XXII Encontro de Iniciao Pesquisa

Universidade de Fortaleza
17 21 de Outubro de 2016

How to implement a product by using the Ansoff Matrix on the example of a

german supermarket ALDI

Davina Hbler, Christian Hauck, Mirjam Wittmann

1.UniversidadedeFortalezaPIBIC/CNPQ.
2.UniversidadedeFortalezaCursoDireitoBusinessStrategy:Prof.SergioForte.
3.BerlinSchoolofEconomicsandLawCursoPublicandNonProfit
Management
davinah@web.de,1chris26@gmail.com,mirjamwittmann@gmx.de.

Palavras-chave: Aldi,AnsoffMatrix,newmarkets,4Ps,ProductMarket

Abstract
As part of the course at Unifor Business Strategy taught by Professor Sergio Forte, we developed a paper
about a particular business tool in the practical application and use our knowledge as well as other research
opportunities. This paper will show, how ALDI is implementing new products, by using Ansoff Matrix, which is
a method to find diverse marketing strategies and long term strategies. Besides that it will be described how
ALDI uses the 4 Ps which means Placement, Product, Price, Penetration , another business tool to
investigate opportunities for entering new markets or enter common markets with new products .1The
investigation on the information was made by secondary research tools. Information were found and
evaluated from the internet database, advertisement of ALDI gave information about the marketing strategies
and results of customer assessments served as a database of customers demand. Furthermore a primary
research tool was used, which means the interviews answered by an employee of ALDI. All information were
evaluated and concluded by the analytical data software Excel.

Introduo

Nowadays Companies need to be more competitive, because of the rapidly change in our businesses. The
demand of the customers is growing and they are always asking for new, better, cheaper and different
products or services. Therefore its a big challenge for all companies in every sector to meet the demand and
to become more successful. Regarding to the current market situation the use of different business
strategies is essential. One Business Tool is the Ansoff Matrix, which helps enterprises to enter into new
markets with new products.2 In the following paper we discuss the advantages and barriers, which occur
during the process of the implementation of Ansoff Matrix at the example of ALDI which is a successful
German discounter with a various kind of products.3 ALDI is one of the biggest supermarkets in Germany
and even Europe, it was founded in 1913 by the mother of the Albrecht brothers. In 1946 the two brothers
took over the business and expanded the discounter. Today there are over 10,000 Stores in 18 countries with
a yearly revenue of 50 billion $. Example for barriers are costumer, competitor, economic situation, habitants
of the society.4 Benefits could be that the company oversees their competitors and the current economic

1 www.cleverism.com/understanding-marketing-mix-concept-4ps/
2 www.mindtools.com/pages/article/newTMC_90.htm
3 www.aldi.de/
4 www.marsdd.com/mars-library/barriers-to-entry-factors-preventing-startups-from-entering-a-market/
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situation. During the preparations for that paper we were thinking about what would be an interesting point to
work on. We came to the result to analyze if ALDI can successful implement a product like traveloffers by
using a business tool like Ansoff Matrix and also considering the strategy of the 4Ps? We assume that ALDI
is able to implement successful a product like traveloffers to new or to existing markets, by correctly following
the steps of Ansoff Matrix.

As a part of the course Business Strategy at the Unifor University of Fortaleza, which includes the
development of business skills, we were supposed to choose any kind of company and investigate how they
use one business tool. Therefore, we chose the Ansoff Matrix, which is a famous business strategy tool and
our knowledge we gained from the course at university. In general, a market should not be defined too
broadly (or too narrowly) since a key purpose of market definition is to allow a firm to develop strategy and
make decisions. In his 1957 paper, Ansoff defined a product-market strategy as a joint statement of a
product line and the corresponding set of missions which the products are designed to fulfil. For example,
one of Apples product missions might be to provide consumers with easy-to-use digital technology, and
another mission might be to provide fashion accessories for Yuppies and young people.

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Market Penetration: a strategy to increase sales without departing
Figure 1: www.mindtools.com
from the original product-market strategy. This involves
increasing sales to existing customers and finding new
customers for existing products; Market Development: a
strategy to sell existing products to new markets (normally
with some modifications). Ansoff described this as a strategy
to adapt the present product line to new missions. For
example, Boeing might adapt an existing model of passenger
aircraft and sell it for cargo transportation; Product
Development: a strategy to sell new products, with new or
altered features, to existing markets. Ansoff described this as a
strategy to develop products with new and different characteristics such as will improve the performance of
the [existing] mission. For example, Boeing might develop a new aircraft design which offers improved fuel
economy; Diversification: a strategy to develop new products for new markets, which can either be related
to the current business (e.g.vertical integration or horizontal diversification) or unrelated (e.g.lateral
diversification). Each of the above strategies represents a different path that a firm can take to pursue
growth. However, in practice, a firm will often implement more than one strategy at the same time. As Ansoff
notes, a simultaneous pursuit of market penetration, market development, and product development is
usually a sign of a progressive, well-run business and may be essential to survival in the face of economic
competition. This Paper is about the strategic management tool which was developed by Igor Ansoff and
first explained in his 1957 Harvard Business Review article entitled Strategies for Diversification. This
strategic planning tool provides a framework to help executives, senior managers and marketers to devise
strategies for future grow. According to Ansoff, there are four growth strategies in his matrix. By aiding clear
thinking about growth strategy, the Ansoff Matrix can help an organization avoid key risks such as:
Overlooking available growth strategies and Misunderstanding the implications of pursuing a particular
strategy; or selecting an inappropriate strategy given the firms diversification objectives. 5

Metodologia
We used a type of descriptive research and also one primary research tool. The process of research is
divided in 3 Phases. The first one was to create the question for the company, the second one was to ask the
question and the third one was to find the answers und evaluate this. We focussed on the qualitative point of
view. The company we chose is a german company so we used our knowledge and data base of the internet
and made an interview via telephone.

Period of Research:10.10.2016 - 07.11.2016

Phase 1: 1. What was the inspiration to offer a new and different product like travels? 2.How did you know
that you will reach new costumers? 3. Did you use special marketing strategies to reach the customers? 4.
Did you generate a revenue from the new product?

Phase 2 Using the elements of research for gaining the required information by choosing an employee of
ALDI. Besides that it was necessary to investigate the way of advertisements of this supermarket to see how
they advertise new products. Furthermore there were found some information from costumer assessments.
Secondary research was made with Statistics and public information from the website of ALDI.

5 www.wikipedia.org/wiki/Ansoff_Matrix
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Phase 3 We interviewed a friend of us, who is working as a cashier in an ALDI branch. We called him and
asked him some questions to give us a more clear perspective. The interview took 40 minutes. At first we
asked him the questions above, but he couldnt give us answers because he is not in a managing position.
We decided to change the questions to the following, so he was able to answer them.

Resultados e Discusso
Figure 2: www.aldi.de
Aldi (stylized as ALDI) is a
leading global discount
supermarket chain with
almost 10,000 stores in 18
countries, and an estimated
turnover of more than 50
billion. based in Germany,
the chain was founded by
brothers Karl and Theo
Albrecht in 1946 when they
took over their mother's
store in Essen which had
been in operation since
1913; it is one of the world's
largest privately owned companies. ALDI has a clear business philosophy and a number of guiding
principles. It can be summarized by following statement: "Top quality at incredibly low prices- guaranteed".
ALDI has got five main ideologies, to be precise 1) Huge savings, 2) excellent Quality, 3) Outstanding value,
4) Superb special buys and 5) Buy with confidence.

Organizational orientation can be of 4 types. ALDI is considered as mix of both Market Oriented as well as
Sales Oriented Organization. Let us discuss about types of orientation and then focus on some important
details on how ALDI is successful in grocery retail market by being mix of market and sales orientations.

"Production orientation is an approach to business that focusses its procedures on producing goods more
efficiently and cost effectively; presumptuous that price is the only factor significant to customers". "Product
orientation occurs where the focal point is given to product rather than the market. A product is prepared so
that it meets its own requirements and not that of the markets. The needs of the customers are less
important to that of the products".

"Marketing Orientated Organizations are treated as organizations wide generation of market intellect
pertaining to the current and future customer necessities, distribution of intellect across departments and
organization wide responsiveness to it. These companies get close to the customers in order to recognize
their needs and problems and come up with strategies accordingly so as to reach the expectations of the
customers and thereby satisfying them". (Kohli & Jaworski, 1999)

Market orientation consists of a three pattern of activities in the company, and has three dimensions, the
generation of, dissemination of, and the response to the market intelligence. (Grunert, Baadsgaard& Larsen,
1996). ALDI specializes in their own-branded labels rather than any other branded labels so that they can
control the cost and production processes. ALDI also stock non- food items such as clothes, health and
beauty products, fresh fruits and vegetables, stationery, household goods, electronic products, soft tools. The
process of distribution of products shows ALDI's pricing strategy used for being able to sell their products at
low price. This comes from ALDI's business model - Keeping high bargaining power over their suppliers,
ALDI can buy large quantities of stock to service all the shops across the country. Secondly Customers have
very limited amount of choices that enables ALDI to purchase one item per line that's keeps the price of
product low. We often analyse ALDI's special buys for technology gear and gagets. This
Wednesday's special buys are in a less frequent category for the supermarket giant: travel gear. We've run
through what's on offer to identify the best deals. If you're a regular traveller, the odds are good that you'll
already own versions of all the items in this list. If you're planning for an annual holiday and know that your
old suitcase is falling to pieces, seeing a bargain item at ALDI might tempt you. There are some good deals
in the week's offer, but many of the prices are similar to those you can find at other retailers. As with any
purchase, a little advance research can save you from impulse buys that are either not needed or actually
not that cheap. (Kidman, Angus 2012) Did your work change by the implementation of new products, like
the travels?

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Answer: I received a short introduction from our manager in order to know what they are selling. All the
information that customers need to book a travel they can find in the prospect. If they have more questions,
there is a hotline that they can call, where trained staff can answer all their questions. How does the
Marketing from these travels work?Answer: ALDI has a Marketing department which is responsible for the
advertisement of these new products. Mostly the brochures are given out in the local newspapers. But there
are also TV advertisements. Do you think that the travels were successfully implemented? Answer: Yes, I
think so. In the beginning I was sceptic about the success of this product, but the cheap price and great
travel destinations proved me wrong. Even in the shop that I am working in, they already sold many travel.

Concluso

We found out, that ALDI tries to implement many new products. They use different marketing strategies to
reach their customers and selling a huge variety of products. ALDI can implement new products as the
Travels by using the Ansoff Matrix in correlation with the 4 Ps. By selling the product on an existing and new
market at the same time, with a great price and a good variety of travels, they managed to implement this
new product successfully. it is imperative for firms to grow as otherwise their resources would not generate
the returns needed for the firms to make profits as well as deliver value to their shareholders. Moreover, firms
need to continually look for ways and means to increase their market share, which would help them create
value for their stakeholders. This is the reason why the Ansoff Matrix has become so popular because it
charts the strategies that the firms must follow in each option, which again is a combination of the firms
current capabilities, and the possibility of new market led growth. In conclusion, the Ansoff Matrix is very
relevant in these recessionary times as it can be applied by any firm wishing to either expand into newer
markets or leverage its existing capabilities.

We couldnt get the answers for our initial questions, because we didnt know anybody in a management
position at ALDI. This was our limitation.

Referncias

www.wikipedia.org/wiki/Aldi accessed in:01.12.2016, 12:33

www.ivoryresearch.com/writers/susan-gill-ivory-research-writer/ accessed in: 01.12.2016, 14:20
www.aldi.de/ accessed in: 02.12.2016, 14:44
www.ukessays.com/essays/marketing/an-analysis-of-aldi-marketing-essay.php accessed in: 02.12.2016, 15:20
www.mindtools.com/pages/article/newTMC_90.htm) accessed in: 02.12.2016, 15:34
www.ivoryresearch.com/writers/susan-gill-ivory-research-writer/ accessed in 02.12.2016, 16:10
www.ukessays.com/essays/marketing/an-analysis-of-aldi-marketing-essay.php accessed in 02.12.2016,
16:45
www.economicsonline.co.uk/Business_economics/Barriers_to_entry.html accessed in: 03.12.2016, 10:05
www.free-management-ebooks.com/dldebk-pdf/fme-ansoff-matrix.pdf accessed in 03.12.2016, 11:30
changingminds.org/disciplines/marketing/marketing_strategy/ansoff_matrix.htm accessed in 03.12.2016,
12:45
www.unternehmen.aldi-sued.de/de/ueber-aldi-sued/unser-unternehmen/ accessed in 03.12.2016, 13:30
www.wikipedia.org/wiki/Marketing-Mix accessed in 03.12.2016, 14:44
www.pestleanalysis.com/what-is-a-business-strategy/ accessed in 03.12.2016, 14:50
www.wikipedia.org/wiki/Aldi accessed in 04.12.2016, 15:30

Agradecimentos

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Thanks to the employee of ALDI and Prof. Sergio Henrique A C Forte for helping.