Whole Foods Market
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Assignment Objective: #5 Assess the organizational components that impact strategy implementation. #6 Evaluate the roles of ethics, social responsibility, and environmental sustainability in strategy implementation.
Assignment Purpose: To understand company competitive advantages.
Assignment Description:
Week 5 Assessment: Case Study #3, Whole Foods
- Conduct a company review of Whole Foods. What are their unique marketing and product positioning strategies?
- Explain why they give the company a competitive advantage. Compared to other grocery store chains, Whole Foods is very profitable, why is that?
- How does their financial strategy differ from the competition?
SAMPLE ANSWER
Whole Foods Market
Whole Foods Market has been highly competitive and profitable in the United States grocery market for a long time. Its unique positioning and marketing strategy has been outstanding in driving its operations, growth, and competitiveness as shown in this study.
Whole Foods is a grocery store in the United States that deals mainly with perishable organic goods. The company has 433 stores in the US and Canada, which offers grocery, food items, nutritional supplements, body care and lifestyle products (Bells, 2015). For a period of ten years before 2015, the company had been the most profitable and fastest growing grocery store in the US. The company employed an out-of-the-box market mix positioning strategy to ward off stiff competition and make profits. Through product positioning, Whole Foods successfully segregated its products according to customers’ buying capacity. The 365 Everyday Value line offers products at a competitive price to a price-conscious buyer (Smithson, 2015).
Similarly, the Whole Foods Market Brand line is made of premium products, while the Engine 2 Plant Strong is the company’s line for vegetarian and dietary preferences (Smithson, 2015). Whole Foods Market has also been expanding its marketing place in order to reach more customers. The company offers its products through the stores or by delivering to customers who request the products online (Smithson, 2015). This has enabled the store to venture into new markets like the UK and Canada. The promotional market mix strategy used by the company entails advertising, sales promotion, and public relations. The company primarily relies on customer testimonials and word-of-mouth recommendations (Bells, 2015). According to Smithson (2015), the company also does regional and sometimes national advertisement like ‘Value Matters’, where customers are taught importance of value and business relations.
Whole Foods offers its products at a premium price while at the same time ensuring high quality upscale grocery experience (Harrison & John, 2013). Despite the high prices charged way above traditional competitors like Wal-Mart, Costco, and Kroger, the high product quality and unique customer experience keeps them abreast of the competition. Furthermore, the pricing aligns it to its strategy of ‘broad differentiation’ (Smithson, 2015). As compared to its competitors who sell a variety of products, the company has narrowed the customer needs to perishable, premium grocery, giving them a marketing and competitive edge. Johnston and Szabo (2011), posits of how customers feel good to be at the stores just for the ambiance, not the pricing.
Additionally, the financial market strategies of Whole Foods differ significantly with that of Wal-Mart and other industry players. Despite Wal-Mart offering the same grocery prices at rock-bottom-prices, Whole Foods does the opposite (Bells, 2015). The company goes at length in addressing the customer needs by providing quality products, exquisite shopping environment, close customer relations and relying on customers rather than media for advertisement (Harrison, John, 2013 & Bells, 2015). Hansted and Posner add that, the company’s employees are usually involved in charitable activities in the company’s time. The company also uses alternative forms of energy to power its stores; hence saving on costs. This has ensured the company remains profitable and competitive for a long time.
Conclusion
The unique marketing mix and positioning strategy of close customer relation, wide pricing option and quality has enabled profitability of Whole Foods Market for a long time. The strategy worked to drive competitiveness and suitability of its stores.
References
Bells, S. (2015). Introducing Whole Foods: American Organic market. (Updated 18 Nov. 2015). Retrieved from: http://marketrealist.com/2015/11/introducing-whole-foods-americas-organic-food-market/. Market Realist. (Accessed 11/10/2016).
Harrison, J. S., & John, C. H. S. (2013). Foundations in strategic management. Cengage Learning.
Johnston, J., & Szabo, M. (2011). Reflexivity and the Whole Foods Market consumer: the lived experience of shopping for change. Agriculture and Human Values, 28(3), 303-319.
Show, W. H. & Barry, V. (2016). Moral Issues in Business. Cengage learning. 13th Edition. Pp. 250.
Smithson, N. (2015). Whole Foods Market Marketing Mix (4ps). Panmore Institute.
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