Marketing Plan

for

Italy’s Pizza Deli

Mkt 516, November 28, 2006

By

Jennifer Usher

Abdullah Alnahdi

Jack Palmer

Abraham Kirunga

Hsiang-Ying Wu

Executive Summary

Italy’s Pizza Deli aims to provide the best pizza, subs, wings and

other foods alongside services to targeted business environments in the

Deland region. This plan seeks to generate a significant increase in

company sales and profits from the delivery of pizza, increased catering

services, retaining of new and old customers, and increased customer

awareness compared to the preceding year. Enzo, the owner, is au fait

when it comes to pizza. He has been doing it for over 30 years.

The highlights of this plan are the targets: retain customers, increase

catering and delivery, improve ambience at the restaurant which all lead to

increased sales-revenue. These targets are attainable through a proactive

approach to the retaining of clientele, teaming-up with technology

providers, and partnering with reputable local and regional food suppliers

while we improve pricing, and reduce risks. The projected marketing

budget for each month will be $5,000.

This business plan has been created on the basis of three months of

market research, which spanned September of 2006 to November of 2006.

Data conclude the size and growth of the market and geographical

segments, customer needs, perception, and buying behavior trends have

been on the upswing, and are expected to continue in this trend for the

next several years. Italy’s pizza Deli feels that it is able to fill the hole in the

family restaurant niche, and will benefit from continuing operations and

revamped marketing.

Environmental Analysis

The Marketing Environment

The marketing environment in the food industry is very competitive.

Our major competitors are larger chains such as Domino’s, Papa John’s

and Pizza Hut. The strength of the larger companies is their marketing

dollars. They can afford to advertise nationwide on TV. On the downside

the weakness of the larger chains is the depth of their product line and the

quality of the product. They do not carry as many products on the menu,

and can’t compete with the freshness and grade of our ingredients. The

larger chains have a set marketing mix which is controlled by the franchise

and therefore will have little to no response to our marketing mix if

changed. However, we also have smaller competitors such as Tony’s New

York Pizza, Bellini’s, and Milone’s. These competitors have more similar

strengths such as a deep product line and will compete, using price wars

or other promotional events if our marketing mix is altered.

Many substitute products are available in the dining industry, having

an effect on the attractiveness of our product and in the future there is also

a possibility of new competitors entering when new local restaurants with

quality products open in the Deland area. While the larger companies have

an advantage entering the market over the smaller ones due to marketing

power and the ability to bargain with suppliers, smaller companies still

have the ability to enter the market if a niche is found.

Some advances in technology can help operations as well as marketing

efforts. Most well known restaurants today have websites, carrying their

menu, directions to the place and other important information. Some

places also allow customers to order their pizza online. Another technology

becoming standard in the pizza industry is delivery bags with a heater build

in. These pizza bags keep pizza warmer and longer and make deliveries

more efficient since more deliveries can be made at once and save gas

money.

The values of our society have changed in the way that life has

become fast paced and family dinners are seldom cooked at home

anymore. Longer working hours and mothers going to work instead of

staying at home anymore has opened up new markets for many dining

places to create pick up meals which moves towards the general attitude

of convenience. Cooking takes too much time, ordering food from a place

is faster and does not involve much hassle.

Target Market

Our target market consists of people from different demographics. Because

everybody needs to eat we technically target everyone in our environment, regardless of

sex, age, and ethnicity. However pizza is especially popular with kids, teens and college

students. This means that people living in the couples, launching, and retirement stage of

the Family Life Cycle don’t feel the need to eat pizza at a regular basis, whereas people

in the Independence and Parenting Stage do. The location of the restaurant is close to

downtown Deland and is situated next to New York Avenue, a high traffic road. It is

easily accessible to Deland residents located within 4 mile radius of the restaurant and is

also accessible for handicapped people in its plaza location. Our target market usually is

open to fast food atmosphere and pizza. They don’t mind substituting pizza for a meal,

such as students looking for a snack or party host, which excludes very health oriented

customers. Even though our business is capable of offering a great quality

product to satisfy target market needs, competitors are faster when it

comes to food production. Nevertheless the affordability and specials are

enticing enough to wait a little longer. The needs of our target market will

change with time. Later operating hours and more frequent deliveries will

be in demand. A faster service and better service will be expected from our

customers.

SWOT Analysis

Strengths

Italy’s Pizza Deli main strength is the quality of their product. The

owner of the business has been in the pizza business all his life and knows

how to produce quality pizza at good price without sacrificing superior

ingredients.

This strength has helped the business differentiate their products from

competitors and satisfy the demand of their target market.

Another strength of Italy’s Pizza Deli is the dine-in area rented. It is very

clean and has open space to host bigger groups of people. This strength

welcomes a strong walk in customer base and helps when special events

want to be held at the restaurant.

The menu offers a vast variety of products including pasta meals, subs,

meats, pizza, and salads. The depth of the product line and the size of the

pizzas are another strength of the restaurant.

Weaknesses

One weakness of Italy’s Pizza Deli is it is difficult to locate visually.

First time visitors will not see the place right away, since it is located in the

corner of the plaza and signs are overshadowed by the post office sign.

The interior of the restaurant though clean and open lacks decoration and

is very bland; there is a lack of a particular aesthetic.

Opportunities

The major market which Italy’s Pizza Deli has not entered yet in

Deland is the Stetson University student body. There are around 2400

students which can be potential customer of the business if marketing is

successful. Another opportunity is increasing marketing efforts towards

delivery business. The majority of our business is walk in and by

increasing deliveries we will gain more customer base and increase profits.

Another opportunity is making the interior a theme such as an Italian home

which helps with the atmosphere of the place. Together with the theme

beer sales can be advertised which helps customer retention.

Threats

The threats in this industry are other Italian restaurants such as

Milone’s Pizzeria & Subs, Angelina’s Pizzeria, Domino’s Pizza, Papa

Johns, Pizza Hut, etc. While Milone’s and Angelina’s are in direct

competition with Italy’s Pizza Deli and fighting over the market share of

dine-in guests, Domino’s and Papa John’s only compete over take outs.

The chain companies have more advertising dollars and have the ability to

overshadow our advertisements and take away customer base.

Another threat that can hurt business is the food trend. If all of a sudden

Chinese food is the trend and everybody is eating it, then Italy’s Pizza Deli

will lose customers due to this trend. In order to prevent this threat Italy’s

Pizza Deli has to continuously advertise and change their menu according

to trends.

Marketing Objectives

Our main marketing objectives are to increase the sales of business,

create a strong brand name, and inform people about our catering ability.

One way of doing this is by increasing the number of repeat

customers. Many walk-in customers exist from the surrounding

establishments but not many are repeats. By establishing a “punch” or

“stamp” card, giving customers’ incentive to return and work towards a free

pizza will allow us to see how many customers are returning and how

many of those are new customers. It will take about two to three months to

launch the cards and being able to track the progress. By introducing the

cards you are taking advantage of the fact that a quality product is sold

and customers return to use their cards and in turn increase business.

Also by utilizing the card he can counter one of his weaknesses and

reach the customers creating brand recognition and maybe entice them

into becoming brand loyal consumers. This objective is consistent with his

goals in that he wants to increase his customer base and make his

restaurant more brand recognizable.

When considering the marketing channels that are involved with

Italy’s, it is apparent that there are too many distributors involved in the

delivery of the food. This seems to affect the meat and cheese portion of

the menu the most which is important to achieve more production in his

catering business. By increasing the quality of the menu by purchasing

premium meats and cheeses, it should increase the quality catering market

share percentage as well. Boars Head is the brand that was on the menu

until managerial discrepancies lead to the use of a more diverse and

possibly less reputable brands. By increasing the number of distributors

Italy’s is ultimately increasing delivery dates, shrinkage (loss of product),

distribution efficiency, and rates that may be achieved by ordering larger

amounts of product from a smaller number of distributors. By allowing the

Boars Head brand back into the menu and decreasing the number of

distribution channels, Italy’s will see long-term benefits in rates and profits.

Marketing Strategies

Target market & Marketing Mix

One of the most important markets we are trying to gain a larger

share of would be the student population, the majority being Stetson

students. Targeting students is an important market because this would

include the large number of both high school and college population

combined with the ability to match the price range for these students with

cheap food. The second target market is the business district that is

surrounding the location of the restaurant. By focusing on the potential

business that is within walking distance of the location, Italy’s has made

lunch quick, easy, and inexpensive which has, over time, increased this

lunch time walking distance market share. The other target market that we

are trying to tap into is the larger business district. Deland offers a highly

saturated business area that is very close to Italy’s Pizza Deli. We are

hoping to reach this market on a level where he can get his foot into the

door for larger catering events in the near future. By creating a relationship

with these businesses, there are many potential customers that would

diverge from the catered food and become more regular customers.

By applying the marketing mix to these target markets, it helps to

realize the needs of the target markets and what needs to be applied for to

generate a larger market share. The product and pricing strategies for the

student market is a simple one. The idea here is to supply students with a

quality food at a cheap price. This is something that is already offered by

Italy’s; therefore the goal is simply to get this message to the student

population. Delivery times are important when it comes to this market

because students do not like to wait. Delivery efficiency is important

because many students might be willing to sacrifice time for price or even

food quality. Promotions are a must when dealing with this market.

Themed nights of the week where certain items or alcohol is cheaper

would help to boost the productivity of many nights that seem to be slow.

Also, anything free will attract many students attention. This will help by

promoting product awareness and accessibility while increasing brand

recognition and ultimately profit among the student market. All of this is

necessary to maintain a competitive advantage.

The product strategy for the second target market is just to maintain

quick and quality food for the lunch rush. People get little time for lunch

break so the faster they get their food, the more likely they are to return as

a customer. The pricing strategy will have little fluctuation as the lunch

hours tend to offer a daily special. Other specials could be added to the

menu over time for diversity. Again, the distribution is very important to this

target market. It is important that the restaurant is properly staffed for the

lunch rush and that people do not find themselves waiting for long periods

on any given day. Promotional value can only hold so much weight in this

market because specials are already given daily at a low price. Other

specials may be created or systems of rewards may be set up to

encourage maximum repeat customers.

The third large target market that is trying to be penetrated is the

large business district. There are a couple of things that may be taken out

of this market. The first is the possibility of growing the catering side of

Italy’s business. By bringing in large scale portions of food for business

luncheons or parties, we would be raising brand awareness exponentially.

It is important to get people to taste the food for the first time. This brings

us to the second benefit which would be ambient business created through

the people from these business outlets. If people try it at work, they might

begin to continue the business outside of work. Product strategies for this

market would include the diversifying the large ticket items past pizza,

such as pasta and sandwich trays. The pricing should be reasonable but

not too cheap. Businesses tend to feel that they get what they pay for

which might deter a business from having the initial tasting of the food.

Having the ability to staff any given catering party is also important.

Businesses demand efficiency and speed when it comes to catering.

Promotions may include business raffles, free lunches or discounts to

certain businesses on certain days, company specials, and more.

Whatever it takes to get people to try the product for the first time is

important to increasing the share of this given market. Increasing brand

awareness is very important in hopes of increasing the market share of all

of these mentioned markets.

Market Implementation

Italy’s Pizza Deli has to organize their business to align with their

marketing objectives. In order to achieve this, several activities can be

done.

A salad bar should be introduced to the restaurant. This would

attract another segment of the market of people who eat out, the health

conscious type. Adding a salad bar would turn the restaurant into more of

a full service restaurant. It would then attract more customers and have

more options for customers to choose from. A salad bar would fit easily in

the back area of the restaurant or the front as you walk in. There is a low

maintenance need for the upkeep of the salad bar, however it would need

to be monitored to ensure that it was stocked and fresh. This would not

require a new employee and would be beneficial if it was implemented by

January 2007 because salads are a popular item when spring approaches

for those who are looking to lose weight for the warm weather activities in

the spring.

Another product activity would be to enhance the atmosphere of the

inside of the restaurant with TV’s, more tables, and the development of the

Italian theme in the restaurants name. The TV’s would draw more people

because people like to be entertained and kept busy; this would cause the

people to stay and then in turn purchase more food and beer. Adding

more tables would allow more people to eat there and thus give the

restaurant an opportunity to make more money of walk-in customers.

More tables would also make the customers feel less likely to leave right

away after they eat. This way they can watch TV and be more inclined to

order a dessert or another beverage. This would be more beneficial if it

was implemented by the first of the year as well. It would be a great way

to start the third year of the business.

The last product activity we thought would be beneficial would be to

have the menu posted largely on the wall. It can even be one that is

adjustable so you can alter prices and new items that are offered. There

are many little menus but if it were larger people would be more prone to

try something new because they might not turn to the side of the menu

with the dinners on it. However, if it is right there in front of them, they see

it and maybe they will order another item. It just allows you to put it all out

there and offer everything to the customers. Leave nothing for them to

have to do in searching for your products. This can be implemented at

anytime but the sooner the better because of the benefits mentioned

earlier that it would bring in.

Distribution Activities:

To try and increase sales through distribution they need to extend

their hours for delivery and maybe add a few more drivers when delivery

business picks up. The Stetson student target market will be more inclined

to buy pizza if they are open later and can get the pizza relatively quickly.

The competition has later hours so in order to compete they need to stay

open until at least 11 o’clock on Thursday, Friday, and Saturday. These

are the most popular days to order late night pizza because the on-campus

cafeteria is not open late on these night causing students to look else

where for food! This project should be implemented and running by late

January, when students come back from winter break.

Another distribution enhancement would be to have the name

printed on the outside of the box. I know that he was concerned with the

taste factor of the cardboard, but I believe they can print the logo on the

outside box too. This is a great way to advertise for virtually nothing.

People walking back with their pizza and the smell fills the room or

wherever they are and others are drawn to it. The thoughts are “where did

they get that pizza, it smells great!” That is when the name and number on

the outside of the box would come in handy. It gives new meaning to the

saying “one man’s trash is another man’s treasure.” A pizza box in the

garbage still smells and to a hungry student or passer by it will be a great

way to reach more people through word of mouth advertising. This should

be implemented as soon as the stock of pizza boxes diminishes so as not

to waste them. This will be a huge asset to the sales because the pizza

can sell itself it just needs a so called voice to do it with, hence the

information on the outside box.

Promotion Activities:

The restaurant is having it’s three year anniversary in January, they

need to take advantage of this marketing opportunity by having a day

where they give back to the community. A Day of Thanks to the

community can be held on one day during the week that is specified

through an ad in the local newspaper and flyers in the restaurant. They

could offer a buy one slice get the second free or even a more substantial

discount. There just needs to be an emphasis on the “Thanks” part to

make the customers feel appreciated and give them the true feel of the

restaurant. This should be done around the anniversary date in January to

make it realistic and heartfelt.

Another promotional activity that would increase revenue would be

the Punch/Stamp Card. This would be a business-sized card that you

would have punched/stamped when you ate from the restaurant, and when

you reach a certain number of punches/stamps you would receive a free

pizza. This would be a good way to track new and repeat customers and

entice customers to visit more often to work towards their free pizza.

These are great tools to use to attract and keep business growing. The

cost of these cards would only be the cost of printing them and the free

pizza when the card is full. There would be no need to mail anything out

since you have to come to the restaurant to benefit from this. This is

something that you can start and stop whenever you like. There is no

need to advertise this promotion; the card will speak for itself. This can be

implemented at anytime but should be soon to be ready for the

Anniversary Thanks celebration.

The last promotional activity that should be looked into would be a

daily special promotion. This would include a special every day that would

run for at least one month so. The specials would be the same each week,

for example every Monday make it college night and have a pizza and

beer special during football season, on Tuesdays it could be family night

where you offer specials on lasagna or other meals. Wednesday could be

local business lunch day and offer specials to the local businesses. These

daily specials would allow the customers to know what was happening

each day and they could expect it and plan accordingly. There is no hurry

on this promotion since the rest of the recommendations are suggested to

be implemented soon.

Marketing Budget Plan

RecommendationCosts    

Monthly Yearly One-Time  

 Launch a Salad bar 150   700  

* Purchasing the Salad bar is under the One-time Cost.  

* The Monthly Cost to fill the bar with fresh Salad         

TV - 200  Tables - 500  

* Price is for One TV with its bracket  * Price is for 5 small-size tables with 4 chairs        

 Creating Italian Theme 1,000  

* Pictures on the wall, Colors, Music, Light        

 Name on Pizza boxes 50 -  

* $50 In addition to the current cost of Pizza boxes         

3rd Anniversary 1,000 -  * Cost of discounted and free food, plus the place

preparation        

 Punch/Stamp cards 20 -  

* Price of printing 400 cards per month + stamp/puncher cost        

Punch/Stamp rewards $500  * Allocation for Punch/Stamp rewards

** This is not recognized as expenses unless redeemed, and that doesn't happen until the Punch/Stamp program success in raising sales*** Punch/Stamp reward is not included in the monthly cost total

       

 Daily Special / Monthly Special 500 -  

* Discounted or free food        Other/ current marketing 3,000      

    

Total $3,720.00

$1,000

$ 2,400  

 Average Monthly cost of Marketing + Improvement costs (first Year Only)

$4,003.33  

 Average Monthly Marketing cost for 2nd year and

thereafter $3,803.3

3   * All $ amounts are estimated

Evaluation and Control

To measure the success of our marketing plan, we will implement a

method of tracking return customers to the business. We will also keep

track of first time customers so that we can tell how many new customers

are coming through our doors and hopefully we can develop ways of

keeping them. As for the catering business, we will keep track of the

number of companies that want our business and also the size of the party

we are catering for. We hope to greatly improve our orders through

delivery and we will count those too.

We hope to look into the following aspects that we want to see

improve:

Assess location, facility, interior, and market position

Review new customer experience, follow-up, awareness,

communication

Staff interaction

Group session to maximize team effort in marketing

Monitoring procedures for accurate response gauge

Media/Public Relations opportunities

Pinpoint competitive challenges and referral opportunities

Every business has different needs and a unique structure. We are a

private firm unaffiliated with any other company. This means that we

are still pretty small scale and performing a formal marketing audit can

be limited to once every six months. The audit will ensure that:

Projects are competed as scheduled

Marketing remains within an approved budget

Projects correlate to your target market

Response monitors are maintained and evaluated

Staff communication and support is available

Ongoing opportunities and solicitations are evaluated

Quarterly marketing reports are compiled