AMB359- Strategic Marketing Audit. Tutor: Husain Akareem Yuen Kai Keith Chan N

Transcription

1 AMB359- Strategic Marketing Audit Tutor: Husain Akareem Yuen Kai Keith Chan N

2 Table of Contents 1. Overview of product and context External and Customer Analysis Defining the market segments Customer Value Proposition Competitor analysis Direct Competitors Indirect competitors Competencies and assets of key competitors Market/Submarket analysis Market Analysis Developing Submarkets Key Success Factors Environmental Analysis and Strategic Uncertainty Technological trends Consumer trends Environmental trends Preliminary strategic options Strategic competitive advantage Functional strategy Measuring success Reference List... 9 Appendix

3 1. Overview of product and context Consumer demand for healthy foods is emerging at a rate like never before, due to the increase in people being educated about healthy eating and how it nourishes their bodies. Since 2014, All Real Food has launched nine vending machines across universities and hospitals with the aim of providing an easier way for people to maintain a healthy diet, even if they struggle with time. Food in the vending machine include a wide selection of salads, wraps, yoghurt and protein balls. A deep analysis of the healthy fast food market has been undertaken to evaluate consumer behaviour, the competitive market and potential customers. With these findings, preliminary strategic options could be formed.

4 2.0 External and Customer Analysis 2.1 Defining the market segments To discover the most appropriate customers to target for All Real Food, a combination of the consumer s demographic, geographic, behaviour and psychographic must be investigated. According to Hegedus and Mullan (2015), raw foods and fresh vegetables are beginning to replace sugary doughnuts and high-cholesterol burgers on the Australian market, with recent findings that both genders in the country are becoming more health conscious at a younger age, therefore presenting All Real Food an immense opportunity to capture these individuals. Cullen (2016), states that the modern, health conscious Australian have a strong demand for organic, natural and low-fat food, preferring healthy and nutritious food over high-fat processed food. On the other hand, ready to eat food have become increasingly popular due to busier lifestyles (Fish, 2016). 2.2 Customer Value Proposition The most appropriate customer value proposition for All Real Food s is that low-fat, healthy food such as salads and wraps are made fresh daily at specific University and Hospital locations, and is available to be purchased through the vending machine. Therefore, also allowing consumers with busy lifestyles to easily access healthy food anytime during throughout the day. By allowing consumers to easily access healthy food will benefit All Real Food in helping individuals reach their desired goal or to simply maintain a healthy diet, creating a distinctive customer value proposition (Maras, 2016).

5 3.0 Competitor analysis It is crucial for a business to analyse their key competitors when entering a market with a high potential growth. According to Albayrak (2015), the analysis of key players can provide the business a clear understanding of the marketplace, revealing strengths and weaknesses of key competitors, therefore playing a vital role in shaping the marketing strategies for the business. 3.1 Direct Competitors Youfoodz, Lite n Easy and Sumo Salad are the major competitors within the Brisbane healthy fast food industry. With Sumo Salads opening their 11 th store in 2017 here in Brisbane and Youfoodz and Lite n Easy delivering up to meals and snacks to a customer per week accordingly to their meal plan requirements. Figure 1: Key Competitors comparison Points of difference Youfoodz Lite n Easy Sumo Salad Convenient and fast Delivery of fresh not frozen meals Aims to help customers reach or maintain their nutritional goals. New meal added to menu every day giving customers another choice on their next order. Assists clients to lose weight through portioned meal plans. Fresh meals are delivered to customers in one big esky. Renown brand awarenessestablished in Over 100 stores across the globe, with the claim to be the healthiest fast food franchise. Catering people who look for a healthy option in the food court. Purchased over the counter with many salads on display for the customer. Customer can purchase up to five salads 3.2 Indirect competitors According to Porters Five Forces theory, business viability is reduced if customers can easily choose an alternative product to satisfy their need (Aaker, 2014). Competitors outside the healthy fast food industry will also be an issue for All Real Food, as they are essentially able to satisfy the same consumers need of hunger (Brjis 2016). Those that offer relatively cheap and convenient meals will impact All Real Food the most, especially fast food giants McDonalds and Subway who are currently leading the industry respectively, with both already having a large customer base (Mathe-Soulek, Krawczyk and Harrington, 2016).

6 3.3 Competencies and assets of key competitors Current key competitors within the industry have adopted similar competencies and assets to compete in this competitive and emerging industry. As the emphasis for modern day healthy fast food is to be fast, fresh, friendly to all kinds of diets including vegan and gluten free, and most importantly for sale at a reasonable price (Wellard, Koukoumas, Watson and Hughes, 2016). With these being the key success factors for the industry, a SWOT analysis has been established for All Real Food to overview their current status. Figure 2 All Real Food SWOT analysis Strengths 24-hour access through vending machine Low wages cost Natural and organic ingredients Supplies from local farmers Fresh produce sourced only from Australia and New Zealand Opportunities Emerging market with the potential for sales still to grow Unique and innovative idea which can potentially be a market leader Increase in health-conscious individuals Weaknesses Chance for potential overcrowding in the growing market Weak/moderate online and offline presence Threats Direct competitors offering healthy meals Threat from local competitors in various locations (eg- café s, sushi and sandwich bars) Ease of customer switching

7 4. Market/Submarket analysis 4.1 Market Analysis For a firm to succeed when entering a competitive market, they must analyse their competitive vitality. Although All Real Food s brand image has not reached its full potential and is far behind key competitors, entry and exit barriers for the firm is still rather weak due to them operating through vending machines rather than stores, meaning they are able to enter without wasting time and money on renovation and exit by simply removing the vending machine. Also, by selling healthy food rather than junk food, it eases entry to places such as universities and hospitals as it aligns with their values and principles of encouraging healthy eating (Piercy and Smith, 2011). 4.2 Developing Submarkets The emergence of the health eating movement has allowed entrepreneurs to incorporate alternatives for healthy eaters even at popular fast-food chains and traditional cuisines, making the hospitality sector extremely competitive and challenging for small businesses like All Real Food (Montandon and Colli, 2016). 4.3 Key Success Factors By analysing All Real Food and their key competitor s current assets and competencies in the extremely competitive industry, allows the firm to exploit the current successful factors within the market (Philpott, 2016). The successful factors found within the competitive market involves the increasing amount of businesses using technology and information systems to attract repeat purchases from customers, which is proving to be successful for many of All Real Food s competitors. For All Real Food s to compete or gain a competitive advantage against competitors, their strategic strength should aim to attract repeat purchases through innovative technology such as a mobile application acting as a menu and loyalty program, as seen from competitors such as Sumo Salad (see appendix 1) as these modern-day applications have a significant impact on the business s revenue (Tang, 2016). Figure 3 - Key success factors in the market Success factors Mobile loyalty application Free Wifi at store location Web order and delivery Loyalty cards Competitors Sumo Salad, Guzman Y Gomez McDonalds Youfoodz, Lite n Easy Subway, certain café s

8 5. Environmental Analysis and Strategic Uncertainty 5.1 Technological trends The idea of offering healthy meals and snacks from a vending machine is truly innovative as it offers customers café and salad bar like quality food through a click of the button and tap of a credit card (Maras, 2016). However, to dominate the market, this is not enough as All Real Foods must take advantage of the latest technology and information systems in creating a mobile application that can include a loyalty scheme, nutritional information on meals and updated stock list on available food at specific locations. That is due to online activity shifting to mobile, and the fact that the percentage of smart phone owners in Australia is at its highest percentage to date at 82.6% (Biddle, 2017). 5.2 Consumer trends The most relevant consumer trend for All Real Food s market right now is fit is the new skinny, where consumers are becoming more health conscious at a younger age due to increase in dietary education and social media influencers such as models and athletes (Boepple, Ata and Thompson, 2016) Combining this social trend with convenience and organic packaging, All Real Food can capitalise on these trends by supplying food to these health conscious individuals, helping them to stay healthy and to achieve their desired nutritional goal. 5.3 Environmental trends More and more businesses are beginning to use environmentally friendly packaging as it s not only beneficial for the environment, but also their brand image (Fish, 2016). When customers learn that eco-friendly materials are used in packaging, they generally feel better about their purchase and therefore increasing the chance of a repeat purchase (Hoek, Pearson and Friel, 2017). Therefore, All Real Food should consider environmentally friendly packaging for their products. Figure 4- Pestle analysis for the healthy fast food industry Political Economic Social technological Legal Environmental Stable political environment Growing market for healthy fast food Property prices increasing Increasing amount of health-conscious individuals Busier lifestyles and working hours More consumers favouring environmentally friendly products Use of web technology and applications from businesses Online customer reviews can be seen by anyone Mobile payments Health and safety laws Anticompetitive behaviour Trend towards environmentally friendly products Seasonal change: can impact suppliers (farmers)

9 6. Preliminary strategic options 6.1 Strategic competitive advantage In the emerging and competitive industry of healthy fast food, differentiation is vital to stand out from competitors, incorporating a mobile application may help improve customer experience and increase the chance of a repeat purchase (Dolan, 2015). On the other hand, bio-degradable packaging will have less of an impact on the environment and will meet the growing consumer demand for environmentally friendly products (Boon, 2016). 6.2 Functional strategy With the introduction of the mobile application, All Real Food should implement a penetration pricing strategy for a brief period where customers receive discounts through their first purchase on the application, which will help increase brand awareness (Dowling, 2016). Once brand awareness has increased through penetration pricing, All Real Food may then alter the pricing strategy back to premium pricing, focusing deeply on organic meals and bio-degradable packaging, cutting back on the number of discounts distributed on the mobile application. This way, the business would have increased their customer base and brand awareness and may shift to a more premium brand, differentiating themselves from key competitors. 6.3 Measuring success Observing success factors for the business must be done frequently to be align with competitors (Mahoney and Tang, 2016). Besides from total revenue, the firm should observe the mobile application for repeat purchases from customers, customer satisfaction and indicators of best and worst sellers, which are all key indicators of success and positive signs for productive strategic implementation (Klubeck, 2017).

10 7. Reference List Aaker, D. A. (2014). Strategic market management (Tenth ed.). Hoboken, NJ: Wiley. Albayrak, T. (2015). Importance performance competitor analysis (IPCA): A study of hospitality companies. International Journal of Hospitality Management, 48, doi: /j.ijhm Biddle, C. (2017). Increasing the online presence of the AANA journal. AANA Journal, 85(1), 6-7. Boepple, L., Ata, R. N., & Thompson, J. K. (2016). Strong is the new skinny: A content analysis of fitspiration websites. Body Image, 17, doi: /j.bodyim Boon, R. (2016, ). Environmentally friendly packaging a super idea. The Straits Times, 12(3), 9 Brijs, B. (2013). Business analysis for business intelligence. Boca Raton, FL: CRC Press. Cullen, J (2016). Australian Institute of Food Safety: Food and consumer trends 2016 [EBL version]. Doi: / Dolan, A. (2015). Is your business ready for mobile applications? Central Penn Business Journal, 31(48), 25. Dowling, G. R. (2016). Winning the reputation game: Creating stakeholder value and competitive advantage. Cambridge, Massachusetts: The MIT Press. Fish, E. (2016). flexible packaging: Convenient and (becoming more) environmentally-friendly. Flexible Packaging, 19(7), 8 Hoek, A., Pearson, D., & Friel, S. (2017). Shrinking the food-print: A qualitative study into consumer perceptions, experiences and attitudes towards healthy and environmentally friendly food behaviours. Appetite, 108, doi: /j.appet Hegedus, J., & Mullan, J. (2015). Are we adequately providing support services for optimal infant nutrition in australia? A study in regional NSW. Australian Journal of Primary Health, 21(3), doi: /py14044 Klubeck, M. (2017). Success metrics : A multidimensional framework for measuring organizational success (1st ed.). Berkeley, CA: Apress. Mahoney, L. M., & Tang, T. (2016). Strategic social media: From marketing to social change. Chichester, United Kingdom: Wiley-Blackwell. Maras, E. (2016). Top kiosk stories for october: Food and convenience dominates reader interest. Kiosk Marketplace. News Features Mathe-Soulek, K., Krawczyk, M., & Harrington, R. J, (2016). The impact of price-based and new product promotions on fast food restaurant sales and stock prices. Journal of Food Products Marketing, 22(1), doi: / Montandon, A., & Colli, C. (2016). Effective nutrition labels for fast food consumers. British Food Journal, 118(10), doi: /bfj

11 Philpott, L. (2014). Marketing and merchandising: Strategies for successful marketing. AJP: The Australian Journal of Pharmacy, 95(1129), Piercy, A., & Smith, S. (2011). Effect of menu labeling and suggestive selling on sales of healthy food options in a university setting. Journal of the American Dietetic Association, 110(9), A76-A76. doi: /j.jada Tang, K. Y. (2016). Mobile app monetization: App business models in the digital era. International Journal of Innovation, Management and Technology, 7(5), 224. doi: /ijimt Wellard, L., Koukoumas, A., Watson, W. L., & Hughes, C. (2016). Health and nutrition content claims on australian fast-food websites. Public Health Nutrition, 20(4), 1-7. doi: /s

12 Appendix 1 Sumo Salad mobile application allowing customers to order and collect their food as well as collecting points and rewards.