In Part 1, The Company, Red Jett Sweets lists six “Ingredients for Success” (p. 251). For each ingredient, designate it as either a cost benefit or as a value benefit and discuss your reason for your designations. Support your answer with concepts from the text covering value and cost benefits.
Red Jett Sweets has determined that six, unique “Ingredients for Success” will help it to achieve its mission (Katz & Green II, 2013, p. 251). Each of these elements will provide Red’s customers with either a value benefit, a benefit related to the cupcakes themselves (p. 195) or a cost benefit, a benefit that keeps costs low for consumers (p. 195). Utilizing a mobile “cupcakery” (p. 251) is both a value and cost benefit. Mobilizing the business
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First, Red Jetts is choosing to utilize a mobile food truck to operate out of/delivery its products. As the only mobile cupcake business within its proposed trading area (p. 261), this will give Red Jetts the unique advantage of being able to locate where their customers are and where they are likely to purchase the goods. Offering catering services for custom-themed parties, to include personalized/customized cupcake flavors that align with that theme, in addition to their competitive pricing (p. 261), allows Red Jetts to offer its customers a unique service and experience that is not only affordable, but an added value not offered by its competitors. Lastly, Red Jetts is focusing heavily on offering superior customer service to consumers allowing it to compete with its competitors on value benefits as opposed to cost benefits (p. 196). While Red’s cupcakes are competitively priced, the sheer number of bakeries in the area may make it difficult to differentiate itself based on price, especially from those chain businesses that can capitalize on economies of scale and scope. By choosing to focus on superior customer service, one of the most important market differentiators for small businesses (Knight, 2014), Red’s can enrich their customers’ experiences and give themselves an advantage over those organizations that may be lacking in that
The company is geographically located in most major united states locations. It employs a hierarchal organizational design. One of the contributing factors to its success is the company’s success in providing a dining experience for its customers that excel in choices, price, customer service, and serving size. The company is known world-wide for its delicious cheesecakes with the key factor being the variety.
Kudler Fine Foods uses a loyalty program which, as it currently stands, serves to “increase the consumer purchase cycle as a means to increase the loyalty and profitability of its consumers,” (p. 1, University of Phoenix, 2007); management is proposing the implementation of a new multi-media shopping cart that will appeal to the high-end clientele as well as track more customer data and improve sales. The Media cart gathers key information that will enable the marketing department to customize better the shopping experience, making use of in-store advertising, and collect data related to consumer activity (Media Cart, 2010). Although the initial investment in the carts may seem high, the return on
Within the next 12 months, Kudler Fine Foods plans to increase customer loyalty by offering added high-margin services, leveraging a better understanding of customer purchase patterns, and providing more efficient operations. Kudler Fine Foods also plans to increase the customer base through social network marketing, word of mouth, and increasing profitability by cost reductions initiatives. In view of this
Since the opening of Chick-Fil-A, they have received over 2 billion dollars in sales. The company’s great recipe for success is due to the marketing strategy of product, price, place, and promotion. The additional two P’s, purpose and people, also give a hand in the success. Purpose, guiding the company’s strategy planning process, and people, being key to implementing strategy. For the company, product itself is the fact that the food is made fresh every day, only making just enough inventory to sell. They found that customers reward great product. Since Chick-Fil-A makes their product, using the very best resources they can, the customers are willing to pay full
Initially, Red Lobster aligned itself as a restaurant whereby clients could get inexpensive seafood, in an approachable and casual dining setting. This strategy led the company to focus on price promotion and utilizing deep discounts in order to drive clients into the restaurants. This type of business consciousness caused clients to doubt the Red Lobster’s quality, seeing it as a dated, low-end restaurant that served frozen, mass-produced seafood. This type of reputation, coupled with the fact that the price of their products was relatively higher end on the casual dining arena, led to their client satisfaction rate stagnating.
Trader Joe’s forgoes advertising for a strategy of customer relationship management because advertising “can’t create an experience. It’s the personal relationship with these people that builds loyalty” according to St. John, vice president of Trader Joe’s (Guth, and Marsh 183-187). Through this strategy, Trader Joe’s has seen much success. At the time of this case study, analysts estimated annual revenues to be around 3 billion. Today they are estimated to be around 8.5 billion. The effect is that the company has grown and still continues to grow. Trader Joe’s has gone from having 220 stores in 17 states in 2004 to 356 stores in 28 states as of June 2011 (“Trader Joe’s”). One area of attention for Trader Joe’s is to not lose sight of this customer relationship strategy as it continues to grow into a national or even global company. The company needs to continue to “pay attention to the information it
Due to economic downturn the strength of the buyers’ power has increased as the industry looks to gain consumers with pricing strategies much like those of McDonald’s “Value Menu” and combination meals even though the cost of commodities have gone up (James, 2010). Customers of QSRs are looking for quality food without high costs. While Chipotle does not have a value menu or offer any type of combination meal much of their success is due to the fact that the customers are willing to pay a higher cost for higher-quality (Chipotle, 2010).
To provide a satisfying marketing-mix, companies must set a price that is acceptable to target market members (Pride and Ferrell, 2011). Price is the value paid for a product or service in the market, it is a key element in the marketing-mix and one that generally is the only variable that can be quickly changed to react to market changes such as competitor actions or demand variations, for example Burger King mainly targets little kids. By offering toys in Big Kid Meals at Burger King, kids are more likely to want to eat at Burger King. Because our society is focused upon pleasing children, parents give in and bring their children to Burger King for breakfast, lunch, or dinner. In addition, Burger King targets those individuals who work often
Robert is wholeheartedly interested in making his father's business, "Frank's All-American Barbeque" the next big thing. He has a few conceivable choices for growing his dad's business—locate a bigger area in Fairfield, include a takeout choice,open more restaurants in surrounding communities, incorporate web marketing concepts, and expand the sales of sauces. But in doing so, he needs to make sure that the proposal that he presents to his father will outperform his father's current customer value. Customer value is when perceived benefits outweigh the perceived costs; when this happens the good or service is then seen as alluring. (Small business management in the 21st century, pg,99). Through Michael Porter's value chain model, we understand that customer value consists of four fundamental concepts; customers needs and wants, research and
The sales plan of Stretch ‘R Wings is ineffective due to the lack of proper market research. The lack of research leads to potential issues with the company’s pricing, product, and promotion strategies, all important elements of the marketing mix. In its marketing plan the company states, “We feel pricing is our main competitive edge” (Palo Alto Software, 2013). Although price is critical to the overall marketing mix, value remains the most important aspect to the customer (McDonald & Wilson, 2011). Value drives sales, not price, even though price is an important element in the value equation.
It is clear that Red Lobster should target these individuals because per customer Experientials spend around $52 more than the current Indulgent targets per year (Exhibit 15). In addition, by targeting these individuals and making small tweaks to the restaurants as they are renovated, Eclectics (the second highest grossing average spent per year per customer) may also be drawn to the new changes because of the similarities between these two parties. This is a perfect example of market segmentation without having to radically change the scope of the company from the target Experiential group.
This case involves a mid-sized, regional grocery store chain called Reed Supermarkets. Reed has 192 retail stores, two regional distribution centers and 21,000 employees in five states in the Midwest of the United States. This case discusses Reed’s market strategy for the Columbus, Ohio, market in particular, which is one of Reed’s largest markets. The Columbus market has grown slightly over the past five years, while Reed’s market share has dwindled slightly in the market. Reed has watched their market share stagnate with the entrance of new competitors (10% growth in stores) and a dramatic shift in customer preferences to value or
While the subscription food delivery industry is still new and Blue Apron continues to be at the forefront of this new service, competitors are catching up by offering services to differentiate themselves. My innovative team at THB Consulting is focusing on the subscription model to better serve customers and increase profit. Currently, the main problem with the subscription model is its lack of choice for customers. Plated, HelloFresh, and Chefday, the three direct competitors, offer their customers much more choice in their subscription model. Because Blue Apron is in a competitive industry, it is imperative to always look forward while maintaining the excellent quality and wholesome image customers have come to expect. After relentless research, my team has come up with three recommendations for the company to pursue:
Starbucks can follow some strategies to differentiate their product even more that will lead to vary their menu prices. For example, Starbucks might create “saving menu” by selling some products at a lower prices to attract even more customers. Also, Starbucks might take into consideration the strategies of opening “Starbucks carts” that open in smaller express places that don’t fit for a whole store. Those “Starbucks carts” will attract even more customers because it is easier to get access to. “Starbucks carts” may provide the customers with low cost products to draw larger market base. To be a best cost provider in the market will allow Starbucks to be the most attractive company in the coffee market internationally. Thus, Starbucks will have a competitive advantage over its rivals by fulfilling the needs of a huge customer base in the market, by providing a high quality products and provide products with the best costs.
Panera Bread’s intention is “to make Panera Bread a nationally recognized brand name and to be the dominant restaurant operator in the specialty bakery-café segment.” Panera experienced competition from many numerous sources in its trade areas. Their competition was with specialty food, casual dining and quick service cafes, bakeries, and restaurant retailers, including national, regional, and locally owned. The competitive factors included location, environment, customer service, price, and quality of products. Panera learned from its competitors, none of its competitors had yet