Marketing Management for Restaurant Industry: of Chun Po - Case Study Example

Executive Summary Chun Po is a restaurant in Australia which is offering Chinese cuisine and has been successful in it. This has helped them look for opportunities to grow and ensure that they are able to deliver quality food to its customer as service and quality is a very important aspect in the restaurant industry. The report presents the mission and product line Chun Po deals in. This helps to identify the long term opportunity that it has. The 7P’s of marketing helps to highlights the area Chun Po has worked upon and the areas that have acted as their success factors. This helps to find the internal analysis. The customer analysis deals with the buyer behaviour and the targeted audience which helps to provide the direction needed for the restaurant to market itself. The external analysis highlights the opportunities the restaurant industry provides to Chun Po. The report also has the competitors’ analysis which shows that it faces competition and despite it the restaurant has been able to sustain its customers. The SWOT analysis presents s the different opportunities the restaurant has. Thus, the report helps to find the various opportunities and areas where Chun Po needs to work upon to ensure that the services rendered by them helps them to earn customer. This is on the back drop that Chun Po needs to ensure that they are able to deliver quality service and products to ensure steady customers. Contents Introduction 3 Purpose of the report 3 Internal Environment Analysis 3 Background of Chun Po 4 Mission Statement 4 Brand Detail 4 Product Line 4 7P’s of Marketing 5 External Environment Analysis 9 Customer Analysis 10 Competitor Analysis 12 SWOT Analysis 13 Conclusion 14 References 15 Introduction This is the situational analysis for Chun Po Chinese restaurant, which helps to demonstrate the internal analysis including the 7P’s of marketing, the external analysis, competitor analysis, customer analysis and SWOT. This will help to identify the areas where the restaurant can work upon and based on it the marketing strategy for the restaurant can be worked upon. Purpose of the report To identify the internal analysis which will help to look into the marketing strategies adopted by Chun Po Chinese restaurant To identify the effects of external environment on the working of Chun Po Chinese restaurant To identify the customer and competitors which will help to identify the areas to be worked upon To arrive at a SWOT analysis highlighting areas which will help the restaurant to grow their business Internal Environment Analysis The internal environment analysis helps to identify the internal strengths and areas where the company is working upon. Working upon those areas will help to ensure better delivery of services and satisfaction of customer desires. Background of Chun Po Chun Po Restaurant is Located in the Glenferrie Road, Malvern. The surround areas are have shops and eating centres. Presence of university in the adjoining area makes it a place where consumers like to dine. Chun Po has an advantage because of the variety in the cuisine makes it a favourable destination among many. Mission Statement Chun Po mission is to provide delicious cuisine food to the customers by integrating the western style of cooking with the Chinese environment. They are working towards ensuring quality food and services. (Chun Po Chinese Restaurant 2010) Brand Detail Chun Po restaurant has devised a strategy which helps them to get many customers. They have variety in food and have a dining place for many. They have been working for 12 years and have a sitting capacity of 80 diners. Every table can accommodate at a maximum of 14 people and has a private room also. Product Line The restaurant specializes in Chinese food and services. The cook ensures that the food cooked is fresh and vegetables are purchased fresh. At the same time it is ensured that food is served in Malvern style. The restaurant chain thus specializes in Chinese food. (Food, 2010) 7P’s of Marketing The 7P’s of marketing helps to understand the marketing strategy that the restaurant industry offers. The analysis of this will help to understand the strategy that will help them to be successful. Product The restaurant industry is divided into luxury, business leisure and economy class depending on the income level. This has made the provider differentiate their product. The service plays a huge role but “the socio-cultural factor affects the number of people visiting the restaurants”. (Justin, 2008) Thus, Australia has a mix of services and providers differentiate themselves on some basis. Chun Po offers a variety of products. This has made its value rise as consumers get variety. Chun Po restaurant have ensured that customer gets everything. They have taken care of every requirement. This has helped the company as they have been able to give variety. By offering variety Chun Po has been able to lure customer. They have taken the onus and also provided them with varied services. (Sea Food, 2010) Price The restaurant industry is Australia has multiple price mechanism working according to the living standard. The restaurant industry in Australia offers “a mix of different pricing giving the service provider to tap the market in different cities as per the living standard”. (Justin, 2008) By providing such a variation it also ensures that organisations offers different service provider to choose their competencies. A study conducted shows that “brands create an halo affect around the product as consumer have a perception that the product is better compared to its competitor in terms of quality, price and usage” (Lance, Katrin & Chiranjeev, 1995) Chun Po has priced its product in such a manner that it eyes the target audience in and delivers them proper services. This helps the company to earn extra. Chun Po has also been able to do it. It has been able “to generate more than its competitors who is reflected in the margins”. (White, 2007) This has enabled Chun Po to get high value. This is because of service. It is helping build good reputation. The pricing strategy thus confronts with the promotion strategy and the services provided by them. Place The restaurant industry to ensure proper distribution needs to ensure that the product and service is delivered to the customer at the door step. For this in the restaurant industry the customer has to be present at the place. It is important that the manner in which the services are rendered makes the customer feel a part of the organisation. The type of distribution to be used in the restaurant industry is direct selling. The sales person has to come in contact with the customer to ensure satisfactory delivery of services. A special thing to note here is that the services are consumed at the same time. It is not possible to store it. Chun Po has been able to use the place strategy at its advantage. It has ensured that the sales person deliver the services properly. It is merely for the services rendered by Chun Po that it has been able to earn a brand image. The restaurant has ensured that they look into the fact that direct marketing Promotion The restaurant industry provides an integrated marketing communication to make the customer aware of the services and ensure that they remain loyal. The restaurant industry offers “advertising on television, radio, billboards, newspaper, hoardings, and public relations, personal selling, direct mail and internet”. (Justin, 2008) The technological advancement has allowed companies to use the marketing communication according to their requirements. Thus, it presents a wide avenue to choose to sell the services and also have loyalty programs to retain customers. Chun Po has been able to promote its product in such a manner that it has given them widespread recognition. This helped to attach customer to its product. Chun Po has been promoting it on the basis of “the culture heritage and good service through proper hospitality which has helped them build a market”. They know the customers wants. This is helping Chun Po work on those. The group has also been created “due to standards and values that Chun Po has”. It has been consistent in those. Thus loyalty has grown. Customers prefer it. Thus, Chun Po has been able to use it well. People People in the restaurant industry comprises of employees, customer and the company itself. Companies need to ensure that all this are under control so that proper management is possible. The buyer behaviour “plays a huge role due to the socio-cultural influence so companies need to ensure that segmentation and targeting is sound”. (Kalyani & Babu, 2006) This makes it important that restaurant industry identifies it properly. The services offered should also be good to retain those. Chun Po has been able to put in place a strategy which suits its target audience. This has given rise to consumer preference. The customers want to visit the restaurant again as the quality of food offered is good and the variety offered attracts many. (City of Melbourne 2010) Process Service sector needs to realize the importance of process in the delivery of quality service. The restaurant industry needs to ensure that a system is in place which helps to answer the queries of the customer. Also have a process where the customer is contacted regularly and feedbacks from them are taken for improvements. Further, in the restaurant industry it is important that the customer is regularly updated about new additions and they are able to track those. Also, with integration of technology has provided the restaurant industry to ensure that customers are able to check the availability of rooms and other services using those. Chun Po has been successful in it and has ensured that any changes in the process are accounted for. They have integrated the web and ensured that the queries are solved. A back up team works on tirelessly to handle queries and also provide regular updates. This has provided quick service and ensured that the process for the delivery of services is rendered without any hiccups. Physical evidence Services can’t be seen but only realized by those who have been a part of it so the restaurant industry ensures that the services offered are as per the cultural requirements. The provider so ensure that “services offered are differentiated by offering something else from the others so that satisfaction is high”. (Chawla, 2003) Thus the restaurants have a lot of offer and based on the different culture and places the provider mould their. This helps to provide good service. Chun Po has been able to use it their maximum advantage as they ensure that the service they provide are world class. It highlights the fact that customer have a preference for the restaurant and those who have been a part of it are in a better position to speak about the quality of service offered by Chun Po. External Environment Analysis Analyzing the external factors and its effect on the restaurant industry will help to understand the opportunities the market presents. The PEST analysis for the same has been provided in the following chart (PEST, 2010) Political Economic New legal restriction Decrease in national income reducing purchasing power Change in government policies Rise in interest rate affecting borrowing power Increase taxation rates Increasing inflation reducing purchasing power Changing future laws Reduction in wages   Increase in taxes Social Technological Decrease in population size Rise in capital expenditure due to changing technology Change in lifestyle Rapidly changing research and development growth Concerns about obesity Increase cost of machinery Rise of health conscious people Increase maintenance cost The trend analysis thus presents how the external factors will affect Chun Po Restaurant and other restaurants and companies need to craft strategies to counter those. Customer Analysis This will help to understand the customer wants and requirements. This analysis will help to understand the buyer behaviour, the different segment of customer eyed at, and the customer perspective towards the restaurant. Target Customer The targeted audience for Chun Po has a mix of different age group and people based on the requirements and taste preference. The targeted audience is as follows School & College Goers: Chun Po targets students and college goes as they have universities in the adjoining area. The cuisine of the restaurant matches with the taste of the younger generation thereby helping them to attract the correct customer base. Visitors to malls: Chun Po also targets the customer who visits the shopping mall as there is constant flow of customers there. This will help to ensure that the restaurant always has customers and since the Chinese cuisine is cooked quickly so it helps the visitors to the malls to get food quickly after their purchase. Buyer Behaviour The buyer behaviour of customer in the restaurant industry is influenced by various factors which defines their role and make them arrive at a decision. Role: The buyer role in the restaurant market is determined by the whims and desires. It is seen as a common fact that youngster determine the sell of different cuisines. The defining role here is played by youngster who shapes the direction where they will dine and the food they will have. Decision stage: The decision to purchase is made at the time when they enter a super market and the hunger after purchasing in the market tempts them to be eating outside. The decision here can be either at the beginning or at the end of the purchase cycle but when a smell of the cuisine catches attention is when a decision to eat is made. Decision type: The decision to eat is impulse and no prior planning is done for it. There may be certain situations when planning is done but mostly the decision to dine is done at the point. Thus, it presents a huge opportunity for Chun Po as the customer base in increasing and the decision to eat is impulse provides an opportunity to tap the market. This can add to their advantage due to the service being rendered and the quality of food being offered. Competitor Analysis Chun Po faces competition from many quarters. There are many restaurants that are in similar line of business thereby exerting extra pressure on the brand. Some of the competitors for Chun Po are Bistro Thierry, Bee Chun Hung and Ma Po Dak Gal Bi. All this are in the service industry and provides food to the customer. A comparative analysis of the competitors along with Chun Po is shown below Chun Po Bistro Thierry Bee Chun Hung Ma Po Dak Gal Bi Type of Restaurant Fast Food Fast Food Fast Food Fast Food Type of Food Chinese French Chinese Chinese Service Excellent Good Good Ok Speciality Sea Food, Chinese Onion Soup, Mussels and Pomme Fritte Sea food & Chinese Sea food, Soup & Chinese Thus, we see that the competitors are very near placed to Chun Po. (Bistro Thierry, 2007) This is making them to work hard and ensure that they are able to retain customer. Service here is important as there is very little to choose from. A rating from some customer based on the food shows an opportunity for Chun Po compared to its competitors. The finding looks as follows The overall rating for a survey from 43 customers shows that Chun Po is preferred and has a rating of 7.8 compared to its competitors. (Customer rating, 2010) This provides a window of opportunity for Chun Po to capitalize on and use it to gain maximum leverage. SWOT Analysis The SWOT analysis of Chun Po Restaurant will help to identify the areas where the company can work and strengthen itself into a better player. Strengths Satisfies customer needs of hunger which is a basic need Large market and increasing customer base due to population growth Variety of cuisine suiting all customer needs Growth in super markets and universities nearby enabling more customers Weakness Limited shelf life there by making the product become unfit for consumption Brand power require to market the product pushing the cost to rise Opportunities Huge potential in the school going segment as there is an upward trend in people eating outside. (Ferrell, 2002) Opportunity to launch more variety of cuisine to attract different section of customer Threats High distribution cost Health issue surrounding the beverage industry Conclusion Chun Po has been able to deliver quality service and the analysis presents a window of opportunity for the restaurant chain to tap upon. The restaurant can grow and increase its volume of business as the growth in this segment is phenomenal. Chun Po being high on value and service has a scope to grow and fulfil the hunger for food for their customers. References Bistro Thierry, 2007, “Bistro Thierry”, retrieved on August 26, 2010 from http://1001dinners.blogspot.com/2007/02/bistro-thierry.html Chawla A, 2003, “Marketing Management for Restaurant Industry”, Workshop on Marketing of Educational Institute, Programme and Services Chun Po Chinese Restaurant 2010, Chun Po Chinese Restaurant, retrieved August 26 2010, < http://www.drinkeatweb.com/chunpo/> City of Melbourne 2010, Economic and demographic profiles, retrieved on August 26 2010 from Customer rating, 2010, “Chun Po Restaurant rating”, retrieved on August 26, 2010 from http://www.eatability.com.au/au/melbourne/chun-po/ PEST, 2010, “PEST Chun Po Restaurant”, Research Paper, Viewed August 26, 2010 Ferrell G, 2002, “SWOT Analysis for Chun Po Restaurant”, Orland, Dryden Press Food, 2010, “Chun Po Food variety”, retrieved on August 26, 2010 from http://www.eatability.com.au/au/melbourne/chun-po/ Kalyani V & Babu P, 2006, “Strategies for developing sustainable restaurants brands in Australian market”, Sri Krishna School of Management Justin A, 2008, “Restaurant Industry”, Service Sector Management, Business Week Lance K, Katrin H & Chiranjeev S, 1995, “Brand equity: the halo effect”, European Journal of Marketing Sea Food, 2010, “Chun Po Sea Food” retrieved on August 26, 2010 from http://www.mauritiusdelight.com/chun-po-seafood-restaurant.htm White P, 2007, “The Chun Po Restaurant”, Business World Read More