Transcript Chapter 14

Chapter 14
Marketing Foodservice
Marketing

The process of planning and executing
the conception, pricing, promotion, and
distribution of ideas, goods, and services
to create exchanges that satisfy
individual and organizational objectives.
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Foodservice Organizations, 5th edition
Spears & Gregoire
Marketing Concept
Manufacturing/Production concept – belief that
customers favor products that are available
and highly affordable.
 Product concept – belief that customers prefer
existing products and product forms.
 Selling concept – belief that customers will not
buy enough of the organization’s product
unless the organization undertakes a large
selling and promotion effort.

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Foodservice Organizations, 5th edition
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Marketing Concept
Marketing concept – belief that organizations
should determine the needs/wants of target
markets and deliver desired satisfaction more
effectively and efficiently than competitors.
 Social Marketing concept – belief that
organizations should determine needs/wants
of markets and deliver satisfaction more
effectively and efficiently than competitors in a
way that maintains or improves the
consumer’s and society’s well-being.

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Foodservice Organizations, 5th edition
Spears & Gregoire
Marketing Management

Process of planning, organizing, implementing,
and controlling marketing activities to facilitate
and expedite exchanges effectively and
efficiently.
 Effectiveness – the degree to which an
exchange helps to achieve an organization’s
objectives.
 Efficiency – the minimization of resources that
an organization must spend to achieve a
specific level of desired exchanges.
©2004 Pearson Education, Inc.
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Foodservice Organizations, 5th edition
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Marketing Mix

Combination of Marketing Mix variables
to satisfy target market.
Product
 Price
 Place
 Promotion
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Target market – Customers with common
characteristics for which an organization
creates products/services.
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Foodservice Organizations, 5th edition
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Product
A good, a service, an idea, or any
combination of the three.
 New product – a genuine innovation that
has not been served commercially.
 New to the chain – an imitation of a
successful product offered by another
chain.

©2004 Pearson Education, Inc.
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Foodservice Organizations, 5th edition
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Price
The amount of money charged for a
product.
 A critical component of the marketing
mix.
 Often used as a competitive tool.
 Helps establish a product’s image.
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©2004 Pearson Education, Inc.
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Foodservice Organizations, 5th edition
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Promotion
Used to increase public awareness
about a new product or brand.
 Used to renew interest in a product that
is waning in popularity.
 Used to facilitate exchanges by informing
prospective customers about an
organization and its products.

©2004 Pearson Education, Inc.
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Foodservice Organizations, 5th edition
Spears & Gregoire
Place

The location where food or services are
offered
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Foodservice Organizations, 5th edition
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Environmental Forces
Political
 Legal
 Regulatory
 Societal
 Economic
 Competitive
 Technological

©2004 Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
Foodservice Organizations, 5th edition
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Marketing Segmentation

Division of total market into groups of
customers who have similar needs, wants,
values, and buying behavior.
 Market – a group of people who need products
and possesses the ability, willingness, and
authority to purchase them.
 Homogeneous market – individuals with
similar product needs.
 Heterogeneous market – individuals with
dissimilar product needs.
©2004 Pearson Education, Inc.
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Foodservice Organizations, 5th edition
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Market Segmentation
Geographic variables – climate, terrain, natural
resources, population density, and subculture
that influence customers’ product needs.
 Demographic variables – population
characteristics that might influence product
selection.
 Psychographic variables – motives and
lifestyles characteristics.
 Behavioristic variables – the basis of some
feature of consumer behavior toward a
product.
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©2004 Pearson Education, Inc.
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Foodservice Organizations, 5th edition
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Values and Life-Styles (VALS)
Attempts to predict customer behavior by
defining segments, based on resources
and self-orientation.
 Resources:

Psychological
 Physical
 Demographic
 Materials means and capabilities
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©2004 Pearson Education, Inc.
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Foodservice Organizations, 5th edition
Spears & Gregoire
Values and Life-Styles (VALS)
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Self-orientation:
Principle-oriented – consumers make
choices based on their beliefs and
principles.
 Status-oriented – consumers make choices
based on what they perceive will show their
success to their peers.
 Action-oriented – consumers make choices
based on a desire for social or physical
activity, variety, or risk.
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©2004 Pearson Education, Inc.
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Foodservice Organizations, 5th edition
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Consumer Groups
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Actualizers
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active, take-charge individuals with a wide
variety of interests and interest in growth
and change.
Fulfilleds
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mature, reflective individuals who value
order, knowledge, and responsibility and
base decisions on their principles.
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Foodservice Organizations, 5th edition
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Consumer Groups
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Achievers
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work-oriented, conservative, and value-conscious
consumers who favor established, prestige
products that demonstrate success to their peers.
Experiencers
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young, impulsive, and rebellious individuals who
spend much of their income on products such as
clothing, fast food, music, and movies.
©2004 Pearson Education, Inc.
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Foodservice Organizations, 5th edition
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Consumer Groups
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Believers
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conservative, follow established routines,
organize their lives around home, family,
and social or religious organizations.
Strivers
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tend to be somewhat unsure of themselves,
seek approval from those around them,
often emulate those around them with more
impressive possessions, usually lack
financial resources to purchase what they
would like.
©2004 Pearson Education, Inc.
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Foodservice Organizations, 5th edition
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Consumer Groups
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Markers
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practical, self-sufficient, and traditional
individuals who experience the world by
working on it.
Strugglers
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tend to be poor, ill-educated, low-skilled,
and without strong social bonds.
©2004 Pearson Education, Inc.
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Foodservice Organizations, 5th edition
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Behavioristic Variables

The basis of some feature of consumer
behavior toward a product.
A special product produced for a specific
group of customers (caffeine-free diet cola).
 A product is produced for how a customer
uses it (single serving frozen meals).
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Foodservice Organizations, 5th edition
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Service Marketing
Good – a tangible product that a
customer can physically touch.
 Service – the application of human or
mechanical efforts to people or objects.
 Services account for:

67% of the Gross Domestic Product (GDP)
 57% of consumer expenditures.
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Foodservice Organizations, 5th edition
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Characteristics of Services
Intangibility
 Inseparability of production and
consumption
 Perishability
 Heterogeneity
 Services generally are sold before they
are produced.
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©2004 Pearson Education, Inc.
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Foodservice Organizations, 5th edition
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Intangibility
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Inability of services to be seen, touched,
tasted, smelled, or possessed before buying.
 Atmospherics – physical elements in an
operation’s design that appeal to customers’
emotions.
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Appearance
Color
Sound
Odor
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Foodservice Organizations, 5th edition
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Inseparability
Inability to separate production and
service.
 Services are normally produced at the
same time they are consumed.
 The waitstaff, bartender, and maître
d’hôtel produce services at the same
time the customer is consuming them.
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©2004 Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
Foodservice Organizations, 5th edition
Spears & Gregoire
Perishability
Services cannot be stored for future sale.
 Unused capacity cannot be shifted from
one time to another.
 The service operation must have the
capacity and capability to produce when
demand occurs.
 The cost of keeping a customer is far
less than that of creating a new one.
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©2004 Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
Foodservice Organizations, 5th edition
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Heterogeneity
Variation and lack of uniformity in the
performance by different service
employees.
 Fluctuations in service caused by
unskilled employees, customer
perceptions, and the customers
themselves.

©2004 Pearson Education, Inc.
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Foodservice Organizations, 5th edition
Spears & Gregoire
Components of Service Products
Goods – mostly physical factors over which
management has direct, or almost direct,
control and are usually tangible.
 Service – nonphysical, intangible attributes
that management should control.
 Important components of service:
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Friendliness
Speed
Attitude
Responsiveness.
©2004 Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
Foodservice Organizations, 5th edition
Spears & Gregoire
Strategic Planning Process
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Strategic planning process for marketing:
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Define the organizational mission statement –
summation of the organization’s purpose,
competition, target market, product, and service
and of the recipients of the service.
Establish strategic business units (SBUs) –
organizational components with specific market
focus and a manager.
Set marketing objectives – a statement of what is to
be accomplished through marketing activities.
©2004 Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
Foodservice Organizations, 5th edition
Spears & Gregoire
Strategic Planning Process
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Strategic planning process for marketing:
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Perform a situation analysis – the identification of
marketing opportunities and potential problems
confronting an organization.
Develop a marketing strategy – selecting and
analyzing a target market and creating and
maintaining an appropriate marketing mix that will
satisfy that market.
Implement tactical plans – specific action
implementing a marketing strategy.
Monitor results – comparison of performance
standards against actual performance over a
definite time.
©2004 Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
Foodservice Organizations, 5th edition
Spears & Gregoire
SWOT Analysis
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Identifies:
Strengths – unique resources a company
can provide.
 Weaknesses – aspects of a company that
limit their ability to achieve their goals.
 Opportunities – areas where competitive
advantage exists or where new markets
could be developed.
 Threats – elements that might prevent
accomplishment of objectives.
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©2004 Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
Foodservice Organizations, 5th edition
Spears & Gregoire
Marketing Research
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Function linking the consumer, customer, and
public to the marketer through information that
is used to:
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Identify and define marketing opportunities and
problems.
Generate, refine, and evaluate marketing actions.
Monitor marketing performance.
Improve understanding of marketing as a process.
©2004 Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
Foodservice Organizations, 5th edition
Spears & Gregoire
Marketing Research
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Research should have:
Objectivity – conducted in an unbiased,
open-minded manner; conclusion based on
data and analysis.
 Accuracy – use of research tools that are
carefully constructed and implemented.
 Thoroughness- ensuring that the sample
represents the population; a questionnaire,
if used, is pretested; and the analysis of
date is statistically correct.

©2004 Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
Foodservice Organizations, 5th edition
Spears & Gregoire
Marketing Research Process
©2004 Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
Foodservice Organizations, 5th edition
Spears & Gregoire
The Marketing Plan

A written document or blueprint governing an
organization’s marketing activities.
 Marketing planning – a systematic process
involving:
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The assessment of marketing opportunities and
resources.
The determination of marketing objectives.
The development of a marketing strategy.
Planning for implementation and control.
©2004 Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
Foodservice Organizations, 5th edition
Spears & Gregoire
Development of Plan

A marketing plan should be:
Real and workable.
 Easy to execute.
 Flexible but have a certain amount of
stability.
 Composed of specific responsibilities with
times and dates for accomplishment.
 Constantly reviewed and evaluated to keep
it current.

©2004 Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
Foodservice Organizations, 5th edition
Spears & Gregoire
Types of Plans

Marketing plans categorized according to
Duration – short range, medium range, or
long range
 Scope – varies tremendously
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Separate marketing plans may be developed for
individual menu items & special service
Method of development – bottom-up, topdown, or combination of two
©2004 Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
Foodservice Organizations, 5th edition
Spears & Gregoire
Control and Evaluation

Evaluation – sales analysis used for
evaluating actual performance of
marketing strategies
Sales analysis – the detailed study of sales
data, either volume or market share.
 Market share – the percentage of industry
sales for a product.
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©2004 Pearson Education, Inc.
Upper Saddle River, New Jersey 07458
Foodservice Organizations, 5th edition
Spears & Gregoire