HC1082 Group report and presentation 2020
Marketing management is referred to as the organizational discipline which mainly focuses on the practical application of marketing orientation, methods, and techniques within the organisations of firms marketing activities and resources. Marketing activities mostly employs tools from that of competitive strategy and economics to analyse the industry context upon which the firm operates(Deepak & Jeyakumar, 2019). The marketing tool for the organisation includes Porter’s Five Forces, Value Chain and SWOT analysis that helps the firm in analysing cost structure, resources, and competencies, sources of profits and competitive positioning of their competitors. In the process of marketing management the organisation carries out market research in terms of identifying trends, development and other factors upon which decisions are being taken within the management. During the introductory chapter of the report an organisation has been considered to carry out the report, Wesfarmers Ltd has been chosen to perform the report. The marketing environment will be analysed in this report which comprises of the macro environment and micro environment factors such as political, economic, technological and legal factors will be evaluated in this report which will discuss the competitive business environment(Haider, et al., 2019). Whereas, evaluating the micro environment factors such as customers and competitors it has been identified that it helps the organisation in identifying the taste and preferences of the customers along with identifying the competitive advantage that the competitor firm enjoys. Moreover, as the report progress, it will briefly discuss the four Ps of Wesfarmers and about their strategies which helps the organisation in performing their set objectives and achieve the desired results. Finally at the end of the report conclusion and recommendations will be provided.
The marketing environment of the businesses refers to the internal and external factors which have influenced the marketing operation of the business (Gregory, Ngo, & Karavdic, 2017). The demands and requirements of the social group have also essentially identified for inclining the product line-up into that direction. The market environment of Wesfarmers is demonstrated through the macro-environmental factors and micro environmental factors.
The macro-environmental factors of the marketing refer to the demographics, political, ecological, technological, socio-cultural and economic factors that have influenced the marketing approach of the firm (Valenzuela, Merigó, Johnston, Nicolas, & Jaramillo, 2017). As the business has dealt in the retail sector, the number of competitors has risen and the long term debt or provision of the business has also risen. So, political factors and economic factors are discussed for identifying its influence on the marketing of Wesfarmers.
Political environment
The political environment of Australia has assisted Wesfarmers to expand its business operations in food and staple retailing in more than 10 countries. It also contributes to the GDP of the country which helps to maintain economic stability. The risks related to lower-level corruption and military invasion are overcome through surveillance and monitoring the business processes (BBC, 2019). The firm has also considered the factors of tax rates, wage legislation, workweek regulation and the necessary employee benefits along with other safety regulations for continuously managing the business process. The marketing of the products has to be executed in a systematic manner which helps to follow the guidelines of the country and reach most of the customers.
The tariffs and trade regulations along with the legal frameworks are evaluated for inclining the policy and procedure of the business related to inventory and procurement (Burns & Rossi, 2019). As the retail sector has contributed significant value to the GDP of the country, the increase in the number of businesses also assists the Government in getting a hike in their taxation field. So, the operations for large businesses such as Wesfarmers or Woolworths have been controlled by updating the policies which sometimes enhance the final cost for deliverables.
Economic environment
The businesses have focused on the economic factors of the countries such as savings rate, interest rate, inflation rate, economic cycle, exchange rate, etc. for demonstrating the relationship between aggregate investment and demand for the business. The GDP growth of the country has been demonstrated as 2% which is boosted by hiking the investment in the wages allotted for the employees (ABC News, 2019). From the recent report of the Australian Bureau of Statistics, the spending of the business in the wage section has been increased by 4.7% for the retail sector. The growth rate of the food and stapes industry in Australia is demonstrated from the direct supply from the local supplies without relying on the transported materials.
The disposable income of the citizens has also been in the growth stage which has been utilized by the businesses for promoting their quality operations in terms of product delivery. The quality deliverable of the products is also affected by changing the supply rates and raw ingredients (Gregory, Ngo, & Karavdic, 2017). The customer behavior had completely been changed during the financial crisis in 2009 as the disposable income of the citizens have reduced and most of them had wanted to store the most number of items. Moreover, climate change has also affected the business operation of chemical fertilizers as the cost has forced to increase. The economic down-gradation assist in plummeting the confidence level of customer that possesses lower demand.
2.2 Microenvironment
The micro environmental factors are the internal forces that have affected the regular marketing and business process (Gregory, Ngo, & Karavdic, 2017). The factors are customers, suppliers, stakeholders, and competitors. Mainly, suppliers and competitors are discussed as they have the most impact on the business process.
Suppliers
The business has focused on the quality procurement of raw ingredients which helps to execute the quality deliverable of products and services. Wesfarmers have maintained their communication with 15,000 suppliers for identifying the best quality product in pricing for the diversified offering of the business. Wesfarmers have also taken some initiative for promoting their connection with suppliers (Wesfarmers, 2019). WesCEF has been involved with the suppliers and contractors for identifying new opportunities for the indigenous people. The tie-up of the firm with Coles help to source product from farmers directly of Goulburn Valley, Gippsland, and Launceston. The firm has also been involved in the commercialization process of fuel cell and hydrogen with collaborating Coregas and Hydrogen Mobility.
The marketing process of mentioning the scouring from suppliers and farmers also helps to gain the attention of most citizens. The business has also focused on the improvement in working conditions for the suppliers which helps to boost the business operations without facing any issues (Valenzuela, Merigó, Johnston, Nicolas, & Jaramillo, 2017). In the retail sector, sourcing of the product has a matter of setting an effective price without hampering its quality and quantity. The firm has also been worked with the suppliers to minimize the amount of waste material in the food sector which adds value to consumers.
Competitors
The number of competitors in the Australian retail sector has been increased for the past 10 years as technological improvement has been executed. The customers have also preferred shopping through the digital medium rather than focusing on physical stores. This has been utilized and prioritized for the businesses to gain a competitive advantage. The main competitors of Wesfarmers are Woolworths, Myer, Best & Less, etc. which have positioned their business by offering the bulk products in lower pricing. The marketing operations of the business has to be regulated under fair competition where the negative perspective of business are not included and demonstrated for the promotion (ABC News, 2019). The packaging of the products is also evaluated to be attractive for the competitors which have attracted most of the customers. The strategies of the business are required to be inclined to managing the regular operations and increase the efficiency of the employees for enhancing the productivity of the business.
Wesfarmers Ltd is an Australian based conglomerate business whose headquarter is situated in Perth, Western Australia. Wesfarmers limited predominantly sells products mainly under 5 broad categories and each of the categories serves as separate product lines. Lots of product variety are being sold by Wesfarmers, which enables the customers to search for the best available product that mainly suits according to their traits. Moreover, it has also been identified that Wesfarmers sells the product that is highly differentiated in nature and comprises of various features that they provide to their customers to achieve competitive advantage(Wesfarmers, 2019). The unique value proposition is being offered by Wesfarmers to their target market through the broad product categories that set them apart and make them unique in the Australian business environment. The product of Wesfarmers is perceived higher in quality than that of its competitors because it has been identified that Wesfarmers uses advanced plants and machinery to manufacture products so that quality can be maintained within the products. Due to the high value in their products customers are willing to pay a high price for the product. The differentiated product strategy also helps Wesfarmers in selling their products by maintaining traditional design which attracts the attention of the customers and builds a relationship with them(Wesfarmers, 2019). Moreover, it has also been noticed that Wesfarmers also gives special attention to R&D where they introduce new products in respect of maintaining the product differentiation strategy and achieve growth opportunities for the management that builds brand equity and higher profitability for Wesfarmers organisation.
Wesfarmers conglomerate business firm mainly manufactures products that aim towards providing the products at lower prices to the customers. The purpose of the firm is to make their products available among the customers so that they can increase their brand visibility among them. The current pricing strategy that Wesfarmers business organisation follows is a competitive based pricing strategy. Competitive based pricing strategy helps the business organisation in identifying the price level upon which the competitor brands sell their products to the customers(News, 2019). Furthermore, it has also been noticed that Wesfarmers organisation also takes cost into considerations concerning setting up the prices for the products. The prices that are set out by the organisation are competitive and hence it becomes costlier for other firms to compete with Wesfarmers. The prices of the products that are set out by Wesfarmers are higher due to the features they offer through their products. Additional information has also been noticed for Wesfarmers such as they also follow the bundling pricing strategy where all the products are bundled together and sold at prices lower than the total of individual items. During festival seasons and off-season Wesfarmers also follows an optional product pricing strategy for certain products, where the business offers the products at separate prices for the accessories that come along with it(Afr, 2015). Whereas, it has also been identified that Wesfarmers also sell products at great prices when they sell it through an online platform because of the delivery cost associated with it. Therefore, the pricing strategy has been set out by Wesfarmers concerning the different situations as because it helps the organisation in keeping an eye of their competitors and remain competitive.
Wesfarmers limited mainly sells their products through two marketing channels the first one is known as directly to the consumers through an online website, whereas the second channel is that of through wholesaler who then sells the products to different retailers all over the country. The Australian based firm has its product presence in over more than 500 retailers, where it mainly follows an intensive marketing strategy so that they can promote their products through every available place. The main purpose of the organisation to adopt an intensive marketing strategy in terms of ensuring its products being available to the customers through different parts of the country(Wesfarme, 2019). Moreover, the firm is also present in the online marketplace, where there is huge traffic of customers, the firm has partnered with numerous delivery service providers so that they can provide timely delivery of the services. Moreover, it has also been noticed that Wesfarmers follows the Omni-culture distribution system where the management has integrated its online and offline stores to provide flexibility to the customers to access information about the products(Wesfarmers, 2019). One of the key information that has been identified concerning Wesfarmers it has been identified that they have 500 suppliers present in distinctive places to increase the brand awareness of the firm.
The Australian based conglomerate business entity mostly uses multiple media channels in terms of promoting their products and services among the customers. The firm also uses traditional media, which includes television and radio to advertise their offerings among the customers. The online marketplace has also been considered by Wesfarmers where the enterprise uses social media advertisement, which is cheaper and reliable and are used to increase its brand salience among the people(Wesfarmers, 2019). The Firm also uses social media platforms such as YouTube, Twitter, and Facebook where they promote products among the customers so that relationships among them can be established and better future growth opportunities can be achieved. Sales promotional strategies are also being used by the organisation such as ATL and BTL activities through which brand equity is generated among the customers.
4. Conclusion and Recommendations
From the above study, it has been concluded that the marketing operations of Wesfarmers have been flourished through following micro and macro-environmental factors of the business. The requirements for labeling and packaging the products are fulfilled under regulations and controlled costs. Moreover, the export taxes are also under control for the business to improve its operation. The firm has dealt with the diversified range of retail sector and other food and staple products with maintaining regular communication with suppliers. The price of the products has also set to be moderate for gaining the attention of most of the citizens. As the business has introduced its online medium, social media promotion assists the business process to reach most of the users.
The management of Wesfarmers is recommended to modify the pricing policy with justifying the quality of the product as the economic stability of business has supported the principle. Moreover, the analysis of the economic environment of business also provides the business with an overview to deploy the policy and procedure. Controlling usage of resources along with budget allocation assist the business to minimize the operational process of business. The promotional medium should be increased and diversified which provides the business an opportunity to deploy their services to a wide range of customers. The business strategy for gaining competitive advantage is established through an increasing number of customers by promoting them through social media. The increased price for the products also helps to contribute to the profit margin of the business.
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