Strengths

Discuss about the Marketing Strategy for New Service Launch of Home Run.

Home Run is positioned among the most renowned retail brand that is focused on launching “Home Run” in Australia that are rich in high organic and nutritional value (Allen et al.2015). The company will have its retail operations focused on Australian food and petrol, supermarkets, drinks group and hotels. Hone Run is a 1-hour shopping as well as delivery experience whose organizational model is focused on simplicity and speed. After launching its business in Australia, consumers can choose their favorite supermarket and place a grocery order that will be delivered in less than 60 minutes. This “Home Run” development has considered undertaking an extensive review, reformulation and rebranding of the food ranges with major changes including decrease in salt, sugar, saturated fats along with overhaul of product packaging. This new grocery store will enhance product transparency on packaging with “Health Star Ratings” and the range will include offering textural innovations along with new ways to communicate with brands. (Baker, 2014).

SWOT Analysis

The attractiveness of the Australian retail market for the new product launch can be analyzed through carrying out Porters “five forces analysis” in order to evaluate the appeal and success of the market (Balaji & Roy, 2017).

Figure 1: Porters Five Forces Analysis

(Source: Charlton, Kähkönen, Sacks & Cameron, 2015)

• Threat of Substitutes- This force is high in Australian retail market and “Home Run” faces threat from several indirect competitors like the convenience stores, specialist grocery stores along with the farmers markets (Cuellar, Eyler & Fanti, 2015). From analysis of the Australian retail market it is gathered that the indirect competitors serve as the viable substitutes to the Home Run that might have more threats in upcoming years convenience stores is observed to experience an expansion of goods offerings and might be competing with the retail supermarkets with choice provision convenience along with “one-stop shopping”. A growing trend has been observed in the direction of healthy alternatives, farmer markets providing organic products that tend to offer likely future threat. Conversely, a threat coming from some specialty stores is observed being decreased with increase of greatly rising “time-poor” customers (Dwyer, Pham, Forsyth & Spurr, 2014).
• Rivalry amongst Existing Competitors- An increased degree of rivalry is observed being present within Australian retail market. There is a high competition level in the Australian retail market from other major players such as Aldi, Wesfarmers or Coles that also introduces innovative product ranges and has a huge loyal consumer base (Ellis & Waller, 2016). However, there are few major players in Australian retail market and there is absence of high differentiation because of generic nature of products and services offered by Home Run. The competition that is faced by the company is generally based on price and the other factors encompass location and of store and product choice.
• Bargaining Power of Suppliers- This threat is observed being low in the Australian retail industry. In a situation where Home Runs and Coles attaining around 80% of the market share, numerous local Australian producers that has limited selection of intermediaries to select (Kasemsap, 2018). For this reason, in such situation Home Run is positioned as a larger purchaser and just one purchaser of manufacturer’s production. Conversely, it is likely to change with emergence of Costco along with Aldi expansion within Australian retail industry (Larke, Kilgour & John, 2016).
• Bargaining Power of Buyers- This force is observed to be low as an aggressive push from Federal Government along with ACCC to decrease barriers related with competition and facilitate new business rivals for attaining market entry is focused on increasing customer choice. This can drastically increase bargaining power of consumers. An increasing consumer buying power might increase of process comparison websites like the “grocery.bestpricedirectory.com.au” (Scollo, Bayly & Wakefield, 2015). This facilitates customers to compare prices along with selecting the cheapest alternative. These factors are set to being the consumer’s upcoming bargaining power for moderate level.
• Threat of New Entrants- This threat is observed to be low as well as this is observed to remain unaltered with the presence of combination of domestic zoning laws along with the agreements of leasing with landlords (Scollo, Bayly & Wakefield, 2015). This has led to scarcity of grocery store websites. This is blocked entry of new entrants’ particularly international players within Australian retail sector.

The target consumer group those shop for Home Runs grocery products look for all-new “Green seal for approval” on the new “Home Run” product (Scollo, Bayly & Wakefield, 2015). The target consumers of the company desire for delicious, high quality product that contains no artificial colors along with flavors at a reasonable price that are created by nutritionists and chefs and are tested by them. For this new product, the new target consumer segment is deemed to be the household segment of the retail market. The consumer segment of the Home Run belongs to the age group of 18 to 45 years and generally belongs to the high-income group. The segmentation in relation to the income level of the target customer segment has facilitated the retail organization to develop different set of new food product innovation strategies in the product procurement from the manufacturers (Scollo, Bayly & Wakefield, 2015). Such consumer segment division is conducted by dividing the market into consumers having different needs or desires regarding food products. The consumers those are targeted by Home Run after its launch of new nutrition filled product ranges will be the consumers those look for higher product quality with better value process through convenient situations. Shifting focus on comparison of price to quality, Home Runs target consumer will be the ones looking for “The fresh food with high nutrition and great value”. Focused on the needs of its target consumer segments, “Home Run” will offer that will make sure its consumers attain great quality and tastier options (Scollo, Bayly & Wakefield, 2015).

Weaknesses

There are a number of competitors for Home Run new food product ranges in the Australian market. There is a high competition level in the Australian retail market from other major players such as Aldi, Wesfarmers or Coles that also introduces innovative product ranges and has a huge loyal consumer base. However, there is small number of major players in Australian retail market and there is absence of high differentiation due to generic nature related with products and services offered by Home Run (Zarkada-Fraser & Fraser, 2015). The competition that is faced by the company is generally based on price and the other factors encompass location and of store and product choice. Two major drives that can increase future competition are the American retailer Costco and the Coles, which indicates high threat in future from their products (Scollo, Bayly & Wakefield, 2015).

In launching its new grocery product, Home Run has focused on setting positioning strategy of its products in its new brand promotion campaign. This product positioning strategy indicates that the positioning strategy is focused on advertising that the campaign captures the essence of the values of the food products that makes Home Run great and exceptional (Webster & Hume, 2015). The integrated promotional product positioning campaigns include online, print, radio, street and transit media along with You Tube pre-rolls. Moreover, for this grocery product ranges from supermarkets, Home Run has refreshed its product positioning through launching a multimillion dollar brand positioning campaign. This campaign seeks to promote the fresh food positioning that focuses on delivering food from the farm to the table. The new product positioning will focus on addressing major consumer concerns around quality, sourcing and freshness of goods. For increasing positioning of the brand, a few commercials will be released as a million-dollar campaign that includes micro site inviting shoppers to view the grocery products fronting the spots with interviews along with behind the scenes talent footages (Xie, Hong & Stroud, 2015).

The marketing objectives set for the organic grocery product launch by “Home Run” are explained under:

• To increase sales of the new nutrition product launches by 10%
• To increase brand awareness by 15% regarding the new product ranges
• Increase market share for this new product ranges by 5% at the end of the first year of product launch
• Attaining new consumer groups for the new product that is deemed to increase by 10% at the end of the first year of product launch

Two major marketing strategies will be involved in increasing the sales of Home Runs new food product ranges in order to compete successfully in the Australian retail market that includes in-store promotions and organizational dynamism. In launching its new organic and nutritional food ranges, “Home Run” has focused on setting positioning strategy of grocery in its new brand promotion campaign (McDonald & Wilson, 2016).

Opportunities

To promote its newly launched nutrition focused food product ranges, several effective promotional techniques can be implemented. The brand can focus on launching promotional campaign. The brand can use online media and the magazines as well as newsletters for better product promotion (Pantano, 2015). This marketing strategy can be effective through ensuring easy availability and accessibility for attaining loyal consumer base. “Home Run” can also focus on offering extensive offers and deals for the shoppers or the target consumers. Gift cards are also given away by the “Home Run” for in promoting the “Home Run” product of the company. Extensive promotion can be carried out through online media by “Home Run” Company that will promote the online stores as well as offering discounts for attracting huge consumer base towards its nutritional food ranges (Scollo, Bayly & Wakefield, 2015).

The marketing strategy of “Home Run” for the new food ranges is focused on setting suitable price for these new food product ranges. Considering that there will be organic and highly nutritional food ranges with increased variety in comparison to its competitors, prices will be kept competitive within the Australian market (Sutton-Brady, Kamvounias & Taylor 2015). Moreover, the retail chain will serve the consumer segment with low and premium prices for the “Home Run” product. This marketing strategy can be implemented by “Home Run” through offering its loyal consumers with shopping card that can automatically track their purchases along with providing discounts on first time purchase of such “Home Run” product for which they will require to retain paper receipts.

References

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