Assignment
Orientation
on
ALDI’s
Market
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1. Executive Summary
Market place has now become extremely competitive these days and it is quite important for the
companies to put enough emphasis on building a sustainable business environment and model
where they can retain the customers and keep creating the value for both the company and its
customers. The idea of evolving the customers as important stakeholders is gaining momentum, and
the concept of market orientation emphasises on evolving the organizational culture as well as
developing a step by step process where the market and business intelligence in gathered across all
the departments and used in consolidation in order to create value for both the business and the
customers (Lafferty, Barbara A. and Tomas, G. H.2001).
ALDI has targeted to gauge the overall market orientation of the company with the help of
responses gathered from different customers. Different customers were asked for their responses
on different parameters of market orientation of the company.
The survey provided important insight into the various measures taken by ALDI which is leaving a
lasting impression on the customers as how the company is creating the value for the customers and
what areas does it need to improve upon in order to be more market oriented. An important insight
came from the survey that more than just putting in the efforts to be more oriented, it is also very
important to promote its measures and create a successful differentiating factor for the company.
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Contents
1.
Executive Summary ......................................................................................................................... 2
2.
Introduction .................................................................................................................................... 4
3.
Market Orientation Definition ........................................................................................................ 5
4.
Importance of Market Orientation ................................................................................................. 7
5.
Analysis of ALDI’s Market Orientation ............................................................................................ 8
5.1 Survey questionnaire and customers’ response ........................................................................... 8
5.2
Analysis of customer responses ............................................................................................ 10
5.2.1 Determining/ Measuring ALDI’s Overall Market Orientation .............................................. 11
5.2.2 Aldi’s Customer Orientation ................................................................................................ 11
5.2.3 Aldi’s Competitor Orientation.............................................................................................. 12
5.2.4 Interfunctional Coordination of Aldi .................................................................................... 12
5.2.5 Long Term Profit Focus ........................................................................................................ 12
6.
Recommendations ........................................................................................................................ 13
7.
References .................................................................................................................................... 14
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2. Introduction
These days, with competition going sky high and the market structure becoming essentially ideally
competitive in nature, most of the companies are finding it pretty difficult to make themselves
economically sustainable in a long term. In such a scenario, the companies are using different
business models and approaches to target maximum customer satisfaction and achieve economic
efficiency and sustainability.
It is very important to develop customers as not only the ones to purchase your goods and services
but to also develop them as partners and advisors. The idea is to involve the customers more in the
business decision making process so that they feel like being a part of the process. Developing
relationships with the customer is not a one off event and it demands an ongoing model in process
so that the actual relationship building process has been started much earlier than approaching the
customer for Customer Relationship Management process (Kennedy, K. N., Goolsby, J. R. and
Arnould, E. J. 2003).
The evolved marketing concept sates that the single point focus for the companies is to satisfy their
customers more effectively than their competitors in order to achieve sustained economic and
operational success. Market orientation is an evolved concept which describes how well can the
customer needs be satisfied and what measures can be taken for the same. Market orientation has
been conceptualized on two aspects, the one being the behavioural and the other being the
organizational cultural perspective.
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3. Market Orientation Definition
Market orientation is defined as an exclusive approach which focuses on identifying and meeting the
stated or hidden needs of the customers in order to satisfy the customers. Many marketing experts
have defined market orientation as per different school of thoughts. While Narver and Slater
describe market orientation as an organizational culture, on the other hand Kohli and Jawaroski
define market orientation as an implementation of the marketing concept. Kohli and Jawaroski
define it as a step by step holistic approach where the change is on an organizational level and the
marketing intelligence is accumulated across the different levels of business and across the various
departments. Further, it means an organization wide response to the accumulated market
intelligence across the various departments and use of important market information in responding
to various market factors affecting the business directly and indirectly.
The other important yet quite different channel of thought provided by Narver and Slater state that
the market orientation is a systematic approach where the market orientation itself is made up of
three behavioural components namely customer orientation, competitor orientation and
interfunctional coordination. Overall, as per Narver and Slater, market orientation is an approach to
redefine the organizational culture of the entire organization itself (Henard, D. H. and Szymanski, D.
M. 2001).
Customer orientation: it is the concept of meeting the needs of one’s internal and external
customers. This concept advocates the idea of setting up specific customer satisfaction standards
and actively monitoring the customer satisfaction level and taking steps to have clarification and
meeting on both the expressed and unexpressed needs of the customers. The idea is to provide
courteous and timely response to the customers and developing the relationship with the customers
as partners and trusted advisors.
Competitor orientation: A business or firm is said to be competitively oriented when it constantly
assesses its strengths, weaknesses, threats and opportunities with respect to its competitors in the
market. Production efficiency, delivery time, customer satisfaction, employee retention, market
share, pricing, product quality, promotions etc are measured with respect to its competitors in the
market. In a competitive market each firm is trying to expand its customer and sales base on the
expense of its competitors. Being competitor oriented means aligning one’s business activities in
response to the business activities of one’s competitor.
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Interfunctional coordination: As per Narver and Slater, for market oriented companies the barrier
between the different business functions of a firm has to be removed and has to be internally
coordinated to work as a single cohesive unit. Market oriented companies are successful in getting
together all its business functions in order to provide maximum customer value (Appiah-Adu, K.
1997).
In a nut shell, across the various lines of thoughts by different marketing scholars, market
orientation is defined as a holistic approach where the different business functions work together in
a cohesive manner and the intelligence generated at different levels across the business units are
used to provide useful business information in order manner to provide the maximum customer and
business value.
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4. Importance of Market Orientation
Market orientation is not only some theoretical concept with little or no direct implication on the
business; rather market orientation has much practical and economical significance in today’s
business environment.
The marketing scholars have cited many benefits of market orientation few of which can be
explained as below (Tay, Linda and Morgan, Neil A. 2002):

Places the highest priority in profit creation. Market orientation places a high emphasis on
economic sustainability in the long term and puts a very high priority on the profit creation
for the business.

Creation and maintenance of superior customer value. Market orientation has been defined
as an approach which places high importance on creation and maintenance of superior
customer value while at the same time taking care of the interests of other stakeholders of
the business.

Information gathering and collection of important and useful market information. The
evolved marketing concept places an emphasis on useful information gathering in order to
provide useful business information.

Provides norms for behaviour regarding organizational development and culture. Market
orientation provides norms for behaviour of employees across the organization in order to
promote standard business ethics and values and promote a homogenous culture across the
organization.
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5. Analysis of ALDI’s Market Orientation
ALDI’s market orientation was tried to be measured with the help of a survey questionnaire by
gathering responses from the customers. The following questionnaire was used to gather responses
from different customers.
5.1 Survey questionnaire and customers’ response
1. Our business objectives are driven by 1
customer satisfaction.
2. We monitor our level of commitment and 1
orientation to serving customers’ needs.
2
3
4
5
6
7
2
3
4
5
6
7
3. Our strategy for competitive advantage is 1
based on our understanding of customer
needs.
2
3
4
5
6
7
1
2
3
4
5
6
7
1
2
3
4
5
6
7
1
2
3
4
5
6
7
1
2
3
4
5
6
7
1
2
3
4
5
6
7
1
2
3
4
5
6
7
1
2
3
4
5
6
7
1
2
3
4
5
6
7
1
2
3
4
5
6
7
1
2
3
4
5
6
7
1
2
3
4
5
6
7
4. Our business strategies are driven by our
beliefs about how we can create greater
value for customers.
5. We measure customer satisfaction
systematically and frequently.
6. We give close attention to after-sales
service.
7. Our salespeople share information within
our business concerning competitors’
strategies.
8. We respond to competitive actions that
threaten us.
9. We target customers and customer groups
where we have, or can develop, a
competitive advantage.
10. The top management team regularly
discusses competitors’ strengths and
strategies.
11. Our top managers from every function
visit our current and prospective
customers.
12. We communicate information about our
successful and unsuccessful customer
experiences across all business functions.
13.
All of our business functions (eg.
marketing/sales,
manufacturing,
R&D,
finance/accounting, etc.) are integrated in serving
the needs of our target markets.
14. We target customers and customer groups
where we have, or can develop, a
competitive advantage.
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Where, the following notations where used:
1: Not at all
2: To a very slight extent
3: To a small extent
4: To a moderate extent
5: To a considerable extent
6: To a great extent
7: To an extreme extent
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5.2 Analysis of customer responses
Different questions, a total of fourteen, were put there in the questionnaire and the response was
noted from different customers based upon their feedbacks. Different questions were added from
different topics in order to give an insight into customers’ perception into ALDI’s customer
satisfaction, competitive advantage, strategic alignment, after sales service, competitor evaluation,
competitive advantage, customer satisfaction evaluation, communication and competitive
advantage. The responses of customers were measured on a scale of one to seven and measured
against all the questions.
Six customers were interviewed with the survey questionnaire and the following findings were noted.
Objective driven Customer
Satisfaction
8
7
6
5
4
3
Objective driven
Customer Satisfaction
2
1
0
1
2
3
4
5
6
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Competitive Advantage
1
2
3
4
5
6
7
5.2.1 Determining/ Measuring ALDI’s Overall Market Orientation
Aldi’s overall average score against all the parameters and across all the customer responses were
3.35. Out of a scale of 1 to 7, a score of 3.35 is just in the mid range of the scale and reflects that the
overall market orientation of ALDI is quite average and there is a scope of significant improvement.
The most worrying aspect is that many customers have rated ALDI on some parameter as 4, 5 and 6.
Though the score looks quite healthy on a scale of 1 to 7 with 7 being the highest, this remaining gap
of 3, 2 and 1 respectively against the scores of 4, 5 and 6 reflects some impending issues in customers’
perception which needs to be taken care of. The more worrisome aspect is that the high scores give an
inflated score and the company might be fooled into believing that they are doing well, although there
are pressing issues which needs to be taken care of, else the customer might drift to other competitors
(Sandvik, Izabela L. and Kare, S. 2003).
Another important observation is that the standard deviation of all the average scores in 1.59 which is
quite high given the data ranges. It means the customers have rated on different parameters across the
range. For few parameters some customers have given a rating of 1 while for others the same or
different customers might have rated ALDI as 7 out of 7.
5.2.2 Aldi’s Customer Orientation
The customers were asked upon their opinion on how objective driven was ALDI’s customer
satisfaction level was, and the average score for this was 4, which is on a fair level. On the other
hand, when asked on whether ALDI was committed to satisfying customers needs, the average score
was only 1.50. this reflected that the company needed to project its commitment towards customer
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satisfaction level more. The customer response was also not very positive on whether ALDI was
measuring the customer satisfaction level effectively. This reflects a customer perception where
ALDI is not putting important efforts in making the customers felt like their satisfaction is important
to the company. The main problem is of projecting the customers’ value to the company, as it is later
shown in the survey that the customers are happy with various measures taken by the company,
however these efforts need to be more flaunted.
5.2.3 Aldi’s Competitor Orientation
The customers were asked if ALDI was giving proper attention to the after sales service and also if
ALDI was putting an effort in understanding the customer needs and was building its competitive
advantage in the same. Customers rated ALDI fairly decent on this and the average scores were in
range if greater than 4 (4.67 and 4.17 respectively). This reflects that ALDI is putting proper efforts
with respect to their competitors towards building a competitive advantage based upon the
customer needs.
5.2.4 Interfunctional Coordination of Aldi
When the customers were asked, if there was proper communication across all the departments
regarding the successful and unsuccessful customer experiences, ALDI was very poorly rated as 1 on
average. However, when asked if the business departments were integrated well, it got a quite high
score of 5.83. However, this high score can’t be taken much seriously, as the customers may not
have proper insight into the same, and lack of proper knowledge might have resulted in the inflated
scores.
5.2.5 Long Term Profit Focus
When the interviewees were asked if they felt that the top management team of ALDI discusses
competitors’ advantage and strengths, and how did they rate ALDI in comparison to its competitors,
the respondents responded with quite an average score. This reflects that ALDI’s services were fairly
consistent with the market, and customers though generally satisfied, didn’t find much differentiating
factor in ALDI’s services.
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6. Recommendations
Though, ALDI’s business has got a fairly decent overall market orientation score as per the data
collected from different respondents, the scores and the pattern of responses suggest that there lies
a significant room of improvement where ALDI can put efforts to be more market oriented. They can
be summarized as below:

Putting more emphasis on promotions and reaching out to the customers. Many customers
responded that they were quite satisfied with the general level of services provided by the
company and also they viewed that the company was performing well on the different
parameters of market orientations. However, when asked if they were happy with the
overall market oriented approach of ALDI, they were not so positive. It means that ALDI
needs to reach out to customers as how much effort they are putting in for the same
(Matsuno, Ken, Mentzer, J. T. and Ozsomer, A. 2002).

Trying to establish a differentiating factor. Most of the customers responded that they didn’t
find any special differentiating factor in ALDI’s services, as they didn’t rate ALDI high on
ALDI’s competitor orientation. The average scores indicated that the customers were not
able to differentiate well between ALDI and its competitors.

More information needs to flow across different departments of the company regarding
both the positive and negative feedbacks from the customers. A common repository or
mechanism through which crucial customer information can be shared should be promoted
and adopted by ALDI.
Overall, as per the customers’ responses, ALDI is performing well on the customers’ satisfaction
index and taking appropriate measures towards integrating its business departments. However,
more information needs to flow across the departments and more emphasis should be given on
promoting an organizational culture where creating the highest possible value for customers was
given the top priority.
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7. References
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Large Firms Hold in the Small Business Sector?” Journal of Euro-Marketing, 6 (3), p1–27
2. Atuahene-Gima, K. (1996), “Market Orientation and Innovation,” Journal of Business
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3. Baumgartner, Hans and Rik, Pieters (2003), “The Structural Influence of Marketing Journals:
A Citation Analysis of the Discipline and Its Subareas Over Time,” Journal of Marketing, 67
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Scale Development,” Psychological Assessment, 7 (3), p309–319.
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18. Subramanian, Ram and Gopalakrishnan, Pradeep (2001), “The Market Orientation–
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