Marketing strategies bolster Woolworths profits
Woolworths has posted over $1.8 billion in sales for the last half of 2013, their strongest sales growth since 2011. This puts Woolworths on top as Australia’s fastest growing food and liquor retailer. Several moves, particularly a change in marketing strategy, contributed to this impressive increase in business.
Supermarkets, petrol stations, hotels, Big W and hardware stores all contributed to the uptick in business. Big W, Woolworths’ department store, was the weakest performer, but acquisition of the online and catalogue retailer Ezibuy helped buoy revenue. The increase can also be attributed to the opening of 20 supermarkets and 13 liquor stores.
Woolworths’ doubling of growth can be largely attributed to its marketing strategy for 2013. One of their most rewarding moves included Aussie Animal trading cards, a huge hit with children. Grocery and petrol discounts and premium label products promoted by celebrities also had a positive impact on sales.
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Analysts say Woolworths is more successful in its engagement with suppliers, as they are focusing less on price cuts and more on strategies to grow category sales. That said, the supermarket giant was able to offer over $400 million dollars in savings to its customers through their “More Savings Every Day” promotion.
In the future, Woolworths will continue to make better use of data analytics and will invest in big data and online retailing to continue the implementation of their four-point strategic plan. Chief executive Grant O’Brien says this plan is aimed at restoring Woolworths profit growth to about 10 percent over time.
“The first priority, and the central theme of our focus, has been to ‘extend our leadership in Food and Liquor’. The improvement in the growth rates for our Food and Liquor business demonstrates the transformation that is underway,” Mr O’Brien said in a statement.
It seems that as long as Woolworths is able to continue to implement its successful marketing strategy and focus on their four-point strategic plan, there will be nowhere to go but up.