Marketing management (KUDU)

1.???? Introduction

KUDU is one of the largest fast-food chains in the Kingdom of Saudi Arabia.? The restaurant was first opened in the year 1988 in Riyadh by a group of young Saudi Arabian nationals. The owners’ vision was to create a sandwich restaurant in the country that offers unique menus and meals that are made from fresh and locally sourced ingredients (Kudu, 2019 ). This was a very unique idea given that no other restaurant in the country was offering such products and services.? Given the high competition in the fast-food market, Kudu implemented various strategies which were key to its success. For example, the company prepared each meal in front of the customers, resulting in a new and unique experience for the citizens. Today, the organization has grown to cover more than 300 branches in KSA and Bahrain and currently employs more than 5000 workers. The main products offered by the restaurant include Burgers and Sandwiches, but it has mainly specialized in providing sandwiches. They have also diversified their services to offer breakfast and some Western-style menus.? At Kudu, the restaurant makes sure that the customers get the best services and the highest possible quality and the management has instilled its values across all employees to ensure that they all work towards a common goal (Kudu, 2019).

2.???? Value proposition

As stated by Philip Kotler, a value proposition refers to a set of values or benefits that an organization offers or promises to deliver to customers to satisfy their needs (Payne & Frow, 2014 ). In the modern fast-paced world, customers are always looking for different, Fresh and unique experiences.? The value proposition of KUDU is centred on the goal of the company, which is to create and offer new and unique dining experiences to the people in KSA (Kudu, 2019). The organization has created a concept in KSA around the consumption of sandwiches and menus made from fresh and locally sourced ingredients.? With this in mind, the company can create value for the customers by providing affordable, fresh and high-quality products (Payne et al. 2017).

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3.???? Current situation and the problem

KUDU has grown to become one of the most acknowledged restaurants in the KSA fast food industry, offering healthy sandwiches made from fresh and locally sourced ingredients (Kudu, 2019). The customers of the restaurant include the people who appreciate natural ingredients extracted from locally reliable sources. It has been able to enhance its brand image and is today recognized as one of the largest fast-food chains in KSA. The organization targets particular customers who prefer these menus and as a result, in case competition upholds comparable products, they would still not be able to come up with its unique combination of high-value quality locally sourced ingredients (Kudu, 2019). ?However, the organization might have been able to establish trust among the customers through its high-quality products and services, but there is a need to expand its total market both in KSA and in the region to increase profitability. One opportunity is to introduce meals for executives in business offices during lunchtime and nationwide expansion and diversification (Benajiba, 2016).? To device better marketing strategies and take advantage of the opportunities, the company should evaluate both the internal and external factors which affect its operations.

Macro-environment analysis

The PESTEL analysis model will be used to evaluate the external macro-environment of KUDU.

Political: The major political factors faced by FUDU range from new laws on labor, to taxation, and regulations on foods.? Changes in rules and regulations on taxations might affect the sales of the organization, but the company has always been complying with the regulations (Hossain, (2019).

FUDU remains competitive in terms of providing adequate pays and benefits to the workers as directed by the government, but current regulations on foods have been increasing to protect the consumers (Kudu, 2019). Therefore, bleaching any laws can result in lawsuits or hefty fines.

Despite few external challenges, the political stability of KSA is presumed to be more stable when compared to the past decades hence providing an ample business environment.

Economic: the economic rate is essential in business operations. From the economic point of view, FUDU does not face a significant threat from other competing firms in the industry, although there is a need to monitor the increase in interest rates actively.? Any changes in interest rates may affect debt repayment and the operating profits of the company.? There is also an increasing cost of raw materials and labor, which might affect the operations of the company and decrease its profitability (Hossain, (2019).

Social: changes in lifestyles and cultural tastes could affect FUDU. Despite increasing competition, consumers are becoming more committed to the FUDU brand and changes in the way of life are expanding interests into the restaurant's services (Kudu, 2019).? Today, people are going for more healthy and less processed foods as people become more health conscious, which is essential for the company.? The education level in KSA is also improving and people are becoming more appreciative of locally produced foods with locally sourced ingredients (Benajiba, 2016). However, customers continued demand for cheaper products is a challenge as this might negatively impact the quality of the products.

Technological: Technological advancement could have both negative and positive impacts on FUDU restaurants.? For example, the growth of the internet allows people to shop online, which makes it convenient for the organization to operate on the internet (Ang & Rusli, 2018). The company can use the website for advertising itself and sharing more information about their products.? The company can, however, invest in Google apps, which can help in making orders and tracking orders to the offices.

Micro-environmental analysis

The micro actors that affect the business include elements that might directly affect the performance and operations of the organization, including customers, competitors and the public.

Customers: Customers are the most important players in any business operations and they determine its success (Kotler & Keller, 2009). FUDU mainly operates according to the needs of the customers who require healthy and high-quality menus. The organization's target customers include men & women, friends & families, youths & adults and students.

Competition: FUDU holds a significant KSA market share, although competition is increasing by the day as the government encourages diversification.? For FUDU to be successful in the country and expand in the market, it has to find ways of being competitive over its major competitors (Lapersonne, 2013 ). Some of the main competitors include Hardees, Albaik restaurant and Herfy, all of which are competing for the same local market. However, FUDU still has a competitive edge in the KSA market as it provides unique, reliable and high-quality menus and has been able to establish a brand image and customer loyalty (Benajiba, 2016). However, to sustain its competitiveness, FUDU requires sustainable competitive advantages based on experience and expertise.

The analysis shows that FUDU has been operating in a stable environment and that's why it has continued to experience sustained growth despite the presence of a few economic challenges. The restaurant needs to increase its value and reduce costs.

SWOT analysis

SWOT-analysis helps in analyzing the internal strengths and weaknesses of an organization and the external threats and opportunities for growth.

Strengths

Weaknesses

·???????? Strong brand name and value in KSA

·???????? Locally sourced ingredients ad healthy menus

·???????? High number of loyal customers

·???????? Greatly skilled and experienced workers who promote quality customer service

·???????? Product innovation

·???????? Rising cost of labour and production increased the price rate.

·???????? Lack of diversification

Opportunities

Threats

·???????? Expansion into developing markets

·???????? Introduction of new products

·???????? Business diversification (Alturki et al., 2018).

·???????? Office delivery

·???????? Nationwide expansion

·???????? Changing customer habits

·???????? Imitation

·???????? Competition from other big outlets with cheaper alternatives

·???????? Rising products of locally sourced ingredients, increasing the prices of the products (Alturki et al. 2018).

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4.???? Marketing research

This is the process of evaluating the market and product viability and helps the firm understand the target market. The information gathered from marketing research is essential in determining the STP and the marketing mix of the company (Payne et al. 2017). Some of the activities of marketing research include defining marketing problems and opportunities, monitoring performance and understanding marketing processes. The research employed an online survey and focus groups. The surveys entail selection of the market sample, and collation of data obtained through questionnaires (Lin, 2012). The questionnaires sought to gather information on demographics, what customers feel about FUDU and its products and what they think should be improved on. Focus groups were then used to research how the marketing strategies have changed and marketing methods used for each product and how it has affected its success.

5.???? Comprehensive marketing plan

Segmentation, Targeting, and Positioning (STP) Strategy

Segmentation, Targeting, and Positioning (STP) are essential strategic market models that are used by organizations to divide their products, goods and services that they give to certain audience.

Segmentation

Market segmentation is described as the process of subdividing a certain market into buyers of different groups with varying needs, characteristics, or behaviors that require separate products or different marketing strategies (Sindhwani & Ahuja, 2014). FUDU has been able to gain a significant market share in KSA by paying attention to the market segments.? The organization uses different forms of segmentation, including demographic, psychographic and behavioural segmentation.

On demographic factors, FUDU has separated the customers based mainly based on income levels, although, to some extent, it also separates them according to age (children and adults).? In KSA, a larger population of the people has a lower level of pay and hence, they are various cautious when spending (ALFaris et al. 2015). Therefore, the organization has tried to offer them quality things at affordable prices, mainly for people living in major towns. In terms of age, Fudu mainly targets all age clusters and families by offering distinctive family sparks to attract families.

On psychological factors, the organization is dividing its customers in terms of upper-middle-class and well-off people who are more knowledgeable and appreciative of high quality and healthy food products. The restaurant ensures that the working class can easily purchase fast meals quickly and go back to work.? The company has also geographically segmented its market by selecting store locations in the cities and commercial areas with middle-high income class.

Targeting

Market targeting refers to the approach of evaluating all the available market segments in the region and selecting either one or more market segments to focus on. FUDU restaurant target market mainly ranges from the middle class to high-income earners and office workers who are more interested in high quality and healthy products (ALFaris et al. 2015). The management wants to make the restaurant a place where customers can relax and enjoy as their meals get prepared in front of their eyes, which makes them vigilant about quality and meeting expectations. The company uses a mass-market approach for all the target segments, but it can be challenging to develop a product that satisfies all the needs of the customers (Alturki et al. 2018). However, FUDU has been able to use this strategy without compromising the quality of its products and aggressively growing in the fast-food industry over the years.

Positioning

After selecting the market segments to focus on, the next step involves deciding the positions to occupy in the identified segments. Kotler defines market positioning as the approach of arranging for a product and service to occupy in a distinctive and desirable place when compared to the competitors' products in the minds of the consumers (I?orait?, 2016). FUDU restaurant has developed a unique market position for the sandwiches, which is one of the main reasons as to why customers stick with its products. They have positioned themselves as a highly reputed brand, which gives it a strategic advantage in the target market. ?The restaurant seeks to offer unique dining experiences to the customers by providing them with high-quality and fresh foods. The organization offers extensive employee training and development as it focuses on customer satisfaction and employee satisfaction (Alturki et al. 2018). Through training and development, it has made the employees partners in the organization, which has made it successful in meeting its objectives.

Marketing mix

One of the essential concepts of today’s marketing is planning the details of the marketing mix. This refers to the use of tactical and controllable marketing tools denoted as 4Ps (price, product, place and promotion) (I?orait?, 2016). The firms should blend the tools to produce the desired response in the target market. FUDU has a well-designed marketing mix.

Product:? These are the goods and services offered by the organization to the target market (Ang & Rusli, 2018). FUDU has effectively used its brand name and fresh and quality products and services as one of its product tools. The main products offered by the restaurant include sandwiches, burgers, beef and soft drinks. The products are packaged in and labeled in unique company’s colors and logos celebrating the great-tasting products. Gradually, the organization continues to introduce other western foods into its menus to increase the diversity of the lunch menus. There is a need to increase the variety of its lunch offerings targeting professionals so that they don't get bored with eating the same time of food. Also, doorstep deliveries to the offices should be enhanced in all the major towns in the country and make use of online platforms to save time and cost. ?

Price: this is the amount of money that one gives for a certain product and mainly, customers will use the price as the indicator for quality. On many occasions, the pricing strategy will always depend on the consumers' capacity to buy (Ang & Rusli, 2018). Therefore, in KSA, FUDU uses the economy pricing strategy to make it easier for many executives and people in the country to afford it. Thus, by reaching to a large number of people in the country through affordable costs, the organization achieves economies of scale. The company always tries to deliver the high value as promised to the customers as promised and hence uses high quality and fresh ingredients and efficient training to staff, which also helps to justify their pricing (Kudu, 2019). The organization should come up with segmented pricing for loyal customers who order lunch regularly, whereby they should be provided with membership cards. This means that they can enjoy special discounts on special occasions or with their kids.?

Promotion: Promotion includes all the marketing activities that try to stimulate the actions of the customers or product sales (Kubicki, 2015). Kudu uses various tactics to promote the products and communicate with the target market. The main communication tactics used by the restaurant include advertising, sales promotion, and public relations.? Additionally, digital marketing has become an essential marketing strategy which Kudu could use to reach the target customers (Alturki et al. 2018).? In this approach, the company could take social media marketing and search engine marketing to react to a larger market share in KSA, especially the younger generations. It can also offer discounts and offers to professionals and executives to attract a larger market share.

Place/distribution: place and distribution channels link the products or services of an organization to the customers (Kubicki, 2015). In the case of Kudu, maintaining a personnel relationship with the consumers is very essential and it has, over the years, strategically placed its stores in towns and shopping malls. They have always focused on highly visible locations with high traffic. The company has over the years, depending on the physical presence of the restaurants.? To promote office delivery to offices, there is a need for mobile apps and websites for deliveries.

6.???? Merits and potential downside of your marketing plan

The marketing plan will play an essential role in helping the organization expand its market share and reach new potential customers. The demand for healthy and fresh fast-food products in the country has been increasing significantly over the years, which is an opportunity that Kudu should take advantage of (Benajiba, 2016).? The marketing plan is essential for identifying the new market segment and marketing approaches that should be used to meet their needs effectively. ?The plan provides the organization with a focus or direction on which the company should follow and hence, avoid the mistake of taking too many directions. However, it would be more important to conduct more in-depth market research to come up with quantitative data or statistics on the market, which would give the organization an accurate overview of the market (I?orait?, 2016). For example, identify the total market share percentage and total population, which is essential in market planning. ?The marketing plan also lacks an explanation of how it would be implemented and forecasts, which is essential in projecting future market trends.?

Conclusion

KUDU restaurant has been able to take a leadership position in the KSA fast food market by focusing on a strategy that allows it to connect with the customers through quality services. Overall, KUDU is regarded as a strong firm operating in eth country despite the increasing competition. Through its unique products and strategies, the organization was able to be successful since its establishments and they have never compromised on their quality and services, which is key for sustainability. However, with increased effort and marketing management, the company needs to seek ways to increase its market share and diversify its products in the country (Kotler & Armstrong, G. (2006). The report has analyzed the segmentation, targeting and positioning strategy of the firm in KSA and shows how the marketing mix variables i.e., price, product, promotion and product, are supported in the company. According to the market analysis, KUDU has great opportunities to expand and grow both locally and internationally and it has the necessary resources and capabilities to venture into new markets and offer new products and services to the people. Today, KUDU continues to grow and is in over 300 places and the level of success holds on important lessons for the business world.

References

Ang, C., & Rusli, H. (2018). The Impact of Marketing Mix 4Ps and Consumer Behavior toward Purchase Decision of Adidas Products. iBuss Management, 6(2).

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Alturki, H. A., Brookes, D. S., & Davies, P. S. (2018). Comparative evidence of the consumption from fast-food restaurants between normal-weight and obese Saudi schoolchildren. Public health nutrition, 21(12), 2280-2290.

ALFaris, N. A., Al-Tamimi, J. Z., Al-Jobair, M. O., & Al-Shwaiyat, N. M. (2015). Trends of fast food consumption among adolescent and young adult Saudi girls living in Riyadh. Food & Nutrition Research, 59(1), 26488.

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