Factors That Influence Customers In Selecting Supermarkets In Australia

Literature review

Question:

Discuss about the Reflective Journal on the Assignment Final Research Project.

My experience about preparing the project report

Introduction

This reflective journal covers the research project done in the investigation of factors which influence customers to select particular supermarkets to shop in Australia. This research focused on three supermarkets such as Aldi, Woolworths, and Coles. In addition, it focused on the following variable: the location of the business enterprise, packaging of products, brand image, price, value as well as the quality of the product.  On this premise, this journal discusses the lessons gained from doing the research. In addition, the journal identifies some important areas that I ignored during the research such as the rationale for the preferred research methodology and the awareness of ethical and social responsibility.

Literature review

From the literature review, I established that brand value, the quality of the product as well as the pricing strategies strongly affect the competitiveness of firms relative to the others. Specifically, I noticed that many enterprises in the Australia retail sector had focused on low price strategy as the main approach to see them through stiff competition (Nenycz-Thiel, 2011). These firms include Tesco, Aldi, as well as ASDA. In doing this, these retailers reaped a lot from this practice in terms of increased market share. Nonetheless, some retailers like Aldi differentiated their pricing strategy by focusing on the provision of substitute products which replaced the conventional expensive products (Ausfood news, 2016). According to Wu, Yeh and Hsiao (2011) customers always show greater preference towards products that translates to cost savings. On this note, the low priced products offered by Aldi lured high customer traffic thus making it overtake Woolworth.

However, the use of pricing strategy sparked up the issue of pricing wars. Many firms including Woolworth suffered losses due to price cuts caused by price wars(Argus, Bee, Honey, Bates, Beacham, Apiaries & Family, 2012).  To avoid these losses, I learned that firms should adopt other unique strategies to make them more competitive than others. As earlier noted, Aldi was brilliant and creative by identifying the products that have traditionally been expensive in the market and focused the low pricing strategy on them. In doing this, the majority of customers noticed the price reduction on such products which was uncommon among other supermarkets. As a consequence, Aldi achieved tremendous growth in its market share over other supermarkets.

Secondly, the research demonstrated that the product quality matters a lot in promoting customers purchasing intentions. In support of this, I noted that firms that had not upheld the issue of quality in their products maintained poor performance in the Australian retail market(Wang, Chen & Chen, 2012). These firms include Woolworth as well as Coles(Mitchell,2015). In this context, the quality was viewed on the basis of the freshness of the products offered as most of these firms deal with perishable products like food as well as grocery. The successful firms were noted to be very organized by arranging for delivery of fresh products from the suppliers which were immediately passed on to the customers at the point of sale. Besides, some retailers took initiative and invested on foodstuff storage machines which ensured that surplus products remained fresh until they are all sold to the customers.

Marketing strategies

Furthermore, I established that the nature of marketing strategies that firms use determined whether the customers will buy the products or not. Some of these marketing strategies entailed the introduction of offers as well as discounts to the customers. In this connection, I found out that, the success of Aldi significantly relied on the weekly offers as well as discount that it always extended to its customers. Aldi sold some of its food products at discounted prices during holidays which were characterized by a myriad of ceremonies that was behind escalation of demand for foodstuffs. To increase awareness of these attractive offers to its customer segment, Aldi employed the online marketing approach. As a consequence, the online approach presented an opportunity for the retailer to get responses and reactions from the customers and responded to them accordingly. This was advantageous as the firms were able to understand and address the exact needs of customers (Hollensen, 2015).Also, the involvement in online marketing by Aldi is advantageous as it is cheaper and is effective in reaching customers located across the world. Lastly, online marketing is efficient in carrying out demographic targeting as it enables the retailer target particular people who have a strong interest in the company’s products.

I have also learned that business plan is vital for the realization of the firms’ objectives. The business plans function by aligning the ongoing operations of the business enterprise along with the preset objectives. In addition, a good business plan enables the retailer to embezzle funds from its investors which are channelled to various activities in the business. According to Jasra, Hunjra, Rehman, Azam and Khan (2011), adequate funding of firms translates to fast business expansion as the funds are used in financing various investment projects within the business. Also, the business plan contains some business models as well as business strategies which are prescribed to be the best for the firm. Through the strict implementation of the business plan, I established that the retailer increases its chances of success as demonstrated in Aldi. For instance, Aldi adhered to its business strategy like low price strategy though differentiated it on the basis of the marketing environment. In addition, I noted that Aldi ensured that its customers get the best products. Conversely, other retailers like Woolworths and Coles also laid a lot of emphasis on the execution of its marketing, financial, operational, financial plans as well as the prescribed strategy relating to its products and marketing. However, as Osterwalder and Pigneur (2013) claim, these strategies can be changed depending on their effectiveness in achieving their targeted goals.

Further, I noted that the researcher concluded that the marketing strategies employed by Aldi were more effective in comparison to the ones employed by Woolworth and Cole. The rationale for this is that Aldi located its store outlets in regions of high customer traffic which made it easier for the customers to access them. On the other hand, Woolworth and Cole applied situated its stores further from the cities, where there is low customer traffic, thus making it difficult for the customers to access them.

Business plan

Moreover, I discovered that parking space determines the choice of customers to carry out their shopping in particular retail stores.  I substantiated this claim by arguing that retail stores with ample parking space attract customers with busy schedules whereas retail stores without parking spaces shy away this kind of customers. For example, Aldi has been able to record high sales volumes as it has ample parking space for its customers as asserted by Chiou, (2014). On the contrary, Woolworth and Coles, experienced low sales as few customers entered into their stores.

However, I noted that I ignored the impact of ethical and social responsibility in a business environment.  Ethical and social responsibility involves activities which are carried out by firms voluntarily to the best interest of the society in which they operate in. According to Saeidi, Sofian, Saeidi, Saeidi and Saaeidi (2015) social responsibility is essential in boosting the sales of a particular firm that operates within a certain locality. The ethics and social responsibility can be demonstrated through various ways like reducing environmental pollution by using eco-friendly packaging techniques, advancing scholarships to scholars from the nearby community, making donations in terms of food stuff to the community as well as taking part in training its employees. In doing this, a sense of belonging is developed among customers which influence their purchasing behaviors. According to Cooperative News (2015), Aldi took part in social responsibility by donating foodstuffs in the form of relief foods. Perhaps, this should be one of the reasons for its dominance in the market.

In addition, Woolworth has also taken part in corporate social responsibility through the provision of more job opportunities accompanied by improving employees’ potential through training programs (Woolworths Limited, 2016). Also, Woolworth has demonstrated fairness to both of its external and internal customers. Nonetheless, the issue of corporate social responsibility among companies has been subjected to unending debates as CSR practices. On one hand, it has been argued that CSR increases the firms cost of operation which may cause a corresponding rise in prices of products. On the other hand, El Ghoul, Guedhami, Kwok and Mishra (2011) argue that CSR increases customers’ intentions to purchase firms products as it empowers the society through job creation among other benefits.

Day-to -day activities on how I carried out my research

Date	Dissertation Activities
5th Jan to 17th Jan	Aligning the research objectives to the research topic
18th Jan to 31st Jan	Collection of relevant sources for the research
1st Feb to 29th Feb	Commence reading as well as conducting the research on background information about the study
1st Mar to 15th Mar	Check and confirm whether the potential study area is accessible and decide on the research methodology appropriate for the study
16th Mar to 31st March	Commence writing the first Chapter
1st Apr to 10th April	Write the literature review or the second chapter
11th April to 25th April	Carry out data analysis and begin writing chapter 3
26th Apr to 3rd May	Conduct data analysis and begin writing chapter 4
4th May to 20th May	Write Chapter 5 and proofread the whole document to correct all errors

How I find it difficult to interview my sample

Conducting this research was not that difficult as I expected initially. This was achieved through the proper selection of the research methodology. Firstly, I discovered that the research approach relies on the particular research philosophy employed in the study. To investigate the determinants of customers towards making a purchase intention in a given retail store, I chose the positivism philosophy. This philosophy was advantageous as it was suitable since this research dealt with quantitative data and it is more accurate as it subscribes to a well-defined structure.

In line with the chosen research strategy, I realized that deductive research approach suited this research. I also discovered that the deductive approach was advantageous as it was less cumbersome due to its reliance on previously formulated research hypothesis thus evaded the cases of deviation from the scope of the study. I also chose the case study as the scope of the study is very wide which suggested that it would have been more cumbersome if I would have chosen census method. However, I found it difficult in applying both the survey and case study approach as I had chosen particular organization as my area of study. In addition, I selected descriptive research design. In line with Bryman and Bell (2015) thinking, I confirm that descriptive research design was suitable as it entails accuracy in what the researcher purposes to achieve, it is time-saving and associated with minimal cases of bias

Comparing marketing strategies

My experience with the interview sample

In interviewing the sample, I found it hard to use the survey method to conduct my interview sample. To avoid this difficulty, I noted that the most appropriate data collection technique was the use of questionnaires to gather quantitative data. The questionnaires are advantageous as they are cheap, less cumbersome, time-saving as well as enable recording of collected data which makes it convenient for safe storage as it awaits analysis process (Zikmund, Babin, Carr & Griffin, 2012). Additionally, the combination of these two sets of data gave rise to a comprehensive conclusion which promoted reliance and validity of the findings. The need for both quantitative and qualitative data necessitated the use of both probabilistic as well as non-probabilistic sampling techniques. In this connection, I developed strong preference to the stratified random sampling as well as snowballing techniques. To facilitate the data analysis process, it was commendable that I use SPSS. The SPSS automatically generated the tables as well as figures which enhanced presentation of findings.

Above all, I complied with a number of the research ethical issues such as conducting prior consultations of the research respondents which promoted voluntary participation in the study. Also, I noted that I used information from reliable sources which are authorized. I also assured the respondents that high confidentiality level will be maintained which implied that no private details of the participants will be disclosed in any document However, I learnt that I ignored to disclose how the information generated from the study was going to be used which meant that I did not comply with all ethical requirements in the conduct of the research.

Conclusion

From this reflection, I noted that I was well organized in conducting the study as indicated in my day-to-day research plan. In fact, the arguments on the relationship of the determinants of customer purchase intentions in a particular retail store were presented clearly through the use of examples of retail stores that have succeeded after application of favorable strategies aligned towards these determinants. However, I discovered that the researcher ignored the contribution of taking part in ethical and social responsibility by retailers on customers’ purchasing intentions. Regarding the methodology, I noted that I chose appropriate methodology except making a decision of using both the survey and case study research strategy which created problems during interviews.

References

Argus, A., Bee, A. Q., Honey, A., Bates, T., Beacham, V. G., Apiaries, B. M. H., … & Family, M. B. (2012). Monthly. Retrieved 23 May 2016, from https://honeybee.org.au/pdf/MAY%202012.pdf

Ausfoodnews (2016). Aldi tries new strategy to grow bigger market share in Australia | Australian Food News. Retrieved 23 May 2016, from https://ausfoodnews.com.au/2015/05/20/aldi-tries-new-strategy-to-grow-bigger-market-share-in-australia.html

Bryman, A., & Bell, E. (2015). Business research methods. Oxford University Press, USA.

Chiou, B. (2014). International education, student migration and government policy: A comparative study of Australia and New Zealand (Doctoral dissertation, Auckland University of Technology).

Cooperative News (2015). How do UK supermarkets do corporate social responsibility? – Co-operative News. Co-operative News. Retrieved 23 May 2016, from https://www.thenews.coop/93768/news/general/how-do-uk-supermarkets-do-corporate-social-responsibility/

El Ghoul, S., Guedhami, O., Kwok, C. C., & Mishra, D. R. (2011). Does corporate social responsibility affect the cost of capital?. Journal of Banking & Finance, 35(9), 2388-2406.

Hollensen, S. (2015). Marketing management: A relationship approach. London: Pearson Education.

Jasra, J. M., Hunjra, A. I., Rehman, A. U., Azam, R. I., & Khan, M. A. (2011). Determinants of business success of small and medium enterprises.International Journal of Business and Social Science, 2(20).

Mitchell, S. (2015). Fresh food people? We’re savers, not foodies, survey finds. The Sydney Morning Herald. Retrieved 23 May 2016, from https://www.smh.com.au/business/heres-why-consumers-are-choosing-aldi-over-woolworths-and-coles-20150714-gicgix.html

Nenycz-Thiel, M. (2011).Private labels in Australia: A case where retailer concentration does not predicate private labels share. Journal of Brand Management, 18(8), 624-633.

Osterwalder, A., & Pigneur, Y. (2013). Business model generation: a handbook for visionaries, game changers, and challengers. Chichester: John Wiley & Sons.

Saeidi, S. P., Sofian, S., Saeidi, P., Saeidi, S. P., & Saaeidi, S. A. (2015). How does corporate social responsibility contribute to firm financial performance? The mediating role of competitive advantage, reputation, and customer satisfaction. Journal of Business Research, 68(2), 341-350.

Wang, C. H., Chen, K. Y., & Chen, S. C. (2012). Total quality management, market orientation and hotel performance: The moderating effects of external environmental factors. International Journal of Hospitality Management, 31(1), 119-129.

Woolworthslimited (2016). Corporate Responsibility – Woolworths Limited. Retrieved 23 May 2016, from https://www.woolworthslimited.com.au/page/A_Trusted_Company/Corporate_Responsibility/

Wu, P. C., Yeh, G. Y. Y. & Hsiao, C. R. (2011). The effect of store image and service quality on brand image and purchase intention for private label brands. Australasian Marketing Journal (AMJ), 19(1), 30-39.

Zikmund, W., Babin, B., Carr, J., & Griffin, M. (2012). Business research methods. South Western: Cengage Learning.