Woolworth’s Growth Strategy

I want to take a look at a growth strategy for Woolworth’s Group, now this might seem like a very unbelievable brand to think of proposing a growth strategy for when they have already implemented a number of growth strategies such as extending their product line in terms of fashion with David Jones Limited, Country Road Limited, Woolworth Financial Services and their joint venture with Barclays Africa Group.

As most readers would be aware Woolworths specialises in selling food, as well as clothing, beauty and home-ware products, they also provide financial services to their customers.

So what possibly could Woolworth’s do to ensure a bigger and brighter future for the brand , especially in such a congested market space? I would think that we should take a look at some of their competitors such as Spar, Pick ‘n Pay, Shoprite on the food side as well as The Foschini Group and Mr.Price on the clothing side and see the one thing that they are missing. Majority of the larger Woolworth’s stores, have the food section as well as the clothing section in one shopping space, whereas most of their competitors do not, except for one, this would be Pick ‘n Pay, Pick ‘n Pay launched their first Pick ‘n Pay stand alone clothing store in 2002,now bringing them into the same market space as Woolworth’s but offering better prices. When I look at the two stores and compare them side by side in their product offerings, not necessarily the quality, there is one big thing that is missing. This would be the need for a dedicated section in their stores that sells toys.

I would propose an extension strategy for Woolworth’s and more specifically a line extension. The reason I have chosen this strategy and not the brand extension strategy is because Woolworth’s does currently have a hand full of toys to choose from within their stores, they mainly feature in the kiddies clothing section of the shops, as well as smaller items at the checkout in the food store, or occasions themed items that are sold during the holiday seasons such as Halloween, Easter, Christmas etc.

Introducing this strategy would show an increase in profits and I believe an increase in customer happiness as well as loyalty. This would create the ultimate one stop shop for all their consumers necessities as well as the more luxury product purchases, this would enable them to broaden their market size as well. This would be the ultimate vision for the brand, apart of their values are to be innovative, and to provide service by always putting the customer first. This would be the ultimate way to do it, consumers already have a preconceived idea of the quality of the items that are sold by Woolworth’s, they could potentially partner with Hamleys and even sell some of their toys as Hamleys is making a break into the South African market.

I would recommend the best option would be for Woolworth’s to start their own line of toys and launch this in all their stores, I would recommend in order to grab more attention, to have these toys placed in the food sections of their stores as this accounts for more than 60% of their turnover and in their own aisle as opposed to in the clothing sections, as consumers purchase food far more regularly than they do clothing, generally parents have their children with them when doing their grocery shopping and having this would increase the likelihood of parents purchasing toys for their children.

In conclusion, I would suggest that in order for Woolworth’s to maintain, or in fact to grow it’s current position in the marketplace, to become more relatable to their consumers and to understand their customers needs, they would need to implement a line extension strategy and to increase and dedicate sales of toys in their stores. Many shoppers have less and less time to get to the everyday tasks of a busy lifestyle, being able to provide more options and more of a one stop shopping experience that caters for the needs of all the individuals of a family with quality toy products, quality food and quality clothing, they would increase the amount of consumers purchasing from their stores as well as maintain consumers that already purchase from their stores.