Whole Food analysis has implemented the following strategies in their business:
Market penetration – Whole Foods has opened more branches in the US in order to increase their presence and grab a bigger market share (Thompson, 2015).
Market development – Whole Foods has entered new market and provided highly differentiated products in the new markets. For instance, Whole Foods entered the UK market by acquiring Fresh & Wild Stores and attracted new customers by offering them top quality organic and natural foods (Thompson, 2015).
Product development – Whole Foods offers new products to existing customers in order to increase the revenue per customer. For instance, in 2008, Whole Foods eliminated the use of disposable plastic bags in its stores and instead replaced them with environmental friendly biodegradable bags (Thompson, 2015).
Improving its value proposition – Whole Foods has embarked on an aggressive promotional campaign, improved the price positioning, and value offering across the store (Robb, 2015). For instance, Whole Foods ran a promotional campaign dubbed ‘Flash’ where customers would have a limited time (about five hours) to buy a specific item at a substantial discount (Robb, 2015).
Collaborating with others in the value chain – Whole Foods entered into partnership with Instacart to do their home deliveries (Kusek, 2015). Instacart is a collection of independent freelancers who shop on behalf of their customers and deliver to their doorsteps (Kusek, 2015). The partnership with instacart allows Whole Foods to meet their customer demand for home deliveries without incurring the expenses associated with building their own delivery infrastructure (Kusek, 2015).
Store experience – Whole Foods is committed in providing their customers with a satisfying store experience by refurbishing older stores and improving product transparency (Kusek, 2015).
Continuous innovation – Whole Foods has been testing new ideas in order to differentiate themselves from their competitors and give them a competitive advantage. For instance, Whole Foods is testing microbreweries in some of their stores after launching one in Huston.
Differentiation – Whole Foods strong selling point is that they sell natural and organic products (Thompson, 2015). This strategy makes Whole foods to differentiate itself from its competitors.
In implementing these strategies, whole Foods developed the following resources and capabilities:
Market penetration – they opened new branches
Market development – going to new markets through merger and acquisition and developing new products to offer to such markets
Product development – being innovative and trying new products
Improving value proposition – getting a better understanding of the customer and using heavy promotion
Partnering with others – entering into partnerships to reduce risk and investment outlay
Store experience – committing finances to refurbish the stores
Continuous innovation – researching into possible ways of improving their value proposition
Differentiation – engaging farmers in the value chain in order to obtain natural and organic products
All the strategies except the store experience, and differentiation are average strategies that competitors of Whole Foods can easily replicate. The experience at the store will be hard to duplicate because it involves several factors at play such as the ambience, staff, and the physical outlay of the shop. Whole Foods has been able to set itself apart from competitors by selling natural organic products, it will take a competitor considerable effort and time to grow a similar reputation.
The building blocks of Whole Foods strategy aims at creating value for the customers through differentiation. Whole foods aim to differentiate not just its products, but the shopping experience as well. Providing natural and organic foods provides more value to health conscious customers though they do not lead to cost reduction. Home delivery also improves value to customers especially those customers with busy schedules who would find the service convenient.
Reference list
Kusek, K. (2015, February 17). Five Lessons Retailers Can Learn From Whole Foods Market's Q1
Performance. Retrieved March 11, 2016, from http://www.forbes.com/sites/kathleenkusek/2015/02/17/five-lessons-retailers-can-learn-from-whole-foods-markets-q1-performance/#5824543e4612
Robb, W. (2015). Strategies. Retrieved March 11, 2016, from
http://wholefoodsmarketrodrigues.weebly.com/strategies.html
Thompson, A. (2015). Whole Foods Market's Generic & Intensive Growth Strategies - Panmore
http://panmore.com/whole-foods-market-generic-strategy-intensive-growth-strategies
