Marketing Pan for Green Pizza Restaurant in Riyadh, Saudi Arabia - Case Study Example

MARKETING PLAN Name: Abdulhakeem Alfaleh Course: Foundation of Marketing Theory Executive Summary The organizations that produce and market products and services are performing their basic functions primarily to satisfy their commitments to the society, the customers and other relevant stakeholders. From an economic-point of view, they create a benefit, called utility such as form, time, place and ownership utilities (Boone and Kurtz, 2009, p. 5) and they are the want-satisfying power of the goods or service. But in today’s highly complex marketing contexts, no business would be able to survive unless it plans effectively for the future. The contemporary marketing is largely influenced by technology, competition, globalization and customers’ ever-changing specific requirements. Therefore, a marketer has to foresee how these significant variables can impact its marketing domain and how they can effectively be managed in order its marketing activities to be successful and to help it create long-term sustainable competitive advantage. This paper presents a marketing plan for ‘Green Pizza Restaurant’ in Riyadh, Saudi Arabia, comprising of major marketing and situational analysis and relevant description of marketing objectives and marketing strategies. This paper uses SWOT analysis and PEST for analyzing both internal and external environmental factors to the business. With relation to marketing objective, segmentation, target market and positioning strategy (STP) and marketing mix strategy including its sub-elements of product, price, promotion and place are detailed in this paper. TABLE OF CONTENTS Introduction ………………………………………………………… 4 Purpose of the report……………………………………………….. 4 Situation Analysis (Internal to the company) ………………………… 5 Background of Green Pizza Restaurant………………………. 5 Company’s mission, objectives and growth strategies ……….. 5 Past Performance………………………………………………. 6 Marketing Mix elements ……………………………………… 6 The customers …………………………………………………. 9 Unique Value Proposition ……………………………………… 12 External Analysis ………………………………………………………. 12 The Market Extent …………………………………………….. 12 Competitor Analysis ………………………………………….. 13 The Economic Environment ………………………………….. 14 SWOT Analysis ………………………………………………………. 18 Objectives……………………………………………………………… 19 Supply Chain Analysis………………………………………………… 19 Implementation & Control……………………………………………. 19 Conclusion ……………………………………………………………. 20 References ……………………………………………………………. 21 Introduction Green Pizza restaurant which specializes in pizza looks to ensure that they satisfy the customer through value in their offerings. (Kerin, 2005) To ensure this Green Pizza restaurant has ensured that the marketing strategy is developed in a manner which focuses on customer and looks towards quality food and services. This helps to build strong customer relations which ensure that they will remain loyal and help to build a strong base of customers for the future (Armstrong & Kotler, 2005, p.6). The report looks into the different marketing approach adopted by Green Pizza restaurant. While finding out the mechanism used by the company stress is made on the mission, vision, marketing strategies which will help Green Pizza restaurant to develop a sustainable strategy for the future. Purpose of the report To look into the internal analysis of Green Pizza restaurant which will help to understand the marketing strategies used by the organization To identify the effects of external environment on the working of Green Pizza restaurant To find out the marketing plan for Green Pizza restaurant along with the time schedule To identify the SWOT analysis which will help to find out the growth alternatives which will help Green Pizza restaurant Situation Analysis (Internal to the company) Background of Green Pizza Restaurant The restaurant is located in Eastern Riyadh. The restaurant has an advantage as there are shops and eating centres surrounding the restaurant. This provides an opportunity for Green Pizza Restaurant to tap and will ensure that there business grows. Added to it is the variety of offering made by the restaurant. Green Pizza Restaurant has a lot of options when it comes to pizzas which will ensure that the restaurant does well and attracts customers of all types. Company’s mission, objectives and growth strategies Green Pizza Restaurant looks to attract customers by offering pizza which are healthy, freshly made and also looking into the issues of obesity. This strategy has helped Green Pizza Restaurant built a pleasant environment around the brand (Armstrong & Kotler, 2005, p.42). This has helped Green Pizza Restaurant develop a mission statement for their restaurant. The mission of Green Pizza Restaurant is to provide quality food which is healthy and considers health issues for the upper class of the society. Green Pizza Restaurant has used this strategy considering the status and income level of people in Riyadh. The average income for a normal person who works ranges from SR 4000 to SR 10000. This income increases for the business men and this are the main section of the consumers who visit the stores for pizza and fun. Green Pizza Restaurant has been able to find the requirement of the higher income class and develop pizza which matches the taste and requirements of this section. Green Pizza Restaurant as a result has been able to use a strategy where they try to differentiate their food based on quality and taste so that the people in the higher income bracket which are more susceptible to it can be attracted. Green Pizza Restaurant has thus been able to identify its long term objectives as loyalty, quality in food which helps to improve customer focus and ensure profitability by changing with the environment. Green Pizza Restaurant has thus directed their strategy to be aimed as customers by ensuring customer relationship management, loyalty, and ensuring that each aspect is looked into. Past Performance Green Pizza Restaurant has been performing well from the single outlet that they have in the city. The restaurant looks to serve around 170 customers each day which ensures that the restaurant is flooded with customers all the time. Presently the restaurant is performing well and is expected to grow with their strategies in the future. Marketing Mix elements Green Pizza Restaurant to ensure proper marketing of their pizzas has looked into the 4P’s of marketing. The approach of Green Pizza Restaurant has been integrative so that every aspect is looked into. Green Pizza Restaurant have looked into the different aspect of marketing and realized the importance of each element of the marketing mix (Wilson & Gilligan, 2005, p. 536). They have ensures that every aspect of the marketing is integrated so that the collective effort can help the restaurant. Green Pizza Restaurant has thus adopted a pricing policy of penetrating the market. In this strategy Green Pizza Restaurant has priced their pizzas comparatively low and when the demand peaks up the price will be adjusted automatically. While doing so Green Pizza Restaurant has ensured that quality is not sacrificed. Green Pizza Restaurant also look towards different schemes and offers at different time of the business cycle depending on the different occasion. A more analysis is as follows Product The restaurant sector is divided into restaurant and lodging section depending on the income level in the country. This has made the provider differentiate their product. It is a seen phenomenon that Green Pizza Restaurant looks towards highlighting the benefit of their products and showing that it is also fit for health conscious people. The service plays a huge role but “the socio-cultural factor affects the number of people eating in restaurants and this gets altered due to services being offered by the restaurant”. (Pobari, 2009) Thus, Green Pizza Restaurant has a mix of services and providers differentiate themselves on some basis. Price The hospitality sector is Riyadh has multiple price mechanism working according to the living standard. The restaurant industry in “Riyadh offers premium pricing for the high class restaurants, value for money for frequent eaters and cheap value pricing for the price conscious customers”. (Justin, 2008) The mix of different pricing gives the service provider to tap the market in different cities as per the living standard. By providing such a variation it also ensures that Riyadh offers different service provider to choose their competencies. Promotion Green Pizza Restaurant while promoting their restaurant has looked towards using an integrated marketing strategy so that loyalty can be developed which will help Green Pizza Restaurant in the long run. The restaurant has used different methods of marketing like advertising through print and visual modes, email and other forms to ensure maximum penetration (Justin, 2008) Green Pizza Restaurant has also used different technology while marketing their restaurant which has helped them to develop different loyalty programs aimed at the customers. Place Green Pizza Restaurant has used differnet ways to sell pizzas. Green Pizza Restaurant has looked towards an integrated approach by ensuring that the pizzas are delivered at the door steps and can be ordered over the phone. Along with it Green Pizza Restaurant looks to provide pizzas over the counter as well thereby ensuring timely delivery (Justin, 2008). Green Pizza Restaurant strategy to understand the customer requirements at Riyadh has helped them to develop their strategy which is aimed at it. People The restaurant industry is composed of people from different sections and includes employees, customer and the company. The restaurant working under this industry ensures that they are able to develop better strategies. The restaurant industry needs to understand the socio cultural behaviour in Riyadh so that their efforts can be directed in the right direction (Kalyani & Babu, 2006). This will help the industry performing in this sector to be able to develop strategy to retain the manpower. The industry looks to ensure that proper training is provided so that employees are able do deliver quality service. For this the industry looks to develop employees in the local language and looks towards ensuring that they are able to understand the body language and signs so that the service element associated in the service industry is of high quality (Kalyani & Babu, 2006) Physical Evidence Service has different characteristics as it can be felt. This has made the restaurant industry concentrate on the requirements of the different services and integrating it with the culture has helped to develop a better strategy (Chawla, 2003) This has made the different players in the restaurant business to differentiate them by bringing about a change in which services are delivered to the customers (Chawla, 2003). This has helped the different providers to be able to ensure a different strategy and build their presence in the market around service. The customers To ensure effective marketing the most important aspect for a business is recognizing the customers (McLoughlin and Aaker 2010, p. 26). This can be strengthened by differentiating customers into different segments and looking towards each segment as a different section so that targeting is better (Luther, 2011, p. 55). The main targeted customers are people in the middle and higher income bracket people who go an extra step to spend high for quality food, ambience and comfort. This helps the restaurant to concentrate on people who are more health conscious and look towards healthy food. This goes in line with the target base the income level of people in Riyadh is $15,500 which is very hight and makes it easy for the restaurant to identify their customers correctly (Peskin, 2009, Para. 7). This when converted to the local currency becomes SR 55125, making an average of SR 4953 per month. This helps to identify most of the customers to be either in the higher or middle income bracket with the majority being composed of the latter. (Al-ghaith, 2010) This has also been demonstrated in the graph below which highlights the income level of people. Another important aspect to note here is that majority falls in the youthful segment thereby helping the restaurants to offer more variety. This has been further segregated according to customers who prefer organic food compared to other types of food. Despite having a segmented market it has been identified that the restuarant industry has a trend to serve customers who visit their stores thereby highlighting the fact that the focus is on mass marketing. The company while ensuring this has looked towards continuous developments by identifying the needs of the customers and molding their services according to it. This has helped the restaurant to find the preference in taste and mould their behaviour accordingly. This has helped to ensure more customer focus and developed them for the future. The above factors also helps to identify the target market for Green Pizza restaurant to be young people who have a desire for different taste and are willing to spend extra money to ensure quality in service and food. Unique Value Proposition Customers look towards quality, expectation about the product, features and other association with the product or service before deciding what they want to purchase in the market (Duchessi, 2002, p. 81). Customers swap form on service to another if the value from the other product increases and are one of the most important factors determining the buying habit. Green Pizza Restaurant on this front looks towards adopting a stance where they differentiate themselves from the competitors and help to develop brand equity. Green Pizza Restaurant is looking towards marketing themselves by highlighting their benefits. The restaurant uses a strategy where they highlight their pizza which has less oil content. This has helped the restaurant to ensure that it attracts the health conscious people and has helped the restaurant to grow with this strategy. This is a unique selling point which Green Pizza Restaurant targets at and looks towards attracting customers by using it. External Analysis The Market Extent Green Pizza Restaurant is looking to attract customer from Riyadh and is not looking towards increasing their stores in different parts of the globe by looking towards movement in different part of the globe. This has made Green Pizza Restaurant concentrate on the local market and is looking towards attracting customers from all age group and income level to ensure efficiency in their marketing strategies. This strategy of Green Pizza Restaurant has enabled them to work towards using a model it is able to concentrate on the school goers, visitors to malls and people with an income level that will ensure maximum penetration in the restaurant. This has made it possible for Green Pizza Restaurant to concentrate on the few segments of people. Competitor Analysis Businesses look toward identifying the strategy of the competitors so that they can identify the potential the market has and develop their own strategy based on it (Ireland, Hoskisson and Hitt, 2007, P. 162). This goes a long way to build a strategy which closely resembles to those of the competitors thereby helping to improve the efficiency of the marketing segment. This has been substantiated by a study which stats that identifying competitors helps to develop sound strategies (Bangs, 2002, p. 61). Green Pizza faces competition from Eat-Fresh, Zigzag, Al-raid and Hill-View. The total number of people visiting this restaurant on the combined basis is 400 to 600. Green Pizza Restaurant strategy to develop its amenities and interiors will help them to attract a major chunk of the visitors and it is expected to be around 220. This is based on the sound strategy that Green Pizza Restaurant has adopted. A detailed analysis of the competitors for Green Pizza Restaurant has been provided as Eat-Fresh Zigzag Al-raid Hill-View Green Pizza Aims at people in higher income bracket Aims at youth Aims at low income bracket customers Aims at people in higher income bracket Aims at all people Offers variety of food including pizzas Deals in pizza but little concentration on health issues Serves fast food including pizza Offers variety of food including pizzas Offers pizzas which are helth conscious Serves 165 people Serves 160 people Serves 150 people Serves 150 people Serves 170 to 180 people Strength Stable customers range Strength Attracted by youth Strength Attraction for low income people Strength Reputation due to a long presence in the market Strength Deals with customers belonging to different segments Weakness Limited customer base Weakness Provides pizza thereby lacks variety in their offerings Weakness Limited focus on few categories Weakness Limited focus on few categories Weakness Provides pizza thereby lacks variety in their offerings Poor service delivery Health issue an ara of concern Poor service delivery Poor service delivery Complex menu and the manner food is prepared The Economic Environment The growth in the industry in Saudi Arabia provides an opportunity for business to flourish. Along with it the presence of oil industry and the developments taking place provides an opportunity for different industry to use different business cues. This along with the string growth and rise in income level provides an opportunity for the different players in the market to tap the widespread option that is available to them. The ample opportunity the business environment of Riyadh provides to the different players makes it one of the most desired business destinations for all. This is aided with the fact that the kingdom of the king has undergone tremendous changes and provides an opportunity for everyone in the market to use it to their advantage. This has made business look towards Riyadh to develop their business futher and expand in other markets. The growth in the real estate business, the rise in GDP and more development in the economic condition provides an opportunity for businesses to flourish. The country has dealt with the financial crisis effectively and has developed a model which ensures that businesses are permitted to grow. The laws of the government have been supportive and Green Pizza Restaurant can benefit greatly from it as the policies are directed towards growth and there is no interference of the political system in the restaurant business. Political Political situation defines a manner in which an industry is able to grow and abide by the rules prevalent in the country. Riyadh which is a developing country finds the presence of political influences on different matters (OPpapers, 2010). The restaurant industry has been able to deal with it positively as the interference of the government is limited to local players and mainly looks to ensure that the rules are adhered to (OPpapers, 2010). This makes it important to understand the political scenario. Riyadh has witnessed a stable government (OPpapers, 2010) which has helped the restaurant industry to ensure that the policies are supportive. This has ensured that the business is able to take account of it and there are no sudden changes in the working condition which has greatly helped Green Pizza Restaurant. Economic The state of economy has a huge role in the spending pattern. This is more for the restaurant industry as rise in income increases the visitors as people use it as a luxury item to enjoy and opposite happens in case of a downturn (Justin, 2009). This further gets influenced by inflation as raise in the price level makes it difficult for certain section of the customers to visit the restaurants. Riyadh provides an opportunity in this direction as the country has been able to withstand the global crisis and has been able to ensure that the economy grows strong so that consumer confidence returns which is seen by the increase in customers in restaurants. This has made the standard of living to grow. “It has been identified that the present GDP stands at $1600 which is when we consider the fact that the economy has just recovered and is bound to grow with the strong policies of the government which favours it”. (OPpapers, 2010) This will thereby benefit every industry and restaurant industry will witness more visitors spending more in the restaurants. Social Riyadh has a strong influence of the socio and economic culture prevalent in the country. The diversity in culture has helped them immensely. “The country has a mix of different culture which has made the economy looks into different factors to attract customers and ensure that their strategy matches those with the culture (Justin, 2008) The culture prevalent in a country defines the success for the industry functioning in the economic environment and makes it important to integrate it in their planning process (Justin, 2008) Religion is another factor which has an influence on culture and businesses need to tap it. The service industry has looked to develop their strategy based on the culture and look to integrate it in their management process. The companies performing in the service industry in Riyadh are looking to bank on this factor and ensure that customers remain loyal (Justin, 2008). The country thus has been looking towards the social factors in determining success. Technology Environment The dependence of the restaurant industry on technology is limited as is the case with players in the hospitality business. The restaurant business has witnessed the use of technology in some form. Recently the business has seen the use of induction cooker, electronic ovens, electronically timing system etc which are controlled through the use of technology. An area where technology has been used in the restaurant industry is billing and maintaining information about the customers. This has made it important that the restaurant industry copes with the required changes that technology confronts with (Joseph, 2005). This will help to improve efficiently and maintain all important information and data related to the business. Environment The government has taken steps which helps to improve the environment standards for the organizations. The restaurant industry has been a contributor in this direction as they have looked to reduce wastage and ensure that the wastes are not dumped into the land which increases the land fills. This is an area which the restaurant industry has looked seriously. This will pay rich dividends as it will help to build long term relations and receive the support of environmentalist and government in the future. This will thereby help to develop the business model and ensure more developments on all fronts. Cultural Trend The cultural trend shows that people belonging to the elderly group prefer the traditional house food. The composition of them is 1.8% of the total population thereby not having a large influence in the market. The other part of the population is open to changes and prefers variety in food thereby presenting an opportunity for the restaurant industry. SWOT Analysis Strengths Weaknesses Restaurant looks towards quality service and customer satisfaction Having an approach where all P’s of marketing is considered Increased consumer dependence on healthy food The business model that looks to deliver quality in service. Complex menu and the manner in food is prepared is complex Lack of variety in offerings making them adhere to a limited section of people. Large proportion of the population are not fond of pizzas Opportunities Threats Presence of a market in the locality Increased attention of customers towards food along with fun Providing pizzas which are different in taste and appearance from others Using new methods to bake pizzas so that it is more crunchy Increased competition level form other players Availability of ready to eat food attracting customers . Objectives Green Pizza Restaurant has looked towards using SMART as a cornerstone for their marketing activities (Lipe, 2002, p.115). This can be substantiated from the fact that the customers have grown from 150 to 220 thereby highlighting the efficiency of the marketing strategy achieved by the restaurant. This makes it important that the restaurants bring about the change in their sitting capacity to further strengthen their visitors to the restaurant. This will help Green Pizza Restaurant to look towards ways of improving their interiors as the company based on the performance will be confident to deliver quality service and will be able to expand its reach to different parts of the globe. This is making Green Pizza Restaurant target Jeddah as it provides an opportunity for the restaurant store to grow its business. Supply Chain Analysis Green Pizza restaurant is looking to satisfy customers by developing a supply chain which will help to serve the customers with fresh pizza. The restaurant on this direction is looking towards different tie ups so that they are able to evaluate the mechanism which will ensure that they are able to deliver quality products. Green Pizza in this direction is looking towards tie ups which provide regular pizzas and the stale ones are replaced with the fresh ones. Implementation & Control Green Pizza restaurant needs to devise a strategy by looking at the time frame and the manner they will achieve the objectives of the business. Green Pizza needs to look towards improving the brand name, market share and penetration into different markets. For this Green Pizza needs to evaluate their strategy regularly so that they are able to identify the areas they need to work on. Green Pizza by having a time frame will be able to ensure that they take all steps which helps to bring the entire functioning into one. This will help the restaurant to develop their market model better and the strategies used by the restaurant will pay the required results. It will at the same time ensure that timely changes are being made to the required strategy to ensure that their plan is according to their desire. Conclusion The growth in the per capita income of the people is providing an opportunity for the restaurant industry to tap on (Ajay, 2006). This has attracted many players into the market as it provides an opportunity for the players to tap on. This along with the strong policies of the government which favours growth has made it possible for the restaurant industry to adhere to the legal requirements. This has made the growth an important constituent. Growth in the technology front has also helped the restaurant business to flourish. Also the use of the socio cultural factors has made it possible for the service industry to grow their business. 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