The secret of Woolworths’ success lays in the actions of its founder Frank Woolworth – the discoverer of price tags, merchandising, supermarkets and sales. After opening the shop, Frank Woolworth developed his own strategy, which contradicted all the unspoken laws of trade at that time and became revolutionary. It was Woolworths that became the world’s first self-service store (Kampen et al., 2020). The main distinguishing feature of Woolworth’s stores was also a large group of products priced at five cents. To date, the Woolworths retail chain in Australia has an almost monopoly position, since it has only one serious competitor – the Coles store chain.
The marketing strategy was developed based on the values and innovative solutions proposed by the founder of the company. Woolworth has experienced the benefits of pre-holiday sales and taught its sellers to make the most of them. Therefore, the main strategy is to change the layout of goods every 2 weeks, and to sell goods whose demand is changing (Smith, 2021). Customer orientation is also a primary component, so the goods are placed on shelves that are easily accessible to the buyer. For the same reason, the duties of cashiers include the ability to pack purchases beautifully and smile in a friendly way.
The Woolworths retail chain offers its customers to return products if they seem stale to them (even if the fruit is not past the expiration date). Money for products is returned immediately: without questions or complex procedures with documentation of the return. Such actions will increase consumer confidence in the chain’s supermarkets and allow for better control of the quality of fresh produce on supermarket shelves. These actions are a response to the reduction of fruit and vegetable prices by up to 50% by the main competitor – the Coles store chain (Haskins et al., 2020). Thus, the Woolworths store chain has a competitive advantage over its main market rival.
Woolworth’s modern strategy works so well because current marketers continue to focus on the values laid down by the founder of the chain of stores. All business processes, products, pricing, and actions of the company’s personnel are aimed at the client. The basis is not just not just to please the client and blindly following the rule “the client is always right”. Woolworths’s marketing strategy is aimed at ensuring that the customer is fully satisfied with the result of interaction with the store.
There are people of different ages among Woolworths buyers, but middle-aged women and men who lead a joint household predominate. Since the stores are located all over Australia, the target market includes both urban and suburban residents, but part of the urban population predominates among buyers. The average monthly income of most customers is average or below average; most of them visit the grocery chain two to three times a week.
While many stores have switched to online operation, Woolworths has chosen a different strategy. This is due to the fact that among the main consumer segment, most people have a low income, and for some of them online grocery shopping is difficult. Therefore, Woolworths has opened more local small stores where products are always fresh thanks to frequent deliveries (Shaikh et al., 2021). Due to the specifics of the location, contacts between residents of different districts decreased. Thus, the main impact of the pandemic on the marketing strategy was the possibility of expansion in residential neighborhoods.
Haskins, B., Nehme, Z., Cameron, P., Bernard, S., Parker-Stebbing, L., & Smith, K. (2020). Coles and Woolworths have installed public access defibrillators in all their stores: It is time other Australian businesses followed their lead. Emergency Medicine Australasia, 32(7), 166-168.
Kampen, V., & Kirkham, R. (2020). Assessment of the supermarkets and grocery stores sector in Australia: A case study of Woolworths and Coles using DEA and VAIC. Journal of New Business Ideas & Trends, 18(1), 1–11.
Shaikh, A. A., & Shaikh, M. M. (2021). A viewpoint on sustainable practices of Coles and Woolworths during Covid-19. Academy of Marketing Studies Journal, 25(5), 1-4.
Smith, J. (2021). While Woolworths reaps the rewards, the Northern Territory community will be left to clean up the mess. Health Promotion Journal Australia, 32(5), 158-162.