MARKETING THE INDUSTRY SEGMENTS

4.06 Explain the food 4.06 Explain the food and beverage industry.and beverage industry.

Food and beverage Food and beverage business: A business: A business operated business operated to prepare, serve, to prepare, serve, sell, or provide sell, or provide food for people to food for people to eateat

Segments of the food and beverage Segments of the food and beverage industryindustry

•Commercial foodservice

•Institutional foodservice

•Foodservice in a consumer business

Commercial foodservice: Profit-driven Commercial foodservice: Profit-driven businesses that compete for businesses that compete for customers’ dollars by preparing, customers’ dollars by preparing, serving, selling, or providing food for serving, selling, or providing food for immediate consumptionimmediate consumption

•Fine dining operations

•Fast food restaurants

•Cafeteria operations

•Buffet restaurants

•Theme restaurants

•Ethnic restaurants

•Family restaurants

•Catering operations

Fine dining operationsFine dining operations

•Customers are seated at tables, and a server takes guests’ orders.

•Meal selections come from a set menu, with daily specials.

•Food and service is of highest quality.

•Prices are consistent with quality—high.

•Atmosphere is important.

•Food is cooked to individual order.

•Service is concentrated and the ratio of servers to customers is high.

•Dining is enjoyed over an extended period of time.

•Chefs are highly qualified and their skills contribute to atmosphere.

•These businesses are frequented by only a small percentage of population.

Fast Food/Quick ServiceFast Food/Quick Service

•Facilities and operations are designed for faster service.

•Counter service and/or drive-thru window service are provided.

•Menu choices are minimal.

•Food preparation time is quick.

•The customer dining area is small.

•Atmosphere does not encourage customers to linger over meals.

Cafeteria operationsCafeteria operations

•Consists of a long serving line with menu items on display

•Customers move their trays along the serving line and ask food servers to plate the item they select.

•A hot line/side and a cold line/side are often provided.

•Dining areas are large to serve large groups.

•Customers get food items, take trays with them, and seat themselves.

Buffet RestaurantsBuffet Restaurants

•Food is displayed on special tables that keep the food hot or cold.

•Customers get up and down from their tables to get the food they want.

•Servers clear the dirty dishes and may provide beverage service.

•Buffet service is capable of handling large groups of people.

Theme RestaurantsTheme Restaurants

•Carry out a common theme throughout all parts of the operation; menu items, décor, servers’ uniforms, and sometimes music are factors in setting theme

•“Total experience”

Ethnic RestaurantsEthnic Restaurants

•Most are independently owned.

•Several notable successful chains

•Serve needs of immigrants in the area and customers who want to try something new

Family RestaurantsFamily Restaurants

•Cater to all members of the family

•Relaxed setting, menu provides for all ages

•Some have salad and dessert bars

•Special menus for children

•All-day menus

Catering OperationsCatering Operations

•Provide food, beverages, and service for special occasions

•May have their own location and cater groups there, or they may cater to groups at other locations

•Coordinate many details and must keep in close touch with the customer

•Weather may impact outdoor activities

Institutional Foodservice: Institutional Foodservice: Foodservice that is provided to Foodservice that is provided to customers in an institution such as a customers in an institution such as a hospital, prison, school, or the hospital, prison, school, or the militarymilitary

•In-house foodservice

•Contract foodservice

In-house foodservice: A foodservice In-house foodservice: A foodservice operation that is run by the business operation that is run by the business itselfitself

Contract foodservice: An institutional Contract foodservice: An institutional foodservice operation that is run by an foodservice operation that is run by an outside foodservice agencyoutside foodservice agency

Foodservice in a consumer businessFoodservice in a consumer business

•A food and beverage business sometimes operates within another business.

•The food is not the main purpose of going to these attractions or locations, but it enhances the experience.

•These businesses have characteristics of both institutional and commercial foodservice.

•Examples: airports and sports arenas

Factors affecting locationFactors affecting location

•What are demographics of surrounding population?

•Is there growth in immediate area?

•What is existing public infrastructure?

•Does the property/building have good access?

•Is there enough parking?

•Is the property visible from surrounding roadways?

•Who are the competitors?

*Location is key factor in *Location is key factor in marketing mixmarketing mix

Foodservice Industry TrendsFoodservice Industry Trends

•Americans eat approximately half of their meals away from home.

•When dining at home, Americans want food items that are convenient and quick to prepare.

•Take-out continues to be popular.

•Consumers expect high-quality ingredients.

•Theme restaurants make eating out entertaining, not just convenient.

•Healthy choices are very important.

•Technology has improved service.

Advertising in the food and beverage Advertising in the food and beverage industryindustry

•Smaller operations can target local markets through local media.

•National chains use television for broad exposure.

•Magazine ads can target specific markets and geographic areas.

•Billboards are used to direct tourists to businesses in the local area.

Personal selling in the food and Personal selling in the food and beverage industrybeverage industry

•Suggestive selling is important in any restaurant.

•A server’s knowledge of the product and preparation methods helps the sales process and image of the business.

•The one-on-one customer contact generates immediate feedback.

Sales promotion in the food and Sales promotion in the food and beverage industrybeverage industry

•Toys in kid’s meals, t-shirts, and specialty glassware

•Temporary plans incorporated to bring customers into the business

•Rate cards and informal surveys

•Table tents

•Sales promotions are only as effective as the salesperson trying to sell them.