IntroductionKudler Fine Foods is a premiere gourmet grocery store for shoppers who are searching for the finest bakery products, meats, produce, cheese and dairy, as well domestic and imported wines. Kudler Fine Foods has experienced significant growth and is currently focused on expanding the services, improving the efficiency of its operations, and increasing the consumer purchase cycle. (Kudler Fine Foods) Kudler Fine Foods continues to grow and gain popularity. With their current growth, Kudler Fine Foods is ready to develop changes to increase revenue and lower costs. This paper will justify the importance of research to the marketing strategy and tactics of Kudler Fine Foods. This paper will also cover competitive intelligence and analysis and explain how it plays an important role in the development of the marketing strategy and tactics. In addition, if Kudler Fine Foods needs any additional areas of research, this paper will identify those as well.
Marketing ResearchMarketing research is a type of business study that gathers records and analyzes data about consumers, competitors and the market. Marketing research can help create a business plan, launch a new product or service, expand into new markets, fine tune existing products and services. Businesses use market research to configure which parts of the population will purchase their products based on variables such as age, gender, location and income level. Marketing research finds the characteristics of target markets and plays an important part in an organization’s strategy of expansion. (Kotler, 2006)Marketing research is important to Kudler Fine Foods (Kudlers) since they are expanding their services. Marketing research will help Kudlers develop a plan for their expansion and help them identify their strengths and weaknesses. In addition, marketing research can help Kudlers identify new potential customers, new market areas and develop new sale strategies.
Marketing Research JustificationIncreased loyalty and profitability of consumers is Kudler Fines Foods strategic objective. Kudlers conducted a market survey in 2006 and 2007 to develop their strategic objective. In their market survey, Kudlers asked detailed questions about atmosphere, staff, pricing, overall experience, and merchandise. The opinions of Kudlers current target market provided the best research for the company. This type of marketing research provided critical information for Kudlers to help them correct their weaknesses.
In 2006 and 2007 when Kudlers conducted surveys, they found that their customer service representatives were increasingly becoming un-courteous and it was resulting in customer dissatisfied. Kudlers found that in 2006, 15 out of 50 people marked disagree, or 30% were dissatisfied with the service they received. In the following year 2007, Kudlers found an increase of people 20 out of 55 people, or 36.36% were dissatisfied with the service they received. The marketing research obtained by these questions gave Kudlers the information they needed to correct what their target market felt was unacceptable. If Kudlers did not conduct this marketing research, their business would have decreased instead of increased. This part of the marketing research proves vital in keeping customers happy and happy customers are loyal customers. Marketing research is important in the development of Kudler Fine Food’s marketing strategies and tactics because it has helped them discover customer issues they would have not found otherwise.
Competitive Intelligence and AnalysisIf Kudler Fine Food’s plans on staying in business they must also develop a plan for their competitive intelligence and analysis. Competitive intelligence and analysis will help Kudlers to formulate ways to stay ahead of their competitors. Competitive intelligence is defined as researching the business environment a firm operates in, in order to influence its emerging strategy for business development or the process of gathering actionable information on the competitive environment. (Kerin, Hartley, Berkowitz, & Rudelis, 2006) Competitive intelligence is pertinent to Kudlers since they are still growing their customer base. In order for competitive intelligence to be beneficial to Kudlers, they will need to analyze some of the marketing strategy and tactics used by their competitors.
Competitive intelligence involves the action of analyzing, gathering, and applying information about customers, products, domain constituents, and competitors for the short-term and long-term planning needs of an organization. (Kerin, Hartley, Berkowitz, & Rudelis, 2006) The competitive intelligence involves asking multiple questions. According to The Society of Competitive Intelligence Professionals (SCIP) asking the following questions can help Kudlers gain competitive intelligence:oWho are your five nearest direct competitors?oWho are your indirect competitors?oWho are your five nearest direct competitors?oIs their business growing, steady, or declining?oWhat can you learn from their operations or from their advertising?oWhat are their strengths and weaknesses?oHow does their product or service differ from yours?SCIP suggests that in order to gain competitive intelligence companies make profiles of their competitors. The competitor profiles should include the name of the competitor, promotional materials, advertising and pricing strategies. The information that is needed in the competitor profiles can be found on the internet, trade shows, interview current customers, personal visits and annual reports if they are a publicly traded company. If Kudlers were to conduct personal visits they would be able to gain incite on the way their competitors customer service is and if their experience is better or worse. Competitive intelligence and analysis is extremely important to have when running a business. It can keep businesses one-step ahead of their competition and help them gain knowledge on what they can do be better.
Additional Marketing ResearchKudlers is on the right track with conducting marketing research through survey opinions. However, there are multiple ways that Kudlers can conduct additional marketing research. Kudlers needs to be aware of marketing trends and customer’s expectations. One thing that Kudlers could look at for additional marketing research is the internet. Although Kudlers has an internet site, they could revise it to add customer surveys and track down information that could be beneficial. The internet is a resource for businesses and can help them again a competitive edge.
“During 2007, Kudler plans to increase customer loyalty by offering added high-margin services, leveraging the firm’s better understanding of customer purchase patterns, and providing more efficient operations.” (Kudler Fine Foods) Kudlers 2007 selling plan is to increase loyalty and profitability of existing customers and to gain new high-margin customers. Through surveys, Kudlers has been able to determine that they have had growth in all areas except customer satisfaction with pricing. If Kudlers wants to continue to grow in all areas, including pricing, they will have to develop additional marketing research to correct their pricing problem. Kudlers can conduct market research and focus on ways they can reduce internal costs and production cost. If they are able to reduce overhead cost, they can pass the savings on to the customers through price reductions. The effect lower pricing will have on Kudlers is increased sales, increased customer loyalty and increase shopping satisfaction of customers.
ConclusionIn conclusion, Kudler Fine Foods is growing as a company and creating a strong customer base by conducting market research. Through market research, Kudlers has been able to identify areas that needed improvement and correct them. The surveys Kudlers conducted successfully helped them identify new ways to improve their stores. The market research done with surveys in 2006 & 2007 helped Kudlers realize that their customers were dissatisfied with their service. In 2007 to improve Kudlers customer satisfaction they have implemented a new training employee program and new software systems that will help increase their customer satisfaction.
Kudlers marketing plan for 2007 is outlined well. However, they should do more research into competitive intelligence by following the guidelines suggested from the SCIP. Based on the surveys Kudlers second main complaint next to the customer satisfaction was their high prices. Kudlers should conduct additional market research to find ways to reduce costs internally and externally to lower prices. Kudlers is on the correct path for success, but with success comes more hard work. Kudlers is defiantly willing to work hard for their success.
Reference:Kerin, R., Hartley, S., Berkowitz, E., & Rudelius, W. (2006) Marketing. New York, NY: McGraw-Hill/Irwin.
Kotler, P. (2001). Marketing Management, Millennium ed. Upper Saddle River, NJ: Pearson.
Wind, J., Mahajan, V., & Gunther, Rt. (2002). Convergence Marketing. Upper Saddle River, N.J.: Prentice Hall.
The Society of Competitive Intelligence Professionals (SCIP) website, retrieved October 13, 2008 from http://www.scip.org/
Introduction
Kathy Kudler is the owner of Kudler Fine Foods, which is a gourmet grocery store that has experienced significant growth and constantly focuses on expanding its services, improving the efficiency of its operations, and increasing the consumer purchase cycle. This paper will justify the importance of marketing research in the development of Kudler Fine Food's marketing strategy and tactics, and identify the areas where Kudler requires additional market research. It will also analyze the importance of competitive intelligence and analysis in regards to the development of Kudler Fine Foods marketing strategy and tactics.
The Importance of Market Research
"Marketing research is the process of defining a marketing problem and opportunity, systematically collecting and analyzing information, and recommending actions" (Kerin, et. al., 2006, p. 205). According to the Clearlybusiness website, "You can have the best product in the world but, without extensive information on your customers and their behavior, your chances of succeeding will be slim. This is why knowledge of the market in which your products or services sold is so crucial. And one of the best ways to gather that information is through rigorous market research" (2004).
Market research plays an important role in every aspect of an organization's strategy of expansion and diversification. Since Kudler Fine Foods is expanding its services then it needs to know about its competitors. Market research helps in determining its position next to its competitors. Market research will help identify Kudler's market share. Kudler Fine Foods will be able to identify the areas where it is stronger than its competitors and then work on its strengths to tackle a strategy against its rivals. Similarly, the five steps of marketing research outlined below can help identify its potentially weak areas and devise ways to overcome its rivals.
Additional Market Research
"Kudler Fine Foods has experienced significant growth and is now focused on expanding the services, improving the efficiency of its operations and increasing the consumer purchase cycle as a means to increasing the loyalty and profitability of its consumers" (Kudler Fine Foods - Sales and Marketing, 2004). Two of the ways they plan to increase revenues is expanding their services by offering parties to their current patrons showing them how to prepare specialty foods, and offering a "Frequent Shopper Program" to the customers who purchase items frequently by collaborating with a loyalty points program. This program will provide customers with points, which the patron can redeem for high-end gift items, airline first-class upgrades, or other specialty foods.
Kudler already has the programs in place as to how they want to attract more business, but are they sure this is what the customers want? How did Kudler determine that this was the most effective method to attract more business? Prior to launching any programs, Kudler should survey some of their regular patrons and ask for their feedback as to what they would like to see as a rewards program, such as which vendors would the patrons prefer Kudler to collaborate with. In addition, the parties may not attract the amount of people Kudler would anticipate; therefore, this topic should be included in the survey of the current clientele.
The purpose of the parties is to draw in consumers to train under world-renowned chefs, local celebrities, other food experts, and even Kathy Kudler herself, These students will also be invited to exclusive, upscale events not open to the public. The anticipated outcomes will increase the customer purchase rate of high margin food and beverage items, as well as get consumers to make an evening at Kudler Fine Foods part of their social network. Prior to rolling out this program, additional research is needed to determine how many people would attend these training classes, what date and times would draw in the most attendance, if the patrons are interested in parties, is there a certain type of meal they would like to see prepared (i.e., appetizers, dinners, desserts).
In Kudler's overall marketing budget, there is money allocated for marketing communications, such as radio, newspaper and television advertising, as well as public relations, events, and sponsorships. What Kudler needs to do is determine which areas in each of these fields would be most effective to promote their store. For example, during which television programs would people be most interested in watching a gourmet food store commercial? Television networks such as a dedicated food network, women's television channels and home and garden would be ideal during peak times and popular shows. Another great example would be which events Kudler be most effective in participating in, such as restaurant trade shows on a local and national level.
Competitive Intelligence
Investorwords.com defines competitive intelligence as "Data gathered and used by a company for the purpose of learning about its competition in a given market" (2006). Competitive Intelligence is one of the many inputs used to create a market share forecast. This forecast in turn is paramount to decide how much inventory Kudler should have on hand, especially since most of the items they stock are perishable. Competitive intelligence and analysis will help Kudler Fine Foods to formulate ways to stay ahead of its competitors. Kudler will require additional market research in areas such as identifying potential target customers, new territorial areas and new marketing and sales promotion schemes.
It is important for Kudler to know what their competitor is doing for several reasons. First, if their competitor is offering a promotion to the public that is attracting more business, then Kudler will want to offer something along the same lines so more business will sway in their direction. Second, although Kudler may feel that they offer the best product, if the public feels that the competitor is offering a better product, they may want to consider changing their supplier of certain food products. Since price is not a factor in their customers' eyes, they can charge higher prices for better quality product. Last, and probably the most important reason to be adept in competitive intelligence is to find out what the competitor is not doing and take it to the next level. The main purpose of competitive intelligence is to be creative and innovative.