Introduction
International expansion is a strategic opportunity in which companies look to expand into global markets and use their potential (Al-Tabbaa and Zahoor, 2024). Global marketing refers to the practices and strategies which can be applied by a company to promote its services and products on an international scale (EBSCO, 2025; Hollensen, 2014). In this study, there will be an assessment of the market of France and Germany to evaluate which one can be considered by Asda for expansion. For this, a market analysis will be conducted, after which the target audience will be identified. A method of expansion and marketing mix will be developed accordingly, after which legal, risk and ethical considerations will be taken into account. Accordingly, the implementation plan and the performance metrics of the company will be developed.
Company Overview
Asda is a large UK-based supermarket retailer whose operations occupy a very competitive grocery and general merchandise industry. Since it was founded in the 1960s, it has managed to command a strong presence in the market due to its value-based offer and its comprehensive line of products, on which it has focused and presented as affordable (ASDA, 2025). The major products of Asda are food and groceries, fresh produce, store brand and clothing (George brand), and household needs (ASDA, 2025). Asda is also in the UK market and competes with Tesco, Sainsbury and Aldi using the differentiation strategy, which happens to be the pricing leadership and customer value (Reuters, 2024). The company has the use of well-developed logistics, good relations with suppliers, and inventory management through the use of data to remain efficient in its operations.
Market Analysis:
PESTEL analysis of Germany
Political
The index of political stability which has been recorded in Germany 0.59 (The Global Economy, 2025). This indicates that the country is fairly politically stable.
Figure 1: Index of political stability
(Source: The Global Economy, 2025)
Economic
The rate of inflation, as of 2025, is 2.3% (Trading Economics, 2025). The rate of inflation of the German market has remained low for the latter part of 2025.
Figure 2: Germany Inflation Rate
(Source: Trading Economics, 2025)
Social
In Germany, the personal disposable income of the consumers is €663.91 billion (Trading Economics, 2025). The spending power of consumers has been increasing consistently. The people of Germany tend to speak German, are punctual and hardworking, and the majority of the population is Christian (Haxhiavdyli, 2025). These are the primary cultural considerations which have to be made by Asda for the German market.
Figure 3: Germany Total Disposable Income
(Source: Trading Economics, 2025)
Technological
The rate of penetration of the internet is 93.63% in Germany (Trading Economics, 2025). This indicates that the people of Germany have easy access to the internet, and this can be leveraged for the marketing efforts of Asda.
Figure 4: Rate of penetration of the internet
(Source: Trading Economics, 2025)
Environmental
The development of the German Sustainable Development Strategy has ensured that there is sustainable development (The Federal Government, 2025). This is a law which has to be followed by the brand during the development of its sustainable development strategies.
Legal
The national minimum wage of Germany is €12.82 (D Statis, 2025). To make sure that Asda does not have any form of legal issue with its employees, it has to make sure that they are being paid the minimum wage.
Analysis:
As can be seen, Germany is more politically stable, is technologically progressive, and the common people have a considerable disposable income, which means that Asda can maintain a profitable business venture in the country. The German market has strong legal requirements to protect the environment and the rights of employees. However, a notable disadvantage of the market is the high inflation. However, it must also be noted that the people have considerable spending power, which means that it may not cause an issue for Asda.
PESTEL analysis of France
Political
The index of political stability in France is 0.34 (The Global Economy, 2025). This indicates that the political stability of France is not high; however, it is not low either.
Figure 5: France: Political stability
(Source: The Global Economy, 2025)
Economic
The level of inflation for France as of 2025 is 0.9% (Trading Economics, 2025). The rate of inflation is low in France, indicating that the people have considerable buying power in the country.
Figure 6: Rate of inflation
(Source: Trading Economics, 2025)
Social
The disposable personal income among the people is €471062 million (Trading Economics, 2025). The personal disposable income of the people of France has increased, indicating that the company can sell well in the country. The French are fashionable people, with French cuisine and various forms of art as a core part of their culture (Explore France, 2021). This is a cultural consideration which can be made by Asda during its expansion into France.
Figure 7: Disposable personal income
(Source: Trading Economics, 2025)
Technological
The level of internet access has been recorded at 94.43% as of 2025 (Trading Economics, 2025). This means that Asda can leverage the internet for marketing purposes.
Figure 8: Level of internet access
(Source: Trading Economics, 2025)
Environmental
The AGEC law No. 2020-105 focuses on the reduction of the generation of waste for promoting the circular economy (Refashion, 2025). To make sure that the company has sustainable development in the French market, it is important to ensure that they follow the requirements of this law.
Legal
The minimum wage in France per week is €415.80, €1,801.80 per month and €21,621.60 every year (CXC, 2025). To avoid legal issues with the employees, Asda must develop its salary system based on the minimum wage requirements of France.
Analysis:
The main issue of France is that it is only moderately stable politically, indicating that it is prone to breaking out into political turmoil. However, the rate of inflation is low, the disposable income of the people is high, and the presence of technology is strong. These are some elements which can benefit the growth of Asda in the market. France also has strong employment laws and regulations for protecting the environment, which have to be taken into account by Asda.
SWOT analysis of Asda
Strengths
Asda offers a wide range of products and services, ranging from food, laundry, alcohol and so on (Asda, 2025). This is a considerable strength for the company, as it can cater to a wide range of people. The company integrates methods of sustainable development in all areas of its operations (Asda, 2025). This is yet another strength for the company, which can be leveraged during international expansion.
Weaknesses
The company caters to 98% of the homes in the UK (Asda, 2025). While this indicates that the company is highly popular in the UK market, it also shows that the brand is highly dependent on the UK market, which is a weakness.
Opportunities
The company can consider expanding into other countries to solve the weakness of being overdependent on the UK market. It can enhance the reputation of the brand in the market and ensure that the company can grow effectively.
Threats
The main threat which is being faced by the company faces is the high inflation of the UK and the rising costs of labour. The rate of inflation recorded in 2025 is 3.2% the national minimum wage of the country for people aged 21 and above has risen to
£12.21(Money Helper, 2025).
Analysis:
This shows that the main strengths of Asda lie in their wide range of products and initiatives for sustainable development, which ensure that the company has a clear understanding of the requirements of the customers and the market. However, their main weakness is their overdependence on the UK market, which presents them with the opportunity to expand into other international markets. The present threats they are facing from the UK market are the rising costs of operations, due to the increase in inflation and the costs of living.
Chosen Market
Germany is not only more politically stable than France, but also has seen strong technological progress, initiatives for sustainable development and protection of the rights of the workers. Although the rate of inflation in Germany is higher than in France, the disposable income is higher as well, indicating that the standards of living will not be hampered due to the consistent inflow of profits. However, it must be noted that the rate of inflation is lower in the French market, which means that the costs of operations and communications will be lower for Asda. Due to the wide range of products of Asda and their initiatives of sustainable development, Asda can ensure that it can operate well in the markets of Germany as well as France.
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Target Market Identification
Germany
Asda's target market in Germany will include urban and suburban consumers aged 25-55 and older, and sensitive to price. The demographics of this segment include the middle-income families, young professionals, and those families who understand the low-cost and cheap items in grocery and household products without compromising the quality of the products. As of data, the current retail market value of Germany is estimated at EUR 711.3bn in 2024 (GlobalData, 2025).
This segment of German consumers is psychologically efficient, transparent and practical consumers. There is an intense preference for the privatisation of products, sustainability and product information. The retailers that are renewable in quality, have decisions based on ethical sourcing, and are environmentally responsible in their actions, have a high level of trust from their customers (Azuonwu, 2024). The convenience and the reliability determine the choice of the store.
The target market has been determined to have a high frequency of grocery shopping, high price comparison behaviour and affiliation to value-giving retailers behaviourally. Retail models based on cost leadership are widely accepted in this space, as it is dominated by discount supermarkets, such as Aldi and Lidl.
As an individual destination, Germany has been favoured as a target market due to its well-developed retailing system, the maturity of its people with respect to affordable products and due to its endorsement of the culture of induction of discount-oriented groceries. The demand and purchasing patterns of the German customers fully align with the strategic orientation of Asda as a low-end retailer.
Figure 1: Germany Positioning Map
(Source: Created by the learner)
France
The target market of Asda in France includes people between the ages of 30 and 60, families and working classes in suburban/semi-urban areas, who have a value-oriented orientation. The target audience of this justice has a predisposition to stable incomes and unaffordable purchases of groceries without fears of low quality. The retail market in France is currently valued at $1,377.6 million for 2024 and is growing at a rate of 28.1% (Grand View Research, 2025).
Psychographically, the French people are more concerned with product and food source quality, believe in brand and are price-sensitive, due to the impact of inflation. What is seen is the growing popularity of merchandise in the national-label products and lower prices than the national ones. All the elements of sourcing ethically and being sustainable are also good identifiers of purchase.
In the behavioural dimension, the target market will show the weekly bulk-buying behaviour, high responsiveness to promotions and the willingness to visit large format supermarkets and hypermarkets. Value promotion by way of in-store schemes and loyalty schemes is very influential in terms of store selection (Abdul, 2023). The customers will shift brands or retailers with an aim of achieving a high value.
The target market is France due to its experience in the development of the grocery industry, excessive consumer expenditure on foodstuffs, and an increasing demand for competitively priced, privately labelled products. Because of its cost leadership and its own label position, Asda is in an ideal location to support the needs of French value-oriented consumers.
Figure 2: France Positioning Map
(Source: Created by the Learner)
Marketing Strategy Development
The Asda international marketing strategy to expand both in Germany and France should be formulated based on a value-based position, market entry, and selective brand modification to suit the local consumer expectations.
Market Entry Strategy
The entry mode that would be most appropriate in both Germany and France is a joint venture or strategic partnership. Partnership with established domestic retailers or providers would aid in reducing barriers to entry, lessen capital risk and provide entry to an already existing supply chain, retail infrastructure and regulatory proficiency (Haryanto et al., 2024). The regional distributors' partnership in Germany would enable the sourcing and distribution of the products efficiently to the competitive discount retailing industry. In France, the partnership would be employed to align it to the strict retail policies and labour regulations through the assistance of local retail associations and swift entry to the market.
Competitive Positioning Strategy
Asda is recommended to adopt a value differentiation position strategy of cost leadership. Asda should position itself as the other established low-end in France as an alternative to the traditional hypermarket with a competitive price label, a stable product quality, and promotion of the product specifications. The premium or experience retailing should not be stressed in the positioning, but rather should be affordability, transparency and everyday value (Cunningham and De Meyer-Heydenrych, 2021).
Brand Adaptation versus Standardisation Strategy
The proposed solution would be a halfway policy of standardisation of the brand and adapting it to the local setting. In both markets, the key elements of the brand, such as the value proposition of Asda, focus on own-label and price-sensitive communications, cannot be altered in case of losing brand identity and financial gains of scale. However, it has to be altered selectively in order to reflect the preferences of the local population and cultural norms (Liu, 2023). German communication is said to be efficient, sustainable, and useful. Communications in France are supposed to be based on quality assurance, source of product and trust. It will need to change product lines to incorporate locally popular food products, even though the ASDA format of own-label structures must be preserved. Overall, this marketing strategy will enable ASDA to leverage its competitive strengths and address the competition.
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Marketing Mix (4 Ps)
According to Lim (2023), the marketing mix is a common tool which is applied for marketing, with the main elements being product, price, place and promotions.
Product
To make sure that the products of Asda are adopted by the people well, the company will have to make sure that they use sustainable packaging, with a logo of the product on the same for better recognition. Additionally, the details about the product have to be published clearly on the product to make sure that the consumers have clear and transparent information. The brand has to be perceived as sustainable to make sure that it can establish a level of credibility in the market.
Price
To make sure that the company can draw the attention of the customers, Asda can introduce the competitive pricing method. This is a method which involves the process of conducting an in-depth analysis of the target market and the competitors (Tanir, 2023). Due to the high inflation and high competition in the retail sector of Germany, this will ensure that the company stands out.
Place
The products will be available and distributed from the German website of the brand and the offline supermarkets and stores. Asda will partner with various grocery suppliers for sourcing their products and integrate sustainable transportation and inventory management systems in alignment with its image of being a sustainable brand.
Promotion
To make sure that the company can promote their products, maintain public relations through media and press releases and reach out to their audience, the digital marketing method will be applied. The market for digital marketing in Germany has been recorded at $32,473.6 as of 2024, and it is expected to grow at the rate of 14.8% between 2025 and 30 (Grand View Research, 2025). The process aims to make sure that the company can gain recognition in the market, inform the customers about their products, develop a relationship and enhance sales. To introduce the products and services and develop a relationship with the customers, the company will leverage its social media platforms and website and make media and press releases to put forth important information. The queries and issues of the customers will also be managed by the company. Through this, Asda can effectively promote its products.
Legal and Ethical Considerations
Asda's entry into Germany has to be highly inhibitory in regard to legal, regulatory and ethical requirements in the country. German retail is controlled both by the laws of the European Union and by the national laws that control competition, employment, consumer protection and data protection laws (DLA Piper, 2025). The competition law of the EU should be followed, particularly regarding pricing policies, contracting policies with the suppliers and predatory pricing practices which influence the discounting retailing industry. German employment laws are highly strict, and any form of employment has to conform to the standard rates of minimum wages; collective bargaining and protection rights are very high among the employees.
The regulations regarding food safety and the labelling of goods are particularly harsh in Germany. Asda will be obligated to comply with EU food safety standards, food traceability, clear labelling, allergens and country of origin labelling. The rapid compliance with data protection according to the General Data Protection Regulation (GDPR) is essential, and the customer loyalty programmes and Web store websites (GDPR.EU, 2025). On the moral level, the German market is domineering in terms of responsible sourcing, environmental sustainability, and healthy relationships with suppliers. Honest advertising and transparent prices are also a part of an ethical marketing campaign to maintain the consumer’s trust.
Risk Management Plan
Asda is susceptible to several strategic and operational threats due to its international expansion in Germany. There is also a high amount of competitive risk as the market is controlled by the established discount stores such as Aldi and Lidl. Competitive prices, differentiation of special-label goods, and operational efficiency are strategies that can be used to reduce this risk. The regulatory risk entails the complex requirements of the labour and high retail regulations that demand legal compliance and local understanding, which requires sustained effort. Some of the economic risks include the risk within the exchange rate between the euro and British pound that is likely to affect the sourcing cost and profitability (Pellegrino et al., 2024). They can eliminate this risk by putting up currency hedging policies and increasing sourcing within the euro zone. The cultural risk is in the form of differences in consumer expectations concerning the quality of their products, their sustainability, and the level of their services.
The operational risks include supply chain crisis and supply chain logistics inefficiency (Duong et al., 2023). It can enter partnerships with local suppliers and logistics manufacturers to reduce the dependency on transport services for intercontinental supply. The reputational risk concerning ethical or environmental problems is managed through the assistance of the proven corporate social responsibility operations, as well as meeting the requirements of the German sustainability standards. A structured risk monitoring will ensure the opportunistic identification and response to emerging problems.
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Implementation Plan
Asda’s market penetration into Germany should be a gradual process that is done within a span of 24 months. The first one would be market preparation achieved through regulatory approvals, partner's choice and market research. Through this step, it is visible that suppliers are located in the area, and other logistics partners and legal counsel are hired who would be responsible towards maintaining compliance and operational readiness. The next part will involve pilot store products in specific urban and suburban settings, and this will give a test of the value proposition, price and product mix.
Marketing is done to achieve brand awareness that is supported by promotions and setting negative prices (Bondarenko and Vyshnivska, 2023). The pilot operations give feedback to optimise the product selection and operation. Next stage is about growing and streamlining. Store networks are expanded gradually, electronic platforms are initiated, and the supply chain efficiencies are optimised. The performance monitoring and coordination of the UK headquarters and the activities of Germany are detailed by specialised management teams.
|
Phase |
Timeline |
Key Activities |
Responsible Parties |
Key Resources |
|
Market Preparation |
Months 1–6 |
|
|
|
|
Partnership Setup |
Months 4–8 |
|
|
|
|
Pilot Launch |
Months 7–12 |
|
|
|
|
Evaluation |
Months 10–14 |
|
|
|
|
Expansion |
Months 13–20 |
|
|
|
|
Optimisation |
Months 21–24 |
|
|
|
Table 1: Timeline
(Source: Created by the Learner)
Performance Metrics
In order to gauge the performance of Asda venturing into the German market, a combination of both quantitative and qualitative measures of performance would be used. The monetary KPIs will include growth in revenues, operational margin, cost effectiveness and payback. The competitive performance indicators are market-based, like market shares, customer acquisition rate, and average basket value (Alawadh and Barnaw, 2022).
Operational metrics are sensitive to the efficiency of the supply chain, turnover of inventory and presence of products on shelves, such that the level of service remains unchanged. The value-led approach can be estimated in terms of competitiveness in price and the existence of its own label amid the prices. Online traffic and online conversion rates are some of the digital KPIs used to measure the effectiveness of the omnichannel.
Customer-centric metrics include customer satisfaction scores, brand awareness scores and brand loyalty programmes (Tahir et al., 2024). The information given in surveys and reviews can also be used to recognise the areas of perception difference and where adjustments are necessary, as qualitative feedback information. One of the compliance measures that ensures that the program complies with the German laws and ethics is the regulation adherence and sustainability performance. The high frequency of the performance analysis helps the management alter the strategies, to invest the resources properly and to make the company sustainable in the German market in the long term.
Conclusion
As discussed, Germany is a good market to invest in by Asda as it is a high-demand market based on value-based retail formats and well-developed infrastructure. The segmentation of the target market was in a position to determine price sensitivity in individuals who accepted the target products highly. The regulative forcefulness and the rivalry were significant in decision-making on the entry and positioning strategy. The idea of sustainable expansion relies on a value-oriented marketing strategy, which is powered by alliances, discriminated adaptation and the management of high risk. Compliance with laws and efficient operations and performance monitoring still remain critical to success in the long run. Overall, the strategy aligns the competencies of ASDA with the expectations of the German market to ensure the achievement of controlled growth and presence of capacity to resist competition.
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