Since time immemorial, Kroger has not taken a step ahead to expand its activities across the globe; its stores are situated only in the United States. Kroger has always paid attention to delivering its services to the local community. Therefore, its activities present cultural communication barriers, if expounding internationally. Most importantly, the activities of the company are affected ethically by misleading companies like Apple and Foxconn. In the United States, Kroger controls more than 2480 supermarkets and 770 convenience markets in more around 30 states. The main challenge that will affect its activities in the international market is its lack of ability to interact in a different setting. Kroger has always spent most of its time to solidify the local customer loyalty, and at the same time, disregarding the impact caused to the rest of the population. The business maintains the local banners thus making it difficult for other countries to accommodate their products and services. Compared to Wal-Mart and Costco, Kroger is lagging behind in the global market. Wal-Mart has analyzed the international market to understand their customers need, and as a result, it has produced goods that fit the addressed interest (Hill, 2014). The main hurdle presented in the outside market is the inability for individuals to purchase wholesale products like the Americans.
The expansion of Kroger activities in the global market presents numerous sociocultural challenges. As a matter of fact, the way of life in other countries is completely different with the one in America; thus, their products will face a lot of resistance. Majority of its products are designed to fit the American culture, and this works towards their disadvantage. Lack of a proper communication structure will fail to clear the notion that their products are unpopular and invaluable. For Kroger to achieve success worldwide, it must be ready to launch products and services that fit the foreign people. There is a need to ensure that the foreign market participates in the decision-making process for them to give suggestions of what needs to be improved. The best strategy to surmount the mishaps associated with cultural differences is to develop a wide range of products that will satisfy the foreign people. The company has failed to conduct a proper market research that will help to grow a unique product line with expected satisfactory standards (Forum Magazine, 2005). Every culture has its value that must be respected by all manufactured products.
Perceptual and language differences will affect the operations of Kroger in the global market. Foreign people tend to ignore any products that contradict with their values and beliefs. It is also regretful to note that Kroger has failed to control the pool of helpful information. The top executive must up their game to control the flow of this information to avoid ineffective communication. Inattention is another barrier for the company since it fails to provide products that match the interests on non-Americans. If not eliminated, the barriers will continue to present hurdles when trying to penetrate abroad. Communication enhances understanding, it is vital as ignoring it remains suicidal to activities of any company. Kroger has a lot to do towards establishing a fair ground that will help them to engage customers outside the United States.
Kroger business had adopted both the pull and push strategy to remain relevant in a competitive market. The business is ensuring that it promotes the pull strategy. It simply means to "Getting the customer to come to you." The most popular Pull strategies adopted by the company include word of mouth referrals, sales promotions and discounts, customer relationship management, and advertising through the social media. The pull strategies depend on the satisfying demand developed by requests of the end-user (Wysocki, 2005). The grocery supply chain allows the promotional dollars and this attracts more customers to the retail stores. Kroger has adopted a low pricing strategy and provide quality products, and this has marked success as a pull strategy. The pull strategy has an objective to generate a “pull” throughout the system.
Moreover, the push promotional strategy in Kroger Company proves efficacious. The business has introduced several methods to enhance in-store promotion. For instance, end cap display, supply of store’s magazine, and temporary price discount are among the push strategy implemented by Kroger. The product is delivered to the customer via all possible means. Since its establishment, Kroger targets the local population in the United States as it ensures awareness of their products at all points of purchase (Wysocki, 2005). The commonly applied push tactics include trade show promotions, negotiation with the retailers to their products, selling their products directly to the clients, use of modern packaging designs and point of sale displays. The suppliers and vendors are the most reliable parties utilized by Kroger in serving as supply chain intermediaries. Channel push has resulted into accumulated success recording over 18% increase of sales in Kroger’s budget. Kroger has always maintained its pull and push strategy, and this had proved highly effective in its operations. The competitors in the grocery market have tried to copy the pace set by Kroger.
Forum Magazine. (2005). Cannondale Trade Promotion Study 2005: Saying No to the Status Quo. Forum, Second Quarter 7(2), 72-84.
Hill, C. W. (2014). International business: Competing in the global marketplace.
Wysocki, A. F. (2005). Choices Article - A Frictionless Marketplace Operating in a World of Extremes. Retrieved from http://www.choicesmagazine.org/2005-4/supplychain/2005-4-10.htm