Marketing Plan
for
Italy’s Pizza Deli
Mkt 516, November 28, 2006
By
Jennifer Usher
Abdullah Alnahdi
Jack Palmer
Abraham Kirunga
Hsiang-Ying Wu
Executive Summary
Italy’s Pizza Deli aims to provide the best pizza, subs, wings and other foods alongside services to targeted business environments in the Deland region.This plan seeks to generate a significant increase in company sales and profits from thedelivery of pizza, increased catering services, retaining of new and old customers, and increased customer awareness compared tothe preceding year. Enzo, the owner, is au fait when it comes to pizza. He has been doing it for over 30 years.
The highlights of this plan arethe targets: retain customers, increase catering and delivery, improve ambience at the restaurant which all lead to increased sales-revenue. These targetsare attainable through a proactive approach to the retaining of clientele, teaming-up with technology providers, and partnering with reputable local and regional food suppliers while we improve pricing, and reduce risks. The projected marketing budget for each month will be $5,000.
This business plan has been created on the basis ofthree monthsof market research, which spanned September of 2006 to November of 2006. Data conclude the size and growth of the market and geographical segments, customer needs, perception, and buying behavior trends have been on the upswing, and are expected to continue in this trend for the next several years. Italy’s pizza Deli feels thatitis able to fill the hole in the family restaurant niche, and will benefit from continuing operations and revamped marketing.
Environmental Analysis
The Marketing Environment
The marketing environment in the food industry is very competitive. Our major competitors are larger chains such as Domino’s, Papa John’s and Pizza Hut. The strength of the larger companies is their marketing dollars. They can afford to advertise nationwide on TV. On the downside the weakness of the larger chains is the depth of their product line and the quality of the product. They do not carry as many products on the menu, and can’t compete with the freshness and grade of our ingredients. The larger chains have a set marketing mix which is controlled by the franchise and therefore will have little to no response to our marketing mix if changed. However, we also have smaller competitors such as Tony’s New York Pizza, Bellini’s, and Milone’s. These competitors have more similar strengths such as a deep product line and will compete, using price wars or other promotional events if our marketing mix is altered.
Many substitute products are available in the dining industry,having an effect on the attractiveness of our product and in the future there is also a possibility of new competitors entering when new local restaurants with quality products open in the Deland area. While the larger companies have an advantage entering the market over the smaller ones due to marketing power and the ability to bargain with suppliers, smaller companies still have the ability to enter the market if a niche is found.
Some advances in technology can help operations as well as marketing efforts. Most well known restaurants today have websites, carrying their menu, directions to the place and other important information. Some places also allow customers to order their pizza online. Another technology becoming standard in the pizza industry is delivery bags with a heater build in. These pizza bags keep pizza warmer and longer and make deliveries more efficient since more deliveries can be made at once and save gas money.
The values of our society have changed in the way that life has become fast paced and family dinners are seldom cooked at home anymore. Longer working hours and mothers going to work instead of staying at home anymore has opened up new markets for many dining places to create pick up meals which moves towards the general attitude of convenience. Cooking takes too much time, ordering food from a place is faster and does not involve much hassle.
Target Market
Our target market consists of people from different demographics. Because everybody needs to eat we technically target everyone in our environment, regardless of sex, age, and ethnicity. However pizza is especially popular with kids, teens and college students. This means that people living in the couples, launching, and retirement stage of the Family Life Cycle don’t feel the need to eat pizza at a regular basis, whereas people in the Independence and Parenting Stage do. The location of the restaurant is close to downtown Deland and is situated next to New York Avenue, a high traffic road. It is easily accessible to Deland residents located within 4 mile radius of the restaurant and is also accessible for handicapped people in its plaza location. Our target market usually is open to fast food atmosphere and pizza. They don’t mind substituting pizza for a meal, such as students looking for a snack or party host, which excludes very health oriented customers. Even though our business is capable of offering a great quality product to satisfy target market needs, competitors are faster when it comes to food production. Nevertheless the affordability and specials are enticing enough to wait a little longer. The needs of our target market will change with time. Later operating hours and more frequent deliveries will be in demand. A faster service and better service will be expected from our customers.
SWOT Analysis
Strengths
Italy’s Pizza Deli main strength is the quality of their product. The owner of the business has been in the pizza business all his life and knows how to produce quality pizza at good price without sacrificing superior ingredients.
This strength has helped the business differentiate their products from competitors and satisfy the demand of their target market.
Another strength of Italy’s Pizza Deli is the dine-in area rented. It is very clean and has open space to host bigger groups of people. This strength welcomes a strong walk in customer base and helps when special events want to be held at the restaurant.
The menu offers a vast variety of products including pasta meals, subs, meats, pizza, and salads. The depth of the product line and the size of the pizzas are another strength of the restaurant.
Weaknesses
One weakness of Italy’s Pizza Deli is it is difficult to locate visually. First time visitors will not see the place right away, since it is located in the corner of the plaza and signs are overshadowed by the post office sign.
The interior of the restaurant though clean and open lacks decoration and is very bland; there is a lack of a particular aesthetic.
Opportunities
The major market which Italy’s Pizza Deli has not entered yet in Deland is the StetsonUniversity student body. There are around 2400 students which can be potential customer of the business if marketing is successful. Another opportunity is increasing marketing efforts towards delivery business. The majority of our business is walk in and by increasing deliveries we will gain more customer base and increase profits.
Another opportunity is making the interior a theme such as an Italian home which helps with the atmosphere of the place. Together with the theme beer sales can be advertised which helps customer retention.
Threats
The threats in this industry are other Italian restaurants such as Milone’s Pizzeria & Subs, Angelina’s Pizzeria, Domino’s Pizza, Papa Johns, Pizza Hut, etc. While Milone’s and Angelina’s are in direct competition with Italy’s Pizza Deli and fighting over the market share of dine-in guests, Domino’s and Papa John’s only compete over take outs. The chain companies have more advertising dollars and have the ability to overshadow our advertisements and take away customer base.
Another threat that can hurt business is the food trend. If all of a sudden Chinese food is the trend and everybody is eating it, then Italy’s Pizza Deli will lose customers due to this trend. In order to prevent this threat Italy’s Pizza Deli has to continuously advertise and change their menu according to trends.
Marketing Objectives
Our main marketing objectives are to increase the sales of business, create a strong brand name, and inform people about our catering ability.
One way of doing this is by increasing the number of repeat customers. Many walk-in customers exist from the surrounding establishments but not many are repeats. By establishing a “punch” or “stamp” card, giving customers’ incentive to return and work towards a free pizza will allow us to see how many customers are returning and how many of those are new customers. It will take about two to three months to launch the cards and being able to track the progress. By introducing the cards you are taking advantage of the fact that a quality product is sold and customers return to use their cards and in turn increase business.
Also by utilizing the card he can counter one of his weaknesses andreach the customerscreating brand recognition and maybe entice them into becoming brand loyal consumers. This objective is consistent with his goals in that he wants to increase his customer base and make his restaurant more brand recognizable.
When considering the marketing channels that are involved with Italy’s, it is apparent that there are too many distributors involved in the delivery of the food. This seems to affect the meat and cheese portion of the menu the most which is important to achieve more production in his catering business. By increasing the quality of the menu by purchasing premium meats and cheeses, it should increase the quality catering market share percentage as well. Boars Head is the brand that was on the menu until managerial discrepancies lead to the use of a more diverse and possibly less reputable brands. By increasing the number of distributors Italy’s is ultimately increasing delivery dates, shrinkage (loss of product), distribution efficiency, and rates that may be achieved by ordering larger amounts of product from a smaller number of distributors. By allowing the Boars Head brand back into the menu and decreasing the number of distribution channels, Italy’s will see long-term benefits in rates and profits.
Marketing Strategies
Target market & Marketing Mix
One of the most important markets we are trying to gain a larger share of would be the student population, the majority being Stetson students. Targeting students is an important market because this would include the large number of both high school and college population combined with the ability to match the price range for these students with cheap food. The second target market is the business district that is surrounding the location of the restaurant. By focusing on the potential business that is within walking distance of the location, Italy’s has made lunch quick, easy, and inexpensive which has, over time, increased this lunch time walking distance market share. The other target market that we are trying to tap into is the larger business district. Deland offers a highly saturated business area that is very close to Italy’s Pizza Deli. We are hoping to reach this market on a level where he can get his foot into the door for larger catering events in the near future. By creating a relationship with these businesses, there are many potential customers that would diverge from the catered food and become more regular customers.
By applying the marketing mix to these target markets, it helps to realize the needs of the target markets and what needs to be applied for to generate a larger market share. The product and pricing strategies for the student market is a simple one. The idea here is to supply students with a quality food at a cheap price. This is something that is already offered by Italy’s; therefore the goal is simply to get this message to the student population. Delivery times are important when it comes to this market because students do not like to wait. Delivery efficiency is important because many students might be willing to sacrifice time for price or even food quality. Promotions are a must when dealing with this market. Themed nights of the week where certain items or alcohol is cheaper would help to boost the productivity of many nights that seem to be slow. Also, anything free will attract many students attention. This will help by promoting product awareness and accessibility while increasing brand recognition and ultimately profit among the student market. All of this is necessary to maintain a competitive advantage.
The product strategy for the second target market is just to maintain quick and quality food for the lunch rush. People get little time for lunch break so the faster they get their food, the more likely they are to return as a customer. The pricing strategy will have little fluctuation as the lunch hours tend to offer a daily special. Other specials could be added to the menu over time for diversity. Again, the distribution is very important to this target market. It is important that the restaurant is properly staffed for the lunch rush and that people do not find themselves waiting for long periods on any given day. Promotional value can only hold so much weight in this market because specials are already given daily at a low price. Other specials may be created or systems of rewardsmay be set up to encourage maximum repeat customers.
The third large target market that is trying to be penetrated is the large business district. There are a couple of things that may be taken out of this market. The first is the possibility of growing the catering side of Italy’s business. By bringing in large scale portions of food for business luncheons or parties, we would be raising brand awareness exponentially. It is important to get people to taste the food for the first time. This brings us to the second benefit which would be ambient business created through the people from these business outlets. If people try it at work, they might begin to continue the business outside of work. Product strategies for this market would include the diversifying the large ticket items past pizza, such as pasta and sandwich trays. The pricing should be reasonable but not too cheap. Businesses tend to feel that they get what they pay for which might deter a business from having the initial tasting of the food. Having the ability to staff any given catering party is also important. Businesses demand efficiency and speed when it comes to catering. Promotions may include business raffles, free lunches or discounts to certain businesses on certain days, company specials, and more. Whatever it takes to get people to try the product for the first time is important to increasing the share of this given market. Increasing brand awareness is very important in hopes of increasing the market share of all of these mentioned markets.
Market Implementation
Italy’s Pizza Deli has to organize their business to align with their marketing objectives. In order to achieve this, several activities can be done.
A salad bar should be introduced to the restaurant. This would attract another segment of the market of people who eat out, the health conscious type. Adding a salad bar would turn the restaurant into more of a full service restaurant. It would then attract more customers and have more options for customers to choose from. A salad bar would fit easily in the back area of the restaurant or the front as you walk in. There is a low maintenance need for the upkeep of the salad bar, however it would need to be monitored to ensure that it was stocked and fresh. This would not require a new employee and would be beneficial if it was implemented by January 2007 because salads are a popular item when spring approaches for those who are looking to lose weight for the warm weather activities in the spring.
Another product activity would be to enhance the atmosphere of the inside of the restaurant with TV’s, more tables, and the development of the Italian theme in the restaurants name. The TV’s would draw more people because people like to be entertained and kept busy; this would cause the people to stay and then in turn purchase more food and beer. Adding more tables would allow more people to eat there and thus give the restaurant an opportunity to make more money of walk-in customers. More tables would also make the customers feel less likely to leave right away after they eat. This way they can watch TV and be more inclined to order a dessert or another beverage. This would be more beneficial if it was implemented by the first of the year as well. It would be a great way to start the third year of the business.