Case 14 Whole Foods
CASE 14 – WHOLE FOODS
Whole Foods is a retailer that specializes in organic foods and it has done an excellent job of determining its target market and how to position itself. Instead of going head to head with large food retailers such as Wal-Mart, Whole Foods has found a niche market that works perfectly for itself. This niche market is one that prides itself on being health conscious and environmentally responsible and Whole Foods has done a great job of positioning itself in the same way through its environmentally safe actions and its use of the local community to stock its stores. However, as Whole Foods grows and expands, a person has to wonder if the company will be able to maintain this same position or will have to make sacrifices if it wishes to grow.
QUESTION TWO
Organic foods are becoming very popular. Many chains, including Wal-Mart, have begun offering and expanding their selection of organics. Does this pose a competitive threat to Whole Foods?
I believe that some of the larger store chains such as Wal-Mart may pose a competitive threat to Whole Foods by taking a portion of their sales away from them. According to the Food Marketing Institute, organic food is available in 82% of mainstream supermarkets and some food organizations say mainstream grocery stores account for a majority of the organic food sales. Due to these factors, Whole Foods is most likely losing some of their sales to the mainstream supermarkets. However, because of how Whole Foods has positioned itself in the organic food market, I believe that its position reduces the competitive threat from mainstream grocery stores as Wal-Mart. Whole Foods has chosen not to directly compete with the larger chains and therefore has chosen to market to a niche market. Even though larger chains are offering organic foods, the consumers in this niche market choose to shop at a store such as Whole Foods for factors that they consider more important than price. Therefore, even though
Whole Foods is a retailer that specializes in organic foods and it has done an excellent job of determining its target market and how to position itself. Instead of going head to head with large food retailers such as Wal-Mart, Whole Foods has found a niche market that works perfectly for itself. This niche market is one that prides itself on being health conscious and environmentally responsible and Whole Foods has done a great job of positioning itself in the same way through its environmentally safe actions and its use of the local community to stock its stores. However, as Whole Foods grows and expands, a person has to wonder if the company will be able to maintain this same position or will have to make sacrifices if it wishes to grow.
QUESTION TWO
Organic foods are becoming very popular. Many chains, including Wal-Mart, have begun offering and expanding their selection of organics. Does this pose a competitive threat to Whole Foods?
I believe that some of the larger store chains such as Wal-Mart may pose a competitive threat to Whole Foods by taking a portion of their sales away from them. According to the Food Marketing Institute, organic food is available in 82% of mainstream supermarkets and some food organizations say mainstream grocery stores account for a majority of the organic food sales. Due to these factors, Whole Foods is most likely losing some of their sales to the mainstream supermarkets. However, because of how Whole Foods has positioned itself in the organic food market, I believe that its position reduces the competitive threat from mainstream grocery stores as Wal-Mart. Whole Foods has chosen not to directly compete with the larger chains and therefore has chosen to market to a niche market. Even though larger chains are offering organic foods, the consumers in this niche market choose to shop at a store such as Whole Foods for factors that they consider more important than price. Therefore, even though
References: Brady, Diane. (2005). Eating Too Fast At Whole Foods. Businessweek. Retrieved from http://www.businessweek.com/magazine/content/05_43/b3956106.htm. Chait, Jennifer. (n.d.). How Do We Know Who the Top Organic Retailers Are? About.com. Retrieved from http://organic.about.com/od/marketingpromotion/f/How-Do-We-Know-Who-The-Top-Organic-Retailers-Are.htm. Chait, Jennifer. (n.d.). Top 5 Largest Organic Retailers in North America 2010. About.com. Retrieved from http://organic.about.com/od/marketingpromotion/tp/Top-5-Largest-Organic-Retailers-In-North-America-2010.htm.