There is no doubt in the fact that the Whole Foods is one of the biggest food super markets in America that has been considered as specialized in organic food. The provided two articles discuss about the marketing strategies and tactics used by Whole Foods in order to stand out of the market within an intense competition.
It has been witnessed that due to globalization as well as fewer barriers to enter the market, more firms have entered the market and they impact on the sales and revenues of the already existing companies. Same is the situation faced by Whole Foods because it has earned huge revenues in the past due to organic product offering, but now due to many competitors offering the same products, Whole Food has a threat of losing a significant proportion of its sales.
Marketing Strategies adopted by Whole Foods
It has been stated in both articles that the sales of Whole Foods was declining due to the increasing competition. In this regard, a firm has to come up with a new and different concept in order to attract the target market. The need of the target market must be taken into account while launching a new product because the product must satisfy the existing needs of the customers or the concept of the new product must be strong enough in order to develop the need of the new product among the targeted clients. In this regard, Whole Foods has acted cleverly and intelligently because it decided to introduce a new brand chain named “365 by Whole Foods Market”.
There are a lot of marketing strategies, and some of them are widely applicable. The Porter’s Generic Strategies are Cost Leadership, Differentiation, and Focus strategies. Here, one can see that the Whole Foods has adopted two strategies at the same time in order to stand out of the crowd in an effective manner. According to Porter, in order to get an edge over the competitors, a firm has a few options, for instance, adopting a cost leadership strategy means that the firm can let go a portion of its profits, but can attract a huge market share because of being cheap. In this way, the firms do earn good profits and revenues and are able to attract and retain more customers. The other option is differentiating the product, which requires research and development of the product in the light of the needs of the customers which are unmet. A firm can charge more prices for the differentiated product and can make significant profits by selling the high quality and unique products. The final option is focusing on a niche and catering the needs of a selected target segment.
It can be seen that the Whole Foods has adopted a mix of cost leadership strategy and differentiation strategy in order to become the best option for the targeted customers. The new small 365 stores will be providing high quality organic food to the customers on a lower price. Whole Foods wanted to do something different and it has chosen to become closer to the customers by opening small outlets in different areas so that the buyers can access the high quality organic food more easily.
Marketing Mix of the Whole Foods “365 stores”:
The products will be organic food items or the other food items that are not decided yet
The prices will be lower as a market penetration strategy will be implemented
The promotion will be done by mentioning it as a sub-brand of Whole Foods so that the customers can relate the new brand with its mother-ship
The products will be available by near outlets as a market expansion strategy will be followed by Whole Foods to open a 5 to 10 of “365 stores” by next year.
Target Market of “365 Stores”:
The target market of these stores is the customers who want to spend less time on shopping by quickly identifying and getting their desired products.
Using Brand Image to Influence the Customers
The other article has mentioned another program by Whole Food Market namely, Responsibly Grown program. The company has been gaining the loyalty of the customers by using its marketing tactics and brand image. The Whole Foods Market has always been known for high quality products, but the “responsibly grown” program has been criticized by many farmers because it is very costly for them to be eligible for this program.
Whole Foods has a lot of customers loyal to the brand, and in this way, the brand is using its image in order to influence the customers about the rating of the products available at the stores. The products are categorized as “good”, “better”, and “best”, so that the customers can perceive that what they must buy. Note that a differentiation strategy is also adopted here for the convenience of the customers/
Apart from this, many of the organic farmers are against this program by Whole Foods because they claim that this program gives a message to the buyers that conventional products are better than organic ones because organic farmers are not allowed to use the pesticides using which the conventional growers get a better rating.