The Success of Whole Foods Market - Case Study Example

Whole Foods Market Segmentation Topic Models of Attitudes change The success of Whole Foods Market is attributable to its ability to convince up-market customers to buy high prices for its natural, local foods since they have a belief that these foods are healthier. The strategy of attracting these customers is based on the fact that many customers hold the misconception that healthy foods are more expensive than others. In this regard, Whole Foods Market should change such attitudes with the intent of capturing the new market. Part 1 With the notion that organic foods are expensive, it is apparent that Whole Foods Market needs to develop mechanisms of erasing such misconceptions if it has to establish itself in such a market. Tri-component model which is expressed through sequence cognitive-affective-conative can be utelised by Whole Foods Market towards this effect. This denotes that Whole Foods Market should first engage in informing the potential customers of the importance of the organic food and then work towards lowering the prices. This can be achieved by packaging its foods into different sizes that would enable such customers afford to buy. When this is done, the feeling of affordability will be created to the customers and they will be eventually buy Whole Foods Market foods. At the end, customers would buy the recommended products and succeeed in weakening any misconception that bar them from buying the products. In fact, when a few of them get the experience of the products, they would recommend the products to other customers. However, this has to be accompanied by other complementing strategies. The company should produce high quality products and offer good customer service. Customers are considered to be rational in consumption. Therefore, they tend to purchase from stores that meet their current needs. If Whole Foods Market is unable to meet different customer needs, there is a high possibility of the customers would shift to other companies offering similar products. Part 2 For Whole Foods Market to be able to change some of the negative attitude of customers that bars them from buying the organic food, the company should concentrate on changing the motivation function. This can be achieved by offering cheap organic foods that would negate the customers’ misconception that organic foods are expensive. Additionally, this can be done strategically by focusing on the group that has such misconceptions with the intent of proving that Whole Foods Market foods are of high quality and affordable to all. Additionally, if the customers have a different belief that seems to favour Whole Foods Market’s competitors, the company should ensure that they counter these beliefs by offering similar products that gives a competitive edge. With this in mind, there is likelihood that the customers would change their attitude towards the brand. Topic 3: Whole Foods Market Segmentation Market segmentation is considered as a market strategy used by organisations to strategise on how to reach a broad market that has diverse cultures and different consumption behavior. Whole Foods Market has been able to successfully segment its market in regard to offering largest selection of organic, healthy foods that has distinct appealing to its customers. The decision to have luxury brand image has enabled it to acquire a substantial market share. This has helped in building brand and corporate image that most people like being associated with since the brand centers on values of the environment and the quality of the foods that people enjoy eating. The approach Organisations that need to succeed in developing and maintaining competitive advantage have to come up with good market segmentation. For Whole Foods Market, the company has to segment the market by targeting customers in regard to their different statuses. For instance, Whole Foods Market may decide to produce products that meet the needs of low income earners. This may be in line with the residential areas of the target customers. People in informal settlements would require low price products. The company can ensure that it packs its products into different sizes that would make it possible for some people to afford them. Some people prefer distinct packaging that associates them with their social status. Highly educated people would not mind purchasing distinct packaging products at a higher price because they feel their status allows them to. Low earning people with lower education would not worry much about the packaging style used for different products provided they believe that the products are of high quality. Segmentation variables Whole Foods Market can consider producing foods depending on the geographic location of its customers. This entails market research on potential customers that do not have the experience of the company’s products. Therefore, this would enable the company to decide on the new markets to venture in order to capture the new market. Different things such as the distance of the target market from the nearest store and the cost of operating the business in such areas are worth understanding. Additionally, demographic factors are also critical in that different people have distinct preferences in regard to consumption of products. It also means that the more densely populated an area is, the more potential customers are there. Different people have different socio-cultural characteristics that distinguish their consumption behavior. Whole Foods Market should consider entering new markets that have diverse culture and social class. The company should also consider the usage rate, awareness, and brand loyalty of the target market. This way, the company can strategise on how to improve the awareness, create loyalty to customers and use different tactics that would increase the usage rate. Additionally, situation segmentation would also help the company in determining the right time to introduce its products. This should be guided on the objective of promoting the brand in target population in selected locations. Since Whole Foods Market already understands that the target market accept organic foods, but concerned about the prices, the company should strategise on convincing the customers about the value of customer’s money when they buy its products. Topic 5: Theory of Motivation Consumption behavior of the new market denotes what motivate them to purchase particular products from other companies. For instance, personal health remains a strong motivating factor for people to purchase organic food. However, some consumers identify not only with the health and environment, but support the local farmers as being part of their motivation. In a different dimension, different customers from different countries are motivated to consume organic food depending on their culture. For example, some customers of Whole Foods Market have been quoted saying that the company ignores local produce. This is an indication that the company has to consider preferences of customers depending with what motivate them to buy. However, since consumption behavior depends on whether it is acquired or innate, Whole Foods Market must have a comprehensive research in order to understand specific consumption behavior. Apparently, acquired needs become easy to satisfy since it means that the customers slowly acquire them thus, it would also be possible for Whole Foods Market to attract such customers by focusing on things that can motivate them. In regard to innate needs, Whole Foods Market may decide to produce products that meet such needs because it is difficult to tame such customers or even to change their preferences. Hierarchy of issues The main goal of Whole Foods Market as presented in the case study is to focus on value and price. Therefore, the emphasis should be on the quality of the foods and the health related benefits. In light of this, the company would be better positioned to attract customers that are motivated by the need to have healthy foods and those that need quality foods. Therefore, Whole Foods Market should focus on understanding the preference of specific brands by certain groups of people. However, consumption of certain products is dependent on both the positive and negative motivations. People that have positive motivation believe that organic food is good for their health. People with negative motivation believe organic foods are too expensive. Therefore, it is indispensable for Whole Foods Market to evaluate these motivations and offer products that suits every consumer. The company should concentrate on adding value to the food and lowering its prices to capture the attention of people with negative motivation. With regard to application of Maslow’s concepts of motivation, Whole Foods Market should focus on the social status of different customers to determine the kinds of products to produce for every social group. Some people feel that consumption of certain products caters for their psychological needs. This is the case in light of the notion that organic foods are healthier than natural foods. Other people purchase organic foods on the concept of security. Such people believe that they need to have good health. Additionally, Whole Foods Market should understand that some people consume organic foods for satisfaction of esteem needs. With this understanding, product promotion would be based on the perception that organic foods satisfy customers and most of them enjoy eating them. Therefore, enhancement of the quality of its products is necessary since it will help it in attracting customers with esteem needs to purchase them. Some customers’ consumption behavior is dictated by their current achievements or what they want to achieve. For instance, some customers believe that their current job status should match the products they purchase. Others wish to purchase products that match what they want to achieve. Therefore, Whole Foods Market should ensure that all of its products meet the criteria of categorizing customers depending on their achievements. Some other people believe that their status in regard to the positions they hold requires a matching pick up line in regard to what they choose to purchase. Organic foods are considered vital to such people since they believe they have the capacity to purchase them. Whole Foods Market should ensure that such a group of people is well taken care of by a way of producing products that matches their needs. Read More