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Aldi Case Study

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Q1

Aldi is dealing with a low-cost business strategy for attracting customers toward

themselves. They provide value products at a reasonable price, they can improve their business

strategy by adding it with a differentiation strategy. This will help them in competing in the

marketplace (Fuertes, 2020). My recommendation for Aldi is that they should increase the

quality of the product to make them unique in front of their competitors’ products. When they

provide differentiate quality products at low cost it produces customer satisfaction and loyalty.

For example, it is human behavior that individuals tend to buy things that are lower in cost but

superior in quality because this provides them a sense of reliability and affordability in most

cases.

Q2

The 5 business-level approaches or strategies include cost leadership, differentiation,

focused differentiation, Focused cost leadership, and Integrated low-cost differentiation strategy

(Leonard, 2019). All these stated strategies are essential in business but in the case of Aldi, it

would be a cost leadership strategy. The reason behind this is that this strategy aims to attract

customers with a pricing strategy, as Aldi is attracting consumers by offering low-cost products.

If this business strategy is switched by the business strategy of differentiation consumer might

change their mind because of the affordability factor. As differentiated products cost a higher

amount of money and it changes consumer behavior of buying from Aldi (Leonard, 2019). For

example, Mercedes is one of the most expensive cars in the world as it is differentiated from

other cars and termed as “luxury automobile”, but still individuals prefer to buy Honda because

of its reliability and cost. The same case is applicable for Aldi, it is probable that if they switch

their business strategy consumer might switch their buying behavior.

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References

Fuertes, G. (2020). Conceptual Framework for the Strategic Management: A Literature Review

—Descriptive. Retrieved from https://doi.org/10.1155/2020/6253013

Leonard, K. (2019, January 29). Five Types of Business-Level Strategies. Business Planning &

Strategy. Retrieved from https://smallbusiness.chron.com/five-types-business-level-

strategies-781.html