Chick-Fil-A Marketing Report - Essay Example

Chick-Fil-A Marketing Report Chick-Fil-A 5131 Rufe Snow Dr. North Richland Hills, TX 76180 Chick-Fil-A 1711 Loop 288 Denton, TX 76205 Analyzed by: Brandon Harmon, Hyein Kim, Matt Middleton,Melody Pinkerton, and Jing SuAnalyzed for: Chick-Fil-AMarch 27, 2014Executive Summary Our goal is to expand Chick-Fil-A’s already stellar reputation by furthering advertising campaigns, extending our efforts in charitable contributions and community involvement, reaching out to demographics that we have not adequately acquainted ourselves with, educating the general public of our outstanding exemplary product, and adding onto the menu in an attempt to appeal to a wider range of customers.

Table of ContentsI. Title Page 1II. Executive Summary 2III. Table of Contents 3IV. Corporate Connection 4V. Environmental Analysis and Forecasting 5IV. Operating Environment 6V. Remote Environment 7VI. SWOT Analysis 7VII. Segmentation and Targeting 9VIII. Next Year’s Objectives and Quotas 10IX. Action Plans: Strategies and Tactics 10X. Resources Needed to Support Strategies and Meet Objectives 11XI. Marketing Action Plan 12XII.

Marketing Controls 13XIII. Conclusion 14XIV. Bibliography 15Corporate ConnectionRelationship to other plansChick Fil-A’s “Corporate Purpose” is: “To glorify God by being a faithful steward to all that is entrusted to us. To have a positive influence on all who come in contact with Chick Fil-A.” This purpose has a strong relationship to every aspect of the way Chick Fil-A does business. For instance, the restaurant’s hours of operation plan exclude Sundays. Aside from simply “doing business”, the company also does a lot of charity work through nonprofit organizations.

Simply put, the Cathy family behind the business “puts [their] money where [their] faith is” and this certainly has a colossal effect on how business plans are made and their Marketing related plansSome of Chick Fil-A’s most recent marketing plans include expansion to other regions – mainly the northeastern part – of the U.S. in order to furtheritsdevelopment in the market and to guarantee that the company stays a strong competitor among other chicken restaurants. Quite possibly the most interesting marketing plan that Chick Fil-A has introduced is Cow Appreciation Day, during which customers can arrive dressed like cows to receive free meals.

Environmental Analysis and ForecastingInternal AnalysisManagement: One of the greatest strengths of Chick-Fil-A’s management is that it carefully screens its new hires to ensure that these individuals are loyal to the brand and that they share the same beliefs as the Chick-Fil-A concept. Employees and managers alike have a reputation for being upbeat and extremely sensitive to the needs of guests, as evidenced by the 2nd mile initiative, which places extreme emphasis on “going the extra mile” for the guests.

Weaknesses: Corporate office and policies can intrude into employees’ personal lives. Due to the strict nature of Chick-Fil-A’s hiring process, high quality potential candidates are often scared away from applying at Chick-Fil-A.Chick-Fil-A also steers clear of discounting and limited-time offers, which could be forgoing a significant amount of additional revenues.Marketing: Chick-Fil-A brands itself as a wholesome entity with Christian and family values, and has been very successful in that respect.

Fewer than 5% of owner/operators leave the chain in any given year, with most remaining with the company for over 20 years. That is positive publicity for the corporate structure. People are clearly loyal and happy to be working with Chick-Fil-A.Truett Cathy created the WinShape Foundation in 1984, designed to “shape winnners.” Finance: Chick-Fil-A has very low franchising costs, requiring only a $5000 financial commitment, compared to $25,000 and a $1 million net worth at competitor KFC.

The Eat MorChikin Cow campaign has been very successful, increasing sales six-fold since 1995, chain-wide. As of March 2013, Chick-Fil-A had more than 1700 restaurants in 39 states and planned to open 85 stand-alone restaurants and 17 licensee locations nationwide (can also be applied to the Marketing section).External AnalysisA. Operating Environment Personnel: Chick Fil-A truly cares for its human resources and offers many initiatives for employees. It promotes empowerment to sell (e.g. places like football games), boosting employee resourcefulness and morale.

Truett Cathy’s vision for Chick Fil-A is to have entrepreneurial spirits for Chick Fil-A’s managers and team members; Chick Fil-A human resources maintain a pattern of having “go-getters” with creative minds, looking for multiple ways to stay on top of the market while preserving a compassionate environment.Environmental Trends: Sustainability has become a selling point.Companies are constantly looking for ways to reduce its environmental footprint.Green initiatives seem to boost customer loyalty.

Competitors: Chick-Fil-A was the 9th most profitable quick service restaurant chain in the US in 2013.Chick-Fil-A was the most profitable quick service restaurant specializing in chicken products, surpassing rival KFC, who is now 10th overall.Customers: The majority of Chick-Fil-A’s customer base are families, due to the company’s significant emphasis on family values. An additional sales point in targeting the family market resides with the fact that the larger the party is, the larger the check total will be.

Suppliers: Chick Fil-A works with suppliers, closely monitoring business practices and engagements that are consistent with its own values. As of late, Chick Fil-A has been pushing to work with suppliers to form a sufficient supply of antibiotic-free chicken for its nearly 1,800 restaurants. B. Remote EnvironmentGovernment/Politics: Despite the onslaught of controversy and dispute that resulted from Chick Fil-A’s CEO and president Dan Cathy’s statement regarding support of the traditional family, Cathy hasn’t changed his mind about his values and beliefs.

However, he has recently expressed regret for having made Chick Fil-A a symbol in this enduring debate and says that the company has no place in the culture wars.Economy: Chick-Fil-A is a quick service restaurant so it is more cost-efficient than eating at a full-service restaurant, but Chick-Fil-A does not embrace the value menu like many other quick-service restaurants. As the economy is overcoming a recession, consumers are very cost-conscious and are looking for good bang for their buck. With its new movement for antibiotic-free chicken, Chick Fil-A’s prices have been predicted to increase, but the company is working with suppliers to ensure that the overall economic effects for customers are minimal.

Social Trends: There is no doubt that Chick-Fil-A ruffled some feathers when CEO Dan Cathy made some public comments against same-sex marriages. A large part of the population was very offended and Chick-Fil-A lost a lot of business.Today’s society is becoming increasingly more accepting of alternative lifestyles and gay marriage will soon be legal in all 50 states.Technology: Among other brands, Chick Fil-A has been working with the Detroit Metro Airport to help change the traditional airport restaurant and dining experience.

This will involve the integration of advanced technologies such as the use of iPad and tablet self-ordering stations, mobile point of sale devices, social media and web-based platforms, and even a virtual concierge. C. SWOT AnalysisStrengths: Chick-Fil-A has integrity. The company has not swayed from their ideals, morals, and values. It has definitely accomplished its goal of appealing to the family demographic and has a strong and loyal following.Franchisees and operators are loyal and believe in the brand and its ideals.

Chick-Fil-A has healthier menu options than most quick-service restaurants.The “Eat MorChikin” campaign has been a popular and widely recognized advertising promotion.Weaknesses: Chain-wide, the restaurants are closed on Sundays.The company can miss out on many worthy potential employees due to their strict policies. Image and sales took a big hit after Dan Cathy’s public statements regarding same-sex marriage. Opportunities: Chick-Fil-A has plenty of opportunities to expand on its desired demographics.

One Chick-Fil-A manager explained that with Chick-Fil-A being so family-oriented, that they often miss out on college students and young professionals, while another manager noted that he felt that the company was missing the boat on senior citizens. Chick-Fil-A may also be missing out on targeting inner-city demographics. Threats: Chick-Fil-A’s main threats are all other quick-service restaurants in their price range and area. However, management believes that they set themselves apart from the competing quick-service establishments by offering a more personalized service, including taking orders from the table.

Chick-Fil-A also considers any restaurants, even full-service restaurants, in their vicinity to be threats. Fortunately, not many of Chick-Fil-A’s immediate threats specialize in chicken.Segmentation and TargetingSegmentation Analysis: Chick Fil-A seems to be engaged in concentrated marketing, due to the fact that the company focuses mainly on the family market, and more specifically, the higher-income middle class family. While this segmentation strategy has been highly successful and still continues to help the company grow and expand, the lower income markets are still not being reached, and it seems that Chick Fil-A has little intention of focusing on that market.

Market-Segment Profitability Analysis: While Chick Fil-A’s current market-segment strategy does not reach the highest possible range of customers, it is extremely profitable, as it targets customers that typically come in greater numbers, resulting in higher profits all at once. In terms of total annual U.S. domestic revenue, Chick Fil-A ranks #9 among the largest quick service and fast casual restaurant chains.Target: Chick Fil-A targets the mid-to-higher-income family market overall. With the addition of its menu items featuring premium ingredients, such as premium salads, Chick Fil-A also targets the health-conscious consumers.

Next Year’s Objectives and QuotasObjectives: Chick-Fil-A seeks to expand on its desired demographics. This will constitute inclusion of college students and young professionals who are potential customers, and the senior citizens. Chick-Fil-A aims at targeting inner-city demographics so that its overall market horizon is big enough for increased sales.Quotas: Chick Fil-A has in the past been serving an estimated 1800 restaurants through its suppliers. This is set to go high at over 2200 so that the overall sales volume gives it a better market command and publicity among its competitors in the industry.

This quota will place it at a better market bargaining power in terms of pricing. This quota is estimated to constitute 45% of the overall supply in the entire industry.Vendors communications: Communication is critical to this firm as its operation with vendors provides it with information on market trends and consumer behaviors. In this respect, Chick Fil-A seeks to provide its vendors with communication gadgets in form of mobile phones and other note taking instruments on which they can establish the observed trend in sales and the demand gaps in the market.

Communication will also help Chick Fil-A to co-ordinate various marketing activities with the vendors. Action Plans: Strategies and TacticsSales Strategies: Chick Fil-A seeks to explore potential market in public learning institutions through assigning sales agents to such places. This is considered as a being tactical against the competing food suppliers who have limited finance to acces such market niche. To achieve this, Chick Fil-A plans to undertake a sales promotion in the universities and colleges to gain access to the institutions where the age group is significantly associated with feeding in Chick Fil-A’s products.

Distribution Strategies: Chick Fil-A plans to minimize chain of distribution by having its own vendors assigned different segments of the market. This would ensure that it have direct contact with the customers and monitor the trend in consumption and identify possible distribution related problems like accessibility of some clients like senior citizens. It is critical to note that employing more distributors will equally boost its overall sales volume.Advertising and Promotion Strategies: Chick Fil-A seeks to take sales promotion to major institutions of higher learning where there is significant concentration of students, administrators, teaching and non-teaching staff.

In that regard, it would send its sales personnel to promote the products which will entail free tastes.Pricing Strategies: Chick Fil-A plans to reduce its prices to affordable level in its different market segments.It plans to offer discounts on frequent customers who will fill a given book after purchases and offer various quantities and slightly lower prices.Product Strategies (strengths & weaknesses, threats, measurable objectives, positioning statement): Chick Fil-A supply high quality and anti-biotic free chicken which will continue to improve its market popularity.

Although it faces competition from other restaurants, it will navigate the market through affordable pricing that is close to the other competitors and sell a close substitute of its competitors. This will be achieved through intensive marketing to the geographically dispersed market.Resources Needed to Support Strategies and Meet ObjectivesPersonnel: Chick Fil-A l will employ additional workforce of high skills in various departments to ensure smooth co-ordination of production and supply. This is critical in boosting the present staff to reduce workload and improve on efficiency.

The estimated additional staff will be about 150 persons of diverse backgrounds and strong academic and practical ability.Additional Monetary Support: Chick Fil-A requires additional funds through lending to add more equipment that will see it produce more and achieve its goals of constant and voluminous supply.This is estimated to be about $ 40,000.Miscellaneous Costs: Chick Fil-A will likely incur additional misceleneous costs to cater for its expansive production and supply plans and this will call for additional $ 300 per month.

Marketing Strategies (products/services, price, place, promotion):Chick Fil-A seeks to increase its supplier of chicken through its vendors at affordable prices which will de different at different market segments. The elite resident and the working class market segments will be assigned homogeneous products so that there is relative homogeneity of the product and service to the people. This would be boosted with a blend of sales promotion in different places to inform potential clents and encourage existing customers on the products and services offered by Chick Fil-A.

Budgeting for the Action Plan(Important):The budget must consider critical parts of the success plan and this mean allocation of adequate funds to the right departments. Chick Fil-A will increase its budget towards acquisition of additional equipment and sales promotion. These two are at the extreme end of production and supply hence determinant of the organization’s success.Marketing Action PlanWhat is Going to Be Done: To help Chick Fil-A expand and grow, there will be brand-promoting campaigns conducted, extended efforts in charitable contributions and community involvement, reaching out to demographics that have not been adequately acquainted with through the education of the general public aboutChick Fil-A’s products, and additionsto the menu that will appeal to a wider range of customers.

Where It is Going to Be Done:Due to Chick Fil-A’s vision to expand into the northeastern part of the U.S. which hasn’t been reached, this action plan should be carried out into new and existing locations in that region. However, the plan should begin in the existing successful locations in other parts of the U.S. to begin raising awareness of the new changes.When It is Going to Be Done: This marketing plan should be introduced as early as Summer 2014, to raise the highest amount of awareness.

The plan can be developed and perfected throughout the rest of the year, so that it will be able to be implemented by Summer 2015.Who Will Be Responsible for Implementation:This marketing plan will take quite a bit of resources and participation, so those responsible should first include Chick Fil-A’s CEO and president Dan Cathy. It would be quite a big step to reach him and get him on board with this, but once he agrees to implement the plan, it would be carried out to corporate offices and management team around the U.S.Marketing ControlsHow the marketing plan will be monitored and evaluated: This plan will be evaluated throughout the year by corporate, basing effectiveness on numbers in potential reached markets in addition to the lower-income segments, as well as the amount of money that would need to be spent on aspects such as the introduction of new and more affordable menu items, coupons, and other options that would be cost-effective for the consumer.

ConclusionBibliographyChick-fil-A to switch to antibiotic-free chicken. (2014, February 12). Fox News. Retrieved March 30, 2014, from http://www.foxnews.com/health/2014/02/12/chick-fil-to-switch-to-antibiotic-free-chicken/Columbus Dispatch. (2014, March 21). Chick-fil-A retreats from culture wars. The Columbus Dispatch. Retrieved March 30, 2014, from http://www.dispatch.com/content/stories/faith_and_values/2014/03/21/chick-fil-a-retreats-from-culture-wars.htmlDetroit. (2014, March 22). Andiamo, Chick-fil-A, P.F. Chang’s, Zingerman’s Deli among new dining options at Detroit Metro Airport.

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