chain has other innovative ways of promoting its name and brand, which include the 10 pounds Payday bonus and half price on goods (Philips 2013). The company website is another interesting and attractive feature that Morrison possesses. Its website is very comprehensive, elaborate, and efficient to navigate through when looking for a product. It gives the visitor the impression that if this touch is how attractive the company website is, the grocery.com business is a feasible goal.

The changing pattern of Marketing Planning at Morrison and Morrison’s capability of carrying out a working plan

Before the grocery.com idea, Morrison’s marketing plan was heavily based on the traditional cliché methods and strategies of marketing planning. For instance, the chain had discounts on goods and sold goods in retail at a reduced price; also, they had television and radio advertisements as well as pamphlets and other promotional drives that conventionally mirrored the usual means of marketing planning.

However, with the advent of this new grocery.com project, Morrison Supermarkets Plc is entering the new era of Internet-based business models and is going to stamp its relevance and significance as a product and service supplier. This assertion is especially relevant as it introduces a new dimension to Morrison supermarkets Plc since, whereas initially, it did not have a service sector, now it has one.

As to whether or not Morrison has the capacity to carry out a working plan, the answer is affirmative. A quick review of Morrison’s present structure and strategy reflects flexibility and agility in marketing planning that is unique and impressive. Additionally, it is a very innovative company as evidenced by successful measures to create a name and capture a large segment of the population through incentives like the fuel saver. Consequently, it can implement a working plan.

Market analysis (Morrison’s markets, customers, competitors, and overall economic, political, cultural, and technological environment: Development trends and current situation)

Since Morrison’s primarily supplies fresh food products, markets are wide, and they span the entire United Kingdom population where it has stores. Presently, Morrison Supermarkets Plc has more than 490 stores countrywide, and it is growing at an alarming rate in Hong Kong, where it has several branches. Notably, Morrison targets all sectors of the population. It has children’s clothing, cutlery, and kitchenware, food staffs, petrol stations, gift shops, and the list is endless.

If a family comprising of four children between three and twenty (20) walk into a Morrison supermarket, everybody, including the parents, shall find something to buy. However, that is not necessarily a guarantee that these people shall shop at Morrison, and this element brings in the question of brand loyalty.

The aspect of brand loyalty bears a lot of weight concerning customers and competitors. Customers prefer a particular brand due to the various appealing points of difference when viewed in light of substitutes. Porter’s Five (5) forces can be used to discuss this aspect better and of specific relevance to Morrison’s model is the first force, which is a rivalry. The level of competition is high for any supermarket and especially now that chains are going transnational. Wal-Mart is a traditional name in the store’s department, but it is an American chain.

The prospect of having England’s local market infiltrated and dominated over by foreigners must have really upset many people for today supermarkets, and department stores are fast flooding the United Kingdom market arena. Unfortunately, this trend implies that competitive advantage for stores like Morrison is reduced and so are profits. The reason for this scenario is usually the substitutability of the goods being offered by these companies.

In a bid to counter this concern and raise profit margins, Morrison shall have to increase its competitive advantage, something that it is already doing because one way of accomplishing this goal is through the application of vertical integration measures.

Morrison has applied vertical integration in its business model by cutting out intermediaries and selling products that it manufactures and produces in its facilities. Additionally, it is developing the grocery.com option as an alternative distribution and delivery option that shall increase the convenience and availability of goods.

The economic environment is favorable to Morrison’s model, as most people prefer affordability to even quality or quantity at times. The prices at Morrison are relatively lower than those of other supermarkets in the region are, and this aspect is possible because first, Morrison manufactures or produces most of its products and so it cuts on costs in terms of distribution channels.

Secondly, the chain has a large presence in the United Kingdom, and especially in the localities where it is situated, which allows it to distribute its costs across the board and thus reduce the prices of its stores about the environment or locality. Other smaller supermarkets cannot afford to take that step because they do not have the size or presence required to gamble with such a move.

The political climate has little effect on Morrison as regardless of the policies that are passed, people shall always have to eat, and so when hunger strikes, they go to Morrison. However, in light of market control and quality control, Morrison shall have to continue existing in compliance with the established rules. Of more importance is the issue of grocery.com and the appurtenant cyber laws that apply for ventures in e-commerce.

Morrison shall doubtlessly have a large database of its consumers, which would include confidential information such as credit card numbers or social security details. With the growth of the Internet awareness, it has become prudent for organizations as Morrison to set up a protective system to prevent infection of their databases by malware or infraction by hackers to the detriment of the organization’s reputation (e.g., the incident with SONY’s play station that was hacked into and millions of credit card information leaked).

Finally, regarding cultural trends and developments, it is important to note that scientific evidence has proven that it is healthier to eat particular foods such as whole grains and lean meats, which Morrison supplies, as opposed to fast foods.

Whereas a majority of the population is yet to take this dietary advice seriously, most senior citizens have received medical prescriptions comprising of a healthy diet. In England, 80 percent of the population is aged between 20 and 89, and so this is quite a large number, noting that 16 percent of this number is above 65 (Office for National Statistics 2012). That segment of the population is a guaranteed potential client for Morrison.

Issues Analysis: a review of internal and external forces with impact on a market audit

The internal factors that shall be relevant in marketing planning and specifically with the grocery.com project are a depiction of the organization’s strengths and weaknesses. The strengths of Morrison are compound, and they include their international or transnational status, their innovative staff, which is large and adept at their jobs as evidenced by the genius incentives they come up with to instill brand loyalty and achieve customer satisfaction.

Others include their corporate social responsibility model, which is truly admirable as it includes a charity established by Morrison to cater for disadvantaged children in the United Kingdom. Also, the chain’s current customer base is another pillar of strength as over 11million customers walk in through its doors each day. Finally, the Morrison manufacture and produce most of its products, thus cutting on costs as far as distribution channels are concerned, which is another aspect of strength for the chain.

The chain’s weaknesses stem from some of these strengths because, for instance, it has an indefinite clientele, as they are too many to keep track of or carry out a conclusive survey to obtain feedback from in an efficient manner. Additionally, in light of the proposed grocery.com model, supplying end users living abroad would be a challenge, especially given that it deals in perishables.

This aspect would mean that consumers in Hong Kong, for instance, would not get deliveries from online for at least the first five years for the distribution center that Morrison wants to establish in conjunction with Ocado PLC shall be set up in the Midlands of the United Kingdom.

Morrison’s opportunities are vast as the chain can easily take over the market bases of its competitors who were found guilty of adulteration of meat with horsemeat, for instance.

This observation means that the chain could capitalize on the negative publicity being warranted to such stores and convince the customers of these stores to shop at Morrison where the quality of meats has been tried and tested and approved by the Food Standards Agency. Additionally, the chain reserves the option of going global with its delivery services if it can come up with a preservation plan to keep its perishables fresh for the conveyance.

The threats that affect Morrison include the likelihood of bad publicity like that which its rivals are currently suffering due to horsemeat adulteration. The food industry is very sensitive, and sometimes accidents occur, yet the public is very critical of even the slightest mishaps as this aspect could completely eradicate the customer base.

Secondly, the expense, time, and effort required to educate the staff on the delivery of goods shall draw the company back, as do the debts currently owned by the company (to the tune of 2.7 billion pounds) (Morrison 2013, p. 6). Notably, despite these debts, the company continues to plan for the 65million pounds expenses that they shall require to implement the grocery.com project.

Main barriers to market planning (including an exemplified definition of market barriers)

The objective of carrying out marketing planning is to gain a competitive advantage. Nevertheless, some organizations still avoid or ignore marketing planning strategies due to ignorance or intentionally courtesy of various systemic errors in judgment that often act as marketing planning barriers (McDonald 2010).

The probable reason for this scenario is that the prescriptive texts outlining marketing planning are very basic in their explanation of the process so that they talk about the setting of objectives, SWOT analyses, and marketing strategies to be applied among others. Companies do this at the exclusion of a detailed explanation of who should do what, how, or when.

Consequently, few organizations know how to go about the marketing planning process, and fewer still go ahead and do it. The main barriers to marketing planning thus include:

confusion between marketing tactics and strategies;
hostile corporate cultures;
lack of in-depth analysis, knowledge, and skills;
lack of a systemic approach to marketing planning and a failure to prioritize objectives among others.

Ways of overcoming these barriers

Proposed solutions for the aforementioned barriers include:

Engaging the culture leaders in the process of marketing planning to foster buy-in and measuring the phase of the organisation’s life at which marketing planning is to be introduced for relevance before choosing the marketing planning strategy
Prioritisation of objectives according to the expected impact or effect on the organisation as well as the urgency of the desired end
Ensuring that those involved in the marketing planning process have adequate knowledge and skills in basic concepts such as information sourcing and analysis and the 4Ps of management, and ensure that in-depth auditing is executed before the planning begins.

A marketing plan for Morison’s grocery.com service

This plan is a very basic example that is limited in its scope and detail due to the scope of this paper.

SWOT analysis: This analysis has been carried out above under internal and external factors that could affect an audit.
Market objective: To enter the United Kingdom market with the grocery.com service by January 2014, and effectively capture at least 10 percent of the market by value within a year.
Marketing Strategy: Marketing mix variables – need to develop a new service and a pricing strategy

The main questions that one should ask to include what is the core and supplementary elements of the service, followed by how much should be charged for the service, and finally what is the best way to communicate what the service has to offer. The core services are those that satisfy the customer’s basic needs, and in this case, it shall be the transportation of products to the convenience of their homes.

The supplementary services are opposite to the core, such as enlisting the services of drivers for delivery jobs. It is important to establish facilitations for the core service such as billing for the transportation, and then identify enhancements for the same such as exceptions for billing when a consumer has a valid grievance.

Justification of marketing strategy

The consumer’s experience is a five-stage wheel or cycle that revolves through the steps of discovery, evaluation, acquisition, integration, and extension. In determining the costs, it shall be prudent to apply all three bases of pricing including cost-based, competition-based, and value-based pricing as online shopping and delivery are fast becoming the most popular means of shopping and delivery and many companies are currently offering free delivery. However, it is important to take into consideration real costs incurred say for long distance deliveries.

Meaning of ‘Ethics’ in Marketing

Ethics refers to the core values and principles that govern those involved in the promotion of goods and services to consumers and such values or principle sought to result in customer satisfaction with the products and services as well as the promoters and the company that is offering either the goods or services.

Ethical issues opposite to the development of a marketing plan

When developing a marketing plan, the idea is to gain a competitive advantage over rivals or competitors, and so it is easy to fall off the tracks in a bid to gain an unfair advantage. Consequently, some of the ethical issues that may arise include integrity in the presentation of the good or service being promoted.

False advertisements are a wrong way to go because eventually, the consumers shall realize that they are being played and the consequence of having irate consumers is that the organization may have to close downs or in the very least, move house and start afresh.

Another ethical concern in the establishment of a marketing plan is the bad mouthing of other products and services. It is unwise, unfair, unjust, and even illegal to publicly point out the flaws of competitors and say names. The only permissible practice is selling one’s strengths, which, due to the product or service differentiating, would probably be the rival’s weaknesses and letting the consumer decide.

How consideration of consumer ethics, in general, affects the marketing planning process for Morrison

Ethical considerations have resulted in the innovative turn that Morrison has opted to use in marketing its products and services. Instead of grappling with competitors around the common and cliché ways of marketing, Morrison supermarkets chain has gone out of the box with its marketing plans. For instance, it has television advertisements starred by celebrities to capture the fans of these stars by allusion to their products and services.

Additionally, they have their products coming from their farming program, and so consumers feel like they are one big family and not just another store. The third effect of ethical considerations regarding quality control is that consumers have learned for themselves (in light of the horsemeat scandal) that they can trust the fresh foods that come from Morrison and their rivals have no justification for a vendetta against the chain.

Morrison did not actively participate in the facilitation of the other stores’ downfall, as they were simply innocent, but lucky benefactors of the same.

Reference List

McDonald, M. 2010, Ten Barriers to Marketing Planning. Web.

Morrison: Finance Reports. 2013. Web.

Office for National Statistics: The age and sex structure of the population of England and Wales. 2012. Web.

Philips, D. 2013, Q1 Interim Management Statement – 13 weeks to 5 May 2013. Web.

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