Marketing Mix

Table of Contents I. INTRODUCTION3 II. MARKET STRATEGY4 A. Product5 B. Price5 C. Place5 D. Process5 E. People6 F. Physical evidence6 G. Promotion6 III. ENVIRONMENT7 A. Macroenviroment7 B. Microenvironment8 IV. CONSUMER BEHAVIOUR9 V. MARKET TARGETING & POSITIONING10 A. Segmentation10 B. Target market12 C. Market positioning12 VI. CONCLUSION13 VII. References14 INTRODUCTION This report aims to identify various factors for success in the quality take-away food market. This will be accomplished by comparing two food service companies with a similar strategy – Crust Gourmet Pizza Bars and Real Burger World (RBW) – ended up with remarkably different results from the following aspects; marketing strategy, the environment, consumer behavior and target market and positioning. MARKET STRATEGY The foundation of both Crust and RBW was animated by a similar desire to provide a gourmet or higher quality take away food in the competitive fast food industry. Though, they came up with slightly different plans and implementations. |Crust Gourmet Pizza |Real Burger World | |People |†¢ Founder : previous experience as a manager of |†¢ One of the founders : successful experience in | | |a Pizza Restaurant |starting up a business | | |†¢ Training and management support for their |†¢ General manager replaced because of his lack of| | |franchises |experience in the industry | |Process |†¢ Long |†¢ Long | | |†¢ Preparati on in view of the customers |†¢ ‘guest' burger, customer invited to suggest a | | | |menu item |Physical Evidence |Dynamic, fashionable and modern : upmarket look |Typical burger shop | | |for upmarket target | | |Product |†¢ High quality and fresh |†¢ Real, natural and wholesome ingredients | | |†¢ Broad choice from traditional to original |†¢ Choice more or less diversified | | |taste (‘Asian touch') |†¢ Dynamic menu with gourmet burgers, handmade | | |†¢ Product on demand |fries | |Price |Restaurant prices, more expensive than the |Slightly above competitive brands (1? ore than | | |competitors |the existing competitors) | |Place |Shop, Internet Website, Phone |Shop | |Promotion |†¢ Heart Foundation Tick of approval & medias |†¢ TV Show â€Å"Risking it all† in 2episodes, | | |†¢ radio, local papers, letterbox drops, |†¢ Brochure handouts in the street | | |sponsorships |†¢ Protest in front of their co mpetitor store | | |†¢ Website | | | |†¢ reward card | | Table 1 Marketing strategy of both companies through the 7P’s 1 Product Both companies offer better value to their customers through the high and fresh quality of their product. This is the main advantage that differentiates themselves from their competitors. o Quality QualityWhile RBW provides â€Å"real, natural and wholesome ingredients† (Naz Choudhury, http://books. google. com. au/ ), Crust, sensitive to the new trend of healthy food, provides not only high quality food -with premium ingredients such as prosciutto, tiger prawns or smoked salmon- but also healthy food with six Heart Foundation Pizzas. o Variety They both offer a broad choice from traditional to original taste (‘Asian touch’ for Crust). What seems an advantage for Crust over RBW, and pizza restaurant is that Crust customers can compose their own pizza, though a common doing in the pizza fast food industry. 2 Price Because it is not trying to be cheaper than or as affordable as its competitors, unlike RBW, Crust chooses a clear different position from its competitors. Crust gets a premium price based on the product differentiation. 3 Place The place for the first shops gives an indication on the position of the firm. While Crust established their first shop in a suburb where people may have more time to wait for a longer process, RBW had their first shop in a dynamic street, in the city and a close walk from its competitors. Also Crust developed a delivery service with as many ways as possible to make their product available to overcome their geographic limitation. 4 Process Due to their position as higher and fresh quality food, both of these companies need a longer processing time for their product, than its competitors. Though, Crust found a way to compensate. The preparation in view of the customers increases the interaction between the staff and the customers and is visually exciting. This tactic is a way of creating delight for customers. A good point for RBW is the ‘guest’ burger. The customer is invited to take part in the creation of menu items. 5 People People working for the company are important since they contribute to the image of the firm. Crust understood this well, they made it an important part of their plan. They provide training and management support for their franchises to preserve brand identity and so, the atmosphere of the first shop. On the contrary, RBW showed an mistake from the start, the first General Manager of the store had no experience in the fast food industry. 6 Physical evidence The look of the store conveys the marketing message of the firm. It has to be in adequation with what the firm claims to provide, that includes also the differentiation from their competitors. Crust chose distinctive colours and a high class decor just as a gourmet firm would do. It gives satisfaction to customers who would expect greater value. On the other hand, though they hired professionals to design their store, RBW appeared to have missed the upmarket look and ended up looking like any other burger shop. 7 Promotion By earning the Heart Foundation Tick of approval, they consolidated their image differentiation, got the media attention as a short term promotion but also undoubtedly a long term promotion through this kind of sponsorship. They also use radio, local papers, letterbox drops, and sponsorships. Those tactics are important to build a strong brand identity. Crust is omnipresent so that they stay in potential customer’s minds. They developed a Website to go along with the technology orientated society and targeted customers. The use of a reward card is a way of retaining profitable customers. Whereas in the case of RBW, it is appearing in a TV show, the firm benefited from a priceless mass promotion to make their brand known. Nonetheless, they didn’t sustain themselves to this level and came up with only short term promotion. Protesting in front of their competitor store can be regarded as a desperate move to attract customers. From the analysis of these parameters, we can say that Crust has a well more developed strategy than RBW. When RBW’s main (unique) advantage is the higher quality food, Crust has developed a more complex strategy around the higher quality and healthy food and the service cape, regarded as a key to success. ENVIRONMENT This section discusses external and internal factors affecting Crust’s and RBW’s business. Four factors were chosen to outline their success/failure – Demographic forces (macro), socio-cultural forces (macro), corporate culture (micro), and competitive environment (micro). Macroenvironment are fairly common to the two firms as Australia and UK have similar cultural background and economic level. The factors which led these two firms to contrastive results could be found in microenvironment. [pic] 1 Macroenviroment o Demographic forces Understanding the demographic environment is of great importance as it â€Å"involves people, and people make up markets (Kotler, Adam, Denize and Armstrong, 2009: pp. 89)†. Changes in household types are beneficial trend for fast-food industry. The important demographic trend for fast-food industry is changes in household types. Increased number of one person, childless couple households increases the demand for convenient, ready-to-eat meals. Dual-income families made quality food affordable. The two firms targeted those new-type households. o Socio-cultural forces Businesses exists within society, therefore businesses can be influenced by society. To keep up with social changes may provide businesses with competitive advantages. The increased health awareness in society led the changing trend in consumer preferences to better-taste, fresher fast-food which perceived as healthier. Crust and RBW met this consumer trend. Another socio-cultural force is the trend towards choice. Both firms dealt with this trend by offering broad range of menu. 2 Microenvironment o Corporate culture Strong corporate culture helps to develop strong brand because people, internal and external to the company, can share similar values. Strong brand equity enables businesses to establish firm customer base and brand royalty, which in turn give businesses long-term growth and profitability. Crust has a clear corporate culture of â€Å"personality driven† based on â€Å"professionalism†, â€Å"entrepreneurship† and â€Å"teamwork and partnership with stores and customers† (www. crust. com. au, 2010). This is expressed to customers through store presentation and service, which serves as physical evidence to the customers. On the other hand, RBW’s culture was based on co-founders’ friendship. The business built on friendship can be fallen into amateurism resulted in various operational problems, which could reduce customer satisfaction. o Competitive environment Fast-food industry is highly competitive market and the competition is complex. Players in the market have to compete with huge multinational organizations such as McDonald’s, Subway and Pizza Hut as well as thousands of local take-away stores. To provide greater customer value and satisfaction than competitors, strategic analysis of competitive environment is crucial for businesses. Crust identified a gap in the pizza market in Australia, and then develops the strategy to fit them into the gap. Differentiation against competitors is the key factor to be successful in competitive market. Reflecting the tough competitive environment, crust aims to grow slowly and steady through good relationships with the stores and the customers (www. crust. com. au, 2010). RBW didn’t take it seriously compared to Crust because RBW were confident with the products and believed that consumers choose them once they tried their burger. The location choice for the first store was made by financial reason rather than strategic point of view. This resulted in direct competition with established fast-food brands such as McDonald’s and Burger King. CONSUMER BEHAVIOUR [pic] There is little difference between the fact that RBW and crust pizza are located in England and Australia respectively because both are industrialized nations and both are very similar culturally. As such, both are positively affected by the growing awareness of the benefits of healthier food, as well as an active desire for such food, especially in the age groups that both Crust and RBW caters to. There are three driving psychological influences on a customer to eat at crust pizza. The first is an aspirational one. The existing perception of high dining atering to educated, high earning professionals that crust has worked meticulously to build, and one of the results is that being seen to eat there is indicative of being a member of that particular demographic. [pic] Figure 3. Reasons for eating Fast Food http://shansenta. blogspot. com/2006_10_01 _archive. html The second influence is the imperative and willingness to pay for high quality food by the more discerning consumers. The third is one of safety, in the sense that crust delivers on time, with the correct pizza, in the same quality as in the store due to its specially made base. While the time take is longer, customers are satisfied as it is what they expect. RBW’s customers have different set of influences due to its geographical location in a less well off part of London where price is a significant factor. For the majority of consumers that frequent that particular part of London, the health benefits that RBW provided were not enough of an incentive to try the burgers. Also, it is the nature of burgers that they are quick. The reason for eating them is that it is a convenient way of eating and customers are unwilling to wait more than ten minutes for a burger that elsewhere they can get within one or two minutes. MARKET TARGETING & POSITIONING 1 Segmentation The basis of a long term marketing strategy, as well as the initial success of the business requires a target market to be identified and the business positioned satisfy the needs of the chosen market. |Crust Gourmet Pizza |Real Burger World | |Geographic segmentation |- Distributed around Australia ; NSW, ACT and |- Opened the first store in London in mid 2003 | | |Victoria – An expansion in |- Located in a street with other fast food stores| | |Singapore | | |Demographic Segmentation |- Targeting the age of 18-39 years old including|- Targeting the people with the age of 20-40 | | |families and high incomes including middle class|years old and high incomes | | |and upper class. Targeting | | | |consumers from diverse nationality | | |Psychographic Segmentation |- Targeting the people with a healthy lifestyle |- Targeting consumers with a healthy and busy | | | |lifestyle | |Behavioural Segmentation |- Targeting for the middle and upper class who |- Some of consumers would have negative attitudes| | |would have purchase occasions frequently |due to some failure on plans. | Table 2. Comparison of segmentation between Crust and RBW o Geographic Segmentation Most firms have national marketing programmes which adjust their products and promotions to satisfy the individual needs of geographic units. Geographic Segmentation can be the most important process which  brings to light  the  difference between the case of Crust and RBW. For Crust, it  is distributed in the main cities of Australia include d Sydney, Melbourne, Queensland and Victoria. The stores  are located in various suburbs. This implies two factors of geographic segmentation being region and population density. This  indicates a  greater opportunity  for the  success of  the company due to its location. On the other hand,  the first RBW store  was located in a street with other fast-food stores containing McDonald’s and Burger King. This evidently demonstrates that there is more competition and hence  the  potential of losing customers to  the other major food chains. RBW would be forced to compete against eminent and familiar  fast-food outlets. In this case, having just  launched their first outlet,  it would contribute to decreasing their earnings. o Demographic Segmentation The Crust has targeted  an age group ranging between 18-39 years of age. Additionally,  they are more likely focussing on middle and upper class demographics. We can assume that RBW also has targeted  a similar  demographic of consumers  to that of  the Crust. This can be classified  as demographic segmentation. Each business  targets a specific demographic that they feel the product or service would be most likely to attract. With that, the company will be able to set out its goals, marketing strategies and prices according to that chosen demographic. It clearly shows that both the Crust and RBW have targeted  appropriate level of consumers who would become big fans of the restaurant. In addition demographic factor is very influential on marketing strategy because consumer usage and needs are variable since each individual has different taste desires in  products depending on how old they are, what family life cycle they have or what occupation or income they have. o Psychographic Segmentation The Crust has an aim to change the perception of pizza from  that of a  cheap food to more of one that can be classified as a healthier choice. Accordingly, this will appeal to  those people who have a healthy lifestyle  or are conscious about their diet. This strategy  would lead to  further success in their business as not only will they be able to  maintain the number of existing customers,  they would also  be  attracting a new line of customers. For instance, through education and the media people are  increasingly gaining more awareness with regards to their diet and healthy living. With that in mind, the public will be less inclined to  eat unhealthily and would begin to focus  on maintaining a healthy diet. This  is a  clear indication  that people would  choose Crust rather than Dominos or Pizza Hut because of their marketing strategy. As well as in the case of RBW, they  have tried  to develop  the idea that burgers, if  served correct, can  be considered as  an extremely healthy  meal and not simply  another form of junk food. This also would appeal to  the public to  dine  at RBW as it appeals to the present values the public upholds. o Behavioural Segmentation One of the factors in behavioural Segmentation is purchase occasion. In the case of both Crust and RBW, they have targeted  a demographic of  high income earners  and this has  lead to  an escalating  chance  of increasing their earnings. Since pizzas and burgers are the most favorable food for parties, gatherings and meals,  the public is guaranteed  to purchase these foods on a frequent basis. But consumers may have different attitudes towards Crust and RBW. The Crust has been well-known as a  Ã¢â‚¬Ëœpersonality driven culture’ whereas the RBW has negative aspects associated with their food chain  since they failed with some launch tactics such as brochure handouts and a free burger day. With knowledge of such aspects, the public will most likely respond accordingly and think twice about RBW and it's few slip-ups. 2 Target market For target market there are several different strategies ; undifferentiated marketing, differentiated marketing and concentrated marketing. Firstly, undifferentiated marketing is to ignore the specific market segments and approach the whole market with one market offer. Secondly, differentiated marketing is a marketing that determines to target several market segments and design separate offers for each. Lastly, concentrated marketing is choosing one large market or few submarkets. It clearly shows that both Crust and RWB are concentrated marketers since concentrated marketing provides a means  for small firms to compete against other larger companies and to gain a foothold in the food industry. 3 Market positioning Market positioning is the final part of step, involving developing a positioning for the target market, followed by the marketing mix. Crust pizza positioned their stores to be attractive to the market outlined. The relatively high price per pizza reflects their positioning as a gourmet pizza restaurant, though offering delivery services as well to expand the reach of their business. The restraint ambiance and staff trained in customer service helps differentiate Crust as a higher class of dining than its competitors. It’s certification by the national heart foundation also gives proof to its claims of healthy pizza, swaying those skeptical of those marketing gimmicks and again differentiating it from competitors. RBW however, positioned both physically and otherwise to be in direct competition with existing fast food outlets. Located in a part of London where price is the defining factor, it is similar in price to McDonalds, contradicting its projected image of gourmet burgers. Customers have also commented that the shop feels similar to burger king, losing the perception of healthy food, and thus customers. Unlike crust, it’s burgers are not certified as healthy, though it’s stating of nutritional values of its burgers is a positive move, similar actions by McDonalds and other fast food outlets dilutes the impact of that move. Had it gone with its initial location at a more high priced part of London, the outcome may be very different. CONCLUSION In conclusion, there are a number of factors that determine the success or failure of a business such as those of a gourmet fast food such as RBW and Crust pizza. These factors range from the elements in the marketing strategy to the target market and market positioning, both planned and execution. The importance of these factors can be illustrated by the difference between Crust Pizza and RBW, given the similarity of their environmental and cultural factors. It is RBW’s failure to understand the nature of their product and the behavior and influences on their customers that lead to RBW’s eventual downfall. Crust pizza, on the other hand, well understood these factors and created an appropriate strategy and focused on the correct target market to claim success. References INTERNET Crust website, http://www. crust. com. au/ Momentary Musings, http://shansenta. blogspot. com/2006_10_01_archive. html Wikinvest, http://www. wikinvest. com/stock/Wendy%27s_International_%28WEN%29 BOOK Kotler P, Adam, S, Denize S, & Armstrong, G. , 2009,. Principles of Marketing, 4th ed, Pearson Education. Australia, Frenchs Forest, NSW ———————– Figure1. Market shares of the Major Players in the Fast Food Industry http://www. wikinvest. com/stock/Wendy%27s_International_%28WEN%29 Figure2. Pie chart of Consumer behaviour on Frequency of Fast Food http://shansenta. blogspot. com/2006_10_01_archive. html Marketing Mix According to Eddie Robinson, â€Å"The will to win, the desire to succeed, the urge to reach your full potential†¦these are the keys that will unlock the door to personal excellence. † In this competitive business world, it is imperative that business owners’ develop and create unique products in order to be differentiated from its competitors. Business owners can use a set of tools called the â€Å"Marketing Mix† to provide the unique quality that the item for consumption is a need.This tool is made up of a set of controllable factors that can be adjusted until the precise combination is established to satisfy the needs or wants of consumers in a particular target market while generating a profit. The Marketing Mix is made up of four factors. They are product, price, place and promotion. The product can be referred to as the physical product or service that satisfies what a consumer wants or need. Price refers to the amount that customers will pay for a par ticular good or service after taking into account factors such as profit, competitor’s response, business survival and probable pricing.The channel of distribution that serves as a means of getting the product or service in a convenient location to the target consumers is referred to as place. Promotion represents the methods of communication used to provide information of a particular good or service to its target market using various mediums. The proposed product we have decided to discuss in this essay is a self-cleaning bathtub. This product would satisfy the wants and needs of luxury hoteliers and people who are interested in living a luxurious life around the world.Generally, majority of the people who perform cleaning services usually avoid the time of cleaning their bathtub because it is very tedious task and the effects of the noxious fumes from the cleaning products. The idea of a self-cleaning bathtub would solve these problems, while satisfying the many wants and in some cases, the needs of a wide cross-section of people. This product will be sold in two variations and will range in different sizes. These variations include free standing tubs and drop in tubs.The self-cleaning bathtub boasts of its quick drain plus fast-action integral pump for rapid water changing, self-cleaning system that simultaneously removes surface debris and cleans the bottom of the hot tub with its built in vacuum. It also has premium LED lights that create ambiance and tranquility. It comes with an installation crew and technicians standing behind 10 years of warranty to give customers peace of mind. In addition, the economic theory asserts that in a free market economy the market price reflects interaction between supply and demand: the price is set to equate the quantity being supplied and demanded.In turn, these quantities are determined by the marginal utility of the asset to different buyers and to different sellers. In reality, the price may be distorted by o ther factors, such as tax and other government regulations. When a commodity is for sale at multiple locations, the Law of one price is generally believed to hold. This essentially states that the cost difference between the locations cannot be greater than that representing shipping, taxes, other distribution costs etc.In the case of the majority of consumer goods and services, the distribution costs are quite a high proportion of the overall price, so the law may not be very useful. In practice, it may well make economic sense to offer a product or service for sale at a higher price in a wealthy area than in a deprived area as the marginal utility of the asset for purchasers will be higher in the former. With that being said, several factors can be taken into consideration when looking to price an item such as this one.Since the price of a product is normally the deciding factor in choosing one brand over another, it is a common area of the marketing mix that can be used to make s trategic changes. The customer would not expect to pay the regular price of a regular bathtub. However, they may not expect a significantly high price. For instance, if you take the price of a regular bathtub, add on the cost of products and tools usually used to clean the tub, the customer will not expect to pay a price that is 50-100% more than the total of the two. They might as well decide to continue cleaning their tub on their own.Smart retailers sell good items cheap, with small profit per item because cheap prices increase sales and overall profit. In other words, it is better to sell forty (40) items at ten dollars ($10) profit rather than five (5) items at forty dollars ($40) profit. This will ensure business survival for a very long time as long as the quality of the product in maintained. Competitor’s response will have no effect on this product as long as the affordable price and high quality is maintained. As long as the cheapest possible manufacturing method is utilized, the competitor will find it very difficult to compete.Furthermore, it is important that the self-cleaning tub is available when and where the customer wants it. Distributing the product to its consumers will be done through direct channels for the customers who wants customized tubs and through dual distribution. This product will be accessible to customers with few obstacles. Moreover, mass marketing is a market coverage strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer. It is the type of marketing (or attempting to sell through persuasion) of a product to a wide audience.The idea is to broadcast a message that will reach the largest number of people possible. The target market for this product would be very huge. Quite frankly, every single person who owns or lives in a home should be interested in a self-cleaning bathtub. However, the most strategic channel of distribution should be among person building or looking to build new luxury homes, apartment buildings or hotels. Many new business customers can be obtained since apartment buildings and hotels would want to utilize this product.The benefits range from cheaper cost of janitorial service to additional attraction to apartments and hotel rooms for guests and tenants to choose from. In order to get all prospective customers interested in the product, public demonstrations will have to be made at strategic areas of business in the city or main towns. Invitations should be sent out to all hotels, luxury home owners and apartment building owners to attend this public event where usage of the bathtub will be demonstrated for all to see. Generally, promotion is communicating with the public in an attempt to influence them toward buying your products and/or services.How does promotion differ from advertising? Promotion is the broader, all inclusive term. Advertising is just one specific action you could take to promote your product or service. Promotion, as a general term, includes all the ways available to make a product and/or service known to and purchased by customers and clients. Promotion of this item would be done through various mediums. These mediums include television advertisements, billboards, radio advertisements, newspaper advertisements just to name a few.In summary, the success of the self-cleaning bath tub relies greatly upon proper marketing. The company must have the right combination of all the elements of the marketing mix in order to produce desirable sales results. The mix will include the variables and apparatus that the company will use to satisfy the business objective and the needs of the potential customers. The marketing mix is the foundation of a marketing strategy, unless a new theory is developed and can convincingly replace it will continue to serve that purpose.The market mix is designed to accommodate the customer. Therefore, each aspect of the marketing mix is equally important . When the mix is being developed, all final decisions about the elements should be made at the same time. To summarize the marketing mix, a company develops a product that meets the needs and desires of customers. Then determines how the product will reach final customers. A promotion plan is then developed to inform the customer of the product. Finally, a price is established while ensuring the company earns a profit. Marketing Mix Table of Contents I. INTRODUCTION3 II. MARKET STRATEGY4 A. Product5 B. Price5 C. Place5 D. Process5 E. People6 F. Physical evidence6 G. Promotion6 III. ENVIRONMENT7 A. Macroenviroment7 B. Microenvironment8 IV. CONSUMER BEHAVIOUR9 V. MARKET TARGETING & POSITIONING10 A. Segmentation10 B. Target market12 C. Market positioning12 VI. CONCLUSION13 VII. References14 INTRODUCTION This report aims to identify various factors for success in the quality take-away food market. This will be accomplished by comparing two food service companies with a similar strategy – Crust Gourmet Pizza Bars and Real Burger World (RBW) – ended up with remarkably different results from the following aspects; marketing strategy, the environment, consumer behavior and target market and positioning. MARKET STRATEGY The foundation of both Crust and RBW was animated by a similar desire to provide a gourmet or higher quality take away food in the competitive fast food industry. Though, they came up with slightly different plans and implementations. |Crust Gourmet Pizza |Real Burger World | |People |†¢ Founder : previous experience as a manager of |†¢ One of the founders : successful experience in | | |a Pizza Restaurant |starting up a business | | |†¢ Training and management support for their |†¢ General manager replaced because of his lack of| | |franchises |experience in the industry | |Process |†¢ Long |†¢ Long | | |†¢ Preparati on in view of the customers |†¢ ‘guest' burger, customer invited to suggest a | | | |menu item |Physical Evidence |Dynamic, fashionable and modern : upmarket look |Typical burger shop | | |for upmarket target | | |Product |†¢ High quality and fresh |†¢ Real, natural and wholesome ingredients | | |†¢ Broad choice from traditional to original |†¢ Choice more or less diversified | | |taste (‘Asian touch') |†¢ Dynamic menu with gourmet burgers, handmade | | |†¢ Product on demand |fries | |Price |Restaurant prices, more expensive than the |Slightly above competitive brands (1? ore than | | |competitors |the existing competitors) | |Place |Shop, Internet Website, Phone |Shop | |Promotion |†¢ Heart Foundation Tick of approval & medias |†¢ TV Show â€Å"Risking it all† in 2episodes, | | |†¢ radio, local papers, letterbox drops, |†¢ Brochure handouts in the street | | |sponsorships |†¢ Protest in front of their co mpetitor store | | |†¢ Website | | | |†¢ reward card | | Table 1 Marketing strategy of both companies through the 7P’s 1 Product Both companies offer better value to their customers through the high and fresh quality of their product. This is the main advantage that differentiates themselves from their competitors. o Quality QualityWhile RBW provides â€Å"real, natural and wholesome ingredients† (Naz Choudhury, http://books. google. com. au/ ), Crust, sensitive to the new trend of healthy food, provides not only high quality food -with premium ingredients such as prosciutto, tiger prawns or smoked salmon- but also healthy food with six Heart Foundation Pizzas. o Variety They both offer a broad choice from traditional to original taste (‘Asian touch’ for Crust). What seems an advantage for Crust over RBW, and pizza restaurant is that Crust customers can compose their own pizza, though a common doing in the pizza fast food industry. 2 Price Because it is not trying to be cheaper than or as affordable as its competitors, unlike RBW, Crust chooses a clear different position from its competitors. Crust gets a premium price based on the product differentiation. 3 Place The place for the first shops gives an indication on the position of the firm. While Crust established their first shop in a suburb where people may have more time to wait for a longer process, RBW had their first shop in a dynamic street, in the city and a close walk from its competitors. Also Crust developed a delivery service with as many ways as possible to make their product available to overcome their geographic limitation. 4 Process Due to their position as higher and fresh quality food, both of these companies need a longer processing time for their product, than its competitors. Though, Crust found a way to compensate. The preparation in view of the customers increases the interaction between the staff and the customers and is visually exciting. This tactic is a way of creating delight for customers. A good point for RBW is the ‘guest’ burger. The customer is invited to take part in the creation of menu items. 5 People People working for the company are important since they contribute to the image of the firm. Crust understood this well, they made it an important part of their plan. They provide training and management support for their franchises to preserve brand identity and so, the atmosphere of the first shop. On the contrary, RBW showed an mistake from the start, the first General Manager of the store had no experience in the fast food industry. 6 Physical evidence The look of the store conveys the marketing message of the firm. It has to be in adequation with what the firm claims to provide, that includes also the differentiation from their competitors. Crust chose distinctive colours and a high class decor just as a gourmet firm would do. It gives satisfaction to customers who would expect greater value. On the other hand, though they hired professionals to design their store, RBW appeared to have missed the upmarket look and ended up looking like any other burger shop. 7 Promotion By earning the Heart Foundation Tick of approval, they consolidated their image differentiation, got the media attention as a short term promotion but also undoubtedly a long term promotion through this kind of sponsorship. They also use radio, local papers, letterbox drops, and sponsorships. Those tactics are important to build a strong brand identity. Crust is omnipresent so that they stay in potential customer’s minds. They developed a Website to go along with the technology orientated society and targeted customers. The use of a reward card is a way of retaining profitable customers. Whereas in the case of RBW, it is appearing in a TV show, the firm benefited from a priceless mass promotion to make their brand known. Nonetheless, they didn’t sustain themselves to this level and came up with only short term promotion. Protesting in front of their competitor store can be regarded as a desperate move to attract customers. From the analysis of these parameters, we can say that Crust has a well more developed strategy than RBW. When RBW’s main (unique) advantage is the higher quality food, Crust has developed a more complex strategy around the higher quality and healthy food and the service cape, regarded as a key to success. ENVIRONMENT This section discusses external and internal factors affecting Crust’s and RBW’s business. Four factors were chosen to outline their success/failure – Demographic forces (macro), socio-cultural forces (macro), corporate culture (micro), and competitive environment (micro). Macroenvironment are fairly common to the two firms as Australia and UK have similar cultural background and economic level. The factors which led these two firms to contrastive results could be found in microenvironment. [pic] 1 Macroenviroment o Demographic forces Understanding the demographic environment is of great importance as it â€Å"involves people, and people make up markets (Kotler, Adam, Denize and Armstrong, 2009: pp. 89)†. Changes in household types are beneficial trend for fast-food industry. The important demographic trend for fast-food industry is changes in household types. Increased number of one person, childless couple households increases the demand for convenient, ready-to-eat meals. Dual-income families made quality food affordable. The two firms targeted those new-type households. o Socio-cultural forces Businesses exists within society, therefore businesses can be influenced by society. To keep up with social changes may provide businesses with competitive advantages. The increased health awareness in society led the changing trend in consumer preferences to better-taste, fresher fast-food which perceived as healthier. Crust and RBW met this consumer trend. Another socio-cultural force is the trend towards choice. Both firms dealt with this trend by offering broad range of menu. 2 Microenvironment o Corporate culture Strong corporate culture helps to develop strong brand because people, internal and external to the company, can share similar values. Strong brand equity enables businesses to establish firm customer base and brand royalty, which in turn give businesses long-term growth and profitability. Crust has a clear corporate culture of â€Å"personality driven† based on â€Å"professionalism†, â€Å"entrepreneurship† and â€Å"teamwork and partnership with stores and customers† (www. crust. com. au, 2010). This is expressed to customers through store presentation and service, which serves as physical evidence to the customers. On the other hand, RBW’s culture was based on co-founders’ friendship. The business built on friendship can be fallen into amateurism resulted in various operational problems, which could reduce customer satisfaction. o Competitive environment Fast-food industry is highly competitive market and the competition is complex. Players in the market have to compete with huge multinational organizations such as McDonald’s, Subway and Pizza Hut as well as thousands of local take-away stores. To provide greater customer value and satisfaction than competitors, strategic analysis of competitive environment is crucial for businesses. Crust identified a gap in the pizza market in Australia, and then develops the strategy to fit them into the gap. Differentiation against competitors is the key factor to be successful in competitive market. Reflecting the tough competitive environment, crust aims to grow slowly and steady through good relationships with the stores and the customers (www. crust. com. au, 2010). RBW didn’t take it seriously compared to Crust because RBW were confident with the products and believed that consumers choose them once they tried their burger. The location choice for the first store was made by financial reason rather than strategic point of view. This resulted in direct competition with established fast-food brands such as McDonald’s and Burger King. CONSUMER BEHAVIOUR [pic] There is little difference between the fact that RBW and crust pizza are located in England and Australia respectively because both are industrialized nations and both are very similar culturally. As such, both are positively affected by the growing awareness of the benefits of healthier food, as well as an active desire for such food, especially in the age groups that both Crust and RBW caters to. There are three driving psychological influences on a customer to eat at crust pizza. The first is an aspirational one. The existing perception of high dining atering to educated, high earning professionals that crust has worked meticulously to build, and one of the results is that being seen to eat there is indicative of being a member of that particular demographic. [pic] Figure 3. Reasons for eating Fast Food http://shansenta. blogspot. com/2006_10_01 _archive. html The second influence is the imperative and willingness to pay for high quality food by the more discerning consumers. The third is one of safety, in the sense that crust delivers on time, with the correct pizza, in the same quality as in the store due to its specially made base. While the time take is longer, customers are satisfied as it is what they expect. RBW’s customers have different set of influences due to its geographical location in a less well off part of London where price is a significant factor. For the majority of consumers that frequent that particular part of London, the health benefits that RBW provided were not enough of an incentive to try the burgers. Also, it is the nature of burgers that they are quick. The reason for eating them is that it is a convenient way of eating and customers are unwilling to wait more than ten minutes for a burger that elsewhere they can get within one or two minutes. MARKET TARGETING & POSITIONING 1 Segmentation The basis of a long term marketing strategy, as well as the initial success of the business requires a target market to be identified and the business positioned satisfy the needs of the chosen market. |Crust Gourmet Pizza |Real Burger World | |Geographic segmentation |- Distributed around Australia ; NSW, ACT and |- Opened the first store in London in mid 2003 | | |Victoria – An expansion in |- Located in a street with other fast food stores| | |Singapore | | |Demographic Segmentation |- Targeting the age of 18-39 years old including|- Targeting the people with the age of 20-40 | | |families and high incomes including middle class|years old and high incomes | | |and upper class. Targeting | | | |consumers from diverse nationality | | |Psychographic Segmentation |- Targeting the people with a healthy lifestyle |- Targeting consumers with a healthy and busy | | | |lifestyle | |Behavioural Segmentation |- Targeting for the middle and upper class who |- Some of consumers would have negative attitudes| | |would have purchase occasions frequently |due to some failure on plans. | Table 2. Comparison of segmentation between Crust and RBW o Geographic Segmentation Most firms have national marketing programmes which adjust their products and promotions to satisfy the individual needs of geographic units. Geographic Segmentation can be the most important process which  brings to light  the  difference between the case of Crust and RBW. For Crust, it  is distributed in the main cities of Australia include d Sydney, Melbourne, Queensland and Victoria. The stores  are located in various suburbs. This implies two factors of geographic segmentation being region and population density. This  indicates a  greater opportunity  for the  success of  the company due to its location. On the other hand,  the first RBW store  was located in a street with other fast-food stores containing McDonald’s and Burger King. This evidently demonstrates that there is more competition and hence  the  potential of losing customers to  the other major food chains. RBW would be forced to compete against eminent and familiar  fast-food outlets. In this case, having just  launched their first outlet,  it would contribute to decreasing their earnings. o Demographic Segmentation The Crust has targeted  an age group ranging between 18-39 years of age. Additionally,  they are more likely focussing on middle and upper class demographics. We can assume that RBW also has targeted  a similar  demographic of consumers  to that of  the Crust. This can be classified  as demographic segmentation. Each business  targets a specific demographic that they feel the product or service would be most likely to attract. With that, the company will be able to set out its goals, marketing strategies and prices according to that chosen demographic. It clearly shows that both the Crust and RBW have targeted  appropriate level of consumers who would become big fans of the restaurant. In addition demographic factor is very influential on marketing strategy because consumer usage and needs are variable since each individual has different taste desires in  products depending on how old they are, what family life cycle they have or what occupation or income they have. o Psychographic Segmentation The Crust has an aim to change the perception of pizza from  that of a  cheap food to more of one that can be classified as a healthier choice. Accordingly, this will appeal to  those people who have a healthy lifestyle  or are conscious about their diet. This strategy  would lead to  further success in their business as not only will they be able to  maintain the number of existing customers,  they would also  be  attracting a new line of customers. For instance, through education and the media people are  increasingly gaining more awareness with regards to their diet and healthy living. With that in mind, the public will be less inclined to  eat unhealthily and would begin to focus  on maintaining a healthy diet. This  is a  clear indication  that people would  choose Crust rather than Dominos or Pizza Hut because of their marketing strategy. As well as in the case of RBW, they  have tried  to develop  the idea that burgers, if  served correct, can  be considered as  an extremely healthy  meal and not simply  another form of junk food. This also would appeal to  the public to  dine  at RBW as it appeals to the present values the public upholds. o Behavioural Segmentation One of the factors in behavioural Segmentation is purchase occasion. In the case of both Crust and RBW, they have targeted  a demographic of  high income earners  and this has  lead to  an escalating  chance  of increasing their earnings. Since pizzas and burgers are the most favorable food for parties, gatherings and meals,  the public is guaranteed  to purchase these foods on a frequent basis. But consumers may have different attitudes towards Crust and RBW. The Crust has been well-known as a  Ã¢â‚¬Ëœpersonality driven culture’ whereas the RBW has negative aspects associated with their food chain  since they failed with some launch tactics such as brochure handouts and a free burger day. With knowledge of such aspects, the public will most likely respond accordingly and think twice about RBW and it's few slip-ups. 2 Target market For target market there are several different strategies ; undifferentiated marketing, differentiated marketing and concentrated marketing. Firstly, undifferentiated marketing is to ignore the specific market segments and approach the whole market with one market offer. Secondly, differentiated marketing is a marketing that determines to target several market segments and design separate offers for each. Lastly, concentrated marketing is choosing one large market or few submarkets. It clearly shows that both Crust and RWB are concentrated marketers since concentrated marketing provides a means  for small firms to compete against other larger companies and to gain a foothold in the food industry. 3 Market positioning Market positioning is the final part of step, involving developing a positioning for the target market, followed by the marketing mix. Crust pizza positioned their stores to be attractive to the market outlined. The relatively high price per pizza reflects their positioning as a gourmet pizza restaurant, though offering delivery services as well to expand the reach of their business. The restraint ambiance and staff trained in customer service helps differentiate Crust as a higher class of dining than its competitors. It’s certification by the national heart foundation also gives proof to its claims of healthy pizza, swaying those skeptical of those marketing gimmicks and again differentiating it from competitors. RBW however, positioned both physically and otherwise to be in direct competition with existing fast food outlets. Located in a part of London where price is the defining factor, it is similar in price to McDonalds, contradicting its projected image of gourmet burgers. Customers have also commented that the shop feels similar to burger king, losing the perception of healthy food, and thus customers. Unlike crust, it’s burgers are not certified as healthy, though it’s stating of nutritional values of its burgers is a positive move, similar actions by McDonalds and other fast food outlets dilutes the impact of that move. Had it gone with its initial location at a more high priced part of London, the outcome may be very different. CONCLUSION In conclusion, there are a number of factors that determine the success or failure of a business such as those of a gourmet fast food such as RBW and Crust pizza. These factors range from the elements in the marketing strategy to the target market and market positioning, both planned and execution. The importance of these factors can be illustrated by the difference between Crust Pizza and RBW, given the similarity of their environmental and cultural factors. It is RBW’s failure to understand the nature of their product and the behavior and influences on their customers that lead to RBW’s eventual downfall. Crust pizza, on the other hand, well understood these factors and created an appropriate strategy and focused on the correct target market to claim success. References INTERNET Crust website, http://www. crust. com. au/ Momentary Musings, http://shansenta. blogspot. com/2006_10_01_archive. html Wikinvest, http://www. wikinvest. com/stock/Wendy%27s_International_%28WEN%29 BOOK Kotler P, Adam, S, Denize S, & Armstrong, G. , 2009,. Principles of Marketing, 4th ed, Pearson Education. Australia, Frenchs Forest, NSW ———————– Figure1. Market shares of the Major Players in the Fast Food Industry http://www. wikinvest. com/stock/Wendy%27s_International_%28WEN%29 Figure2. Pie chart of Consumer behaviour on Frequency of Fast Food http://shansenta. blogspot. com/2006_10_01_archive. html