Case Study Help - ASDA Super Market

ASDA CASE STUDY – STRATEGIC BUSINESS ANALYSIS: DEVELOPING A PLAN FOR GROWTH

The blog focuses on the different business aspects of the company ASDA in the current international market. To understand the notions of business and in order to identify the objective that is to be incorporated within an organization for the accumulation of maximum profit, the company has to locate the appropriate market and plan strategies to ensure success. The discussions that the paper presents show the exact goals of the company along with the analysis of the market though the marketing mix concept. A detailed analysis of the model will provide the reader with a sound and clear understanding of the goals and targets of the firm in question.

Introduction

The paper discusses the business strategies of ASDA Stores Ltd, which is a supermarket with its headquarters in Leeds, West Yorkshire. Established in the year 1949, the company was initially owned by the Asquith family and was the second largest chain of supermarkets from the year 2003 to the year 2014. In the current market it is just behind Tesco and Sainsbury’s. The company was close to being bankrupt in the 1990s and was able to survive after being modeled according to Walmart and after the takeover. The focus shifted and the target consumer and marketing strategies evolved and that is discussed in the paper.

Target market

The initial target market of the company ASDA was the areas that were in edge and the locations were out of town, focusing on the district centers in the small towns of Britain (Christensen, M., Bartman & Van, 2016). The company focused on the suburbs like Harpurhey and was able to open their first store in London in the year 1982.

Customer profile

The company went out to rural or suburban areas and opened niche stores that were hypermarkets and super centers attracting millions of food and non-food buyers every year. The consumer profile involved petrol buyers too(Karadag, 2015). ASDA focused on the clothing, eating as well as living habits of the people who lived in suburbs and later on in the cities as well to develop products in order to suit their needs.

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Marketing goals, objectives and strategies

The goals of any company are an integral part of it as they provide the motivation to work effectively and efficiently in the operational units of the firm. ASDA to has some goals and objectives and despite facing serious financial troubles in the 1990s, the company was able to get back to its feet with the help of Walmart and decided to approach towards the achievement of the goals of the company with new marketing concepts and strategies (Xi, Kraus, Filser&Kellermanns, 2015). Their aim is to become one of Britain’s most valuable retailers and to always exceed the needs and desires of the consumers. They have an ethical objective to provide better opportunities and benefits to the employees as well. The company believes in providing more goods at lesser prices to maximum number of people and that is exactly what they preach through their slogans. They have a definite mission which will help them achieve their vision of making ASDA a globally recognized store. ASDA is ahead of its prime competitor Tesco in the grocery market of UK, which they achieved through the Dual-brand concept or strategy and have gained about 31% market value (Xi et al., 2015).

The pricing strategy of the company is quite strong, which promotes repeatedly the notion of “That’s Asda price” through ads and jingles. The concept of keeping the stores “simple and fresh” was significant but the size of an average store is 20% more than the competitors. The company opened niche stores that were more specific in its outlook. Through the options of “Smart Price” ASDA provided the consumers with the lowest price and maintained a competitive edge in the retail store market place. They initiated their label brand called “Chosen By You”, which aimed to change the perceptions of the store in the eyes of the customers after the takeover by Walmart took place.According to Wolf & Floyd(2017), the credit cards provided by the company offered cashback up to 1% when one shops for petrol or does retain shopping (Wolf & Floyd,2017).

Customer analysis

ASDA prepared a price range that repeatedly focused on paying less for more products or services and the company ads and jingles delivered the same (Karadag, 2015). The suburban consumers were lured in by this promise while they also fresh products from exotic places like Italy and France to attract the urban buyers.

Marketing mix (4 P’s)

Marketing is an important aspect of any business organization and especially for companies that have chains as through proper marketing the companies can reach to maximum people in order to present their products or services(Christensen et al., 2016). The concept focuses on delivering the right kind of products to the specific group of people at a time that is right and at the place that suits the company. These comprises of the 4 P’s of marketing that ASDA has followed throughout their journey to achieve the success that they have today.

Place

The place is that part or the concept that provides the location of the market where a specific product is to be sold(Karadag, 2015). The products sold by ASDA are mostly household items like food and non-food goods and the stores are located in areas where the population demands such outlets. They believe in the concept of selling various products together in one place and that is better because it minimizes transportation. Focusing on the rural and suburban areas gave the company the competitive edge as the stores were a requirement in such areas. Later on with the collaboration of Sainsbury’s and Walmart they opened up stores in urban areas like London as well where there target market changed and so did their marketing policies(Christensen et al., 2016).

Product

The company ASDA deals with a lot of products and has a lot of varieties of items that they sell. As stated by França et al. (2017), ASDAhave almost monopolized the supermarket industries and have opened up clothing stores and sells petrol too(França et al., 2017). However, understanding of the life cycle of products and the acceptance of certain products in certain areas gives the company a competitive edge. Therefore, the company has moved between selling petrol, clothing, household items and developed hypermarkets, supercenters, Asda Essential, George Store, etc., and has never limited itself to only one kind of business proposition. This has made their marketing stance stronger and has given them immense success.

Promotion

The promotional features of ASDA are very prominent and unique at the same time(França et al., 2017). They believe in sound and maximum promotional value as they know that through proper promotion they will be able to sell maximum products. They promoted the products through advertisements and slogans like “More for you for less” and “Why pay more?” that pushed them ahead in the success curve. They brought into consideration the “Saving your money every day” as a slogan that attracted maximum consumers. Promotions involved the portrayal or celebrities in exotic locations having fresh food items as well, which lured in the stylized group of consumers (Wolf & Floyd, 2017).

Price

The company ASDA has a very strong focus on the prices of the products that it sells calling it the “Asda Price” which is the “Smart Price”(Wolf & Floyd, 2017). The price depends on the sale of the product and ASDA being a leading retail store has fixed prices. The pricing of the products depends on the consumers too and that is the reason the slogans of ASDA are mostly focused on providing better items at lesser prices so that they can attract the rural population of the land. ASDA understood that if the price of a product is lower or higher than the perceived price or if it differs greatly from the competitive prices then the product will fail to sell(Wolf & Floyd, 2017).

Leadership systems and global prospects

The company ASDA is a firm that takes pride in its employees and is oriented around it. The leaders of the company focus on the training and the benefits of the employees and have initiated the Ethical Trading Initiative(França et al., 2017). It has been featured as one of the best companies that one can work for. The leaders are goals oriented and the CEO motivates the employees to be more efficient. The global expansion of ASDA depends on its diverse outlook and its expansion in Ireland as well. Their collaboration with Walmart and Sainsbury’s gives them further global exposure.

Code of conduct

The codes that ASDA follows involve the ethical treatment of the employees and the production of quality goods. They reach out to as many people as possible through proper communication channels and with the development of relations with international brands (Françaet al., 2017). They are energy efficient and help charities as well. They believe in being simple and fresh.

Conclusion

Based on the discussions above it can be said that the strategies taken by ASDA has been fruitful for the company in the generation of profit and success. The backlash faced by the company was for a limited period of time and ASDA emerged from it victoriously.

Reference list

Christensen, C. M., Bartman, T., & Van Bever, D. (2016).The hard truth about business model innovation. MIT Sloan Management Review58(1), 31.

França, C. L., Broman, G., Robèrt, K. H., Basile, G., &Trygg, L. (2017).An approach to business model innovation and design for strategic sustainable development. Journal of Cleaner Production140, 155-166.

Karadag, H. (2015). Financial management challenges in small and medium-sized enterprises: A strategic management approach. EMAJ: Emerging Markets Journal5(1), 26-40.

Wolf, C., & Floyd, S. W. (2017). Strategic planning research: Toward a theory-driven agenda. Journal of Management43(6), 1754-1788.

Xi, J. M., Kraus, S., Filser, M., &Kellermanns, F. W. (2015).Mapping the field of family business research: past trends and future directions. International Entrepreneurship and Management Journal11(1), 113-132.