Marketing Audit For Country Road: Opportunities And Threats

Industry market for Country Road and opportunities and threats using PESTLE macro model

This study has provided in-depth analysis about the importance of analyzing market position and market segmentation for expanding entire business process. Country Road is one of the most recognizable middle marketing clothing retailers occupying a predominant place in the realm of Australian supermarket industry. Woolworths Holding Limited being the parent company of Country road has decided to provide quality of products to the customers in affordable price range. Providing high quality of men and women clothes in affordable price range is the primary aim of this specific business organization. This organization has launched ecommerce business process as well based on which the business experts can drag the attention of customers from various geographical boundaries.

In order to get in-depth overview about the current market trends the study has focused to make detailed environmental analysis. Market segmentation strategy along with highlighting the market position has also been analyzed in this study. Based on the customers’ grocery shopping behaviour, Country Road has decided to design its products and services for enhancing the rate of customer loyalty.

While evaluating the industry market of Country Road it is observed that the organization has occupied a recognizable position in the retail market of Australia (Müller & Hamm, 2014). Before making business strategy and policy the organization needs to make effective PESTEL analysis in order to evaluate political, economic, socio-cultural, technological, environmental and legal factors. While analyzing the PESTEL analysis the study has identifies opportunities and threats of Country Road:

Opportunities:

• Expanding business in multinational countries for grabbing the attention of international customers.
• Increasing the number of target customers by enhancing product variety and service facility

Threats:

• Competitors’ business strategy is one of the most remarkable threats for Country Road. Large number of established retail organizations is there within the market of Australia which provides variety of products from the stores(Hatheway, Kwan & Zheng, 2017). As a result, the customers do not have to hop from one shopping mall to another. It is however identified that Country Road is primarily recognizable for its clothing brands
• Country Road is not very strong and updated in maintaining their promotional methods. Therefore, the business experts have to face immense threats from the existing competitors such as The Iconic, Coles, JB-HI-FI and so on.

By considering the threats and opportunities the study has focused to make detailed environmental analysis which is as follows:

Political	As per government rules and regulations, Australia follows a stable political set up. The business organizations do not have to go through verbal political chaos (Weinstein & Cahill, 2014). The taxation policies and organizational acts and regulations are very much transparent. Business experts do not have to face challenges in following those taxation policies.
Economic	Economy plays one of the most important role in forming business strategies and policies. Australia is out an out economically developed country. While making pricing strategy of products Country Road does not have to face challenges as the target customers are from high income status.
Socio-Cultural	Australia is a country which is constituted with the people of diverse cultural backgrounds and attitudes. In order to impress the attention of customers from various geographical backgrounds and attitudes the organization has to maintain variety of products (Solomon et al., 2014). Country road has focused to provide their services by maintaining multi-lingual activities. As a result, people having communication barrier do not have to face difficulties in dealing with the service providers.
Technological	The inhabitants of Australia are very much advanced in technology. Due to this technological efficiency customers can get detailed overview about the products by sitting at their own place (Ward,. 2014). County Road thus has focused to launch their ecommerce business methods so that customers can receive their services from anywhere.
Environmental	Environmental issues like deforestation, irrigation, soil salinity, soil erosion are major problems based on which environmental balance is getting hampered day by day. However, with the initiative of Australian government the people have to follow several environmental acts and laws (Wu, Inderbitzin & Benin, 2015). The implementation of The Environment Protection and Biodiversity Conservation Act has rendered a major improvement on the overall environment of Australia. However, the business organizations like Country Road have got immense benefits after the implementation of those acts.
Legal	In order to run the entire business process, every organization has to follow several acts and regulations mandatorily. The acts include data protection acts, right to information act, anti-discrimination acts and so on. Every organization while expanding their business has to provide equal priority and response to both male and female employee (Proctor, 2014). Country Road is not exceptional to that. As per the ethical beliefs of Country Road, the human resource managers have to maintain confidentiality of data and information after recruiting an individual employee.

Table 1: PESTEL analysis

(Source: Müller & Hamm, 2014)

3.1 Strengths and weaknesses of the Country Road while operating in the Australian markets

Strengths of Country Road Good relation with the customers and a strong customer base has helped in the expansion of the organization while operating in the diverse Australian markets Country road maintains superior quality of services in affordable price range.

Weaknesses of Country Road Inefficiency in the market research has affected the functioning of the business while operating in the Australian markets. The high rental rates that are faced by the organization has limited the expansion of the organization in the diverse market situation of the organization

Strengths of Coles A varied range of products that are offered by the organization has helped in the retention of the customers Innovation and the application of technology in the processes have helped the organization in maintaining a steady productivity index.

Weakness of Coles Lower availability of the skilled workforce has affected the functioning of the organization while operating in the diverse Australian markets. It has affected the productivity of the Innovation in the communication technologies of the organization has helped the same in maintaining the smooth performance of the processes while operating in the diverse Australian market structures.  businesses and thereby affected the performance of the organization. The lesser channels of distribution has affected the supply chain that is followed by the organization.

3.2 Porter’s five force (an industry analysis for evaluating the market threats of competitors)

Threat of new entrants (High)	· Low switching costs · Government regulations and policies · High costs of penetration in the markets
Rivalry amongst competitors (High)	· The high cost of switching has affected in maintaining the different changes in the systems of the business while operating in the international markets. The most prominent  competitors  giving a constant market threats include Coles, JB-HI-FI, The Iconic · The innovation that is made by the competing organizations has affected the performance of the business while operating in the international markets. The advancement in technology and its impact on the productivity of the organization  have restricted the growth of the organization in the Australian market.
Substitute products (High)	· Different substitutes are available in the Australian markets, which has affected the course of action of the retail organization. The high range of substitutes in the market has affected the functioning of the organization while operating in the Australian markets. It has posed a threat on the productivity of the business.
Bargaining power of consumers (High)	· The high bargaining power of the consumers is due to the existence of the different alternatives and substitute products, which has affected the functioning of the business relating to the maintenance of a strong customer base.
Bargaining power of suppliers (Low)	· There are different sources through which the organization derives the commodities, which has helped in lowering the bargaining power of the suppliers. It has helped in maintaining the different levels of change in the systems of the business while operating in the international markets.

Table: Porters’ Five Forces for analyzing competitive position, opportunities and threats

(Source: Dolnicar & Leisch, 2014)

In quest of identifying the customers’ grocery shopping behaviour the organization like Country Road has made effective market segmentation for understanding the group of target audience (Dolnicar & Leisch, 2014). The business experts of Country Road have made effective STP (segmentation, target, positioning) analysis.

Segmentation:

As per the market segmentation strategy and policy the business experts of Country Road have decided to segregate the entire market as per geographic, demographic and psychographic ways (Sell, Mezei & Walden, 2014). Most of the popular geographic locations of Australia such as Sydney, Melbourne, Bisbane, Perth are targeted for delivering the products and services of Country Road. As per demographic market segmentation those customers are given preferences that are from average income status (Rid, Ezeuduji & Pröbstl-Haider, 2014). As a result, both the premium customers as well as average cost customers are equally eligible for using the services. The products that are designed within Country Road are for men women and children. Therefore from 10 to 40 age group of people can use the services of this organization. As per psychographic market segmentation the organization has targeted the customers from various cultural backgrounds and ethical values (Campbell, Ferraro & Sands, 2014). The products are delivered to the customers is not made for drawing the attention of specific group of people.

Nature of competition in the industry

Target:

After analyzing the overall target market segmentation it can be summarized that Country Road has selected the people from different cultural and psychological backgrounds and attitudes. Men, women and children are equally important for the service providers of this organization (Hellwig et al., 2015). In addition, in quest of drawing the attention of average cost customers the organization has selected the price range of products in such a way that people having moderate income status can easily purchase its products and services. In addition, the service providers of Country Road intend to show equal approach to the people of various cultural backgrounds and attitudes (Alt & Iversen, 2017). As a result, language barrier or religious barrier cannot be a major obstacle for receiving the services from Country Road.  

Positioning:

Positing is one of the most effective marketing strategies with the help of which the brand and services can be introduced to the doorsteps of target customers (Venter, Wright & Dibb, 2015). In order to position the brand in market Country Road has used both offline promotional method and online promotional method. The marketing executives have used electronic media for multiplying the messages beyond going the regional boundaries (Dey, Lahiri & Zhang, 2014). At the same time, social media has also used as one of the most significant platforms for drawing the attention of customers from multinational countries. However, social media platform is vast in sphere based on which customers belonging to other geographic locations can get detailed overview about the products and service facilities of Country Road. On the other hand, the inhabitants of Australia are very much advanced in technology (Casabayó, Agell & Sánchez-Hernández, 2015). Therefore, before purchasing the products and services customers especially of young generation intend to get detailed overview about its ingredients as well as market review from the internet.

In order to identify the market quality the business experts have to focus on two major components that is quality and price of the products (Venter, Wright & Dibb, 2015).  Quality is divided into two major factors including high quality and low quality of products. On the other hand, pricing strategy is divided into two ways that include high pricing strategy and low pricing strategy.

After making effective competitive analysis as well as stakeholder analysis it is observed that Country Road’s market position is stabled with the segments between high quality and low price.

Low quality

After illustrating the market positing map of Country Road it can be analysed that the organization is successfully able to provide superior quality of products in affordable price range. As a result, the low cost customers can easily purchase the products that helps in reflecting business profitability.

Major market segments for Country road and evaluation of target markets

The market position of the organization leaves a major impact on the overall decision making process of the company. It has been observed that customers from average income status are showing their interest in purchasing the products of Country Road. Therefore, the business experts have decided to render multilingual flexibility within the service providers. As a result, people having language barrier are successfully able to communicate with the service providers (Fabijan, Olsson and Bosch, 2015). The customer service executives of Country Road are flexible in dealing with the people of various religious backgrounds and attitudes. Both male and female customers are given equal priority and response. Based on the market positioning strategy the business experts have got the opportunity to render an improvement within their entire business process (Harding et al., 2015). Due to extreme low cost of product price the organization is facing challenges to grab the attention of premium customers. In this kind of situation, the organization has decided to change their business strategy. They have focused on investing more money for maintaining effective promotional activities. As a result, customers of various geographic locations can show their attention for purchasing products and services from Country Road.  

Conclusion: 

The study has focused to make effective market segmentation strategy of a retail chain belonging to the soil of Australia. Country Road is one of the most recognizable middle marketing clothing retailers occupying a predominant place in the realm of Australian supermarket industry. Market segmentation strategy along with highlighting the market position has also been analyzed in this study. Before making business strategy and policy the organization needs to make effective PESTEL analysis in order to evaluate political, economic, socio-cultural, technological, environmental and legal factors. Competitors’ business strategy is one of the most remarkable threats for Country Road. Large number of established retail organizations is there within the market of Australia which provides variety of products from the stores. Therefore, the business experts have to face immense threats from the existing competitors such as The Iconic, Coles, JB-HI-FI and so on.

The study has also analyzed that in order to impress the attention of customers from various geographical backgrounds and attitudes the organization has to maintain variety of products. Country road has focused to provide their services by maintaining multi-lingual activities. Thus, with the initiative of Australian government the people have to follow several environmental acts and laws. As per the ethical beliefs of Country Road, the human resource managers have to maintain confidentiality of data and information after recruiting an individual employee. In quest of identifying the customers’ grocery shopping behaviour the organization like Country Road has made effective market segmentation for understanding the group of target audience. Therefore, men, women and children are equally important for the service providers of this organization. In addition, in quest of drawing the attention of average cost customers the organization has selected the price range of products in such a way that people having moderate income status can easily purchase its products and services. In order to position the brand in market Country Road has used both offline promotional method and online promotional method.

Decision-making process for Country Road’s primary target market and positioning statement

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