Table of Contents

Introduction…………………………………………………………………………………………… 3

Positioning of Whole Foods UK…………………………………………………………………….. 3

A Brief Overview of 7Ps of the Whole Foods UK…………………………………………………. 4

How Four of the Marketing Mix P’s are Used to Reinforce Positioning………………………. 6

Product……………………………………………………………………………………………………………………….. 6

Place…………………………………………………………………………………………………………………………… 7

Promotion…………………………………………………………………………………………………………………… 9

Price………………………………………………………………………………………………………………………….. 11

Marketing Effectiveness Measurement………………………………………………………….. 14

Conclusion……………………………………………………………………………………………. 14

Reference List……………………………………………………………………………………….. 16

Introduction

Whole Foods Market UK refers to the American health food supermarket brand that has gained national popularity within the UK borders. It operates seven stores in the United Kingdom as of March 2020 (Whole Foods UK, 2021). The supermarket specialises in organic selections and products that are free from preservatives, artificial colourings, and flavours and meet standards set by Food and Drug Administration.  The company also introduced standards for the humane case for animals that are used in brand’s products. Besides, the organisation is known for its corporate social responsibility, as it is committed to decreasing litter by offering deposable plastic bags to its consumers (Whole Foods UK, 2021). The firm successfully employs a wide range of strategic approaches to emphasise the benefits of its business and products and enhance sales. The brand aims at engaging clients through the implementation of organisation’s marketing mix elements. The purpose of this portfolio is to critically analyse the Whole Food UK’s positioning strategy, explain four marketing mix elements, as well as assess the effectiveness of its marketing efforts.

Positioning of Whole Foods UK

According to the Porter’s Generic Strategies, Whole Foods UK pursues the differentiation strategy to position itself in the market. The company delivers high quality products and services to its customers (Kotler et al., 2019). The company invests in development and innovation in order to stand apart from the competitors. More specifically, Whole Foods UK pays special attention to delivering innovative products to its customers, such as meat substitutes, while committing to improving their quality and taste. The brand also ensures that its employees are customer-friendly and well-trained to provide service excellence, as consumers always want to know that they can speak to employees who can willingly help them in case any issues arise (Cox, 2020). Such HRM (Human Resource Management) strategy focused on enhancing customer service by training the employees presents a differentiating factor for the company setting the brand apart from other supermarket brands (Bailey et al., 2018). Since there are other health foods supermarkets in the UK, such as Earth Natural Foods or Planet Organic, that provide similar products, consumers are likely to make their shopping decision based on the customer service that these companies offer. The matter is that 65% of the UK consumers claim that they are loyal shoppers, which is why keeping them retained is of paramount importance for health foods industry (Wordbank, n.d.). This illustrates that the Bargaining Power of Buyers, according to the Porter’s Five Forces Strategy, is particularly important for the Whole Foods to consider when enhancing its positioning and performance in the UK market (Chaffey and Ellis-Chadwick, 2019). Implementing the differentiation strategy by providing customised services helps Whole Foods UK gain a stronger customer retention. Education of employees as well as fostering appropriate organisational culture are essential contributors to maintenance of superior customer service. Therefore, investing in training the personnel is the right strategy, as it would address both technical and personal components of the job. As a result, Whole Foods’ staff members are knowledgeable about the services and products as well as embrace a positive attitude towards serving other people.

A Brief Overview of 7Ps of the Whole Foods UK

7Ps of the Marketing Mix refer to the critical business areas that service companies like the Whole Foods should take into consideration when developing their strategy aimed at target customers attraction. 7Ps cover such aspects as Product, Price, Place, Promotion, People, Processes, and Physical Evidence (Kotler et al., 2019). A brief overview of the 7Ps of the Whole Foods is provided below. Whole Foods UK offers the organic products that meet Food and Drug Administration standards for food quality. The brand is preoccupied with the organisation’s environmental impact and therefore opts for recycled plastic bags. The brand relies on the premium price strategy, as it provides its customers with superior quality of products and services. The company tends to heavily invest in development of physical stores rather than online store. Whole Foods UK also uses a wide range of promotion strategies ranging from public relations to advertising. The company concentrates on hiring the right employees who make the products, who bring them to the consumers as well as who directly communicate with clients (Cox, 2020, p. 73). Such a holistic approach allows the company building a positive image and customer loyalty.

Every brand’s store seeks to offer whatever the consumers require at any point of time. In such a way, the main priority for the firm is to maintain an efficient distribution system in order to avoid products’ scarcity (Cox, 2020, p. 74). Importantly, organic products require special shipment and delivery and have to meet strict quality standards. In order to offer excellent customer experience, the brand should ensure the effective work of salesmen and product placement (Kaydos, W., 2020, n.p.). The company also gives a paramount importance to product packaging, branding, and even decor in the stores. Instead of simply focusing on organic products the firm delivers, careful attention is also paid to the way sales representatives and personnel dress and behave (Kotler et al., 2019, n.p.). The organisation uses an effective strategic approach to physically portray the brand, thereby increasing sales and positively impact consumers. The next parts of the paper give an account of the four Ps (Product, Place, Promotion, and Price) in a greater detail.

How Four of the Marketing Mix P’s are Used to Reinforce Positioning

Product

The Whole Foods UK offers a wide range of products, so that clients will not have an urge to opt for unhealthy alternatives. More specifically, the company takes into account vegetarian and other dietary considerations and addresses the needs of price-conscious customers (Whole Foods UK, 2021). What is particularly important, the firm provides the customers with products of premium quality. All products do not contain artificial flavors, colors, and preservatives. Due to heavy focus on the products of high quality, Whole Foods UK often refuses to sell foods that can be commonly found in other supermarkets. For instance, the company does not offer sugary sodas that are strongly associated with childhood obesity (Kim and Lim, 2019). The firm also has its own label named 365 Everyday Value, which is presented in all physical stores along with other healthy foods brands (Whole Foods UK, 2021). People who are concerned with their eating behaviors and have special dietary preferences benefit from the company’s product lines (Cox, 2020). The following marketing mix element helps the company to effectively differentiate itself from other competitors operating in the market. 

Additionally, there is an evidence of Roger’s Diffusion of Innovation segment, such as early adopter. During the last three years, the company adopted plant-based innovation starting to offer diary-free cheese, a range of milk alternatives and meat substitutes to cover the needs of the rising number of vegetarians and vegans in the UK (Whole Foods UK, 2021). The brand aims at improving the products for this target audience in terms of texture, taste, and mouthfeel. The strategic decision to address the segment of vegetarian and vegan products is an effective course of action for today. The UK consumer expenditure on meat-free products has already reached 595.4 million GBP for 2020, so there is still an untapped market niche that Whole Foods UK addresses (Wunsch, 2021). A growing demand on vegetarian/vegan as well as other dietary meal options indicates that the company has selected the products that can help the business to set itself apart from the mainstream food retail sector.

Place

The major place for distribution of the Whole Foods UK is the chain of the brand’s physical stores. Despite global pandemic and quarantine restrictions, physical stores remain the main place for distributing products (Cox, 2020). The organisation tends to capitalise on the reputation of the brand to attract clients to its increasing number of stores in the United Kingdom. Whole Foods UK opens its stores in the densely-populated areas in which a large number of college-educated people supposedly reside. Another important factor in identifying the location of a new store is the easy access to roadways. Otherwise, the lack of access would be negatively reflected on the customers’ willingness to make purchases at the supermarket (Chaffey and Ellis-Chadwick, 2019). Those clients who decide to suffer the commute in order to shop at Whole Foods UK are not likely to receive the quality shopping experience that they expect from the brand, as they might become tired even before starting to shop. Notably, the selected place should also allow for clear visibility of the brand’s signage. The picture 1 illustrates the example of such stores with visible brand’s signage.

Picture 1. The Wholefoods store in Giffnock (Burnside, 2018).

The brand also has an online store and partners with Instacart, so that customers can make their purchases, thereby ordering delivery (Whole Foods UK, 2021). COVID-19 pandemic has made customers shift the focus from offline to online shopping. Figure 1 shows the  significant increase in the percentage of people living in the UK who plan to use food delivery services due to global pandemics. The change in customers’ behaviours has prompted many businesses to give special attention to eCommerce. Whole Foods UK seems to ignore the given trend remaining heavily focused on sales from offline stores. The company’s effectiveness can be maximised if it invests more effort in developing a comprehensive eCommerce system in order to respond to the basic needs of its customers, such as safety (Zheng, 2020). The forecasted growth rate of online shopping in the UK will grow up to 34.5% in 2023 (Coppola, 2021). Thus, the company is likely to miss an opportunity to win more customers in case it does not pay attention to the online marketplace. The United Kingdom is the most advanced market of online shopping in Europe, so Whole Foods UK overlooks an obvious opportunity to grow and expand its customer base. Besides, online sales can contribute much to additional recognition of the brand, which is why going online is a favourable path that Whole Foods UK can follow. To this end, a heavy reliance on brick and mortar stores only does not seem to be an effective decision for the company’s marketing mix.  

Figure 1. Share of people who plan to increase their use of food delivery services due to the coronavirus (COVID-19) pandemic in Great Britain in March 2020, by age (Statista, 2021)

Promotion

Whole Foods UK uses a wide range of promotion strategies to attract their customers and seeks to make sure that their shopping experience will compel them to return to its stores what is reflected in the combination of the Promotion Mix Elements that require additional review (Blythe, 2008). It is worth noting that the firm heavily relies on the use of social media for promotion. The organisation prides itself on having an active marketing team on Instagram and Facebook with 123 thousand and more than 100 thousand followers, respectively. The use of social media is increasingly important, as it helps the company receive valuable feedback and directly interact with its target audience (Andrews and Shimp, 2017). On its social media, the brand focuses on the range of organic and natural product as well as new recipes and propositions. This helps to reflect the brand personality as health conscious and innovative. The company also implements the word of mouth marketing by ensuring that their products are of excellent quality, so that customers would want to recommend them to their friends. There are many positive comments on the company’s social media accounts as well as those on users’ personal pages. This implies that the word of mouth marketing is working in this case.

During the last couple of years, the company invested in using advertisements at the national level. The brand implemented national campaigns in both the UK and the US, such as the one with the tagline ‘Whatever Makes You Whole’(Smiley, 2018). The campaign incorporates humour to demonstrate what a shopping experience at the store might look like. In such a way, Whole Foods UK concentrates on developing a powerful brand image. The effect of advertising campaigns is likely to become stronger over time, since consumers will pay more attention to ads and promotional materials devoted to their favourite brand (Frontify, n.d.). On a separate note, big stores have the events and experiences that the company sponsors. For instance, Whole Foods UK often arranges cooking classes with chefs. As a result, these promotion strategies, such as organising different events, may help the firm reach a wider audience. Maintaining recognition amongst customers and making them loyal are the natural effects that stem from continuous positive experiences associated with the brand (Frontify, n.d.). Besides, the health foods business provides discounts to its customers (Whole Foods UK, 2021, n.p.) It is one of the effective methods of sales promotions that helps to increase clients’ loyalty.

The company also uses public relations and publicity to boost sales and enhance the brand recognition in the United Kingdom. The company actively cooperates with local and regional PR firms for the purposes of gaining media outreach (Bradley, 2018). PR firms also helps to address a number of brand crises, such as supplier concerns, food safety issues, animal welfare protests, etc. The Amazon deal has impacted the organisational health of Whole Foods UK (Bradley, 2018). The company has not escaped the increased negative attention from the media due to incorrect assumptions, which lingered upon brand’s shift from local suppliers and products and reduced product quality (Bradley, 2018). The PR efforts help the firm to dispel inaccurate assumptions while highlighting the fact that Amazon’s accusation has not affected the company’s core values and strategies (Andrews and Shimp, 2017). The Amazon’s deal has contributed to the need to promote its priorities and unique selling points, such as high quality products and shopping experience. The support of PR organisation is an effective strategic approach to promote customers’ awareness and prevent and address negativity in the media.

Price

Premium pricing strategy is the strategy of choice for Whole Foods UK. This strategy works in the food industry where companies can offer strong competitive advantage. Whole Foods Market charges higher prices compared to options available in other UK supermarkets like Tesco. The premium price strategy is also based on the company’s focus on alignment with high quality standards that assure clients that products are worth purchasing (Andrews and Shimp, 2017). In its early years, the customers highly valued organic products that corresponded to quality standards and seemed to be willing to pay extra price for the quality of products and services being delivered (Blázquez, 2021). This pricing strategy impacted the perceptions of health foods products in the eyes of customers, convincing the latter in their superior quality (Hinterhuber and Liozu, 2018). The company embraces quality leadership, since the products’ price aims to convey high quality, which in turn helps the brand position itself as a quality leader. The quality leadership is effective in this case, as long as its natural products have highly valuable features to health-conscious customers. Moreover, shopping experience that is created with the help of store decor and service excellence can make consumers want to visit the store on a regular basis disregarding other alternatives with more reasonably priced products. The picture 2 shows ambiance created by warm tones and lightning at one of the Whole Foods UK stores in London.

Picture 2. Interior design at the Whole Foods UK store (Tricon Food Service Consultant, n.d.).

However, lately, Whole Foods Market has received a great amount of criticism for overcharging its customers. The target audience even referred to the health foods supermarket as “Whole Paycheck” (Blázquez, 2021). Even though the household income in the UK has steadily increased, the customers seem to be reluctant to pay the price that is far higher compared to that of the competitors. Figure 2 displays the increase in the median income during financial year ending 2019. The company may still rely on the premium price strategy but price reduction marketing technique can positively impact the market share and ensure larger sales. This approach will be particularly in line with a recent increase of average cost of healthy foods, that is worth £7.68 compared to £2.48 for junk foods option (Kelly-Linden, 2020). This means that the company needs to consider a slight reduction in prices to make sure their products become accessible to a wider range of population groups. Dropping the prices will enable the company to scale its customer base, thereby gaining more profits thereafter. Still, the company is recommended to continue to primarily pursue the premium price strategies in order not to affect the image of the brand that offers products of premium quality.  

Figure 2. Median income grew during financial year ending 2019

(Office for National Statistics, n.d).

Marketing Effectiveness Measurement

Analysing the lead conversion rate can help the business understand what marketing campaign has the best impact on return on investment. Evaluating the return on investment can be also necessary. Calculating the cost of each marketing campaign and its profits helps to understand whether it is necessary to proceed with this marketing approach. Given the fact the Whole Foods UK relies on social media marketing, examining the engagement rate is the key to evaluating marketing effectiveness. The company may also see how the engagement rate is changing over time to make conclusions regarding the effectiveness of its posts.

Conclusion

Whole Foods UK is a health foods supermarket chain which offers high quality organic products to the UK consumers. The company is well-known for its natural products free from preservatives and flavours. The company uses the differentiation strategy to position itself as a brand that deliver premium quality products. These products present a high value to health-conscious clients as well as those that have specific dietary preferences. The high quality products help the company to stand apart from other leading supermarkets that operate in the UK. The brand focuses mainly on the sales from physical stores while paying little attention to eCommerce. The COVID-19 pandemic has significantly impacted the business world creating new challenges as well as opportunities for entrepreneurship. Whole Foods UK can be recommended to focus on the online store as well to align with the current customers’ shopping behaviours. 

The main types of promotions include social media marketing, word of mouth marketing, advertising, sales promotion, and public relations and publicity. All these strategic decisions help not only promote the sales of products but also build a reputation of the market leader and prevent and address customers’ confusion or the spread of inaccurate information. From the beginning, the company adopted the premium price strategy, as long as the quality of foods and services appeared to be superior to those provided by the competitors. However, today customers seem to be dissatisfied with the price increases, so that the brand is faced with the need to consider the price reduction marketing technique. Effective implementation of marketing strategies and decisions in the marketing mix elements allows Whole Foods UK to thrive on the health foods market arena. In order to assess the effectiveness of marketing efforts, the company can analyse the lead conversion rate, calculate the return on investment, and examine the engagement rate.

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