Offering high-quality products and an attentive shopping experience, Woolworths dominates the South African retail market…
Woolworths is a household name in South Africa; a retail giant that has managed to maintain customer loyalty generation after generation. However, for Woolworths, being a market leader is about more than just their fiscal success: it’s about creating meaningful socio-economic transformation in South Africa. Founded over 86 years ago, Woolworths has a deep history in South Africa, garnering long-lasting support from customers who have remained loyal to the brand for decades. Yogan Naidu, Head of Non-Trade Procurement, cites the company’s rich heritage as the reason why it remains a market leader today.
“At Woolworths, we really pride ourselves on our rich history. I think the South African market really identifies with that because it is quite a historic and emotional market. Our core values give us a competitive edge because you can really see the impact we have made in the country. So, for instance, we were among the first local retailers to provide our employees with benefits that weren’t offered by some of our competitors at the time such as a pension fund, medical aid and maternity leave. I think our customers really identify with that.” A shopping experience like no other
Customer experience can make or break a brand, and it is a core value which is ingrained into the ethos of Woolworths. When designing a store, every minute detail is meticulously considered to ensure that it offers customers the ultimate shopping experience.
“If you look at the way that our stores are designed you can see that it’s a really comfortable place to shop,” reflects Naidu. “In my opinion, it’s the little touches and the customer service which makes Woolworths a market leader. So, for instance, something as simple as a grocery trolleys in one of our stores will be of a superior quality to that of our competitors.
“Not only do we pride ourselves on our hygiene standards and high-quality products, but we also make sure that we take care of you as a customer when you walk into one of our stores. We invest heavily in research and development and the renovation of our stores to ensure that the shopping experience is enjoyable for the customer.”
A visual brand
Visual merchandising and design is a vital tool that is embedded into Woolworths’ DNA. Over the decades, the company has worked alongside leading suppliers to source innovative, market-leading displays which connect with their customers on an emotional and visual level.
“At Woolworths, we really try to communicate with our customers,” says Naidu. “If you walk around one of our stores you’ll notice that with our packaging, store design, and visual merchandising, we really speak to our customers and inform them about issues that matter to us. So, for instance, when we talk about sustainability, we talk to customers about how much electricity we currently use and how this is provided by green energy. We make information publicly available in our store environment.
“Our suppliers, such as Global Display, are integrated into the business and that’s how we capture the customer’s imagination and deliver the ultimate customer experience. For example, if you walk into a Woolworths store during Christmas season you’ll see that our stores really embrace the festivities.”
Attracting only the best expertise
A smile at the checkout goes a long way in the world of retail and no one is more aware of this than market leader Woolworths. Naidu says that the company has a workforce of over 31,000 employees and that the pioneering leadership of the company is crucial to nurturing growth and inspiring productivity.
“Zyda Rylands, CEO of Woolworths South Africa, is such an inspirational leader. This year she won the global Woman of the Year award at the World Retail Congress retail awards in Dubai and our employees really look up to this. She drives us to better ourselves in terms of sales, social responsibility and customer experience.
“Similarly, in my career, a number of the people who have worked with me want to work with me again in the future and I think that’s what being a great leader is about – it’s about creating an impression on an individual’s life that stays with them forever.
“Our CEO Zyda has a passion to help others in the country. She shares her knowledge when visiting schools and encourages young girls to pursue careers in business. I don’t think we do that enough as leaders of corporate entities, especially in South Africa.” A greater responsibility
Corporate responsibility is a pressing issue in the business world and it is a value which Naidu is fiercely passionate about. “As a company, we have such a responsibility to stimulate the local economy so we’ve got to get out there, encouraging students, encouraging young entrepreneurs to look beyond the challenges or difficulties that present themselves on paper. I’m very passionate about it and that’s what we need we to help elevate the country.”
The challenge to be more responsible and sustainable is one which Woolworths embraces wholeheartedly with its proactive ‘Good Business Journey’. Launched over a decade ago, the bold plan hopes to make a difference in eight key areas: energy, water, waste, sustainable farming, ethical sourcing, transformation, social development and health and wellness. Achieving sustainability in a supply chain can’t be done overnight, but Naidu feels that the company is making significant strives to better South Africa as a country. Whether it’s saving 500bn litres of water or halving their energy impact by 2020, Naidu is confident that Woolworth’s is leaving a lasting, positive impact in the country. “We feel a higher responsibility in the retail sector. We want to be ethical and sustainable whilst being a market leader,” notes Naidu. “We’ve even relocated sweets and chocolate away from the tills in a bid to tackle childhood obesity in the country.” Continually innovating
Dominating the retail market for decades is an impressive feat, but for Naidu, the work doesn’t stop there. Innovation and continual growth are necessary for the retail giant to deliver its high-quality products and the ultimate customer experience. “I think Woolworths isn’t afraid to take leaps and to push boundaries in the company,” explains Naidu. “That’s another characteristic of the business, we’re not afraid to challenge ourselves. We don’t just accept that we’re a market leader; we’re constantly researching and reinventing how we can optimise it and make it better.”
An early adopter of technology, Woolworths was already using a computerised merchandising system by the early 1970s, and to this day the company continues to innovate in the sector and drive transformation.
“I think people who are afraid of technology or don’t see the value of technology in business don’t understand where the world is going,” Naidu says. “If companies don’t keep reinventing themselves from a technology perspective somebody else is going to come along and do it for them. Similarly, for a lot of companies nowadays, the supply base that you will have in 10 years’ time hasn’t even been invented yet. We embrace it as an organisation because not only does it create efficiency, it also gives you a global market reach that you never had before.”
The road ahead
As a retail giant, Woolworths has captured the hearts of the South African market. But with such visible successes, what is the company’s next move? For Naidu, the company is determined to work to help grow, transform and develop their employees and suppliers in the belief that people are at the heart and foundation of their business.
“We are really keen to engage with black-owned business and black, woman-owned businesses in particular,” concludes Naidu. “We want to explore opportunities with suppliers in the market and significantly improve how we support small business, create jobs, and transform the country. That’s our vision for Woolworths and that’s what I am really passionate about.”
Question One (15 Marks)
Consider the information in the case study and critically evaluate the performance of the Woolworths brand.
Question Two (25 Marks)
“We want to explore opportunities with suppliers in the market and significantly improve how we support small business, create jobs, and transform the country. That’s our vision for Woolworths and that’s what I am really passionate about.”
Critically analyse the vision of Woolworths as put forward by Naidu. As a follow up to this, propose a vision for Woolworths.
Question Three (30 Marks)
Consider the facts in the case study and the expectations of society as well as community standards. With reference to the case study, critically discuss the stakeholders of Woolworths and their expectations?
Question Four (30 Marks)
Discuss the role and importance of business governance with reference to Woolworths.
Answers to Above Questions on Woolworths
Answer 1: An analysis of the given case study on Woolworths indicates about the performance of the brand, and it is analysed that the company has a good brand loyalty and long history in South Africa. The company has a strong brand value and it is recognised by its customer as a premium brand in South Africa. The performance of the company also indicates that it is highly conscious with respect to its social responsibility, and undertakes significant initiatives to enhance its social and corporate footprint.
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