What Are The Trends Of Woolworths

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INDUSTRY TRENDS & ANALYSIS The retail industry grew by an annual average of 6 percent in the past eight years. However the recent economic environment has hindered growth. As a result, retailers have to fight fiercely for market share through better quality products, brand name and prices. Thus the industry has become more competitive and promotional. Woolworths however has largely been insulated from this due to its target market being the higher income groups with these groups being more driven by quality and convenience. The Mega-Shift Online One of the major trends in the industry worldwide is online shopping. Online shopping is a form of electronic trade whereby consumers use the internet to buy products that they require, these products are then delivered to their doorstep. During 2013, the number of online users expanded by 17%, to 14 million users, with greater and faster growth expected. Furthermore, this group of online users correlates very closely with the medium- to high-income sector of the population, which appears to have a strong pent-up demand for online services. Online shopping, in developed countries like Australia, is already very prominent and to disruptive to regular brick and mortar retailers, where in Australia around 7% of all sales are done through online retailers. This mega-shift in retail has resulted in retailers moving towards a more omni directional sales environment. Only two food retailers, Pick ‘n Pay and Woolworths, have launched limited online shopping websites, aimed at the higher end of the market. Currently, online retail sales in South Africa represents 0,4% of total retail sales for Woolworths but it grew 40% over the past year. For consumers who can access the internet one huge pro... ... middle of paper ... ...s and growth decelerates. Companies are focused on improving supply chains, while also working out how to generate more revenue per square metre of retail space. At Woolworths there is a close focus on improving profitability, in part through buying back former franchises to improve quality control of in-store operations and merchandising. Investments are being made in centralised distribution and advanced IT systems. Buying Loyalty Most retailers have introduced loyalty card systems, whereby customers can collect points by buying their goods and therefore qualify for discounts and other rewards. Woolworths’ and Pick ’n Pay’s systems are the most of advanced of the retailers, particularly as they serve the middle and upper class, who are well educated on saving and loyalty systems. These trends dominate and will continue to dominate the market in the years to come.

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