Y2.U7.2 Market Analysis

What Are the basic types of research methods used to gather information? Is market segmentation? Can an operation do to create a unique market identity? Are various ways to communicate a message to the market?

Market Research Methods- 4 basic Methods Experimental Method Try out a product for a limited time with a limited group Observational Method Observing how customers react in a natural setting toward a product Survey Method Gathering information using questionnaires. Sampling Method Testing a product with a small group of people, sometimes called a focus group

Market Segmentation Target Market: the people an operation intends to pursue as customers. Every operation needs to be customer driven. Mass Marketing treats everyone in the market as having the same needs and wants. Wasteful and should be avoided. Target Marketing Treats people as different from each other, trying to make a focused appeal to a distinct group Focuses resources toward the people who buy the products

Market Segmentation Demographic Segmentation Looks at individuals in a given location Age, gender, ethnicity, marital status, income, size of household, educational level- U.S. Census Geographic Segmentation Where customers live, work and what kind of transportation they use Product Usage Segmentation Capitalizing on or reacting to brand affinity

Market Segmentation Lifestyle Segmentation Looks at the activities, hobbies, interests, hobbies of a given target market Segments are often used in conjunction with each other Once a target market is established, need to work on a value proposition -a statement of value customers will experience when they purchase the product or service. “Are the benefits worth the cost?”

Market Segmentation Target Marketing Steps Identify groups you want to serve Who are the customers you want to attract and why Identify groups you are actually serving Survey Perform a situation assessment (Customer Profile) Do your targets reflect reality? Continually work to refine message

Market Identity Positioning 3 steps Identify possible ways to differentiate the operation within the market Select the right mix of differentiating aspects Communicate the chosen identity to a specific chosen market All about standing out from the crowd Offering a product no one else does, or in a way no one else does

Market Identity Ways to Differentiate an Operation: Product, Physical appearance/aesthetics, Service, Location, Image Product …the food is a time-tested way, but, given how difficult it is to produce something so unique, so much better than the competition, more than just product is needed Physical Appearance/Aesthetics The look: modern, cozy, formal

Market Identity Ways to Differentiate an Operation: Product, Physical appearance/aesthetics, Service, Location, Image Service How will staff be dressed?, How will guests be greeted? Delivery?, Take-out. Location Geographic and other segment considerations Image Image first, then make product and service decisions that work toward achieving the image

Market Identity Ways to Differentiate an Operation: Product, Physical appearance/aesthetics, Service, Location, Image Selecting the Right Mix One differentiation point? (maybe not enough), many differentiation points? (could dilute the message) Communicating Chosen Identity Are customers getting the message?

Market Communications The process of communication is called the Promotional Mix Advertising Paying to present or promote an operation’s product, services or identity (television, radio, newspaper, storefront, internet) Sales Promotion Limited, short term incentives to entice customers to patronize an operation (2 for 1, Wednesday wing)

Market Communications Personal Selling Always key to an operation’s financial success, well- trained staff goes a long way to communicating an operation’s message Public Relations (PR) Process by with an operation interacts with the community at large (sponsorship, charity event) Direct Marketing Connect directly with a segment of the market (mailing, , phone call, web site feedback, tableside feedback)

Sales Promotions Special Pricing Limited time reduced prices Frequent Shopper Program Benefit in exchange for continued patronage Premiums Free or reduced price merchandise (pen, cup) Special Event One time or periodic event

Sales Promotions Samples Free small tastes of food items Contests and sweepstakes Games/programs that involve customer and provide a prize

Promotional Materials Signage Menu boards, directional signs, other signs Flyers Paper notices distributed in a specific location Premiums Token gifts, giveaway items Carry out and door hanger menus For use outside the restaurant

Promotional Materials Apparel and Branded Merchandise T-shirts, etc. Point of Purchase (POP) materials Menu boards, video, print pieces, other display items near the point of purchase Merchandising materials Table tents Direct mail, Cooperative Sales promotions

Public Relations To engage the public, an operation should employ both Community Relations and Media Relations Community Relations create a positive image, build credibility, build relationships, create a network, generate positive publicity, promote the operation Offer discounts for good grades (limited time) Donate a percentage of sales to a charity Offer discount for bringing in a donation Sponsorship Offer facility for fundraiser

Public Relations Media Relations include newspapers, magazines, television and radio Press Release a brief presentation of promotional information written to sound like a news article Press Kit (media kit) is a packet of information given to media representatives to answer questions they might have about a business or organization

Public Relations Press Kit General information about the operation Menus Any recent articles or press releases Any recent awards Photos of the operation and its menu items Operation’s mission or goal statement Contact Information for spokesperson Other promotional materials

Public Relations Evaluation of media types and vehicles Does it reach the target market or people who can influence market? How much of market? How likely is it there is interest in the story?