Market Segment Analysis - Essay Example

RUNNING HEAD: MARKET SEGMENT ANALYSIS Market Segment Analysis [The of the will appear here] [The of the id will appear here] [The name of the course will appear here] [The name of the course number will appear here] Introduction Eating out has become a famous trend in the Western world. Each day individuals buy from restaurants for different reasons. Some people go to have meetings, enjoy fine cuisine, celebrate a life event, and to escape having to cook meals. Canada, being a multicultural country, offers a wide variety of ethnic food that caters to people belonging to diverse religious and cultural backgrounds. The student population in Canada coming from abroad has increased in great percentage during the last few years; of these most of them come from Saudi Arabia (North, 2012). Despite this, there are no restaurants in Victoria, BC that serve Saudi Food. The purpose of this paper is to evaluate the marketability of opening a Saudi restaurant in Victoria BC by focusing on three potential market segments for this business venture. Three market segments will be analyzed which include Single Saudi students in Victoria, Married Saudi students in Victoria and Muslim non-Saudi. These will be analyzed based on demographic, psychographic, behavioral attributes. Evaluation of the profitability of the restaurant will be based on the analysis and finally recommendations would be offered for the business. Analysis Single Saudi Students The segment consists of Saudi students including both genders male and female. According to Saudi club in Victoria “Victoria now has more than 860 Saudi students male and female are divided among between University of Victoria, Royal Roads University, and Camosun College as well as other English institutions in the city; 67 per cent of the students are single and the rest are married” (N. Daheher, Personal Communication, 12 February, 2013). This means 576 are singles. The percent of single Saudi females in Victoria are 17% of 576 (98 females). The percent of single Saudi males in Victoria are 83 of 576 (478 males). These students usually lead a very busy lifestyle. They are involved in a myriad of activities which apart from taking classes includes homework, taking English Language classes and also socializing. Saudi students, especially men, come from a culture where they have little experience of household chores including cooking. Also their busy schedule in Canada does not allow them to take out the time to cook food. While they consume mostly Western fast food, they are still nostalgic about their Saudi food which is quite different from the food that is available in Victoria BC. Married Saudi Students As mentioned before, there are more than 860 Saudi male and female students; of these 23 percent are married. The married are further divided into male and females. The percent of Married Saudi females in Victoria are 37% of 283 (105 females). The percent of single Saudi males in Victoria are 63 of 283 (178 males). The married Saudi students face additional burden when compared to their Single counterparts. They have the responsibility of managing their family while having similar activities as those of the Single Saudi students. Married Saudis also take part-time jobs in order to support their family. Females in the Saudi culture are expected to look after the family and cook the food. However, at times they are themselves studying which makes it difficult for them to please their husbands. Married students also wish to take out their spouse to dinner once in a while to escape their stressful lifestyle. While there are many restaurants offering ethnic food in the region, there is no restaurant offering Saudi food. Non-Saudi Muslims According the Muslims Community in Victoria “There are more than 5300 Muslims” (Hamado, Personal Communication, 13 February, 2013) which means excluding the Saudi Students, Victoria has more than 4440 Muslims non-Saudi. Muslims non-Saudi may not belong to the same culture as the Saudis but there many cultural similarities between them as a result of following the same religion. Their tastes in food are often similar to each other. Even though, they consume Western food, they have a yearning for food which has more flavors and spices. Non-Saudi Muslims wish to go to restaurants that offer Halal food. While there are many restaurants offering Halal food in Canada, they still have alcohol on their menu. Muslims consider alcohol as haram and often do not feel comfortable in eating in a restaurant that offers alcohol. Evaluate Saudis belong to culture where people believe in good contacts. All Saudis and even non-Saudi Muslims stress on eating and socializing together. For this, they prefer a place that offers Halal food and abstains from alcohol. This restaurant would be attractive to the three identified market segment as the restaurant is unique and there is no such a Saudi restaurant in Victoria. Single Saudi Students are an attractive market because they have a desire for the product. They miss food from home and there is no way for them to enjoy Saudi food in Victoria. They also do not have the time or the inclination to cook food at home. Such students would require the food almost daily and the restaurant may end serving such students daily. Also being in the student campus, the Saudi students have a large network of other Saudi students. They would then influence these students to try out Saudi food at least one. Saudi students also represent a growing market since each year the number of students coming from the Arab world is increasing due to globalization. Married Saudi Students are also a good market considering that they also do not have any place where they could take their family to enjoy food from their own country. Married Saudi Students have the advantage of cooking Saudi food at home since Saudi females often have basic cooking skills. However, due to added responsibility, these families do not have time to cook local food all the time. They wish for a restaurant where they can go and enjoy food with their families. Weekend dining in the restaurant would be appreciated by these married students. During Muslim festivals such as Eid, everyone yearns for local food and this target market would like to enjoy Saudi food during special occasions. The Non-Saudi Muslims are another lucrative segment. Even though these Muslims may not be seeking for such a product but they would find it pleasant to enjoy food from a Muslim country that offers non-alcoholic and Halal food. This market segment presents a good opportunity in the form that they are large in number and would occasionally have a desire for the product. In this manner, these would be infrequent market segment but with their large number, the restaurant may end up serving them quite often. Recommendations Considering the above analysis, the single Saudi students would be the primary market segment. This is because this segment wants the product and is even actively seeking the product. They miss their food and have no way to access Saudi food. Also since they have never cooked, they find it more difficult to cook food than the average student. These students are even more accessible through the communities that they have joined on social networking forums. Another good way of accessing them is mosques and community centers. The Married Saudi students would serve as the secondary market segment. This market segment is interested in dining out during weekends or during special occasions such as Birthdays, Anniversaries and even during Muslim festivals such as Eid. Even though married Saudi students cook their food at home, they did not have time to prepare Saudi food since it requires time. Muslim Non-Saudis would serve as the tertiary target market. This target market does not need or want the product. A Saudi restaurant would be a pleasant experience for these Muslims where they could take their families or even extended families. Additionally, it is easy to reach all the three segments, since all of them gather on Friday in Victoria in three multiple locations for Friday prayer, which are, University of Victoria, downtown mosque. Conclusion A Saudi restaurant in the vicinity of Victoria BC is a viable business opportunity. This is because the Saudis and even non-Muslim Saudis represent a big chunk of the target market. Some of these even seek out a restaurant that serves Saudi food. Single students are the primary target considering that they cannot cook food on their own with their busy schedules and their lack of initiative to cook food. The married Saudi students are the secondary target market considering that they wish to eat out once in a while and often yearn for local student. The tertiary target market as the non-Saudi Muslims who wish to enjoy that relates to their culture and religious practices. A Saudi restaurant in Victoria BC would be the first of its kind and would therefore primarily serve the needs of the growing Saudi student population. References North, N. (2012) Region draws record number of foreign students, Retrieved from http://www.royalroads.ca/news-media/region-draws-record-number-foreign-students Criteria and Ranking (each segment) Saudi Single Students Criteria Assessment 1 Measurable: Size, value can be measured 4 2 Substantial: Large, profitable, growing 3 3 Differentiable: Responds differently to marketing 3 4 Actionable: Effective marketing programs can be formulated 4 5 Accessible: Can be reached and served 4 6 Ethical: Ethically responsible to aim at this segment? 5 Total assessment for segment 23 Saudi Married Students Criteria Assessment 1 Measurable: Size, value can be measured 4 2 Substantial: Large, profitable, growing 2 3 Differentiable: Responds differently to marketing 4 4 Actionable: Effective marketing programs can be formulated 4 5 Accessible: Can be reached and served 3 6 Ethical: Ethically responsible to aim at this segment? 5 Total assessment for segment 22 Non-Saudi Muslims Criteria Assessment 1 Measurable: Size, value can be measured 2 2 Substantial: Large, profitable, growing 4 3 Differentiable: Responds differently to marketing 2 4 Actionable: Effective marketing programs can be formulated 3 5 Accessible: Can be reached and served 3 6 Ethical: Ethically responsible to aim at this segment? 5 Total assessment for segment 19   CONSUMER MARKET Broad Market Segments (from relevant industry) Saudi Single Student Saudi Married Student Muslim Non-Saudis GEOGRAPHIC SEGMENTATION Are segments located regionally, nationally, globally?  Regionally Regionally Regionally DEMOGRAPHIC SEGMENTATION Age, gender, income, marital status, stage in the lifecycle. How many sales can potentially be derived from segment (units/dollars)? In other words, what is the potential segment size relative to the total market area size?  Age: 17-25 Gender: Both Marital Status: Single Sales: Daily sales  Age: 20-35 Gender: Both Marital Status: Married Sales: Weekly sales  Age: 17-55 Gender: Both Marital Status: Single and Married both Sales: Weekly or Monthly sales PSYCHOGRAPHIC SEGMENTATION What is their culture? What lifestyle do the customers pursue? What are their values, believes and attitudes? What is their social class? What activities to they do, what interests and opinions do they have? What is their personality like? Male dominant culture where mothers and servants are expected to cook. They belong to the upper and middle class. They have a busy lifestyle with their school work, English language classes and socializing.  The females are expected to care for the food and other needs of the family. However, with busy lifestyle this would be quite difficult. They belong to the middle or upper class. They have classes to attend as well as take responsibility of their family and work. They are more mature than the single Saudi students and often do not have extra time.  Their culture is mixed. Most of them belong to the eastern culture where family values are important. Males are the head of the family and have a strong role in making decision. They are also conservative and prefer to socialize with other Muslims. They often have distinctive style of dressing. BEHAVIOURAL BUYING SEGMENTATION What benefit do they seek: (what does the customer need/want from the product)? How do they use it? When do they use it? What is their user status: First time buyers or frequent buyers (what is the frequency?), Loyalty Status (loyal, soft loyal, switchers), Buyer Readiness stage: Aware, Interested, Wants the product, Ready to take action? Investigate options, compare costs and take time to decide - or they look, like and buy. What is the purpose or application of the product offering? Where does this potential customer shop for the product offering - media, websites, etc.? How do customers make their buying decisions - how do they learn about the offering, what criteria do they use for deciding? When does the customer shop for the product offering (for example, occasion: winter/summer vacation, honeymoon etc.,)  They want Saudi food that they do not have to cook on their own. Often the food should be available to them at their homes or within the college campus. They will be frequent buyers as they would need a restaurant that caters to their taste buds. They would be soft loyal customers and would switch to other restaurants if they see other viable options. These are people with a strong sense of community and are reachable within their gathering places such as mosques and community centers. They would shop more during their exam times as they are stressed and thus often feel nostalgic.  While Saudi food is cooked in the household, this segments wishes to dine out during the weekends or during special occasions. They could be frequent and loyal buyers if they like the taste and aesthetics of the restaurant. They would be interested in the product and would try out the place at least once. This market uses can be reached in specific counters of the supermarket since grocery buying is essential for them.  This segment wants the product to try out new tastes where they could enjoy the food at a Muslim place. These buyers may not be frequent buyers and would switch to new restaurants if they are available. They would be interested in the product and would like to try out a place that is new. SEGMENT ATTRACTIVENESS What are the primary, secondary or tertiary segments to specifically target a marketing mix to?  Primary Secondary Tertiary Read More