Global Strategic Marketing of Subway - Essay Example

? Global Strategic Marketing Introduction Subway is a well-renowned global restaurant chain established in America which is engaged primarily with selling salads and submarine sandwiches. The first restaurant chain was established during 1965, initially named as "Pete's Super Submarines" which was for the first time renamed as Doctor’s Associates, Inc and later as Subway. Currently, Subway operates through a massive chain comprising over 22, 350 restaurants in 78 countries. It is often regarded as one of the leading companies in terms of the total number of outlets in the US. The restaurant chain of Subway is renowned due to the unique set of global strategies performed by the organization (Pride & Ferrel, 2007). This study will emphasize on identifying the global strategies applied by Subway through relevant theoretical explanations. The study will further focus on revealing the global strategies applied by the company when marketing its products in the foreign markets. Global Strategy of Subway The global presence of Subway has been significantly influenced by its expansion strategies. It can be stated in this regard that Subway has been recent facing a highly fluctuating environment deciphering changing customers’ demands as well as immature market dimensions. Contextually, Subway has adopted a new franchising model, which could be beneficial for effective development of stores and provide better services to customers and thus reward greater competitive advantages in the global market context. To mitigate the problems or restrictions in global expansion when penetrating into foreign markets, Subway adopted the strategy of supporting as well as encouraging franchisees in the international markets which rewarded the company with enhanced competitive features. Additionally, Subway also focused on featuring information of the company through websites in German, French and Spanish along with English and various other languages which further enhanced the reachability of the organization to customers belonging from various cultural contexts (Griffin, 2007). It can be stated that with the application of franchising strategies, different activities performed by Subway, such as internal operations, management of stores, loyalty of customers proved to be beneficial for the organization in handling the process effectively. It also proved helpful in generating greater revenue by maintaining continuously increasing productivity and developing stronger alignment with the local community. This particular global strategy adopted by Subway targeted customers belonging to the age group of 23-40 years in the urban areas who were observed to absorb a greater effect of globalization and thus reduced the chances of socio-cultural conflicts between the American (home country of Subway) and the local cultures. The organization further focused on recruiting local people in its franchisee stores which added to the convenience of the local customers in the foreign markets. When applying its global strategies, the company also ensured that the products served by Subway are of high quality as well as cheap for ordinary local customers (Dong, 2011). Theoretical Explanation of Global Expansion Strategy of Subway Global expansion strategy of Subway has been adopted in order to maintain its effective growth in foreign market context as well as gaining competitive advantages. Contextually, expansion of a food venture in foreign markets contemplates several revolving issues such as searching for quality supplies for the preparation of sandwiches with fresh, nutritional and organic ingredients (Ghemawat, 2004). Hence, it can be stated that Subway maintains “gold standard of quality” while entering into international markets. For maintaining its efficiency in the global market context, Subway also provides training to the owners of new franchises across the globe as well as adapting to dimensions of culture as well as language barriers. Similar to other restaurant chains, while entering into new markets, Subway had to face certain issues related to the formulation of brand awareness and learning regarding tastes and preferences of potential customers. Organizations in such circumstances often aim for adapting quick services in a new restaurants service area. It is worth mentioning in this context that cultural diversity and quality concerns play a major role in the expansion strategies adopted by restaurant chains when implementing expansion strategies which can also be identified in the case of Subway (Pride & Ferrel, 2004). Notably, such obstructions can be effectively mitigated with focus on promoting franchisees when targeting foreign markets benefiting with first-mover advantages (Michael, 2003). Implementation of the Strategy in Marketing the Products of Subway in Middle East Subway opened its first food restaurants in Oman during 2001. Oman is considered as one of the fastest growing industrial economies in Middle East, where most of the international business are being carried out. Subway initiated its global strategy when targeting Oman with a vision of filling a void for health conscious food and offering better quality services for the local consumers. Correspondingly, through its franchisees, Subway offers food products in accordance with the traditional preferences including special menus in food categories to satisfy the tastes of local people with high quality assurance and international standard services. Concerning its packaging strategies, sandwiches that are prepared by Subway franchisees in Middle East has been observed to be based on ingredients which are green and organic to suffice their local culture (Swamidass, 2002). Similarly, when pricing, Subway offers products in Middle East countries, containing ham and cheese ingredients at the local price wherein the ingredients are also collected from the local market. It can be stated the company focuses on the demands and preferences of customers and set the prices of the products according to the economic contexts and the conveniences of the customers taking into account the prices charged by the local competitors (Swamidass, 2002). The strategy of promotion adopted by Subway in the Middle East region emphasizes on attracting local customers through traditional menu of food products. This helps the company to meet the demands and preferences of local customers by serving quality food products (Pride & Ferrel, 2004). In its distribution strategies, the products that are manufactured in Middle East countries are distributed to Subway’s stores through various retailers and suppliers where the retailers sell varieties of food products to various affluent customers. This allows the company to maintain greater productivity by supplying quality products at cheaper rates and thus mitigating the competitive pressures from local players (Pride & Ferrel, 2004). Conclusion From the above observation it can be stated that Subway has been quite successful in penetrating foreign markets applying the expansion strategy based on global franchisee that offers quality food products in over 78 countries. Massive inclusion of local cultures can also be observed in the global strategies of Subway which facilitates the maintaining of quality assured and a diverse range of food products to at a cheaper rate in order to enhance its sales of growth and maintain larger customer base through effective channel of distribution, promotional strategies. References Dong, M. (2011). Expansion of Subway in China. City University of China, pp. 1-26. Ghemawat, P. (2004). Distance Still Matters The Hard Reality of Global Expansion. Harvard Business Review. Griffin, R. W. (2007). Fundamentals of management. United States: Cengage Learning. Michael, S. C. (2003). First mover advantage through franchising. Journal of Business Venturing 18, pp. 61 – 80. Pride, W.M. & Ferrel, O.C. 2004. Marketing: concepts & strategies (12th ed.). New Delhi: Dreamtech Press. Pride, W. M. & Ferrel, O.C. (2007). Foundations of marketing. United States: Cengage Learning. Swamidass, P.M. (2002). Innovations in competitive manufacturing. United States: AMACOM Div American Mgmt Assn. Read More