Carls Jr. Marketing Plan - Research Paper Example

 Executive Summary: Carl’s Jr., established in 1945, is a US based fast food seller that has over 1100 franchises and food outlets across the world. The international chain is now willing to commence operations in Australia so that they could reap monetary profits. A reason behind this new venture is the fact that sales have tumbled by nearly 8% across USA because of weak economy, unemployment and reduction in purchasing power of fast food lovers. Indeed, people in USA are less inclined to eat out because of low real incomes. Australia, in contrast, is a lucrative option because of similar tastes and preferences of consumers as well as strong performance of international franchise chains. Indeed, this sector is regulated by government, yet has received attention of foreign investors because of transparent regulations and presence of Franchise Council of Australia. Carl’s Jr. has planned that it would establish a store at Gold Coast, QLD where it would offer most of American food products because of resemblance in tastes and desires. The company will target middle and elite class people that could afford quality food products at reasonable prices. A. Mission statement To produce and sell delicious and hygienic food products to our potential customers across Australia thereby offering new American food taste to our potential buyers. In addition, to build long term cordial business relationships through continuous improvement, induction of new products and differentiation that would help in generating financial profits for Carl’s Jr. Indeed, the American food chain has strong inclination to expand in Australian market by opening 25 new franchises in next few years. B. Target market: Carl’s Jr. is an American producer and seller of top quality food products that has now become a established brand name across US market. Indeed, the parent company strongly believes in business expansion and thus quite interested to expand operations to Australia. The fast food retailer has planned to market its brand to middle-middle, upper-middle and elite class groups who like top quality branded food. In addition, the chosen host nation is a developed economy of which population is nearly 22 million in 2010. In addition, over 90% population lives in Urban Areas and thus has better purchasing power due to employment and business opportunities in cities. Around 87% Australian people are below 65 years that prefer junk food for lunch and dinner during business hours. For instance, per capita income in Australia is just over US $19200 which ranks 21st in the world. (Internet: indexmundi.com; nationmaster.com) As far as other core factors are concerned, it should be pointed out that scope of franchises is much better in Australia because ‘it’s three times more franchised per capita than US’. In addition, Carl’s Jr. do not have to focus heavily on localization and adaptation strategies because rich Australians’ desires, preferences and general lifestyle is more or less similar to US consumers. Hence, the company will not face difficulties to adjust in new Australian market. (Stafford, 2010) C. Product Classification: Convenience Products: The fast food products such as Zinger, Beef burger, Chicken burger, Ham, Hotdog, fish burger, fries and many others fall in the category of Convenience products because they could be purchased from any food outlet while requires comparison only about taste and quality. Indeed, they are not shopping and specialty products because food is a basic necessity and demanded by every individual. D. SWOT analysis Strengths as Core Competences: 1) Carl’s Jr. brands are well recognized and widely accepted all across the world because they are hygienic and unique in taste. 2) The company has extensive financial resources because of global operations and could easily assimilate if losses are incurred in first few months of operation. 3) Focus on innovation and differentiation through development of new products and flavors. Weaknesses: 1) May face difficulties in initial phase because investors may not be interested to get involved in franchising agreement. 2) Carl’s Jr. could face problems in finding appropriate domestic suppliers who could provide meat, chicken, potatoes and other food stuff at reasonable prices. Obviously, it will not be feasible to import above mentioned inputs. Opportunities: 1) Improvement in global economic conditions and recovery of Australian economy from recessionary shock will increase demand. 2) Relatively higher per capita income (above $19,000) and 90% urban population shows that demand of fast food will increase in future across Australian cities. 3) Chances to expand business to Sydney, Melbourne, Perth and other cities. 4) Resemblance in tastes of Australian and American customers will enable business expansion and sustainability in the long run. Threats: 1) There is open threat of potential new entrants in Australian fast food business because of strong franchising sector and growth opportunities. 2) Substitute products from US, Australian and International competitors may lead to price wars. E. Competitive Situation Analysis Carl’s Jr. would face competition with existing international fast food chains in Australia such as McDonalds and KFC as well as would have to compete with domestic burger chains. In addition, new US restaurant chains such as The Melting Pot and Hardees that are well aware of Carl’s Jr. Products may give tough time to interested junk food seller. Porter’s Five Forces model: Bargaining Power of Buyers: The bargaining power of customers in Australia is medium because of relatively stable economy and aggregate consumption. Consumers do not necessarily demand very low prices because of affordability and new employment opportunities unlike USA. Bargaining Power of Suppliers: The bargaining power of suppliers is medium because food is a basic necessity and is demanded throughout the year; however, there is some decrease in sales from previous years due to economic recession. Potential New Entrants: The aggregate demand of junk food in Australia is not reduced considerably because of relatively stable economy. In addition, strong franchising sector has created several jobs that in turn helped in providing employment to Australian buyers. In short, threat of new entrants is higher. Threats of Substitute Products: The threat of substitute products is higher because of new entrants in Australian food sector. Existing sellers will also introduce new products to entice maximum buyers and retain their market share. Rivalry among Competitors: Obviously, industrial rivalry will increase because each food producer and seller will opt to maintain its existing market share through penetration, competitive and new promotional strategies. F. Marketing strategies Product strategies: Carl’s Jr. has been well aware of the fact that Australian potential customers appreciate American products because of resemblance in tastes and preferences. Hence, the international junk food seller will offer most of its American products including sandwiches, burgers, desserts, shakes, juices, soft drinks etc. in the Australian market. Indeed, the company may use adaptation and localization strategies if some products do not really meets core Australian tastes and thus fail to attract maximum customers. Carl’s Jr. will offer its products such as Super Star, Western Bacon Cheeseburger, Charbroiled Chicken Club and decadent desserts like the hand-scooped shakes made with real ice cream at its new store in Australia. Price Strategies: The international fast food chain has planned to use promotional pricing strategy in first three months after official inauguration of its new store. The reason behind it is the fact that Carl’s Jr. wants to attract maximum customers in first few months to make practically aware of its flavors, tastes, available meals and product variety. The prices will obviously be low for publicity and promotion but then eventually be brought to their normal levels. Yet, the prices will remain competitive because there is greater threat of new entrants and substitute products; hence there is dire need to get customers connected with Carl’s Jr. In addition, the company will make sure prices at Australian stores are more or less equal to prices in USA otherwise company has bear exchange losses. For example, a US $2 product could be sold at Australian $2.5 because US currency is stronger than that of Australia. However, company may also sell the same product at Australian $2.2 to entice new buyers towards its stores. Promotion Strategies: Carl’s Jr. uses every media vehicle for their promotion, and marketing strategy to attract consumers. Some of these strategies are: I like Flatbuns Campaign Carl's Jr. launched a major integrated media campaign to promote its new patty melt burger. Carl's wanted to generate excitement around the burger by creating a unique offering that spoke to the way its target consumers used media. They used services such as, mobile ringtones and WAP sites. Carl’s Jr. Logo Another strategy that I could identify was their logo and their store, which is the colour combination they use. The red and yellow colour combination attracts the consumers; it becomes very eye-catching for them. Billboards Billboards have proven to be a very effective marketing strategy for a very long time, mostly on top of a high-rise building and/or in front of a public building with a lot of daily traffic passing by. Social Media - Face Book, You Tube and Twitter Carl’s Jr. Social Media department allows participation between a brand and consumers. It is not a push of information as much a conversation, it listens and responds. The food seller has created a new layer of influencers; mainstream media, bloggers, digital influencers, and consumers. Indeed, the company opts to use Social media press release (Embedded video, photos, logos, URLs, metatags etc), Social media newsroom (pitchengine.com, carlsjr.com), In addition, the company has been using Social networks. It has designed a page at Facebook that posts news, promotion, events, commercials and related videos. Similarly, the company uses YouTube to post commercials and other related contents such as viral videos, event coverage, and interviews with CEO and key executives. Similarly, the company also uses Micro blogs namely Twitter that also provide information about promotions, new arrivals, events etc. Finally, the crowd sourced news such as digg, reddit and fark etc. are also used to create awareness among potential consumers. Traditional Media Carl’s Jr. uses print (Newspapers, Magazines, publications etc.), electronic (TV), radio, and internet media for publicity and promotion of products. Websites such as Carl’s Jr. Cool Kids – http://www.carlscoolkids.com are also used for providing public information about promotional deals, location of company stores, contact numbers etc. Branding The company also focuses on value addition and branding of its products because this enhances the credibility of product and helps in fetching higher prices for the same product. However, Carl’s Jr. pays special attention to maintain quality. Place strategies: The company will establish its first store at a busy commercial and densely populated area so that it could attract maximum customers towards its brand. The new stores will be opened in upcoming months so that we could increase our reach in the market and ensure Utility of Place and Time. In next phase, the company will open new stores at appropriate locations in various cities to fully tap lucrative Australian market. G. Marketing Goals: Indeed, this is a two year plan (Jan. 1, 2011 – Dec. 31, 2012) that is prepared to accomplish following goals and objectives. 1) To sell delicious and tasty food products to our Australian fast food lovers and hit annual sales of US $1.5 million in 2011. 2) To understand the recessionary impact over Australia and adopt competitive pricing strategy so that sales target could be achieved. Indeed, the company has planned to open 5 franchises at different locations by 2011. 3) To ensure that our customers are well satisfied and receive satisfaction from our products. Carl’s Jr. will opt to expand its reach and establish 10 new outlets in 2012 if sales remain positive. The sales target for 2012 is $4 million from existing and new stores. References: Stafford, Patrick (2010) “Four more US franchises heading to Australia” Available at http://www.smartcompany.com.au/franchising/20100401-four-more-us-franchises-heading-to-australia.html No author “Carl's Jr.” Buyusa.gov Available at http://www.buyusa.gov/australia/en/carls.html No author (2010) “Australia Demographics Profile 2010” Available at http://www.indexmundi.com/australia/demographics_profile.html v No author (2010) “Gross National Income (per capita) by country “ Available at http://www.nationmaster.com/graph/eco_gro_nat_inc_percap-gross-national-income-per-capita Read More