ALDI: THE DARK HORSE DISCOUNTER CASE – Case Study Example
Lecturer Aldi: The Dark Horse Discounter Case Aldi is of the least known discount groceries in the world despite its high sales of around $67 billion in the year 2012. Aldi has unique models of operation. The models are has ensured that its competitors are finding it hard to match to match Aldis quality and prices.
Aldis competitive advantage arises from a uniques marketing mix, above the line promotion and below the line promotion. The marketing mix of Aldi focuses on producing high-quality brands. Quality brands are achieved by hand-picking their suppliers who provide quality raw materials. Erec, (2012) says that the prices of their quality products will be at slightly lower prices than their competitor without compromising on the quality. Aldi also uses a both above-the-line and below-the-line promotion to maintain a competitive advantage. Its above-the-line promotion focuses on increasing customer loyalty through increasing brand recognition and highlighting its superior product through TV advertising and printed leaflets distributed in all its stores. Below-the-line promotion is used to target specific Aldi customers. Aldi has achieved this through social media, target emails and 3rd party endorsements. Aldi has used campaigns like the Swap & Save campaigns.
Aldi created its competitive advantage through its management ensuring there is total efficiency in its production. Aldi has ensured there is no waste, either in production or expenditure like buying company luxury cars or hosting public dinners and forums. Aldi has maintained a high customer orientation through not conducting any customer surveys or tricks to increase sales or any sales ploys (Eric, 2014).
Aldi should increase its innovations on marketing campaigns that have ensured an increase in sales and customer loyalty in the past. Aldi should also stick to its previous strategies like the swap&save and like brands campaigns that have been efficient in the past. Finally, Aldi should increase it stores worldwide so that their products can be easily accessed by their loyal customers.
Aldis total revenue for the year 2012 was $66 billion with most of the revenue coming from the parent country of Aldi which comprised of $32billion. Aldi sales in most countries are on the increase. For example, the sales in the UK rose from $5.68 billion in 2012 to $7.65billion in 2013. Financial positions of Aldi are good since most of their operations do not cost them a lot since they employ very few efficient workers and efficiency in production have increased their profit margins. The average return on equity of Aldi ranges to 31.94% that is a relatively good number. The values indicate that Aldis profits before tax have increased tremendously between 2012 and 2013. Financials of Aldi are very strong, and it will accommodate its expansion plans.
Eric Van Den Steen, David Lane, (2014). Aldi: The Dark Horse Discounter. Harvard Business School.