“SuperMeal” Marketing Plan Report
Executive Summary
Supermeal operates in a favourable business environment. Although the food industry is matured and fiercely competitive, a market is open as long as it enhances its competitive advantage of cost leadership augmented by quality food, extended service hours, and wider restaurant space. Supermeal remains at the introduction stage of product life cycle, which means the need to develop strategies to boost growth. It also constitutes a question mark, which means that it has the potential to become star but it has to focus on market expansion together with product awareness, cost control, and product and service support to retain its existing market while at the same time paving the way for market expansion especially to the larger market of non-Chinese customers. The marketing mix for non-Chinese customers shows the strategies that the company needs to focus on to achieve strategic success, measures through market growth, financial soundness, and personnel performance based on information observed and obtained from customers.
Table of Contents
Executive Summary
Table of Contents
List of Tables and Figures…………………………………………………………… 4
1. Introduction
2. Description of the Firm
3. Target Market
4. Competitive Analysis
5. SWOT Analysis
5.1 Strengths
5.2 Weaknesses
5.3 Opportunities
5.4 Threats
6. Product Lifecycle Analysis
7. Product Positioning
8. Marketing Objectives
9. Higher-Level Strategies
10. Branding Strategy and Brand Positioning Strategy
11. Marketing Mix Strategy
11.1 Product
11.2 Price
11.3 Place
11.4 Promotion
11.5 People
11.6 Process
11.7 Physical Evidence
12. Measurement of Strategic Success
13. Conclusion
Reference List
Appendices
List of Tables and Figures
Table 1: Financial Expenses of Supermeal Chinese Restaurants………………19
Figure 1: Product Life Cycle Model…………………………………………………19 Figure 2: BCG Matrix Model…………………………………………………………20 Figure 3: Ansoff Matrix……………………………………………………………….20 Figure 4: Brand Positioning Map……………………………………………………21
1. Introduction
Each industry is subject to factors, which affects the performance of the firm. In order to have as successful business, companies must know how to surpass different challenges in the marketplace. In doing so, different techniques and strategies should be developed and executed. In this kind of situation, of the most notable approach is marketing plan. Basically, marketing plan enables the business industries to analyze the company. In addition, this plan also helps the company to determine their target audience’s needs, which serve as their basis for the development of their products and services. The newly developed products and services must be promoted effectively to reach their target market (Reed, 2007). Furthermore, the marketing plan also facilitates this essential business approach by outlining the applicable techniques of promotions and sales (Beech, 1997).
Accordingly, marketing plan should be considered to foresee the ability or potentiality of the business in obtaining competitive advantage. An effective marketing plan contains essential factors, which determine the objectives of the organisation and the methods on how these objectives will be attained. Primarily, the main goal of this paper is to provide a marketing plan for Supermeal Chinese Restaurant. This paper will first analyse the current situation of the company using different analytical models. After which, a comprehensive marketing plan for Supermeal follows.
2. Description of the Firm
The company that would be given emphasis in this paper is the Supermeal Chinese Restaurant, which started in the marketplace last February 5, 2007. The company is in the business for one year and 6 months now. The main objective of the company is to be highly profitable and promote culture of traditional Chinese food in Sydney. The target market of the company is mostly Asian and other tourists who love Chinese cuisine and dishes.
The restaurant offers Chinese breakfast meals from 11 am to 5 pm and other meals after 5 pm. Since Supermeal is operating in a Western nation, the company is facing a lot of challenges and issues, such as cultural issues. Other issues that the company is facing are about their facilities and the changes in the season of Sydney, which affect the performance of the company. In this regard, the Supermeal should be able to have a marketing plan that would boost the profitability of the company and solve the issues that they are facing.
3. Target Market
Of all the components of a marketing plan, perhaps the most overlooked but most critical element is the definition of the target market. According to David (2003), it is a homogenous group of people or organizations that a company wishes to appeal to. There are two basic targets for a product or service: the user and the non-user segments. Thus, there are also two business and marketing decisions that the company must decide upon in light of the basic targets. The first is to cultivate the present market alone while the second is to go after non-users. The former can inspire consumer loyalty, which is an important factor in the survival of any business. These are among the consumer characteristics that Supermeal Chinese Restaurant should identify and gain market visibility. The target market of the company is mostly Asian and other tourists who love Chinese cuisine and dishes.
4. Competitive Analysis
Competition is a significant aspect to consider in a business. Industries should have effective competitive strategies to be more attractive in the eyes of the customers and to gain customer loyalty. In this regard, it is essential to analyse the competitors of the company to determine which company provides effective competition. In Sydney, many Chinese restaurants offer the same products as Supermeal is offering. However, one of the edges of Supermeal against their competitor is when it comes to their operation and trade time. Most of the competitors of Supermeal are already closed ad 10 pm unlike Supermeal which is open until 2 am. In addition, in terms of competition, Supermeal has more competitive advantage especially with the affordable and quality foods and services they offer. In terms of competition, Supermeal is competitive when it comes to accommodating more customers because of their structure.
With these findings, it is apparent the conceptualizing, planning and executing business strategies in order to create highly favourable competitive advantage and market attractiveness. These considerations could result to the achievement or attainment of the short-term as well as the long-term goals of the company to succeed in a particular industry (Kotler & Armstrong, 2007). More challenging factors, however, are present when business organizations decide to initiate change in the industry through innovation and technology in product or service production and manufacturing, business operations, and advertising and marketing. Furthermore, initiating such developmental changes in different market orientation to offer products and services to people with diverse cultural and social orientation identifies other issues for a successful business venture (Kotler & Armstrong, 2007).
5. SWOT Analysis 5.1 Strengths
Compared to the industry competitors of Supermeal Chinese Restaurant, the company has been able to preserve their Chinese tradition and promote their traditions and cultures to Australian market. Since the company is a traditional Chinese restaurant, they have the skills and knowledge of establishing good relationship with their customers. The knowledgeable employees are a major strength against their competitors. In this regard, the Supermeal will gain loyalty from their target market and the entire company will have a good reputation. Further, the marketing staffs of the company have the ability to think of the best ways in marketing the products of the company.
In addition, their strength can also be attributed the strategic location of the company which is near the China town in Sydney. This is a strategic approach because this helps them in reaching their customers easily and since they are in the city, they can also provide services to foreigners and Australian. Strength of the company is their trading time and their capacity to accommodate many guests because of the structure of the restaurant. Price is another strength that can be considered since Supermeal provides affordable but quality foods and services.
5.2 Weaknesses
Food industry today is everywhere. However, the problem with this is that the emergence of competitors has an effect to the performance of the company. In line with Supermeal, the company is facing some weaknesses, and one of these is in terms of the expenses [See Table 1 in Appendix] of the company, which cause financial burden to the management and the company as a whole. Another weakness is the inability of the management to promote their business with pint and media advertisements. Further, the inability of the company to upgrade their system like in order taking and their cashier can also be considered as one of their weaknesses.
5.3 Opportunities
Since SUPERMEAL has long been familiar with the local Chinese market, conceptualizations of the value propositions of its products are highly in synch with the traditional foods and service provision present in the targeted location. As such marketing approach come relatively easier to SUPERMEAL management with its market location, which is near China town to reach their target market easily. This situation should be taken advantage by the management to gain competitive edge against other restaurants, which are operating businesses in China.
The participation of Australian government in world trade has opened more opportunity for Chinese restaurants to establish their businesses in Australia, especially in the city. In addition, Supermeal has the opportunity to expand their market portfolio and offer seasonal food and services to meet the immediate needs of target market for food services.
5.4 Threats
One of the threats facing the company is about their expenses and their inability to provide enough financial budgets for each may affect organisational performance. Aside from this, the threat is the emergence of a new Chinese restaurant that uses state of the art facilities for promotion purposes. They are also threatened by their inability to meet the needs of their target market.
6. Product Lifecycle Analysis
To determine the progress of Supermeal relative to the sequence of stages commencing with introduction followed by growth and then by maturity and decline, the company needs to conduct a product lifecycle analysis [See Figure 1 in Appendix]. The stage where the product is positioned influence the marketing strategy of the company.
Gorchels (2000) explained introductory stage the company would experience marketing issues such as higher costs due to advertising and other promotional activities, the price could be low to attract customers, and distribution is limited. During this stage, customers may be hesitant to pay a higher price for the product and need encouragement to make actual purchases. As the product moves on the growth stage, the marketing issues include the consistency in fulfilling value offers together with addition product or service features, price maintenance or shifting depending on market response, establishment of other distribution channels could increase, and investment in promotional activities due to the continuous growth of customers. As the product matures, emerging marketing issues include improvements in product features, assessment of price, intensive distribution, and product differentiation as response to the entry of competitors together with market saturation. During the decline stage, the marketing issue revolves around the decision on whether to maintain, improve, or discard the product as response to the changing demands of the market.
Supermeal, which represents traditional Chinese food at low prices, is in the introduction stage. The company has introduced Supermeal as traditional Chinese food at low prices and extended service hours, which comprise the incentives for consumers to visit its stores. Although the company has been able to provide incentives for customers, it continues to face the marketing issue of cost. It also relied on low prices to attract customers. The company does not advertise but it incurs greater costs in its extended operations and wider restaurant space relative to competitors. Distribution is also limited to its single two-story restaurant in Sydney. These marketing issues place Supermeal at the introduction stage, although it well may be at the latter phase of this stage.
Although the company has been able to draw Chinese customers and has established a small customer base through networks, it is yet to expand its market to more customers in the Chinese communities via its existing network or to the wider Sydney population through direct and indirect promotions.
This implies a number of things in terms of strategy. First, the company needs to intensify its convincing powers towards customers by using promotional activities able to reach out to the wider Sydney population and not rely on store food displays. Second, the company needs to maximise its existing network to expand its market to the Chinese community and to the Sydney population. Third, the company also has to reinforce or augment its value offering that differentiates it from its competitors especially the extended service hours and cost leadership. Fourth, the company needs to rationalise its cost structure to minimize unnecessary expenses and optimise available resources.
7. Product Positioning
To achieve market recognition, Supermeal needs to establish its positioning statement. The positioning statement for the company will be “TO BE THE NUMBER ONE CHOICE FOR TRADITIONAL CHINESE FOOD IN AUSTRALIA.” The objective of the company is to be known all over Australia and to gain more profit in the market. The BCG matrix [See Figure 2 in Appendix] is a means of positioning Supermeal.
Stern and Stalk (1998) explained the four categories of products in terms of the cost structure and market share. Cash cow represents low cost structure and high market share in industries that are slow growing. Star represents high cost structure and high market share in a rapidly growing industry. Question mark pertains to high cost structure and low market share in high growth industries. Dog refers to low cost structure and low market share. The position of the product reflects its present status as well as long-term potential for actualisation through the appropriate strategy.
Supermeal is a question mark because it has a high cost structure and a low market share within a high growth industry. The food products and service is one of the most mature industries in Australia. This means that there are a number of players, competition is fierce, and the market is highly developed in terms of preferences and tastes. By forming part of the industry, Supermeal is dealing with many competitors and customers who know what they want from Chinese food or restaurant. The company also operates via a high cost structure because it incurs cost in maintaining a wider store space and operating at extended hours while offering the lowest price in order to provide value offering and distinguish the company from its competitors. Supermeal also has a low market share because it is yet to make a major breakthrough in terms of the wider market in Sydney or make a name in Australia.
However, as a question market, Supermeal has the potential to become a star, operating on a high cost structure but gaining a higher market share. The company needs to focus on building its market as well as effectively managing its cost structure.
8. Marketing Objectives
After analysing the position of Supermeal in the product life cycle and the BCG matrix that pointed to issues and areas of focus, the company needs to identify marketing objectives. These are necessary to support effective achievement. As a product in the latter phase of the introductory stage and a question mark, the company needs to focus on four objectives that take advantage of its strengths and opportunities as well as addresses its weaknesses and threats.
Kotler and Armstrong (2007) explained that Ansoffs matrix [See Figure 3 in Appendix] supports decision on growth strategy in terms of the product and the market. Market penetration is the strategy of introducing an old product into an existing market. Product development is the strategy of developing new products into an existing market. Market development means introducing an existing product in a new market. Diversification is the introduction of a new product into a new market.
First objective is to increase its market share. Since Supermeal has already been offered in the market since February 2007, traditional Chinese food of Supermeal constitutes an old product. The company has already determined its target market but it has yet to gain a large market share. This means that increasing market share is through market penetration strategy. Increasing the market share takes advantage of the network system together with other channels of increasing its market such as promotional activities. This addresses the issue of high cost structure, which is a weakness of the company.
Second objective is to increase product awareness, which also falls under market penetration strategy. Increasing product awareness means reaching out to more consumers that requires greater action from the company other than relying on restaurant displays and waiting for customers to come in. It has to engage in proactive marketing to successfully introduce Supermeal and create a sufficient market base to move towards the growth stage and start actualising its potential as a star.
Third objective is to control costs. Although high costs are expected from the company’s operations because of its value offering to consumers via extended service hours and wider restaurant space, it should continue to prevent unnecessary costs and look for ways to cut expenses rationally without affecting the quality of its service. This is necessary to sustain its cost leadership advantage.
Fourth objective is to enhance product and service support. Although Supermeal remains in the introduction stage, it has to improve product and service support to ensure that it can provide customer satisfaction to influence return purchases in the future. This involves improved interactive and service delivery skills of staff and improved restaurant ambiance. This is necessary not only to support market penetration but also to build and widen the customer base of the company. These also support cost control by eliminating or minimising errors and delays that could translate to losses for the company.
The aggregate of these objectives contributes to the achievement of the goal of Supermeal to become the number one choice in traditional Chinese food in Australia.
9. Higher-Level Strategies
Based on the identified objectives, there are concurrent higher-level strategies. Higher-level strategies provide general guidance to the entire company (David, 2003; Reed, 2007).
The higher-level strategy for the first objective of increasing market share is to expand the customer base of the company by 100 percent or double the existing number in the next three years. Supermeal has a huge market. Although there are also many competitors, Supermeal has cost leadership advantage, which if combined with extended service hours could also constitute a differentiation advantage. By sustaining its competitive advantage, it is possible for the company to double it market base in the next three years.
The higher-level strategy for the objective of increasing product awareness is to align corporate operations (Reed, 2007) to communicate the brand value of Supermeal. Products and service delivery should revolve around the brand value of traditional Chinese food at low prices during extended service hours. By developing cohesiveness, the company will be able to communicate this message to the market. This is necessary to propel Supermeal to the growth stage of the product life cycle.
The higher-level strategy for the objective of cost control is introducing corporate governance practices including financial accountability into the company (David, 2003). This means the company establishes a system that supports the appreciation for accountability as contributing members of the organisation.
The higher-level strategy for the objective of enhancing product and service support is culture change into an integrated operations (Reed, 2007) so that the quality of products and service as well as service delivery all communicate the unique value offering and sustain the competitive advantage of Supermeal as low-priced traditional Chinese food served during extended working hours.
10. Branding Strategy and Brand Positioning Strategy
After identifying the objectives and higher-level strategies, the company needs to focus on branding strategy and brand positioning strategy. These are necessary to help the company to understand its brand for the company to communicate this better to its target market.
The appropriate branding strategy for Supermeal is umbrella branding, which refers to the use of a single brand for a range of products. This offers the benefit of supporting the kick-start of new products within the umbrella brand but this also involves the complexity of containing a variety of products within a single brand. As such, this requires the company to develop a strong brand able to represent all the products. (Reed, 2007) In the case of Supermeal as a brand, it encompasses all the traditional Chinese food served by the company. This addresses the downside of umbrella branding of involving complexity in ensuring a halo effect over all products. Although there are different food products in the menu, all these fall under traditional Chinese food, allowing the umbrella brand to gain strength by representing all these food products. In addition, building an umbrella would make it easy to achieve uptake in introducing new products in the future.
The brand positioning strategy of Supermeal is a bargain brand based on the product-positioning map [See Figure 4 in Appendix]. Kotler and Armstrong (2007) explained that a bargain brand represents high quality at low price. This is opposed to economy, which means low quality at low price; cowboy brand, which means low quality at low price; and premium brand, which means high quality at a high price. Supermeal is a bargain brand for two reasons. One, it represents high quality as traditional Chinese food, which means that the company ensures that the ingredients used and the manner of cooking and serving conform to tradition. Extended serving hours could also comprise a determinant of quality service. Another, Supermeal is available at low prices since the restaurant enjoys cost leadership as an advantage. The combination of high quality and low cost makes Supermeal a bargain brand.
11. Marketing Mix Strategy
The marketing mix describes the various kinds of options available to organisations in completing the entire process of bringing together products and/or services to consumers (Kotler & Armstrong, 2007). The extended marketing mix, comprised of the 7Ps emerged to focus on services. The 7Ps for Supermeal reflects the process linking the concept to tangible products and actual service delivery to consumers, particularly non-Chinese market segment.
11.1 Product
Supermeal is traditional Chinese food at the lowest market price available for longer hours. This means that the company provides traditional Chinese food experience to non-Chinese customer to provide them with the culinary culture of China. The menu comprises of the choice of noodles, Peking duck, vegetables, and seafood in different modes of preparation to provide non-Chinese customers with options according to their preference. Choices support customer empowerment, which enhances satisfaction (Beech, 1997).
11.2 Price
The pricing strategy for Supermeal is value pricing, which pertains to the provision of value products at a price that match or even lower that the expectations of customers (Kotler & Armstrong, 2007). Value pricing is offering traditional Chinese food at low prices. The range of price for Chinese food is about -, but some seafood liked live fish and mud crab is depending of market price. This pricing strategy ensures that customers get the value, or more, than what they paid for. Although non-Chinese customers may be willing to pay a higher price, value pricing ensures customer satisfaction that in turn influences market expansion to this market segment.
11.3 Place
The restaurant has two floors with tables that can seat couples or large groups. It is located next to China town in Sydney. The restaurant reflects various facets of the Chinese culture including the furniture and fixtures to enhance the culinary experience of non-Chinese customers. This would draw the interest of the target customers.
11.4 Promotion
The company currently does not engage in advertising or other promotional campaigns and heavily relies on its food window display to attract customers. However, the company may need to expand its promotional activities to reach out to non-Chinese market segment such as sponsoring events in China town and in the wider community or advertising in radio shows.
11.5 People
Supermeal offers traditional Chinese food so that the company’s kitchen staff is of Chinese descent knowledgeable about tradition Chinese ingredients and preparations while its service crew are primarily Chinese knowledgeable of tradition Chinese food service not only to satisfy the Chinese customers but also enhance the experience of the non-Chinese market.
11.6 Process
Supermeal offers traditional Chinese food in Australia, which means that the processes of product and service delivery reflect traditional Chinese culture while at the same time sensitive to the norms in Australia. This allows the company to exercise flexibility in accommodating Chinese and non-Chinese customers to ensure customer satisfaction.
11.7 Physical Evidence
The physical space and design of the restaurant together with its ambiance all converge towards traditional Chinese culture communicates the intention of Supermeal to draw not only Chinese but also non-Chinese customers who are likely to place value on an authentic traditional Chinese food experience.
12. Measurement of Strategic Success
Measuring strategic success supports strategic success by providing the company with a means of determining the extent of goal achievement by allowing it to compare previous actual and expected outcomes with current actual outcomes. The difference says a lot about strategic success. (David 2003)
First measurement of strategic success for Supermeal is the number of visitors per day/week/month for the different market segments. The increase in visitors reflects on the success of its marketing strategy in increasing its market share from the various segments. Second measurement is the number of repeat customers, the frequency of repeat purchases, and the number of referrals. Third measurement is growth in sales and profitability relative to its cost structure. Fourth measurement is the extent of positive and negative feedback from consumers in a given period in relation to the performance of its staff. To gain data for these measures, the company needs to draw feedback from its consumers as well as observe the attitudes and behaviour of its customers. The company also has to develop a sound accounting system.
13. Conclusion
Based on the environmental, product positioning, and product life cycle analysis that supported the objectives, high-level strategies and marketing mix, Supermeal holds the potential to increase its market base to support revenue growth and ensure its viability. However, it has to focus on addressing different marketing issues, especially cost control and promotions, together with the development of the appropriate effective strategies to achieve its goal of becoming the first choice in traditional Chinese food in Australia.
Reference List
Beech, W. (1997). Crafting Your sales technique: with a marketing plan, you can put your sales and promotion strategies in place. Black Enterprise, 28(5), 31.
David, F. R. (2003). Strategic management. Upper Saddle River, NJ: Pearson Education.
Gorchels, L. (2000). The product manager’s handbook: The complete product management resource (2nd ed.). New York: McGraw-Hill.
Hills, G. E. (1994). Marketing and entrepreneurship: Research ideas and opportunities. Westport, CT: Quorum Books.
Kotler, P., & Armstrong, G. (2007). Principles of marketing. New York: Prentice Hall.
Stein, C. W., & Stalk, G. (1998). Perspectives on Strategy from the Boston Consulting Group. New York: Wiley & Sons.
Reed, P. (2007). Strategic marketing planning (2nd ed.). Melbourne: Thomson Nelson Australia Pty Limited.
Appendices
Table 1: Financial Expenses of Supermeal Chinese Restaurants
Rent: about 00p/wk (in Aus dollar)
Gas: about 00p/month
Electricity: about 00p/month
Insurance: about 0p/month
Cleaning fee: about 0p/wk
Salary: about 000p/wk for about 30 employees including full time and part time
Profit: about 000-000p/wk depend on cold or hot session.
Figure 1: Product Life Cycle Model
Figure 2: BCG Matrix Model
Figure 3: Ansoff Matrix
Figure 4: Brand Positioning Map
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