Question

1. John will open an Italian restaurant in IFC Mall in Central in December 2020. IFC Mall is a popular mall with a lot of different kinds of restaurants. John’s Italian restaurant will be located on 3^rd level of the mall and next a Japanese restaurant on the left and a Vietnamese restaurant on the right.   John’s Italian restaurant is a fine dining restaurant, which targets the office workers and shoppers.

1. Identify what kind of marketing tool that John needs to use in order to analyze the competition on the 3^rd level of IFC Mall. Then, suggest any THREE elements that can be used for comparison.    

b. John would like to use behavior segmentation to segment the market. Explain any THREE types of behavior segmentation that are suitable for office workers and shoppers.   

Answer 1

a) As the question says,John will open an Italian restaurant in IFC Mall.John's Italian restaurant may face severe competition because of existing restaurants like-Japanese restaurant and Vietnamese restaurant. As john's restaurant targets office workers and shoppers,he can follow the following marketing tools:-

1) Free online booking and delivering food- john's restaurant can initiate free online booking system and delivering food.The office workers can just simply place their order for food or book their tables in restaurant, saving staff time and reduce booking errors.Same goes for shoppers, who can easily place their orders and get their food at their shops.The best part of this tool is that it is free and one can take reservations 24 hours a day.

2) pricing(pricing the menu right)- pricing plays a crucial role in determing the profit for any business.Here john's restaurant can attract many people just by offering them good price schemes.John can keep a tab on his highest selling and low sellling items.If customers are willing to pay more for star items,john can increase the price or push them more,while he can decrease the number of underdogs in his menu.

The three elements that can used for comparison:-

1) price- pricing the menu right can be one of the elements that can be used for comparison.john's restaurant can offer attractive or low prices than other restaurants in the competition, which will later attract more customers to their restaurant.  

2)promotion-promotion is the need for any new business started.people gets to know about the business by means of promotion.john can advertise about his restaurant and make people know about his restaurant.

3)offering discounts- As a new restaurant in competition john's restaurant should offer people discounts and offers on its menu.This will attract people to the restaurant and hence increase customer database.

Hence, these elements can be used for comparison between these restaurants.

b) Behavioral segmentation is a form of customer segementation that is based on patterns of behavior displayed by customers as they interact with the business or making purchasing decision.Behaviour segmentation allows the customers into groups according to their knowledgr,attitude,response to a product,service or brand. The objective is to identify customer segments that enable the business to understand how to address a particular customers needs or desires.

The three types of behaviour segmentation that are suitable for office workers and shoppers are:-

1) Benefits sought- As consumers research a product or service, their behaviour can reveal valuable insights into which benefits,featuresor problems are most applicable to them.And when a customer places a higher value on certain benefits over others, these primary benefits are the driving factors for that customer.

2) Buyer journey stage- Behavioral segmentation according to customer journey stage allows company to align communications and personalize experiences to increase conversions at every stage.It also helps companies to discover stages where customers are not intersted, so company can improve their marketing efforts there. Hence it is very important.

3) usage- This category can be a strong predictive indicator of loyalty or churn and therefore lifetime value-

usage based segments invclude-

-heavy users-company must avid and engaged customers that spend the most time eating in restaurant and purchase most frequently.

-medium users-customers that buy but not frequently

-light users-customers that use or purchase much less than other customers,sometimes only even once.

segmenting by usage helps restaurants understand why certain types of customers become heavy or light users.It enables restaurant or comapny to test different marketing initiatives to increase usage from lower usage customers and potentially attract new heavy usage customers.