Plan to Promote the Broadway Cafe - Research Paper Example

Abstract  The Broadway café established in 1957, started with a reputable menu and loyal customer base via a competitive advantage. As new competitors are establishing in the city, the café needs to upgrade its business processes and strategies equipped with information systems. The competitive advantage will be achieved by building an E- strategy to promote the business in a new innovative way, the creation of an online community in the form of a website, providing wireless surfing of Internet, using customer relationship management systems for improving marketing campaigns and sales strategies, to deal with unique ethical and information security predicament, improved project management procedures to implement elucidations and to understand by analyzing a new dimension of technology implementation within the business. 1 Introduction  I have inherited a coffee shop by my grandfather which was established in 1952, and was a local hotshot for many years. The name of the Coffee house is the “The Broadway Cafe”. The café is located in downtime where I live. It offers many special kinds of coffees, tea, home-based sandwiches, soups, salads and a full service bakery. Over the last five years, business has been dilapidated steadily. My grandfather was a specialist of running the cafe but it is not operated in the capacity of current technology trends and procedures. There are no computing devices in the café which may enhance the café operations and procedures. The information of the customers and orders is stored manually. My grandfather knows the entire customer information by name and he possesses a sharp mind. Even the recipes of baked goods and soups were also stored in my grandfather’s memory. The supply chain management is manually recorded in a notepad along with the salaries of all staff of the café. Information regarding the marketing coupons is also stored in the notepad. 2 Competitive Advantage (Part 1) The analysis related to competitors in the area needs to be carefully analyzed before setting up a strategic plan. The competitive advantage is the conclusion of the unique strategy of the café which cannot be adopted by the competitors. The unique strategy includes customer loyalty at its best which also a vital element for a successful business. An easy definition of Competitive advantage is available on www.business dictionary which states ”Superiority gained by a firm when it can provide the same value as its competitors but at a lower price, or charge higher prices by providing greater value through differentiation.”. For entering “The Broadway Cafe” in a new demanding industry, Michael Porter’s five forces model will assist the evaluation of the challenges. The model will assist to conclude the relative attractiveness of an industry. In Fig 1.1 Michael Porter’s five forces model is illustrated. The threat of new entrants, suppliers, buyers and substitutes is directly impacting on the centralized hub which is the rivalry among existing competitors. These are many coffee houses in the city which offers the same range of products and prices. There are also rumors that Starbucks is opening soon just a few blocks away from the café. The staff of the café is worried on the current operations of the café which they think are incompetent. The staff needs a motivation in terms of technology which assures that the competition will not influence the business and customers. Segmenting the competitive advantage on Porter’s Five-Force analysis, the buying power needs to be overcome. Buying power is defined by Zhiqi Chen as it “refers to the circumstances in which the demand side of a market is sufficiently concentrated that buyers can exercise market power over sellers.”A strategy is required to address the concerns of the employees. Customer loyalty programs are required for enhancing customer satisfaction and experience at the Broadway café. For an efficient customer loyalty programs, integration of Information technology is essential to track and inform the customers about the new products and prices on the Internet. Customer loyalty programs are the most popular marketing strategies adopted by organizations across a variety of industries. Programs that are alleged positively by customers will in turn create strong mind-set of customer loyalty and higher customer revenue (Furinto, Pawitra, & Balqiah, 2009). The café should offer a unique menu which other cafes do not offer enabling the alcove dining experience that can only be purchased at the café. The existing café has a small Supplier power force to compete. There is a wide variety of suppliers for selection. Google extracts results for searching “restaurant supplies” about seventeen million two hundred thousand (Google, 2010). Every 10 websites out of 50 have mentioned toll free number to communicate with and place supply orders. The websites of suppliers offers convenient delivery options with a variety. If the experience is not good regarding the supplier services and operations, another supplier can be selected from the website just clicks away. If the buyer power is relatively high then the threat of substitute products or services is high. There are numerous products and services representing the identical services and products. This threat is differentiated from buying power and emphasize on specific products the café offers. If a café is offering a particular unique item, it means that the café has effectively lowered this threat. The only switching cost the café has to bear is the distance which the customer has to travel to the restaurant and the prices of the meals offered by competitors. The café has to maintain a unique collection of recipes as compared to other cafes is the paramount strategy for keeping this threat to least. The threat of new entrants is high when the café has a low supplier power to challenge with. It concludes that the entrants also have a low level of difficulty to achieve what they require to initiate a café. Customer loyalty and collection of unique and established recipes cannot be purchased by money. For starting a new business, it is easy for a competitor to manage what is required for setting up a new business but it is not easy to attract the customers who have developed regular dining practice of eating traditional recipes by replacing them with the new inexperienced recipes cooked by new chefs. Rivalry among existing customers is present when there is the possibility of large number of restaurants available. Competitive prices will add the café in the list of affordable cafes as compared to other competitors. Service with better price and the unique menu will definitely make the customer joyful. Looking from a broader perspective to the food industry, the Broadway café operates in sky-scraping competition, buying power and new entrants. The focused differentiation strategy will be beneficial as it will tackle the forces which are acting as a barrier for the café. The Broadway café can offer unique high quality recipes for its customers, which are revolutionized for over 50 years and none can offer. 3 E business Strategy (Part 2) The Broadway Café will emphasize on using Self serving technologies (SST). Self serving technologies include interactive voice response systems (IVR’s), Installation of interactive kiosks which will be accessible by the customers not having laptops, an interface via a website to pay online (Welcome to the IIMA online). The Broadway café needs to implement E business solutions on a range of business operations and procedures. The first step is to develop a system in which all the information regarding the recipes can be stored. Knowledge management systems have immense potential significance to business managers as well as to the functions of Information systems (King, Marks Jr., & McCoy, 2002). Apart from the recipes, information related to customer service including customer reviews, dissimilarity can also be recorded helping the Broadway café to convert the today’s leftovers in tomorrow’s special for customers. Customer relationship management system is a vital element for improving and providing better customer service. As per the ICSC Dictionary of Shopping Center Terms it is the “The business strategy that aims to understand, manage, and personalize the needs of an organization’s current and potential customers. The customer relationship management system prioritizes customers who are spending healthy quantity of money to offer them fringe benefits and bonus meals. The reward system will work on the parameters of total money spent so far by each customer resulting in a proactive strategy for improving customer relations. The system will attract new customers as well as maintain a satisfaction level of existing customers. The system will provide the in depth detail to the employees of the café to identify loyal and potential customers. The system will collect information related to business intelligence by categorizing customers with their spending habits. The launch of a website will certainly improve business and the image of the café in the digital world. The website will include the current menus, specials and events occurring in the café. Customers can review what the café is offering in terms of meals and specials. Customer feedback will helps the café to know, which meal is gaining popularity as the customers will demand for specific meals along with the prices. Integration of E commerce will enable the café to take orders online. Customers can pay via credit card and the café can prepare their meal before they reach the café so that it can be served instantly. For socializing the café and providing a value added service to the customer, availability of wireless Internet connectivity is a vital element. Café is no more for just eating and drinking. Customers often bring their laptops and can be facilitated by Internet. The presence of the café will also be listed in the cities free Wi- Fi spots. Advertisement on the Internet can also be considered which will generate additional revenue. Customer who does not have a laptop can access kiosks. As per the ICSC Dictionary of Shopping Center Terms, kiosks are defined as “Booths located in the common areas of the center or mall and generally housing small-time merchandise or services”. Kiosks will definitely add the competitive advantage as there will be no other cafes to offer them. 4 Ethical and Information Security Dilemmas A strategy must be defined for providing free meal coupons to the customers. Organizations are frequently implementing mobile media for promotional services via short message service. A Survey of 370 mobile phone users was conducted in Austria indicating that the attitude of the customers towards mobile coupons affects their intentions to redeem these coupons (Dickinger & Kleijnen, 2008). There must be a verification mechanism of these coupons. The mobile coupons should be associated with the unique ID for verification. The coupon should be in the form of text message otherwise the customer has to download it in the case of MMS. There are lots of spam text messages received by the customer; will they accept the coupons in the form of text messages which will give negative impact of the café? The frequency of transmitting the mobile coupons should be low to avoid this factor. Mc Donald has implemented the largest UK retail mobile marketing campaign (Thomas, 2002). Anne de Kerckhove, managing director of mobile marketing company 12Snap said “Low costs and large potential audiences could make campaigns using mobile technologies such as SMS a cost-effective alternative to traditional direct marketing. Although still a relatively small market, the support of a brand like McDonald's is likely to boost the uptake of mobile marketing”. For detecting the cell phones and phone numbers with the help of the wireless network, marketing mobile coupons is not acceptable in this way. The Coupons will have Unique ID printed in the text message. Customers who are reluctant to send SMS to the system in order to receive a coupon are connecting their phone number to the unique ID. This offers a great prospect for gather information regarding customer activities. If the same number appears attached to multiple coupon unique IDs, then the customer is using the system to its full potential. If a new phone number penetrate in the system, it indicated the presence of a new customer or less likely old customer has a new phone number. A mobile coupon campaign has an established history for identifying customers who have not been in the café for a long time. The coupons are forwarded to other cell phones which allow the café to establish networks of customers. This information is precise and very effective for the café to know the communities of people who frequent visit the café. The identification of customer who has forwarded on their coupon, allows the cafe to give reward to that customer for the referral. If unique IDs are connected with a data of sale record, then other items which the customer has purchased can be identified. 5 Customer Relationship Management As four new espresso machines are installed in the Broadway café, at peak hours customer have to wait or make lines for frappachunios and cappuccinos as the demand for these two drinks is increasing. As wireless connectivity is available a message can be launched for the users who are already connected to the wireless network on the café. The text message including you tube link can also be send to the users on their cell phones. They can view the message by clicking the link, which will redirect them to YouTube video. Those customers who wish to access kiosks will receive the link for viewing the message available on YouTube. Before adoption this approach for better customer relationship, bandwidth requirements can be reviewed in order to broadcast the message to the frustrated customer via YouTube fluently. Systems Development  Nick Zele’s is given the task to build the timesheet component of the Supply Chain Management system for the Broadway Café. There are some vital elements which needs consideration. Before selecting vendors for the development of the organizations core business software, some questions are necessary. What is the qualification of Mr. Zele’s? As compared to the revenue the café is generating, in-house development cost for software development is it the best option? Mr, Zele’s past experience will also be considered. He has designed systems of similar capacity and function before? Accountability is a very crucial factor as the café has not much to lose. If Mr. Zele develops a payroll system having bugs and deletes the records of the payroll of the employees and in the worst scenario the hard drive crashes including the database of all employees and customers. What is the backup procedure? How Mr. Zele will provide support for the system he designs? He is available on phone support or he will locate himself within the café and provide support when the payroll printing is in progress or promotion coupons are printed. What will be the support timings? Will he be appointed in the café or just give part time support to the café? As compared to the above scenario, COTS product is available from a well known reputable vendor with proper documentation and support. Documentation is the only essential element the organization posses when a small system with no technical staff is implemented. The software house has self service IVR and a 24 by 7 hours support center. The customization of the system makes it feasible for the organization in a long term perspective. The evaluation of COTS system needs to emphasize on the customization which will support the evolving business of the café. A system which can take place in between these two is Microsoft access based system. A system based on Microsoft Access is not too complicated. There are wizards for creating each function making it easy as compared to other database systems. Developing a system based on Microsoft access by Mr. Zele, will also be a consideration as the staff adaptability of Microsoft access is relatively higher as compared to the in-house development system and the vendor based system. It is not easy to evaluate the adaptability factor of the employees regarding the time keeping system. Those employees lacking experience with computers will find it difficult to deal with and can be stressed out. When the staff do not know how to navigate from field to field by using keyboard shortcuts, it is difficult to conclude the efficiency of the system rather than entering the data on paper. The old employees will not be entertained by giving presentations of benefit on saving and entering data in the system which may force them to use the system. The factors related to cost savings and organized reports related to the cafes overall success, will encourage them more as compared to presentations and discussions. If the employees are encouraged, they might give their suggestions resulting in improving the overall system. 6 Conclusion  Broadway café has capacity to compete with the current competitors in the digital economy. The café can enhance business by injecting information technology best practices and current trends in the cafes infrastructure. By scrutinizing a focal point which is differentiation strategy, marketing the unique menus along with revolutionary items that only Broadway café will offer, the business will be a success in the restaurant industry. Knowledge management systems, customer relationship management, wireless Internet and business intelligence systems will contribute to all aspects of the business. The website will provide the interface to communicate with customer and place orders online, increasing revenue and better customer services. Mobile coupons will definitely add a value to the customer satisfactory, as the coupons will be received in the customer’s cell phone. The system development can be conducted on custom based system design by Mr. Zeles or from Microsoft Access as a backend. The strategy of motivating older employees will be conducted by perusing them the factors related to the cafes success rather than providing them technological advantages. 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