Book Report: Woolworth Australia Redefining the Brand Image

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Woolworth Australia

Redefining the Brand Image of Woolworth's Australia

Keeping pace with the rapidly changing needs of shoppers, retailers often must change their supply chains, sourcing, logistics and quality processes to ensure the right mix of products at a high quality level are available. In the areas of consumer packaged goods (CPG), groceries and consumer electronics, sustainability or "green" initiatives continue to be a high priority with consumers (Grant, 2008) . In addition, for manufacturers, distributors and grocers, the opportunities to gain cost advantages by streamlining sustainability initiatives continues to show significant potential (Ganesan, George, Jap, Palmatier, Weitz, 2009). The Australian consumer's requirements for accurate nutrient branding are forcing retailers to concentrate on how to transform their supply chains and enable greater sustainability over time (Bryans, 2009). Compounding this is the exceptionally fast growth of social networking adoption on the part of consumers globally (Bernoff, Li, 2008). Social networks are re-ordering the customer-retailer relationship nearly on a daily basis, which makes the speed and thoroughness of green and sustainability initiatives even more urgent. These requirements have become so significant, that there are emerging standards for how Corporate Social Responsibility (CSR) and sustainability messaging is managed throughout Europe and Australia (Karna, Hansen, Juslin, 2003). It is not enough however to merely change the marketing mix, advertising or promotional strategies to promote "green" or sustainability initiatives, which is often called "green washing" (Lee, 2008). What is needed is more of a focus on how to develop a value chain in a retailing business that lends itself to fulfilling and exceeding the expectations created regarding compliance to sustainability or green initiatives (McDonald, Oates, 2006). Consumers have learned how to be exceptionally discerning about which retailers are actually re-aligning their operations to these goals and those that are not (Lee, 2008).

For purposes of analysis, Woolworth's will be used as the retailer who is facing the challenges of staying in step with their customer base, who is gradually favoring other retailers who are "green" and more environmentally sustainable in their operations. Woolworth earned $27.2B in Sales and achieved $1.6B in Earnings before Interest and Taxes. As this retailer is vertically integrated, there are ample opportunities for increasing sustainability process performance and becoming a "greener" retailer as a result. Specifically concentrating on the steps to make the branding and corporate image of Woolworth's reflect greater sustainability and adherence to "green" initiatives, this proposal concentrates on market segment characteristics and how marketing and promotional strategies' can be used to strengthen them. Woolworth's needs to pay attention to and attempt to align with the strong green initiatives throughout Australia that are re-ordering supply chains and the operations of entire companies (Hui-Shung, Chang, Kristiansen, 2006). The proposal takes into account online, offline, in-store experience, and brand perceptions to create a unified strategy across the entire marketing mix (Glynn, 2009). The use of Web 2.0 technologies (O'Reilly, 2006) as part of the online marketing mix, in addition to the use of social networks (Bernoff, Li, 2008) is used to set the framework for online branding.

Introduction

Changing the corporate image of Woolworths' is far beyond just re-doing the website or sending out press releases saying the company has changed. In the very transparent and trust-starved consumers' minds of today, credibility and authenticity matter far more, and must be earned with far greater work, that merely using marketing as a mouthpiece for change (Kwon, Lennon, 2009). For the image of Woolworth's to change, its core processes, systems, people and orientation towards green and sustainability must change. This is the greatest challenge and impediment to companies changing their branding. It is easy to claim any brand image or value proposition in print, online or in broadcast media, it is quite another to create an organization that makes the corporate image and its claims real. The bottom line is that consumers are demanding that branding, especially "green" or sustainability messaging and claims be authentic and real (Lee, 2008). Ironically there are companies who have rushed to get on the "green" or sustainability bandwagon and failed miserably because they failed to make the necessary changes to their supply chains, operations, distribution channels or service (Corkindale, Belder, 2009). For Woolworths to be successful with its redefinition of itself as more sustainable or green, it needs to create a more effective strategy of supply chain management, addition to increasing customer satisfaction with its produce, groceries and packaged goods. It needs to make the connection between augmenting its sourcing and quality standards with healthier, more satisfied customers looking for healthy, sustainable, or green products. This is in essence creating a unique, very relevant and focused story of how Woolworths' increases the quality of life for its customers. The intent of the proposal is to first define how Woolworths' can bring these positive attributes of its supply chain and operations forward so they can serve as the foundation of its green or sustainability messaging. After this is achieved, the creation and execution of a messaging platform and plan is defined, with focus on social media and its role in connecting with green or sustainability-focused consumers in Australia.

Change Proposal

Woolworth's primary focus needs to be on the quality of its produce, groceries and consumer-packaged goods first, and then re-define and strengthen its value chain as a result. Best practices in green marketing and sustainability concentrate on these areas of supplier quality management, setting agreed-on objectives for sourcing the highest quality products first (Peattie, Crane, 2005). Second, the focus on how to make supply chain management, fulfillment and logistics functions -- the most critical areas for transporting groceries and produce from the supplier to the stores - needs to be highlighted in the revised messaging and market positioning strategy. Why these core aspects of Woolworths' need attention is that consumers are more focused on authenticity and trust than ever before, especially in the claims made by companies who state they have sustainability as a core value (Prothero, McDonagh, Dobscha, 2010). In essence, Woolworth's need to be the company it says it is in its green and sustainability messaging if it is to be effective in its messaging strategy. The benefits to customers and the attributes, performance, processes and systems of a company to fulfill them need to be consistent if a company is going to gain trust over time (Bryans, 2009). With so much skepticism in the area of green marketing and sustainability, marketers claiming these attributes as part of their messaging have to provide concrete proof they are true in order to be believed (Lee, 2008).

Segmentation Strategy

The first step in redefining a corporate image and messaging campaign needs to begin with a focus on the core market segments. Using the online service QuantCast to analyze traffic to the Woolworth's Australia website, the following demographic profile has been created. Figure 1, QuantCast Demographic profile, shows the results. The primary market for the messaging and repositioning are primary young adult makes between the ages of 18 -- 34 who are less affluent yet have higher educations. This indicates that many of them are just graduating or are beginning their careers. The focus on social networking is prevalent in this demographic segment, which will make the online messaging strategies on Facebook, Twitter, blogs and other forms of social media critical (Bernoff, Li, 2008). This demographic segment also values egalitarianism and a sense of shared purpose on issues pertaining to the environment, which also fuels a higher level of expectations for customer service (Davis-Sramek, Droge, Mentzer, Myers, 2009). As the primary target market for Woolworth's sees egalitarianism as a form of shared services, there is the expectation that "we're all in this together" pervades not only the brand but the in-store experience that supports the messaging. The implications for this from a messaging standpoint include creating unique, valuable customer stories of how customers are getting unique benefit from Woolworth's green or sustainability message and how these benefits make their lives' better (Prothero, McDonagh, Dobscha, 2010). It is in these stories of customer success that the essence of the new messaging and corporate image need to emanate from -- the stories bring greater credence, credibility and identification on the part of the customers to Woolworth's being green and environmentally responsible.

Figure 1: QuantCast Demographic profile of Woolworth's Australia

Branding and Messaging Strategy

Using segmentation studies including the customer profile shown in Figure 1 as the foundation of the branding or imaging strategy ensures it relevancy over time (Martenson, 2007). Customer segments and audiences are in a continual state of change and to gain relevancy and trust, the messages need to focus on the unique needs of the customers. These messages are best defined in the context of customer stories, which have proven to be effective in moving a company's vision to action, solidifying its messaging and making its branding stronger and more memorable over the long-term (Marzec, 2007). Another factor in choosing to use stories as the foundation of a branding and messaging strategy is their ability to change a… [END OF PREVIEW]

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