Marketing Report: Bunnings

Introduction

Bunnings are the top home and lifestyle goods retailer for residential and business customers in Australia and New Zealand (Bunnings 2021). The business is a significant supplier to residential construction companies, commercial tradespeople, and project builders. The company has established a strong brand and customer base over the years. However, the market is dynamic, and companies must continually assess their marketing activities to remain relevant and competitive. According to Kotler and Keller (2016), effective marketing strategies are crucial for companies to remain competitive in their industries. The purpose of this report is to review the company’s current marketing activities, Bunnings’ market segmentation, and positioning strategy. The marketing mix approach to determine areas for improvement will also be assessed. Lastly, recommendations will be provided to improve their marketing strategy.

Background

Bunnings started as a modest hardware shop in Western Australia in 1886. The business has grown over time to become Australia’s and New Zealand’s biggest retailer of home renovation products. Over 53,000 people work for Bunnings, which has over 507 trading sites (Diviv Group, no date). The organization’s success can be attributed to its emphasis on customer needs, a wide variety of products, and its aggressive pricing policy.

Market Analysis

The home improvement industry is highly competitive in Australia and has several players vying for a market share. Bunnings has also striven to remain competitive and maintain its position in the market.

Current marketing activities

Bunnings has an effective marketing strategy that combines traditional and digital marketing activities. The company’s marketing activities focus on increasing brand recognition, publicizing goods and services, and boosting revenue. Bunnings uses various advertising channels such as television, radio, print media, and online advertising to promote its products and services. The company’s advertising campaigns focus on product features, pricing, and promotions. Bunnings also sponsors several community events and sporting activities. The business supports various activities, including sports organizations like the rugby club, community events, and school initiatives (“Bunnings launches new initiative to help local rugby clubs upgrade their facilities” n.d.). Bunnings has a significant social media presence on Facebook and Instagram. The business engages with clients through social media platforms to market goods and services, share advice and tips, and interact with clients. Additionally, Bunnings provides a loyalty program that enables clients to accumulate points for in-person or internet purchases. The points can be redeemed for discounts or other rewards.

SWOT analysis

Market segmentation, Targeting, and Positioning (STP)

Market Segmentation

Market segmentation involves dividing the market into smaller groups of consumers with similar needs and characteristics (Helmold and Helmold 2020). Bunnings’ market segmentation strategy is based on demographic, geographic, and psychographic factors. Bunnings uses a segmentation strategy based on geographic, demographic, and psychographic factors. Bunnings also target customers based on their location, with a focus on both urban and regional areas. The company segments its market based on the following factors:

Demographic

This segmentation is based on age, gender, income, education, and occupation (Gajanova et al., 2019). Bunnings target a wide range of customers across all age groups, gender, and income levels. The business primarily focuses on homeowners, professional DIY enthusiasts, and people from all walks of life between the ages of 25 and 65.

Geographic

Bunnings operates in urban and rural areas in Australia and New Zealand. The business divides the market based on its stores’ locations to serve clients’ demands in various geographic areas.

Psychographic

Bunnings’ segmentation is also based on its clients’ values, personalities, and way of life. The company mainly caters to customers who appreciate DIY projects, gardening, and home improvement. Customers that value sustainability and environmental responsibility are another group that is targeted.

Behavioural

Bunnings divides customers based on their purchasing behaviour, such as frequency of purchases, purchase volume, and brand loyalty. The business mostly targets consumers who frequently make sizable purchases for home improvement projects or buy a particular brand of tools or building supplies.

Targeting

Targeting entails deciding which of these groups in the market to focus on (Andaleeb 2016). A key component of Bunnings’ marketing strategy includes targeting customers interested in DIY and home improvement projects. The business offers a variety of goods and services to fulfil the demands of DIY enthusiasts and professionals. By providing eco-friendly goods and services, Bunnings also aims to appeal to customers that respect sustainability and environmental responsibility.

Positioning

Positioning entails creating a distinctive perception of the brand in the eyes of the target audience (Andaleeb 2016). The positioning strategy of Bunnings is to provide quality goods and services at reasonable costs. By offering clients a vast selection of items, knowledgeable guidance, and exceptional customer service, the business hopes to become the top retailer in the hardware and home improvement sectors. Bunnings positions itself as the go-to retailer for home and lifestyle products as a one-stop shop for all home renovation requirements by offering clients convenience and affordability.

Marketing Mix

The marketing mix comprises four Ps: product, price, place, and promotion (Išoraitė, 2016). A review of Bunnings’ marketing mix is as follows:

Product

Bunnings offers various products, including hardware, garden supplies, and home improvement products. The company offers a wide variety of products to both residential and commercial consumers.

Price

Price is among the essential marketing mix items (Išoraitė 2016). Bunnings has a competitive pricing approach that emphasizes value for the money. The business guarantees that clients will receive the greatest price by offering a price match guarantee.

Place

Bunnings has a vast distribution network with over 507 trading sites across Australia and New Zealand (Diviv Group n.d.). Customers can access the company’s goods and services thanks to its concentration on urban and rural locations.

Promotion

Bunnings uses advertising, sponsorship, loyalty plans, and social media to promote. The company emphasizes product characteristics, pricing, and promotions in its advertising campaigns. Moreover, Bunnings has a loyalty program to reward customers for purchases and sponsors sports teams and community events.

Recommendations

The first recommendation is to expand the product range. Bunnings may consider extending its product line to meet shifting consumer wants and tastes. For instance, the business can market to clients more concerned about their purchases’ effects on the environment by providing more ecologically friendly and sustainable items.

Secondly, Bunnings can improve its digital marketing. Bunnings must spend more on web advertising, email marketing, and other digital marketing initiatives. This will increase the business’s web presence and help it reach a larger audience.

Lastly, Bunnings can improve customer experience: the company should improve in-store and online customer experience. This can be done by enhancing the layout of the stores, offering better customer service, and posting more online information, tips, and ideas.

Conclusion

Bunnings is a leading retailer in the home improvement industry in Australia and New Zealand. The business enjoys a solid reputation for its brand, a large range of products, and an extensive distribution system. However, the market is dynamic, so businesses must regularly review their marketing strategies to remain relevant and competitive. To enhance its marketing approach, Bunnings can consider extending its product line, strengthening digital marketing, and improving the consumer experience.

References

Andaleeb, S.S., 2016. Market segmentation, targeting, and positioning. In Strategic Marketing Management in Asia (pp. 179-207). Emerald Group Publishing Limited.

Bunnings. (2021). About us. Retrieved from https://www.bunnings.com.au/about-us

Bunnings launches new initiative to help local rugby clubs upgrade their facilities (no date). Available at: https://www.nzrugby.co.nz/news-and-events/latest-news/bunnings-launches-new-initiative-to-help-local-rugby-clubs-upgrade-their-facilities/.

Diviv Group (no date) Bunnings. Available at: https://www.wesfarmers.com.au/our-businesses/bunnings.

Gajanova, L., Nadanyiova, M. and Moravcikova, D., 2019. The use of demographic and psychographic segmentation to create a marketing strategy of brand loyalty. Scientific Annals of Economics and Business, 66(1), pp.65-84.

Helmold, M. and Helmold, M., 2020. Creating the Value Proposition. Total Revenue Management (TRM) Case Studies, Best Practices, and Industry Insights, pp.89-94.

Išoraitė, M., 2016. Marketing mixes theoretical aspects. International Journal of Research Granthaalayah, 4(6), pp.25-37.