Introduction
ALDI is a German Based Discount Supermarket Chain. Albrecht Discount is the full form of ALDI. The Supermarket Chain consists of two main groups. ALDINORD and ALDI SUB. However both groups are independent in their operations and work within the specific market grounds. The individual groups were originally owned and managed by brothers Karl Albrecht and Theo Albrecht. The company has transformed from a small business to one of the most successful and valuable retail business chain with an annual estimated turnover of 53 billion Euros, over 9,000 stores in 18 countries and around 100,000 employees around the world. ALDI operations are mainly based on the limited Assortment Concept - The high quality range of goods sold in the store was initially limited to a basic selection of goods to be purchased in large quantity, sold at realistic prices and presented in simple way. At ALDI, everything from building shop, selecting suppliers, locations and selling goods, is done to make possible considerable savings with the discount always passed on to customers in the end price.
ALDI have introduced Cart Rental System. Customer need to put one coin in the grocery Cart and gets back the coin when the Cart is returned. This mechanism will cut off the need to hire employees whose job is to retrieve the grocery cart. The grocery industry has been revolutionized with a unique business model by ALDI that enable them to provide the highest class product at the lowest prices. ALDI is also an intriguing organization, chiefly on account of its single-mindedness. The company is a little eccentric, but then most highly successful operators have a pathological edge. By all accounts, working with the late Steve Jobs must have been one of the most inspiring experiences; but his obsessiveness also drove people to despair. Intel’s legendary former CEO Andy Grove openly embraced the notion that ‘Only the paranoid survive’. ALDI’s founders’ evangelical zeal for keeping costs down and operations simple is in the same category. Remarkably, the organization preserved this obsession despite the retirement and death, respectively, of Karl and Theo Albrecht, and it has successfully transplanted it to operations in foreign markets. In increasingly competitive markets, consumers have a greater choice over where they buy their goods and services. For an organization to meet its business objectives, it has to find out what consumers require and then identify the best way in which it can satisfies these needs and wants. Creating a competitive advantage can be difficult. A unique marketing strategy with clear objectives is vital to ensure effective promotional activity. But ALDI has identified a unique position within a competitive marketplace.

Literature Review
Scientific and technological revolution have shaped an effective and innovative business order .Since the source of information and information procedures have become rapid and convenient ,the business atmosphere has turn out to be more chaoetic.Consumers are showing their buying capacity with an expectation of high quality for reasonable price. As there are liberal policies, new products and services are launching every day in to the market. Information technology plays a crucial role in the business world with up dated information and rapid way of communication.
A unique marketing strategy with clear objectives is vital to ensure effective promotional activity. Since opening its first store in 1913, ALDI has established itself as one of the most reputable retailers in the global business market by providing great value and quality. ALDI’s goal is simple; ‘to provide our customers with the products they buy regularly and ensure that those products are of the highest possible quality at guaranteed low prices’. ALDI’s products are sourced from hand-picked suppliers whose products are sold under ALDI’s own brand labels. ALDI’s main marketing objective is to grow its market share within the UK grocery market. With the economic crisis came an increased demand for value for money. Market research identified that 80% of ALDI’s customer base also shopped at other supermarkets. These customers spent around £20 billion per year in the other stores. ALDI’s marketing strategies therefore focus on generating customer loyalty. ALDI focuses its marketing efforts on encouraging customers that are already familiar with the brand to shop at ALDI more often. Another key focus of ALDI’s marketing strategy is on demonstrating that ALDI brands are of equal quality to well-known brands such as Heinz and Fairy Liquid. To do this ALDI ran blind taste tests amongst a cross section of shoppers. These confirmed that the majority of consumers that liked the famous brands also liked ALDI’s brands. These findings formed the basis to ALDI’s ‘Like Brands’ marketing campaign. This provided ALDI with a platform to communicate its quality and value messages effectively.
The price war among supermarkets does really benefit the customers in recession time. But the major discount supermarkets like ALDI cannot get the all grip on the retail markets as they had it at early stage. It’s not able to maintain the position in the market as cheapest retailers because of tough competition from rivals. This project hopes to discuss some of the trends among major supermarkets like Tesco, Asda& Sainsbury's in pricing to compete with discount retailers such as Lidl and ALDI.it also focus on the strategies made by the mainstream supermarket chains to overcome the recession effects.

Body of the Report

Ouestion-1:Describe what is meant by the term Marketing?
Answer:
The chartered Institute of Marketing describes the term ‘Marketing’ as the process responsible for identifying, anticipating and satisfying consumer requirements profitability. Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. Many people, working in professional marketing capacities, don't really understand the word marketing, but do not need to, in order to do a great job.
A marketing mix is a complex set of variables. The marketing mix of every business will be different. Aldi’s mix focuses on providing high quality products that are cheaper alternatives to famous brands. Aldi’s marketing mix therefore focuses on:

Figure 1: Marketing Mix

* Product – high quality ‘Like Brands’. * Price – Aldi offers lower prices than its competitors without compromising on quality. * Place – Aldi outlets are expanding globally. * Promotions – Aldi uses a combination of above-the-line and below-the-line promotions with a focus on its ‘Like Brands’ and ‘Swap & Save’ campaigns.
When you use the marketing input of highly trained marketing experts, at the highest level of management, improved marketing management flows down into all levels of marketing activity increasing your business efficiency and return on equity.

Ouestion-2:Explain why is it Important to balance the marketing mix?
Answer:
It is important to provide high quality products to the consumer at reasonable price. Marketing mix is a complex set of variable. Marketing mix of every business is different. ALDI’s mix focuses on providing high quality products that are cheaper alternatives to famous brands.
Organizations need a balanced marketing mix to meet the needs of its customers. ALDI’s focus is on offering the best possible quality products at the lowest possible prices. Every buyerfor ALDI,from fresh fruit and vegetables tomeats and electronics, is anexpert in their field. They look for products from around the world.This enables them to get the finest quality products that ALDI thensells under its own brand labels.Selecting the prices is one of the most difficult considerationswhen developing a marketing mix. Different pricing strategies thatare commonly used include: a) Market penetration – charging lower prices for new products to help them enter the market and gain market share quickly b) Competitive pricing – pricing at a slightly lower prices than competitors. c) Strategic pricing – emphasizing the quality or brand positioning of a product to allow a higher price to be charged.
Competitive pricing is a key strategy for ALDI. ALDI is able to offer quality products at low prices as it buys in great volume. The factthat ALDI buys such large quantities of these products allows greatleverage for negotiating the best possible prices with its suppliers.This is called economies of scale. Buying large quantities of eachproduct allows ALDI to pass these savings to its customers.
Consideration of the marketing mix elements and how they fit together is the basis of your marketing program. For a long time it called them the 4P’s because it was easy to remember.All elements from the Marketing Mix have an interaction on and with each other. If you have a product, you will have to create a price and sell it. The way you communicate this product will make it either more or less visible to your target market. The price you ask for the product will infer a special quality. If you communicate effectively about the product, it will need to be for sale in a place where your target market has access to it. These elements, product, price, place and promotion all influence each other.
In addition to the traditional 4Ps it is now customary to add 3 more Ps to the mix to give us 7Ps. The additional 3Ps have been added because: * Marketing is far more customer service oriented than ever before. * More products are augmented with service elements to gain competitive advantage.

Figure2: 7p’s of marketing.

Customer service lies at the heart of modern marketing transactions as a mechanism for building long term customer relationships of mutual advantage. Customers are loyal to businesses that serve them well, from the way in which a phone or email query is handled, the timeliness and reliability of product.
When trying to balance the different elements, it is very important to understand the market in which you want to sell. You can see how each element of your marketing mix plays a specific role that works collectively with the other elements to:

* Define the right offer and price * Establish awareness * Nurture the customer relationship * Get the desired sales response
From the above discussion it’s clear that most small businesses understand the marketing mix; but finding the right marketing mix balance takes time to put together. As long as your customers are leading your marketing program, you’ll find the right mix every time. That’s why it is important for an organization to balance marketing mix.

Ouestion-3:Analyze the factors that might affect the location of a new ALDI’s store.
Answer-3:
Being in the right location is a key ingredient in a business's success. If a company selects the wrong location, it may have adequate access to customers, workers, transportation, materials, and so on. Consequently, location often plays a significant role in a company's profit and overall success. A location strategy is a plan for obtaining the optimal location for a company by identifying company needs and objectives, and searching for locations with offerings that are compatible with these needs and objectives. Generally, this means the firm will attempt to maximize opportunity while minimizing costs and risks.
A company's location strategy should conform with, and be part of, its overall corporate strategy. Hence, if a company strives to become a global leader in telecommunications equipment, for example, it must consider establishing plants and warehouses in regions that are consistent with its strategy and that are optimally located to serve its global customers. A company's executives and managers often develop location strategies, but theymay select consultants (or economic development groups) to undertake the task of developing a location strategy, or at least to assist in the process, especially if they have little experience in selecting locations.
Formulating a location strategy typically involves the following factors: * Facilities: Facilities planning involves determining what kind of space a company will need given its short-term and long-term goals. * Feasibility: Feasibility analysis is an assessment of the different operating costs and other factors associated with different locations. * Logistics:Logistics evaluation is the appraisal of the transportation options and costs for the prospective manufacturing and warehousing facilities. * Labor:Labor analysis determines whether prospective locations can meet a company's labor needs given its short-term and long-term goals. * Community and site:Community and site evaluation involves examining whether a company and a prospective community and site will be compatible in the long-term. * Trade zones:Companies may want to consider the benefits offered by free-trade zones, which are closed facilities monitored by customs service’s where goods can be brought without the usual customs requirements. The United States has about 170 free-trade zones and other countries have them as well. * Political risk: Companies considering expanding into other countries must take political risk into consideration when developing a location strategy. Since some countries have unstable political environments, companies must be prepared for upheaval and turmoil if they plan long-term operations in such countries. * Governmental regulation:Companies also may face government barriers and heavy restrictions and regulation if they intend to expand into other countries. Therefore, companies must examine governmental—as well as cultural—obstacles in other countries when developing location strategies. * Environmental regulation:Companies should consider the various environmental regulations that might affect their operations in different locations. Environmental regulation also may have an impact on the relationship between a company and the community around a prospective location. * Incentives: Incentive negotiation is the process by which a company and a community negotiate property and any benefits the company will receive such as tax breaks. Incentives may place a significant role in a company's selection of a site.
Depending on the type of business, companies also may have to examine other aspects of prospective locations and communities. Based on these considerations, companies are able to choose a site that will best serve their needs and help them achieve their goals .A business will have to consider many factors when determining where to locate a new branch or operation. Usually, it will have to balance several factors in making a decision. Sometimes one factor may sway the decision: 1. It may choose a site with the cheapest land or buildings. 2. It might decide on a location that is convenient for key employees. A business needs to be able to recruit staff with the right skills base. 3. It might choose a site that has easy access to raw materials. For example, many frozen food factories are located near fishing ports to reduce transport time taken and to keep fish fresh.
The key factor could be the transport and service infrastructure. Many businesses require easy access to good road and railway links and modern telecommunication services. These ensure that they can meet service or delivery deadlines.Enterprise also needs to be open to changing customer demand. For example, a major new housing development may generate a new source of customers in an area. The growth of residential housing could also encourage new businesses, such as shops and offices, to open nearby to provide services and goods to this new market. Enterprise needs to be in a position to adapt its locations to meet any changes in its market efficiently.
So from the above discussion it is identified that there are some factors that might affect the location of a new ALDI’s store in UK which are discussed below:
Factors that might affect the location of a new ALDI’s store:-
1. They keep their store layout simple so that the wastage can be minimized and as a result of that it will keep the costs low. This will ensure that people or customers of ALDI’s will get best quality products at lower prices.
2. They kept into account the demographic factor of the area where the store is located.
3. People visiting the store should be maximum and this can be ensured by better connectivity. Good transport facility availability should be there.
4. They emphasized that the store should be located in the heart of the city to ensure access to large number of consumers.
5. Store should have good visibility and this can be ensured by having the store near the main road.
6. One most important factor was they ensured that the store should be in a location where there is very less to no competition.
From the above discussion it is recommended that ALDI should take consideration while selecting the new store location. Because location play a vital part of company’s success and for the ALDI is it very much important to choose a best location where they can serve their customer with the best quality in product in a lowest price.

Ouestion-4:Evaluate how ALDI has identified a unique positionwithin a competitive marketplace.
Answer:
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”. 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 from the other competitors. Ideologies which establish them a unique positionwithin a competitive marketplace are given below:
IDEOLOGIES

1. Upgrade image 2. Existing customers 3. Target new markets 4. Expend offer 5. Be the best employer 6. Look to the future 7. Promotion 8. Huge savings 9. Excellent Quality 10. Outstanding value 11. Position of Store 12. Buy with confidence 13. Competitors 14. Differentiate

Figure 3: Ideologies which establish a unique position within a competitive marketplace.

* Huge savings:ALDI has a tendency of huge savings. ALDI save their profit for the future to capitalize an opportunity to capture the raw materials in a lowest possible price. * Excellent Quality: Another factor that makes a unique position in competitive market place is providing the product in lowest price without considering products excellent quality. * Outstanding value:Aldi offers lower prices than its competitors withoutcompromising onquality.Its make them a unique position in the marketplace. * The position of store:Aldi focuses on edge of the town centre locations with good visibility from a main road and not too much competition the accessibility of the store and its public transport links the number of parking spaces available. * Buy with confidence:ALDI ensure the good product quality within lowest possible price so that their buyers can buy the products with confidence. * Competitors:Find out who your competitors are, what they are offering and what their unique selling point (USP) is. This identifies the areas you need to compete in, as well as giving you a platform for differentiating yourself. ALDI focuses on price of their competitors. * Differentiate: It’s essential to give your customers good reasons to come to you rather than a rival. Your USP should tap into what customers want and it should be clear. ALDI differentiate themby setting lowest price than the others. * Update image:Simple steps such as painting the front of your premises can make your business look more modern and inviting. ALDI look at their business cards, stationery, website, branded packaging, clothing and so on. It develop ALDI’s image. * Look after existing customers:They will be the competitors' target market. Provide bettercustomer service by being more responsive to their needs and expectations. ALDI feasible it by offering low-cost extras such as improved credit terms, discounts or loyalty schemes - remember, it's cheaper and easier to keep customers than to find new ones. * Target new markets: Selling into a greater number of markets can increase the customer base and spread the risk. Consider whether it can sell online or overseas. ALDI has over 9,000 stores in 18 countries and around 100,000 employees around the world. * Expand offer:ALDI offer excellent quality within lowest possible price to their customer. It makes a unique position in the competitive marketplace. * Be the best employer: Skilled, motivated staff underpins vibrant, growing businesses. But attracting those means more than paying a competitive wage - people are often more impressed by a good working atmosphere and benefits such as flexible working and structured career development. ALDI retain the best employer by meeting their needs and wants. * Look to the future:ALDI focuses on their future. They try to capture the whole market with the good quality and lowest price for the future betterment.

* Promotion:For Aldi to achieve its objective of increasing its market share, ithad to ensure its promotional activity demonstrated the balance ofits marketing mix. For example, to increase customer loyalty it hadto communicate its key quality and value messages. Promotion helps to:
• Increase awareness and improve brand recognition
• Increase demand for products
• Improve brand image
• Highlight the superiority of products and services.

ALDI focus on two types of promotion which are given below:

Promotion

Above the line promotion
Below the line promotion

Figure 4:Classification of promotion.

* Above-the-line promotions:Above the line promotionpaid-for advertising aimed at a massaudience. These include the mediasuch as television, radio, magazines and newspapers that reach a large number of people.This forms of promotion can be costly. It can also be difficult to targetspecific audiences. Aldi uses a range of above-the-line methods toreach its customers and potential customers. These include:

i. Advertising on TVThe ‘Like Brands’ campaign features 20second TV adverts which focus on a particular product. Theadverts show a famous brand as a benchmark for qualityside-by-side with an Aldi brand product. They use the slogan‘Like Brands. Only Cheaper’. This reinforces the message thatAldi products are cheaper than leading brands but equal interms of quality. The adverts provide personality to the Aldibrand. They use humor which helps to build trust and anemotional connection with target audiences. ii. Printed leaflets are distributed within stores (1 million copiesprinted per week) and also to customers living in areassurrounding stores. These leaflets help to reinforce the ‘LikeBrands’ campaign. They also showcase products with limitedavailability and seasonal offers available in stores. iii. Newspaper adverts extend the ‘Like Brands’ campaign and help to showcase a variety of product categories. They also communicate Aldi’s ‘Swap and Save’ message. This campaign demonstrates the amount that shoppers could save if they swapped their weekly shop to Aldi. They compared Aldi products to famous brands to demonstrate Aldi’s value for money message. iv. In store posters are also used to highlight the ‘Swap and Save’ message.

* Below-the-line promotion:Below-the-line promotion uses different ways to engage withcustomers. These methods can bemore easily targeted tospecific audiences than above-the-line methods. They offer organizations a greater level of control over their communications.
Aldi uses a range of below-the-line methods. These include:
• Social media
• Targeted e-mails to customers
• 3rd party endorsement and awards
• Public relations and media relations.

In the above mentioned factors make ALDI a unique positionwithin a competitive marketplace.Aldi has a distinct approach to retailing that has given it acompetitive advantage in a crowdedmarketplace. Aldi’s uniquebalance of the marketing mix enables it to provide high quality,own branded products at the lowest possible price. Aldi’sinnovative ‘Like Brands’ and ‘Swap & Save’ marketing campaignsare improving brand perceptions. They are aiding the achievementof Aldi’s marketing objectives. The campaigns have increasedAldi’s sales per store by +100% over 3 years through creatingmore loyal customers. Its multi-channel promotional activity isengaging consumers and creating positive feedback.

References

1. http://en.wikipedia.org/wiki/ALDI. 2. http://files.aussiehome.com/cmsFiles/261/file/Uk's_Foreign_Investment_Policy. 3. A.Thompson, A. S. (2001). Strategic Management: concept and cases. 4. Uk Food & Grocery Council retrieved from .http://www.afgc.org.au/whoweare.html. 5. http://www.ukessays.com/essays/marketing/the-strategy-of-ALDI-grocery-stores-in-Uk. 6. http://www.businesscasestudies.co.uk 7. http://www.ALDI.co.uk

Appendices
Criticism:
In April 2000, Aldi UK paid damages to a shop manager who was fired for being HIV-positive. Aldi reached an out-of-court settlement with Mark Hedley (who had been manager of the Aldi supermarket in Seaham, County Durham) shortly before an employment tribunal hearing. Hedley complained of discrimination after he was asked to leave because bosses said staff was uncomfortable around him. It is thought the damages paid to Hedley were "six figures".
In 2013 Aldi Germany was criticized for spying on its own staff, in the same year it was also caught up in the horse meat contamination scandal along with Tesco and others. On 8 February 2013, the store group admitted that some of its frozen lasagna and Spaghetti Bolognese products contained 30% — 100% horse meat rather than the advertised beef and that it had terminated the supplier responsible for the adulterated product.
Geographic distribution: Country | Name | Aldi group | Since | Outlets | Germany | Aldi | Nord | 1946 | 2,400 | | Aldi | Süd | 1946 | 1,790 | Australia | Aldi | Süd | 2001 | 311 | Austria | Hofer | Süd | 1968 | 430 | Belgium | Aldi | Nord | 1973 | 380 | Denmark | Aldi | Nord | 1977 | 244 | France | Aldi | Nord | 1988 | 680 | Hungary | Aldi | Süd | 2008 | 85 | Ireland | Aldi | Süd | 1998 | 105 | Luxembourg | Aldi | Nord | 1990 | 12 | Netherlands | Aldi | Nord | 1975 | 406 | Poland | Aldi | Nord | 2008 | 72 | Portugal | Aldi | Nord | 2006 | 36 | Slovenia | Hofer | Süd | 2005 | 71 | Spain | Aldi | Nord | 2002 | 227 | Switzerland | Aldi Suisse | Süd | 2005 | 130 | United Kingdom | Aldi | Süd | 1989 | 512 | United States | Aldi | Süd | 1976 | 1,300 | | Trader Joe's | Nord | 1979 | 418 | Total number of Aldi Nord stores | 4,875 | Total number of Aldi Süd stores | 4,734 | Combined total of Aldi stores | 9,609 |
Table 1: Geographic distribution of ALDI.