Rebranding Project
Out with the old…
In with the new…
Introduction to Marketing Professor Frazier November 20, 2015 By: Sydney Jones
1 TABLE OF CONTENTS
I. EXECUTIVE SUMMARY 3
II. INTRODUCTION TO ORGANIZATION AND PRODUCT 3-4
III. MARKETING OBJECTIVES 4-5
IV. SITUATION/SWOT ANALYSIS 5-6
V. PRODUCT STRATEGY 6
A. TARGET MARKET 6 B. PRODUCT POSITIONING 6 C. COMPETITIVE ANALYSIS 6-7
VI. MARKETING STRATEGY 8-9
A. PRODUCT 8 B. PRICE 9 C. TARGET MARKET 9 D. PRODUCT POSITIONING 9
VII. COMPREHENSIVES 10
A. FACEBOOK PAGE 10 B. PRINT ADVERTISEMENT 11 C. PRESS RELEASE 12
CITATIONS 13
2 I. Executive Summary: With the rebranding process, my main focus will be on making physical changes to the appearance of the brand, also updating the food options by making it much more healthy. Subway has been in need of a makeover for a while now, which is why now is the best time to do it. Since Jared Fogle was the face of the franchise for so long, people associate the old Subway logo and slogan with the commercials he did in the past. In order to dissociate from Fogle completely, creating a new look for Subway will be a fresh change for consumers. The new logo and slogan will have no connection/affiliation to Fogle, therefor this gives Subway a chance to start fresh, which is where the new slogan, “a fresh start” comes from. Our new slogan "a fresh start" perfectly describes our vision for our company. What's special about Subway's new slogan is it is applicable to everyone; we could all use a fresh start in some area of our lives. I also plan to remodel the interior of all Subway restaurants because it is outdated. I want the space to be bright, open, and modern which will hopefully make it more inviting for customers to eat-in. In addition to the interior remodel, I plan to add yummy yet healthy items to the menu. Although Subway is healthier than McDonald’s, it isn’t as healthy as some of the options offered at Chipotle. In order to appeal to the health- conscious audience, Subway will be completely eliminating any and all GMO ingredients. We want to give our customers the best quality. Also, Subway will offer much more than just sub-sandwiches, we will offer more variety and options of healthy foods. We plan to expand the breakfast menu by adding steel-cut oatmeal, Greek yogurt parfaits, fruit smoothies, etc. Subway is going to change how people view “healthy.” Healthy eating doesn’t have to mean eating foods that are flavorless and unsatisfying. In fact, it will be just the opposite; we will offer foods that customers wouldn’t think could be so delicious and healthy all at the same time.
II. Introduction to Organization: In 1965, Fred DeLuca, who was only 17 years old at the time, opened his very first sandwich shop in Bridgeport, Connecticut. He wanted to create a submarine sandwich shop so that he could pay his college tuition for medical school. To help kick
3 start his business plan, DeLuca borrowed $1,000 from Peter Buck, who was a family friend. Together, DeLuca and Buck co-founded the hugely successful sub-sandwich franchise we now know as Subway. Subway became one of the first fast-food chains to offer build-your-own, customizable food. The concept of customers being able to see the assembly line of their food being made, and being able to choose exactly what they want and don’t want on their sandwich, was a new and innovative concept at the time. What also made Subway stand out from their competitors was the fact that their food was healthier than McDonalds, Wendy’s, Burger King, etc. Subway is currently the third largest fast-food chain in the nation, with approximately over 44,400 locations spanning all over the world. I chose to rebrand Subway because while they may seem successful, in the past year, Subway has faced many challenges. The most highly publicized was the Jared Fogle scandal that happened this past summer. Jared Fogle first rose to fame when he became the spokesman for Subway in January of 2000. He claimed he lost over 200 pounds by eating Subway along with exercising. Fogle was once a valuable asset to the company, “Subway attributed one third to one half of its growth in sales to Fogle, with revenue having tripled from 1998 to 2011.” In August 2015, Subway officially broke ties with Fogle after news surfaced that he was involved in child pornography and pedophilia. On November 19th, 2015, Fogle plead guilty to all charges against him and is currently serving a 15-year sentence. Subway has suffered a decline in sales since the scandal. Which is one reason why a company should not have a person/celebrity represent the brand because if they mess up, it ends up affecting the company’s reputation as well. In order to dissociate from Fogle, who has been the face of the franchise for fifteen years, Subway needs a complete makeover from head to toe.
III. Marketing Objectives: a) Rebranding Objective- Remodel/refresh Subway from the ground up by January 2017: o Create a new logo and slogan. o Redesign the interior of all restaurant locations- make it modern, open- concept, bright, overall up to date.
4 o Healthier food and drink options such as fresh-pressed juices, smoothies, whole wheat bread, vegan/vegetarian options, etc. o No GMOs- ban any genetically modified/enhanced ingredients. b) Financial/Sales Objective- Expecting to see an increase in sales between 10- 15% within 12 months of the rebranding campaign. IV. SWOT Analysis: a) Strengths: o Offer customizable sandwiches. o A large number (approx. 44,000) of Subway locations in the U.S. and worldwide. o Partnership with the American Heart Association- helps consumers easily find healthy food options offered at Subway. b) Weaknesses: o Subway is not keeping up with their competition, not staying up-to-date. For instance, Chipotle and other food chains have gotten rid of GMO ingredients- Subway has yet to do this. o The interior and décor are outdated, have not made major changes in seven years. o Does not have a strong online/social media presence to connect with their customers. o Customer service is not consistent from store to store. c) Opportunities: o Change the atmosphere/environment of Subway locations by updating interior to encourage customers to dine-in and eat. o Use social media to interact and build a relationship with customers. o Make Subway more appealing to children, which may encourage children to eat healthier. o Create drive-thru for those on the go, or in a hurry. d) Threats: o The increasing number of competition offering healthier fast food (ex: Chipotle, Firehouse Subs, Panera, even McDonald’s, etc.).
5 o Lawsuits against Subway. For instance, in 2013, Subway customers filed a lawsuit claiming that Subway was falsely advertising their foot long sandwiches. Customers measured their sandwiches, and noticed the sandwiches were shorter than twelve inches. Subway responded by saying that all franchisees will be required to use a measuring tool to make sure that the sandwiches are the correct length. o Health conscious people who would rather eat somewhere with no GMOs, more vegetarian options- such as Chipotle. V. Product Strategy: a) Target Market: o Demographic: upper to middle-class parents, teenagers, young adults, and adults. o Psychographic- Health conscious individuals looking for a meal that is healthy yet quick and affordable. o Geographic- In the city where there is great diversity in people, and also the suburban areas where middle-class individuals live. o Specific Target Market: Appeal but not limited to the millennial generation who is health conscious. b) Product Positioning: Subway offers a wide array of delicious foods that are healthy and fresh, to keep you fueled and satisfied without the feeling of guilt. I want people to look at Subway as more than just a sub-sandwich shop, Subway will now be that one stop shop for families, young adults, teens, anyone, who wants to find a healthy meal at an affordable price. Healthy doesn’t have to mean less yummy meals; there are many meals that can be yummy and healthy, the best of both worlds so to speak. c) Competitive Analysis: Top Competitors: 1. McDonald’s Strengths- offers a wide variety of foods that range from burgers to a salad; they have something for everyone. Also their prices are very affordable which broadens their audience.
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Weaknesses- they are perceived as an unhealthy fast-food chain who promote unhealthy eating habits- the documentary, “Super Size Me” made consumers think differently about McDonald’s.
2. Chipotle Strengths- offers high quality food that is healthy, fresh, and GMO- free. They also have great customizable options that cater to personal preferences such as offering vegetarian alternatives.
Weaknesses- their higher-end prices for their food compared to competitors, and the limited menu options available (ex: burrito, burrito bowl, tacos, salad).
3. Firehouse Subs Strengths- it is the second fastest growing franchise in America. Weaknesses- does not have a strong international presence.
What sets us apart from our competitors? Even though the competition is growing, there are a few things that make us stand out among the rest. For instance, when McDonald’s was first established, many people looked at it as junk food. It wasn’t until consumers began to question McDonald’s integrity when it comes to food quality, that McDonald’s began to implement “healthier” foods to appeal to a broader audience. The issue is, no matter how many “healthy” options are added to the menu, most customers will still view McDonald’s as nothing more than an unhealthy fast-food franchise. Subway, from the beginning has always stood by fresh ingredients; we will continue to stand by that. Also, while Chipotle has high quality food, their menu is pretty limited and does not give customers many options to choose from. That could potentially pose as a problem, because consumers may start to get tired or bored of the menu remaining the same. At Subway, we will be adding several new
7 items to the menu to help reinvent how people think about Subway, and make our customers excited about trying something new. Another thing that really makes us standout as a franchise is the number of locations we have worldwide. Subway is the largest fast-food restaurant chain in terms of units with over 44,400 locations in 110 countries and counting.
VI. Marketing Strategy: a) Product: I will be rebranding the food offered at Subway while focusing on interior renovations. My vision for Subway is to make it more than just another sub-sandwich shop. I want Subway to be a place where people feel good about what they’re eating, knowing that all of the ingredients are fresh. As a franchise, we will work hard to improve the quality of our food by eliminating genetically enhanced ingredients, and using nothing but the freshest. We will expand our menu, to offer a wide array of healthy options. Some ideas of additions to the menu include replacing potato chips with a healthy alternative such as kale or sweet potato chips, using whole grain bread, offering natural juices, tea, and smoothies, etc.
8 b) Price: Since we will be using healthier ingredients, it will cost more for us to produce. That is the cost of having higher quality foods, but it is worth it to us. We plan to keep the prices around the same price point of our competitor, Chipotle. This will be a smooth transition because our prices are currently comparable to Chipotle’s price point. Subway’s menu in prices will range from $2.25 (ex: energy bar) to $8.00 (ex: combo meal- sandwich w/ a bag of kale chips).
c) Place: Since Subway has the largest number of locations out of all fast-food franchises, distributing our new items shouldn’t be too difficult. We will update the menu with the latest additions, but continue selling in-store like we always have.
d) Promotion: In order to meet our goals, the first promotional strategy I will use will be social media. It’s no secret that social media is taking over—that is why many businesses are using social media to promote. I specifically would want to advertise/promote on Twitter and Facebook because those are the most popular social media platforms. I will post exclusive sneak peeks about what’s happening, and also engage in conversation with the customers because currently we are lacking in social media presence. A second tool I will use is a TV commercial ad. Preferably I would want our commercials to air on networks such as NBC, FOX, ABC, and CBS because those channels reach almost anyone—you don’t need to have a premium cable package to watch those channels. Thirdly, I would use a radio spot on a platform like Spotify and Pandora. Those music platforms are widely used today; it’s the way people are listening to music. Therefore having a quick 30-second ad would help get the word out and encourage listeners to check out the new and improved Subway.
9 VII. Comprehensives a) Facebook Page
10 b) Print Advertisement
11 c) Press Release
12 Citations
Helm, Burt. "The Sandwich That Ate the World." Inc.com. 30 Apr. 2013. Web. 18 Nov. 2015.
Jurevicius, Ovidijus. "SWOT Analysis of Subway." Subway SWOT Analysis 2013. 16 Feb. 2013. Web. 18 Nov. 2015.
Koshman, Josh. "Subway Planning Major Rebranding Effort in 2016 to Boost Slumping Sales." Fox News. FOX News Network, 2 Sept. 2015. Web. 20 Nov. 2015.
"The Internal And External Environments Of Subway Marketing Essay." UKEssays. UK Essays. Web. 18 Nov. 2015.
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