An article in Herald Sun on 29 March 2011 shows how the marketing principles of positioning strategy and competitive strategy used by Coles declare the price of chickens. According to this article, fresh chicken which the Coles brand poultry has been added in Coles’ Down Down campaign and they have reducing at least 5000 items since June last year that estimation could help its customers save $800 million per year. Although Coles may burn up with its suppliers by steep fall in prices, they will continue expand their supermarket price cuts (Karen, C 2011).
Coles apply positioning strategy either by emphasizing the distinguishing features of their brand. Positioning strategy is a kind of marketing strategy which aims to make a brand occupy a distinct ‘position,’ relating to the competing brands in the mind of the customer. (Kotler et al, 2010). By the definition of positioning strategy, Coles clearly knows the fact which is difficult to reach their expected profits. As a result, supermarket plays much more attentions to increase the volume of consumer’ purchases in their stores.
Moreover, the most important factor to improve clients’ participation is that the benefits purchase of the same quality as well as cheaper goods in Coles. Simultaneously, people will save $55 weekly budgets. Therefore, there is an increasing trend when Coles reduces the price for customers. The article indicates the concept of competitive strategy as well. people usually prefer spending money on products and services that give them the greatest value. In this article Mr. McLeod said they would continue keeping the prices cuts which the purpose is slashed expenditure for their customers (Karen, C 2011).
This Coles has held the key of winning and keeping its customers. That meant to understand the needs of customers and buying processes better than competitors and to deliver more value. For example, ‘…Coles was making Woolworths ‘very uncomfortable’…’ (Karen, C 2011). The definition of competitive advantage is that if a company can find a position from itself as providing superior values to select target markets—either by offering lower prices than competitors of by providing more benefits to justify higher prices—it gains competitive advantage (Kotler el at 2010). Overall it is a win for customers, suppliers and Coles for the price war.
Karen C.2011, ‘Coles now declares war on the price of chickens’, Herald Sun, 29 March, viewed 26 April, 2011, http://www.news.com.au/business/chicken-latest-target-in-supermarket-war/story-e6frfm1i-1226029792542#ixzz1HwK8SQcA Kotler, P, Brown, L, Burton, S, Deans, K and Armstrong, G 2010, Marketing, 8th edn, Pearson education, French’s Forest NSW.