Research Korner: Cafe de Coral Marketing Plan

MANAGEMENT OF CHANGE: THE CAFÉ DE CORAL EXPERIENCE

MANAGEMENT OF CHANGE: THE CAFÉ DE CORAL EXPERIENCE Table of Contents   I.      Introduction.. 3 II.     Background of the Company.. 4 III.        Diagnosis.. 5 A.    External Change Drivers. 6 1.     Political Factors. 6 2.     Economic Factors. 6 3.     Socio-Cultural Factors. 7 4.     Technological Factors. 7 B.    Internal Change Drivers. 8 Figure 1. Ansoff’s product/market Matrix. 8 1.     Market Penetration. 9 2.     Market Development 9 3.     Product Development 9 4.     Diversification. 10 C.    Current State. 10 1.     Strategy. 10 2.     Structure. 11 3.     Systems. 11 4.     Shared Values. 12 5.     Skills. 12 6.     Style. 12 7.     Staff 13 D.    Source of Resistance. 13 1.     Endings. 14 2.     Neutral Zone. 14 3.     New Beginnings. 14 E.    Leadership in the Company. 14 IV.       Prognosis.. 15 A.    Status Quo Scenario.. 15 B.    Change Scenario.. 15 V.    Conclusion.. 16 VI.       References.. 16   I.      Introduction The realm of the fast food industry, the current trends brought about by western monoliths like McDonalds has been the prevailing formula. Specifically, serving dishes that are easy to prepare and serve such as sandwiches, deep fried foodstuff and other pasta-based products are those that fit the requisites needed in the formulaic process employed in such types of industries. However, one must also highlight that the advantage of these types of companies are not limited to their products and the dishes that they serve. These are only a fraction of what make them leaders of the industry. To be precise, it is this efficiency and quality that places these western companies in the top of their game. This primarily establishes the fact why their respective operations and processes are considered as the prevailing models in the fast food industry.    This problem brings forth a limited number of food genres that would fit the classification as a fast food company. In Hong Kong, a local company, Café de Coral, attempted to dispel the myth that such dishes that offer oriental cuisines will not complement the processes inherent in the fast food industry. This study will be taking a closer look in the existing conditions that Café de Coral is experiencing in their daily operations. The said name is under a corporation controlling various types of stores in the food industry. For the purposes of this paper, the focus of the study will be the Café de Coral based in Hong Kong. The arguments and observations held in this paper shall be reinforced by existing literature on organisational development and change management.    II.    Background of the Company Café de Coral is said to be the largest group of Chinese restaurants in Asia and the rest of the world. The company is listed under the Café de Coral Group in the Hong Kong Stock Exchange. The said company covers fast food, institutional catering, specialty restaurants, food manufacturing, and distribution among others. For the purposes of this study, the focus of the discussions will be the fast food operations of the company. The first store of the company commenced in 1968 on Causeway Bay. After several decades, the company controls over a hundred and twenty restaurants which serves drones of satisfied customers in a daily basis. Based on the company’s website, the current battle cry of the organisation is “A hundred points of excellence.” This is driven by the desire to provide imminent customer satisfaction by constant improvement in the quality of their products, the service that they provide, and the ambience in their restaurants. In doing so, the company makes their customers realise that the value of their money is given importance in the stores managed by the company.   The company has risen in the ranks of the food industry in Hong Kong because of the top products and services that they offer. In the area of products, the company flaunts of their signature products that are made with premium ingredients and prepared with the strictest quality control. The area of services is also one of the major factors why Café de Coral is at the top of its competition. With the motto mentioned above, continuous staff improvement through training is given the top priority of the company. It focuses on both individual and team skills of the company.   III.   Diagnosis In an article of Wong (2006), he coined the term “fast-foodization” as the process imposed by McDonalds in the modern food business. He also pointed out the phenomenon wherein exotic cuisines have become one of the major competitors of these big fast food companies in the West. Japanese, Indian, and Chinese restaurants which serve their respective local dishes directly take on the likes of Burger King and other major companies in the western world. This makes perfect sense as these exotic restaurants offer an alternative to the ubiquitous burger and fries offered by these established organisations in the fast-food industry. In order to establish the change needed in any company, an analysis of both the internal and external environment is required. In doing so, the specific areas on which companies like Café the Coral could pinpoint the specific parts of the operations that require improvements or reductions that will trigger change in the organisation. The following parts shall do exactly that, analyse both internal and external environments of Café de Coral to establish how it could initiate improvements in their operations. In doing the said discussions, the use of analytical tools such as the PEST Analysis, Growth stages, 7s framework, the company’s cultural web, transition curve, and the leadership theories and models implemented in the company. The findings in these discussions shall be the basis of the succeeding parts of the paper wherein two scenarios will be depicted.      A.   External Change Drivers To establish the existing conditions surrounding the external environment, the PEST Analysis will be employed. In doing the change drivers of the external environment shall be directly observed. 1.    Political Factors The government of the administrative region adheres to the encouragement of trade and business in Hong Kong. (Speath, 2004) This is shown in the liberties that it provides companies like Café de Coral and its foreign counterparts. Specifically, this is proven by the fact that the first McDonald’s in the region was established several decades earlier. (Watson 1997, 78) However, the business-friendly nature of the laws in Hong Kong does not make it weak. Companies have to similarly comply with the standards provided for by the laws of the land.     2.    Economic Factors Hong Kong is one of the imminent tourist destinations in Asia. People flock the administrative region wither for business, pleasure, or both. Studies have pointed out that travellers from the mainland have increased exponentially in the past couple of years. (Kam-Yee and Kim-Ming, 2006, 217) This means that aside from the tourists and locals of Hong Kong, companies like Café de Coral have to cater to a much larger crowd as massive numbers of mainlanders have added to the overall market of the Hong Kong food industry. 3.    Socio-Cultural Factors In the study of Chan et al, (1999, 12) they described the consumers in Hong Kong with low uncertainty avoidance. This basically means that the buyers’ decision in Hong Kong is primarily based on impulse. Buyers tend to do away with the possibility of planning to buy a particular product or brand before they actually make the purchase. This spells great for companies like Café de Coral since they already have a strong brand name and recall on the consumers. This makes them already a part of the short list of choices of the consumers when it comes to fast food cuisines. Moreover, it has also been noted that the consumers in Hong Kong possess long term orientation. (Chan et al, 1999, 12) This basically establishes the fact that Hong Kong consumers tend to be loyal to a particular brand or company once they have already tried it and are satisfied with the products or services. This reinforces the observation that companies like Café de Coral has strategically placed themselves in the core list of companies which the Hong Kong consumer will constantly visit. 4.    Technological Factors Companies involved in the food service industry have to contend with a complex system of inventory as they deal with stocks that are perishable and ultimately fragile. Fortunately, Hong Kong is one of the hubs of IT in the whole of Asia. (Koo, Lee, Ngan 2003) Most of its workforce is able to easily apply these processes in their operations. (Lee, Leung, Lim, Sia 2004) Infusion of inventory and logistics is highly workable for companies operating in this environment.      B.   Internal Change Drivers Though the standing of Cafe de Coral in Hong Kong appears stable, it is merely the tip of the iceberg. At some point, one must realise that there are several organisations that operate in the same industry that will readily take away the existing market share of the company. Thus, it is important to make sure that the company is aware of its strengths as to whether it would find a fit with the rest of the external environment. The drive towards market ascendancy of Cafe de Coral shall be presented with the help of Ansoff’s product/market matrix. In this manner, the company establishes the areas which could be considered as internal change drivers. (Adamson 2005, 358) The areas on which the company should consider is summarised in Figure 1 below.   Figure 1. Ansoff’s product/market Matrix     1.    Market Penetration The concept of market penetration basically establishes the possibilities on which an organisation could grow with the use of its existing market and products. (Stopper 2004, 21) In the case of Cafe de Coral, its market in Hong Kong shall continue to be stable provided that it holds true on its resolve of improving its signature products, ensure that premium ingredients are used, and the strictest quality control should be observed. 2.    Market Development As pointed out in the earlier part of this paper, Hong Kong is the centre of commerce in Asia. It has low uncertainty avoidance and long term orientation. This intimates that companies like Cafe de Coral should anticipate impulse spending and a more profound sense of brand loyalty. Hence, it is advisable for Cafe de Coral to find ways to seek new markets as they progress as a company to maximise this opportunity. 3.    Product Development With the area of product development, it appears that the company is lagging behind as they tend to display a single set of signature products. However, they maintained in their website that they never stop looking for ways to improve their products and services to ensure customer satisfaction. (Stopper 2004, 21) This shows promise on the part of the company as a prospective insight on the market appears to insinuate positive results. 4.    Diversification On the whole, the corporation on which Café de Coral is under have taken steps to come up with restaurants and other stores that will cater to those aside from the fast-food model in the food industry. There are several brand names controlled by the Café de Coral Corporation that focuses on catering and food production among others. This shows that the diversifications held be the company are still interconnected with every elements in the food industry. C.   Current State Another element that could determine the areas on which change could be induced is the current state of the company. In this paper, McKinsey’s 7s Framework shall present the distinct nuances of Café de Coral. This tool shall establish the possible implications of changes within the organisation. Hence, it will show the best way to tackle a particular strategy proposed to the company. The discussions in this part of the paper shall base its arguments on the website of Café de Coral. 1.    Strategy The company seeks to acquire “A hundred points of excellence.” In order to do this, the company has implemented a customer-centric approach in their operations. Customer satisfaction is held highly by the company. This is ensured by staff training at regular intervals which seeks to improve the individual and team skills of the organisation. However, it is observable that the company have not indicated a stable and veritable feedback system that would house the demands and criticisms of the customers. In doing so, the company may have difficulty in dealing with the demands of the customers as they are not actually aware of these specific elements.   2.    Structure Café de Coral is divided into independent operations of each store. Each store is considered as a team that has to maximise their profits and generate revenue for the corporation. It is responsible for its operational costs, hence, required to find ways to limit their expenses and find ways to attract clients to their respective stores. The store manager is the one that overseas the operations with the help of their staff which includes the administrative sector and those that deal with food preparation and customer assistance (waiters and servers). This thus manifest the decentralised nature of the decision making process in the organisation. Moreover, the organisational structure in every store is apparently flat hence giving the assumption that the communication lines are rather open between management and the other employees. 3.    Systems The company’s primary activities are basically composed of the acquisition of the raw materials that they would use as ingredients for their dishes. Normally these items of inventory are acquired from the main supplier of the corporation. Subsequent activities are manifested in serving and interaction with the customers. Moreover, the maintenance of the equipments used in the operations is also added into these set of activities.       4.    Shared Values The core value of the company, as intimated in the earlier parts of this paper, is the maintenance of a strong customer relationship management within the organisation. The customer is held highly and thus the operations revolve around what these individuals demand from Café de Coral. 5.    Skills The company basically requires both technical and soft skills. This means that each and every unit of the organisation has to take on skills like accounting and use of store equipment such as telephone and computers. In the area of soft skills, given that the main concern of the company is the consumers, involves elements like leadership, initiative, and communication skills. Looking at the reports provided by the organisation, there appears to be minimal gap in the overall workforce of the company. This is because they conduct regular trainings to keep their personnel sharp and deeply acquainted with the shared values within the organisation. 6.    Style The leadership style in every store varies from manager to manager. However, since there is a flat structure in every store, the leadership and management style tend to be highly participative. On the whole, the stores have a healthy competition with each other. Though they do not contend as to the actual market share, these teams contend to gain some “bragging rights” with the other members of the Café de Coral group. 7.    Staff The number staffs of every store of Café de Coral depend on the demands of the consumers and the required business activity in each store. On the whole, the training provided by the company shall place the required skills of new employees and ensure that the seasoned ones are kept informed of the knowledge required in their respective functions. D.   Source of Resistance To determine the sources of resistance in Café de Coral, the transition curve will be employed. The said model is summarised in the figure below. Figure 2. The Transition Curve 1.    Endings This phase of the transition curve, resistance is anticipated from the employees. This is especially true with regards to the seasoned personnel who are used to the traditionally applied processes. In the case of Café de Coral, it is anticipated that if ever there is some anxiety or denial of the change proposal, it would be rather minimal. 2.    Neutral Zone In this zone, the level of uncertainty is high among the personnel. This is especially true to those who hold positions that are contractual. More specifically, they will be in constant fear whether their contracts would be renewed or not. The managers of the respective stores would have to bear this responsibility to mitigate the implications of this state. The management has to keep control over the situation. 3.    New Beginnings In this state, the change is anticipated and accepted by the personnel. In the case of Café de Coral, the personnel may have realised the positive implications of the proposed change by the management. In this part, the proposed change is openly implemented as a part of the normal operations of the organisation. E.   Leadership in the Company As stated in the earlier parts of this paper, the leadership styles and management styles complement the flat organisational framework of the organisation. Basically, participative leadership is seen exercised in the operations of the respective stores. In this regard, the employees are empowered and the managers keep the human resource under his control.   IV.  Prognosis The following discussions will pinpoint the changes required of the operations of Café de Coral. To clearly establish the implications of these changes, two scenarios will me meted out in the process. Based on the discussions above, the company requires synchronisation in the operations of its numerous stores. However, as their independence has contributed much of their success, the management is in a dilemma what to do. Basically, the answer would be to install additional IT technologies that would put correspondence between the different stores and the respective suppliers in real time communication. A.   Status Quo Scenario In this scenario, nothing will change. The operations will be the same however the existence of a gap in between transactions could lead to delay that will essentially establish significant losses for the company.   B.   Change Scenario The implementation and installation of added IT technologies will provide the company added flexibility and opportunity to adjust their operations to actually minimise the losses of the company in instances where any unforeseen events come up. The apparent issue is the added costs in training the appropriate unit of each and every store in the use of the hardware and software applicable in the process. However, as pointed out in the earlier parts, the common Hong Kong worker is adept with the basics of information technology. Hence, this added instruction will not lead to any more wasted resources and time. V.   Conclusion The discussions above have intimated that the proper fit between the internal and external environments is essential to the achievement of the major goals of the organisation. Be it financially or not, it is left on the shoulders of the company to find a way to balance out the situations wherein they are able to remain flexible and keep things under their control.   VI.  References   Adamson, J. (2005) "Using Marketing Visuals for Product Talk in Business English Classes." Business Communication Quarterly. 68(3), 358 Chan, A., Chow, W., Fosh, P., Snape, E., Westwood, R. (1999) Hong Kong Management and Labour: Change and Continuity. Routledge. London. Kam-Yee, L., and Kim-Ming, L. (2006) "Citizenship, Economy and Social Exclusion of Mainland Chinese Immigrants in Hong Kong." Journal of Contemporary Asia. 36(2), 217. Koo, R., Lee, C., Ngan, M. (2003) “Voices and Implementation of Information Technology in an Elementary School Classroom : A Hong Kong Case Study.” Childhood Education. 79(5) 268 Lee, M., Leung, K., Lim, K., Sia, C. (2004) "Is eCommerce Boundary-Less? Effects of Individualism-Collectivism and Uncertainty Avoidance on Internet Shopping." Journal of International Business Studies. 35(6) 545 Speath, A (2004), “Hong Kong's defiance: China warns the city to forget democracy and get back to business. But many Hong Kongers aren't listening.” Time, Available at: http://www.time.com/time/asia/2004/hk_politics/story.html [Accessed 31 July, 2008] Stopper, W. (2004) "Establishing and Maintaining the Trust of Your Employees." Human Resource Planning. 27(2), 21. Watson, J. (1997) Golden Arches East: McDonald's in East Asia. Stanford California: Stanford University.

MANAGEMENT OF CHANGE: THE CAFÉ DE CORAL EXPERIENCE

MANAGEMENT OF CHANGE: THE CAFÉ DE CORAL EXPERIENCE Table of Contents I. Introduction .. 3 II. Background of...

Strategic Brand Management of Café de Coral – Hong Kong

Strategic Brand Management Café de Coral – Hong Kong   Company Background             Café de Coral is the largest Chinese restaurant chain in the world. It is listed in the Hong Kong stock exchange. Café de Coral has different business operations and has managed to expand its business worldwide. “Major operations include fast food outlets, institutional catering, specialty restaurants, food manufacturing, distribution and other overseas food and beverage businesses” ().   Profile             Café de Coral is Hong Kong’s leading fast-food brand. The company is the undisputed market leader in Hong Kong and is currently serving an average of 300,000 customers everyday. The company boasts its broad experience in the food and catering industry that made them the biggest and most successful brand in Hong Kong. The company’s 34 years of proven experience has made them one of the market leaders in Asia.  Product             café de Coral offers a wide array of food to choose from. Its specially designed menu aims to meet every customer’s tastes and budgets. Café de Coral offers 100 items on the menu that are intended for customers that seek good food, fun dining experience and affordable prices. The food items are regularly rotated to offer the customers a variety of choices. The standard menus range from western cuisine to traditional Chinese dishes. The company also introduces new and innovative products regularly. Place Every restaurant is strategically located to reach the target markets and attract potential customers. Restaurants are located in different mixed use district, business core, shopping centers, industrial areas, private and public and housing estates. The restaurants are modern in terms of designs and have warm ambiance that encourages maximum customer flow.  People The staff at Café de Coral are friendly and warm. They are dedicated and energetic. The service team is properly trained in order to render high quality service to Café de Coral’s valued customers. Café de Corals customers are diverse. People from all walks of life and different backgrounds come to Café de Coral to experience the state of the art ambiance, best food and high quality service.  Promotion "Achieving A Hundred Points of Excellence" has been our commitment to our customers and is now a household catch phrase. As part of our on going campaign to strengthen the Café de Coral Brand, proactive advertising campaigns are launched on a continual basis. Through the campaign, the brand image has been further enhanced by positioning Café de Coral as a place not just for best taste and value meals but also a popular meeting place for all walks of life () Prospect Café de Coral is dedicated to accommodating changing market needs and continues to uphold its reputation and status as the leader in the field of food service. Total dining experience is continuously being enriched by developing new products and constantly improving the facilities and incorporating exiting design concepts. The company is looking forward to establishing a stronger market lead in the Chinese market. Café de Coral is planning for China expansion.   History             The first Café de Coral opened in 1968 on Sugar Street, Causeway Bay. After years of hard work, Café de Coral evolved from a single outlet to a leading Chinese fast food chain with over 120 restaurants, serving over 300,000 customersdaily ().   Products and Services Provided Signature Products  "Baked Pork Chop with Rice", "Hot Pot", "Chicken in Glutinous Rice" and "Tea with Milk" are all signature products of Café de Coral with huge success, but we don't just stop there. We want to be better than the best and we never stop evaluating our signature products to make improvements, so that you always get the best without even having to ask for it. Premium Ingredients  Besides our well established menu, Café de Coral also explores into the realm of the newest tastes. We even introduced luxurious dishes that used to be served only in the most prestigious hotels and high-end dining restaurants, such as our Winter Melon Soup that comes in one-person portion, Shark's Fin Soup, King Size Scallop and Campedore Soup. You always get the best food with the best value for money at Café de Coral. Quality Control  Café de Coral insists so much on food quality that we set the strictest standard for every step, from merchandizing, cooking to storage. We also hire an independent team to examine and evaluate the quality of food at each branch. And you, as our customer, of course have the say - we conduct surveys regularly to understand what you need in terms of food and services ().   Services  A Hundred Points of Excellence    "A Hundred Points of Excellence" is our motto and every one of the 10,000 Café de Coral employees treats "customer satisfaction" as a mission. We try our best to improve our service and food every minute so that you always get the best.     Staff Training Café de Coral provides training for employees on all levels regularly, to refine their individual skills and to improve their co-operation skills as a team. "Mystery shoppers" program is conducted to reveal the real service quality and employee's attitude. This auto-amelioration is surely one vital step in elevating the standard of service ().   Brand Development Strategy             One of the most important brand strategies that Cafe de Coral must develop is creating consumer demand by using advertising and promotion. The company must be able to communicate the brand effectively to the consumers. Café de Coral must continuously launch advertising campaigns in order to strengthen its Brand. Advertisements will be primarily used to build marketing relationship between the consumers and the company’s brand. The company is continuously growing with the aid of effective marketing studies that aim to identify opportunities for expansion, targeted marketing opportunities and discover new niches. The company is growing in a breath-taking rate with over 330 outlets in Asia Pacific region, and over 200 quick service restaurants in North America. The company has expanded its operations, which now include fast food, institutional catering, specialty restaurants, food manufacturing, distribution and other overseas food and beverage enterprises. The company is also determined to sustain customer loyalty by continuously improving the products, the ambiance of the restaurant and maintaining a high level of service quality. Café de Coral has developed a reputation of being both the best place to eat best taste and value meals and a place where from different backgrounds and social levels can meet and mingle. According to  (2000), the company offers a diverse menu so that the customers would visit more than once a week and have a different selection to choose from each time (p.22).  Café de Coral offers a menu that is specially designed to meet the tastes and budgets of every customer. It also introduces new products and seasonal products regularly. The stores are well designed and have a warm and relaxing environment that attracts different people. The stores are strategically located in areas where they can reach their target market and can gain access to potential customers.   Brand Elements 1. Memorability and Recognition             The company must employ different advertisement campaigns in order to make the mainstay customers and potential customers remember the company and its products and service more. Because of the effective advertisements, Café de Coral is easily recognized and recalled by the customers. The company has successfully created a recognizable identity among their many communications and product lines. The company’s “Achieving a Hundred Points of Excellence’ has earned wide recognition and memorability among its customers. 2. Meaningfulness             The company must use brand names, brand logos, brand symbols, brand slogans and brand characters that are descriptive, persuasive and interesting in order to attract the customers. These can be combinations of both visual and verbal approaches.   Brand Positioning             Category Membership is important in establishing and sustaining the company’s brand position. Attributes and image must be used to provide rationales that will give consumers reason to believe that Café de Coral’s brand has the benefit that implies membership in a category. Brand attribute must be used in order to create a point of difference. It is very important for the company to inform the customers of Café de Coral’s membership before stating its point-of-difference in relation to other category members. It is well known that Café de Coral is a fast food restaurant but it is important that the customers know what sets Café de Coral apart from other quick service restaurants such as McDonalds. The company must develop concurrent marketing programs where one features membership and the other the point-of-difference. Developing compelling points of difference is crucial to effective brand positioning. Café de Coral is known as the largest Chinese quick service restaurant chain in the world. The point of difference between Café de Coral and its biggest competitor, McDonalds is the menu, ambiance and service style. The company must focus on highlighting this edge and product development and improvements. The advertisement must convince the customers that Café de Coral offers the more superior products, ambiance and service quality together with affordable prices. The Role of Marketing Mix             The four P’s of marketing mix are important in controlling the internal and external constraints of the marketing environment. 1. Products are the tangible and physical products as well as services. 2. Price decision is important in creating a competitive brand. 3. Distribution is about delivering the products and services to the customers 4. Promotion deals with communicating the product or service to the customers and making a favorable image of the product or service in the minds of the customers.   Contradictory Arguments             Café de Coral is one of the largest Chinese quick service restaurant chains in the world. One major strategy of Café de Coral is advertising. Advertisement is important in gaining customer attention. However advertising alone is not enough to sustain its status and create new opportunities for expansion. Café de Coral must build its success on product innovation and marketing excellence, backed up by an uncompromising commitment to quality customer service. Its marketplace is fast changing and competitive, characterized by increasingly sophisticated customers and ever-tighter profit margins. To sustain its leadership position in this demanding environment, Café de Coral must find a way to improve customer experience while enhancing operating efficiency and reducing costs.   Recommendations             A carefully formulated marketing Mix is important in positioning Café de Coral in the customers’ minds. The elements of the marketing mix (product, promotion, price and distribution) are essential in order to carry out a brand management strategy. The aim of the marketing mix is to create a favorable customer view of Café de Coral using promotional messages, pricing strategy, mode of distribution and the product and service appearance.   1. Products             Café de Coral’s products and services are important in creating a favorable image of the company in the customers’ minds. This image is reflected in the customers’ perceptions and feelings about the products and services. Attention must be given to the benefits that the customers get from Café de Coral’s products and services. The customers must be convinced that the company is capable of giving them the benefits that they expect in order to attract them. Product decisions should include quality, features, options, style, brand name, packaging, services, and returns. Special attention must be given to quality.             Quality reflects differences among products or differences among services. As long as it is possible to create differences among products then it should be possible to create differences in quality. Even in cases where it is difficult to create differences, producers can still try to promote products through ‘perceived’ quality differences, i.e. the way in which they are perceived by the customer. Quality is a relative value that people attribute to things. It reflects people’s expectations concerning a product or service and how well it will provide the various benefits they require from using it. Fortunately, large groups of people have shared ideas about quality and it is possible to produce and market products and services that will meet with the perceptions of large groups of customers. Groups of customers sharing a common perception of a particular level of quality form market segments. A firm can direct its promotional messages to these groups of customers provided that it knows how to reach them. Product quality contributes to business profitability. It has been found to be positively related to market share and return on investment over a wide range of products and in different market situations (2000). 2. Promotion             Café de Coral’s products and services must be noticed and must be trusted by the customers. This can only be achieved through an advertisement campaign that stands out. Advertisements must be able to catch the customers’ attention and deliver the message in an original way that will ensure customer memorablity and recognition. The advertisements of Café de Coral must not only inform but it must also entertain to be able to attract customer attention and interest. Café de Coral must give emphasis to images because they have the “capacity to capture the essence of a thousand words” (2000). 3. Price             Due to stiff competition, Café de Coral must maintain a competition-oriented pricing. 4. Distribution             The distribution process of Café de Coral is direct distribution. Through direct distribution, the company has more control over marketing activities and reduces time spent in the channel.

Strategic Brand Management of Café de Coral – Hong Kong

Strategic Brand Management Café de Coral – Hong Kong Company Background Café de Coral is the largest Chinese restaurant ...

The Cafe De Coral Marketing Strategies

INTRODUCTION   The fast food business focusing on Café De Coral is more global than ever and international fast-food consumption continues to increase in popularity in the market as loyal customers form perceptions of fast-food outlets through communication, exposure to promotion from fast-food restaurants, past personal experience and some sources. It is accepted that fast-food marketing strategies should have a sound understanding of consumers’ perceptions and preferences for fast-food outlets and how they differ across cultures. (2006)   The understanding can be helpful in targeting cultures to promote fast food and improving or amending their restaurants’ perceptions so that customer demand can be increased for a fast-food restaurant, promotional campaigns tailored to individual countries as it was called as whether Café De Coral as best fast-food restaurants are perceived across Hong Kong and other countries and whether its positioning can be improved and changed through careful and selective promotion within such diversity of fast-food restaurants as reflected in market strategies in Hong Kong's Cafe de Coral. Café’ de Coral serves a wide variety of fast food, most of which is served sizzling on a single serving personal iron skillet. Cafe de Coral restaurant is in many ways a fast-food version of a traditional Chinese favorite served at most restaurants and reveal some interesting points about choices of foods made by a certain people, understanding what customers want is important in order for a restaurant to enhance their marketing strategies (2000).               COMPANY BACKGROUND   Café de Coral is the largest Chinese fast food brand in Hong Kong. It was established in 1968 and operates more than 100 self-service fast food restaurants in the territory. With over 34 years of proven experience in the food service and catering industry, Café de Coral currently caters to an average of over 300,000 customers a day, making the chain the undisputed market leader in the field. Thus, Café de Coral has over 330 outlets in Asia Pacific region and over 200 quick service restaurants in North America. (2000) Among a total of over 540 outlets, over 120 outlets and 75 outlets are operated under the household name of Café de Coral, whereas over 200 outlets are operating under the leading brand of Manchu Wok and 20 outlets operating under the name of Oliver's Super Sandwiches. As the market leader in the Hong Kong fast food industry and the largest National Brand for Chinese quick service restaurant in Canada, the annual turnover of the Group now stands over HK$2.7 billion generating an annual profit of over HK$258 million in the year 2004. (2000) Presently, the company has 120 chain stores in Hong Kong and 210 ones in North America and is always good at providing tasty spaghetti and intends to extend its reaches around Mainland China. CAFÉ’ DE CORAL’S MARKETING STRATEGIES – STRATEGY LEVEL MARKET SEGMENTATION Café De Coral in its market segmentation is evident in terms of its products and services success as sought by the customers as there seeks good quality and convenience as the restaurant has identified useful benefits of knowing what customers want and create the services to meet the need. Direct marketing efforts toward increasing customer awareness of such benefits as it is difficult to accurately estimate the size of their customer group (2006). Café De Coral is a winner in its segments as a winner in knowing customers needs and wants as a basic factor for maintaining a successful growing marketing. The restaurant in its marketing effort have potential business in  segmenting its Hong Kong markets in a proper notion. Café De Coral implies various factors that will possibly influence the potential for future markets per se: (2000) Ø      population Ø      available income due to changes in employment Ø      supply of natural resources Ø      laws Ø      consumer tastes and preferences Ø      competition, such as emerging of super fast food store   In strengthening its market segments, it is clear enough that Café De Coral provides a quick service restaurant business in the development and management of quick service restaurants chain as the quick service has now been globalized to cover different part of the world like in US and China. The business has diversified into full-service specialty restaurant operations and its acquisition of a Chinese soup-cum-specialty-dish restaurant chain and achieve a more diverse earning base through the wider market exposure. (2000) The business venture into the institutional catering business with Asia Pacific Catering has gradually developed into an undisputed market leader in the field. Major clients being served cover a wide spectrum of institutions ranging from most major hospitals, universities, private and public corporations, both in Hong Kong and China. Since then, the student catering business was launched under the brand name of Luncheon Star, which has deployed the cook-chill central production technology to tap into this growing business as of it was recognized globally in process of standards accreditation. Coupled with its central purchasing power, centralized food processing also comprises bulk breaking, standardized seasoning and standardized portioning at pre-set specifications, volume requirements and quality standards. (2000)       TARGETING Café De Coral is basically targeting the Hong Kong market and been expanding its target audiences in some other neighboring countries such as China and Philippines, most of all Café De Coral is extending its hopes among its current fast food customers typically younger generation ages eighteen years old and above as well as those people who are health conscious who do not currently purchase fast food services because of some beliefs. (2006) Thus, having ongoing strategic imperative, Café De Coral reckoned that they are serving a target customer who is constantly redefining her needs, the café took it upon  to never stop improving and innovating on our products and shop environment in order to enhance the branding power of local restaurant chains. Henceforth, coupled with a series of effective customer-focus marketing campaigns, the strong branding of Café de Coral have given the pricing power to shelter from cost pressure and margin erosion by revamping its business model, fine-tuning its product mix, rationalizing its costing structures, renovating its shop images and opening successful new stores is well-positioned for local business growth. (2006)         POSITIONING Café De Coral positions its best influences in the fast food restaurants business being one of the best the industry can offer in terms of fast food quick service as recognized in the Hong Kong markets as one of fast food business pillars giving quality products and services to their loyal and valued customers in a manner that Café De Coral has earned the impetus respect in the fast food business as well as to their customers as well as some known business sectors. It is really a fact that Café De Coral is good in its recent market positioning as proof to that the restaurant has already achieved numerous awards for its strong aura in the fast food business as well as for its management excellence from the local and international institutions, which included the most coveted award of the "Asian Management Award for Marketing Management" and the "Asian Management Award for General Management" by  in 1992 and 1993, named "Asia's Best" in 1997, "Top Ten Best" by  in 1998. (2003) In addition, awarded as the "Good People Management Award" by  of HKSAR Government. ( 2003) Henceforth, it was said that Café De Coral would continue to maintain dominant leadership position with constant effort in accommodating changing market needs. New product development and exciting design concepts are continuously injected to enrich the total dinning experience of its customers and sees China market as the next area of strategic expansion of successful branded concept. (2003)   CAFÉ’ DE CORAL’S MARKETING STRATEGIES – TACTICAL LEVEL   PRODUCT Café de Coral's menu is specially designed to meet the tastes and budgets of customers, with over 100 items on the menu list on any one day and are regularly rotated to maintain variety of choices. Standard menus range from western cuisine to traditional Chinese dishes. New products and seasonal products for each time segment will be introduced regularly (2005). PRICE Café De Coral in terms of its prices is quite reasonable adapted within the markets as today, it has a little bit of everything. There's a grouping of deli sandwiches, sausage, salad and pasta salad with feta cheese, There are pastas, pizzas, Italian sausages and dishes named marsala and parmigiana. The prices usually cost from ($7.75) and the only items priced over $10 here are three steaks and a dish of pork chops, each at $11.50. (2005) Some plates are disappointing, others minor revelations. Like an appetizer dish ($5.25) of 10 thick, sweet scallops, each dipped in a batter and fried to acceptable crunchiness or a couple of big, wide pork chops ($11.50) cooked to a point of dryness that even applesauce couldn't save. ( 2005)     Thus, a plate of chili size ($6.25) that was unusual in the fact that a hamburger bun was used to form a mushy, soak-up bed under the burger meat topped with chili and beans. A wedge of banana cream pie ($2.50) that had none of that expected yellow custard filling but was simply pie crust, banana and whipped cream.  The kitchen makes a fair meat loaf ($7.95), passable fish and chips ($7.95) and an acceptable hot turkey sandwich ($7.25).  The fresh salmon ($9.25) wasn't bad one time, and hot apple pie ($2.50) really hit the spot on one occasion. (2005)   Hours Open: 24 hours   Recommended items: Creamed potato soup, fried scallops, meat loaf, hot apple pie.   How much: Everything under $12. Beer and wine. All major credit cards accepted.  Wine list: House varietals are Robert Mondavi Woodbridge (chardonnay, cabernet sauvignon, merlot, white zinfandel) by the glass ($3.50) or bottle ($11.95). Corkage $3.         PLACE Restaurant locations are found in mixed use district, business core, shopping centers, industrial areas, private and public housing estates. Restaurants of an average 300 sq.m. are designed with a modern and warm ambience aiming to maximize customer flow. ( 2005)   PROMOTION Achieving A Hundred Points of Excellence has been the café’s commitment to their customers and is now a household catch phrase. As part of on going campaign to strengthen the Café de Coral Brand, proactive advertising campaigns are launched on a continual basis. Through the campaign, the brand image has been further enhanced by positioning Café de Coral as a place not just for best taste and value meals but also a popular meeting place for every lifestyle. (  2005)         EVALUATION OF CAFÉ’ DE CORAL’S MARKETING PRACTICES   INDUSTRY ANALYSIS The Café De Coral in lieu to the presence in market industry is using appropriate marketing strategies suitable for the Hong Kong market in engaging to the process of its business maintenance in the society wherein the presence of established competition among others is evident as it can be seen through product advertising as customers need to be satisfied with the status quo. (2003) Café De Coral in fast food industry engages in a responsible marketing process on a continuous basis and that uses marketing properties that will determine customers satisfaction of services provided with awareness, motivation and the resources to succeed, the consumers of Café De Coral can work towards a better future in the fast food market.  In its people, there was an energetic and dedicated work force of over 8,000 staffs makes up the Café’s service team as customers come from all ages and all walks of life ranging from students and young executives. ( 2004)     Source: Café De Coral Holdings Limited (2005). Corporate Information – Corporate Overview (Corporate Structure)     Source: Café De Coral Holdings Limited (2005). Corporate Information – Corporate Overview     Furthermore, being a leader in the fast food and dining-out industry, Café de Coral has built its success on product innovation and marketing excellence, backed up by an uncompromising commitment to quality customer service. Its marketplace is fast changing and competitive, characterized by increasingly sophisticated customers and ever-tighter profit margins. To sustain its leadership position in this demanding environment, (2005) Café de Coral needed a way to further improve its customer experience while enhancing operating efficiency and reducing costs. The restaurant group wanted to streamline business processes, improve productivity, promote effective strategic planning and generate savings in manpower and administrative expenses. Most important of all, it needed new ways to continue to enhance customer satisfaction today and into the future. ( 2005).                   SWOT ANALYSIS   STRENGTHS Café de Coral fast food continued to maintain its leading position in the industry despite fierce local competition and continued to introduce innovative products to their menu to provide more and better choices to customers. The offering of freshly brewed coffee was a particular success in winning over the applause of customers. Meanwhile, by upgrading the quality of our core products repackaging them with high quality utensil, has differentiated its products from those of their competitors. The café had maintained high standard of hygiene in food processing successfully transplanted certain labour intensive food processing procedures from Hong Kong ( 2005). The Café strengths could be clear in the following points: Ø      Knowledge – the business know their connectivity in all its business management Ø      Relationship selling – as the café get to acquire loyal customers, one by one that maintains good customer relationship Ø      History – the café have built loyalty  in a strong sense over the years and counting   WEAKNESSES Café De Coral in its weakness may adhere to the fast phasing of market demands of fast moving goods and services as evident in the fast changes of competition environment within the focus of business and market value as substantial costs may result to as put into full operation in other markets. Failure of market entry and expanding business could be a fact for Café De Coral as some feasibility study could give inaccurate information in order to expand the production capacity without losing its discipline of some business control that may affect negatively with the process of branding power of Café de Coral and their continuous effort to upgrade the quality and standard of food and services, to protect the profit margin of our fast food operations from rising costs (  2005).                 OPPORTUNITIES Speaking of such opportunities, Café De Coral is taking over the entire operations of super sandwiches restaurants last June 2003 as the concept has regained its momentum for growth. The café was particularly encouraged by the financial performance that came so shortly after acquisition and having successfully revamped its business model,fine-tuned its product mix and upgraded its shop image and positioned as a unique chain of sandwich restaurants offering high quality of products. (  2006) As indicated unlocking the vast potentials of market has always been long term imperatives of strategic value. There recognized that the café’s continuous expansion into the China market has been a key driver for business growth embarked on a multi-directional development strategy in China. Service as the target market needs more service, the competitors are less than ever to provide it.   THREATS Furthermore, there could be presence of threats with a strong foothold in having market of great potentials as in implementing a series of value-added business improvement initiatives in the areas of operational control, purchasing and product development, marketing campaigns, staff training, store design as well as menu innovation, which should eventually bear fruits in the upcoming years.       There could be a threat of over empowering of fast food business by the café’s competitors in terms of building on successful cumulated experience and refined business model, as it can adhere to an aggressive branch development program in various countries. Café de Coral set up have now recorded meaningful profitability and consistent earning growth, with new branches and have been relentless in testing out new grounds with business re-entry in cities of China as another strategic play for long term business growth. (2006)   RECOMMENDATIONS FOR IMPROVEMENTS IN ITS MARKETING OPERATIONS AND STRATEGY   In giving emphasis in providing useful recommendations of Café De Coral’s marketing operations and strategies, it is essential for the café to adopt to some useful shifts in enhancing food service packaging as the customers would want it in order to get fast food a much quicker in the phase of marketing process in operations and strategies. Café De Coral must adapt a possible option to make it  bigger in the market scene like providing TV ads in pushing their product explaining how it's bigger, has more ingredients and is more filling. The café should continue to have useful innovation that they  should try and make their products look more attractive by packaging it individually and using bright colors - things that people don't immediately look for but their subconscious does find more appealing. One good marketing strategy that Café De Coral can use  is through getting their customers to start out at a young age and are offering kids toys with meals, especially toys that are part of a collection so that the children will insist on keep going back to the restaurant to get more toys and in turn - buy more food. (2005) Café De Coral must also live their business principles in relation to their critical success factors in terms of their advertising and promotion to maintain a competitive edge in the industry and in advertising. There are different kinds of gimmicks like the café could have a discounted food items if a customer will purchase two items, free gift items, raffle draws and a lot more. Proper Pricing such as price cuts and discounts are offered to increase sales. Food outlets that offer the most value for money are the popular ones and by providing high quality food that conforms to the taste of the consumer coupled with fast and efficient service in a clean environment is a big incentive to growth. Consumers have become even more discriminating and quality-conscious. Targeting the consumers' taste buds means upgrading the menu. This is one key in capturing more customers. The smooth operations of food outlets require a steady and adequate supply of raw materials. These companies must then establish tie-ups with reliable suppliers. For a possible investment, franchising is a good way to start. With franchising, there is already product identification. Café De Coral need have to acquire a well-managed logistics support system to run several business operations to make a strong impact as good marketing strategies mean having sufficient capital to support the marketing campaign. Café de Coral needed to upgrade its current system and implement a Business Management System in 199 outlets in Southern China to streamline business processes, improve productivity and enhance customer satisfaction. ( 2005)   There has to be a reliable branch intelligence system that streamlines business processes, improves productivity, enhances the customer and enabling a group-wide, Internet-based loyalty program in software such as Windows 2000 Server and SQL Server 2000. ( 2005)   CONCLUSION In conclusion, marketing strategies as applied by Café De Coral has helped them achieved a steady market catering the international market serving its best and well planned products and services that has amicably soothe the tastes of every aspiring customers and therefore, has built the café success on product innovation and marketing excellence, backed up by an uncompromising commitment to quality customer service. Its marketplace is fast changing and competitive, characterized by increasingly sophisticated customers and ever-tighter profit margins and to sustain its leadership position in a demanding environment, Café de Coral needed a way to further improve its customer experience while enhancing operating efficiency and reducing costs. The fast food industry is attempting to create an image that provides consumers with a comfortable and friendly feel about their product in order to increase sales.  The fast food industry is quickly shifting its marketing focus towards an older audience but understood through the same psychological principles nonetheless.

The Cafe De Coral Marketing Strategies

INTRODUCTION The fast food business focusing on Café De Coral is more global than ever and inte...