SUBWAY - Marketing Plan

Project Report On

Submitted by: Akramul Hoque (10201002)

Date: - March 27, 2012

FOOD RETAILING

2012 Table of Contents

1.0 Executive Summary……………………………………………………………2 1.1 Introduction……………………………………………………………..2 2.0 Situation Analysis……………………………………………………………...3 2.1 Competitive Analysis…………………………………………………...3 2.2 SWOT Analysis………………………………………………………4-6 2.3 P.E.S.T. Analysis………………………………………………………7. 2.4 Five Forces Analysis …………………………………………………..8 3.0 Marketing Strategy……………………………………………………………9. 3.1 Mission………………………………………………………………..10. 3.2 Core Values and Philosophy…………………………………………..10 3.3 Marketing Objectives………………………………………………….10 4.0 Target Markets……………………………………………………………11-12 4.1 Targeting………………………………………………………………12 4.2 Positioning…………………………………………………………….12 4.3 Strategies………………………………………………………………13 4.3.1 Ansoff Strategies…………………………………………13-14. 4.3.2 Porter’s Generic Strategies…………………………………..15 5.0 Marketing Mix……………………………………………………………16-17 5.1 Branding Strategy……………………………………………………..17 6.0 Recent and Future changes in Marketing Environment at SUBWAY ………18 7.0 Appendix……………………………………………………………………..19

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SUBWAY 1.0 Executive Summary SUBWAY was started 43 years ago in the summer of 1965 an enterprising 17 years old young man, Fred Deluca . Subway is the market leader in the sub and sandwich shops offering a healthier alternative to traditional fast foods. Subway‘s annual sales exceeded $ 6.3 billion, while countless awards and accolades have been bestowed its chain over the past 43 years . Subway has more than 28,000 units worldwide whilst its rapid growth has attracted many investments and brought it many competitors such as KFC and Burger king . Recent initiatives attract customers beyond Subway traditionally health conscious consumers should increase the company‘s share of the fast food market. Subway's marketing program addresses health, fresh, custom-made sandwiches expectations of consumers through a number of approaches The Subway concept of serving fresh made sandwiches on fresh baked bread, made right in front of customers, the way they like it has proven to be a winning marketing strategy in Europe. Their customers have really respond to the high level of service that Subway restaurants are famous for. They have also become popular with health conscious customers in Europe who are searching for higher quality fast food options. Subway‘s low initial investment and ability to fit into unusual spaces are other reasons for their success. Without the need for heavy equipments for cooking a Subway restaurant is the perfect business for the small spaces and tight real estate of U.K. Their regional office makes the franchise start –process simple and easy. Europe is currently wide open for development. As their brand awareness grows in Europe, more and more people are becoming aware of Subway as a great tasting lunch option and also as a great way to start their own business within their community. Estimates that its goal of opening another 1600 locations in the U.K and having a total of 30,000 restaurants worldwide, including 4,000 locations in Europe by 2010 are right on track.

1.1 Introduction According to SUBWAY‘s future market expansion strategies they have planned to open 1600 locations in the U.K by 2010. In this marketing plan I am going to discuss and explain what are the SUBWAY existing strengths, weaknesses, opportunities, threats, their marketing strategies, marketing mix , branding strategies and their recent and future changes which are effect their marketing success as a company. And also , as a marketer ,I discuss what are the changes they can do to minimize deviations from their original marketing objectives .


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In this plan I use my marketing knowledge to evaluate SUBWAY marketing strategies and , will be discussing their potential growth from my point of view as a marketer. For this I use some marketing theories and concepts for explain my ideas. First I use small marketing environment audit using SWOT analysis, P.E.S.T analysis and five forces analysis to discuss SUBWAY marketing environment. Then I will discuss subway marketing strategies using Ansoff metrics and Porter‘ s generic strategies while considering their marketing mix and finally will go for recent and future changes.

2.0 Situation Analysis A situation analysis is an honest valuation of the opportunities and potential problems facing a prospective or existing company, through analysis a deeper understanding of an industry , competitor and possible optioned can be examined. Subway is the market leader in the sub and sandwich shops offering a healthier alternative to traditional fast foods. Subway‘s annual sales exceeded $ 6.3 billion, while countless awards and accolades have been bestowed its chain over the past 43 years . Subway has more than 28,000 units worldwide whilst its rapid growth has attracted many investments and brought it many competitors such as KFC and Burger king . Recent initiatives attract customers beyond Subway traditionally health conscious consumers should increase the company‘s share of the fast food market. Being part of a highly competitive and dynamic market, Subway faces a strategic marketing challenge as to what specific marketing mix to use in order to sustain a diffencial advantage while maintaining sales growth and above all profitability. Subway effectively competes with burger chains and others that are in the fast casual segment of the market. Including healthier meals into his menu and giving much attention to obesity and diabetes have supported consumer‘s choice for subway. However, subway has not been satisfied thus far, instead, more intensified efforts have been made to improve business during the dinner hour. Additional menu options have also been added to answer competitor‘s trends and to place more focus on the children‘s segment. SWOT analysis can be helpful to highlight subway‘s 1) Internal strength and weaknesses along with 2) the external opportunities and threats. In the past few years, sandwich market has gained incredible popularity in the U.K culture.


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2.1 Competitive Analysis ―The purpose of analyzing competitors is to try and asses what they will do. This will enable the organization to respond accordingly. Competitive advantage is about relative competitive position competitors are sometimes used as benchmarks.‖ (CIM, 2005) Subway is not without competitive pressures, chief competitors include KFC, McDonalds, Pizza hut, Greggs and Eat.KFC and Pizza hut are the world largest with 33,000 restaurants in over 100 countries. Four of the company‘s highly recognizable brands KFC, Pizza Hut, Long John Silva‘s and Taco Bell, are global leaders of the Mexican, Chicken, Pizza, Quick service sea food categories. McDonald‘s corporation is the world‘s largest food survives relating chain with 31,000 fast food restaurants in 119 countries. The company also operates restaurants under the brand names ―the Boston Market‖ and ―Chipotle Mexican Grill‖. McDonalds operates largely in the U.K and is headquartered in Oak Brook, Illinois employing 447,000 people.

2.2 SWOT Analysis ― However, since marketing is such a complex function , it seems illogical not to carry out a pretty through situation analysis at least once a year at the beginning of the planning cycle , in the same way that an annual financial audit is carried out‖ ( McDonald, 2002 ) ―One useful way of doing audit is in the form of a number of SWOT analyses. A SWOT is a summary of the audit under the headings, internal strengths and weakness as they relate to external opportunities and threats‖ (McDonald, 2002) Subway sandwich shops are well positioned to leverage their strength and address reasonable threats, weaknesses and opportunities. The table below highlights these Strengths, Weaknesses, Opportunities and Threats.


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       

Size and number of stores and channels. Menu reflects demand for fresh, healthy and fast. Use of nontraditional channels. Partnering with the American Health Association. Worldwide brand recognition. Customizable menu offerings. Low franchisee start up cost. Franchisee training is structured, brief and designed to assure rapid start up and success.

WEAKNESSES     

Décor is outdated. Some franchisees are unhappy. Service delivery is consistent from store to store. Employee turnover is high. No control over franchise situation in given market area.

THREATS OPPORTUNITIES    

    

Continue to grow global business. Update décor to encourage more drive in business. Improve customer service model. Continue to expand channel opportunities to include event wagons. Improve franchisee relations. Experiment with drive-through business. Expand packaged dessert offerings. Continue to revise and refresh menu offerings. Develop more partnerships with more producers and toy manufactures to promote new movie releases through children‘s menu packaging and cobranding opportunities.

      

Franchisee unrest or litigation. Food contamination (Spinach). Competition. Interest costs. Economic downturn. Sabotage. Law suits.

Strengths


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SUBWAY‘ main identifiable strength is their size and number of stores and channels. This gives better advantage for SUBWAY when it competes with other competitors. When we consider their product line, menu reflects demand for fresh, healthy and fast .And they have better customizable menu offerings as well. SUBWAY use nontraditional channels to develop their markets. SUBWAY product is mainly targeting for healthy product, they facilitate positioning their products by partnering with the American health association. SUBWAY has better world wide brand recognition which will be discussed later part of this plan deeply. Low franchisee start up cost is another strength they have when penetrating the market. On the other hand their Franchisee training is structured, brief and designed to assure rapid start up and success. These are the main strength which SUBWAY can use their marketing developments.

Weaknesses According to marketing point of view their main weaknesses are outdated décor in their franchise outlets . It reduces their competitive advantages in market. Some of their franchisees are unhappy. And their service delivery is consistent from store to store. Other main weakness of SUBWAY is their employee turnover is comparatively very high. SUBWAY doesn‘t have control over franchisee situation in given market area. For better marketing growth SUBWAY should critically evaluate these weaknesses and make them manageable under some certain level.

Opportunities SUBWAY has number of opportunities become stronger in the sandwiches market rather than competitors. SUBWAY is continuing to grow global business. They can update décor to encourage more drive in business. Better opportunity to improve customer service model. They can continue to expand channel opportunities to include event wagons, improve franchisee relations and expand packaged dessert offerings. SUBWAY can experiment with drive through business like McDonald already doing. To minimize competition SUBWAY should continue revise and refresh menu offerings. Develop more partnerships with more producers and toy manufactures to promote new movie releases through children‘s menu packaging and co-branding opportunities.

Threats Main threats we can identify for SUBWAY might be the food contaminations which are more popular recently (Ex . Spinach). Franchisee unrest or litigation, emerging competition are the other threats which SUBWAY face. Like every other companies SUBWAY face the KIIT SCHOOL OF RURAL MANAGEMENT

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economic downturn threat these days. Sabotage and law suits are the other main threats for SUWAY.

There are varieties of ways of classifying the forces at work in the macro environment. PEST analysis and Porter‘ five forces analysis are two of them.

2.3 P.E.S.T. Analysis Below table explain the P.E.S.T factors which are affecting to SUBWAY.

Political Factors   

Health and safety guidelines Labeling and GM foods Animal rights campaigns

Economic Factors      

Social Factors     

Busy life styles Healthy eating and obesity Increased vegetarianism Homogeneity Social activities

Low set up costs Franchising facilities set ups Support from major suppliers Growing market Perceived value for money Increasing disposable income

Technological Factors  

Investments in technological innovations Computer ordering(Till system)

Political Factors


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Main political factors which are affecting to SUBWAY marketing are health and safety guidelines of the government, Labeling of genetically modified foods and animal rights campaigns specially organize by some environment friendly groups.

Economic Factors Low set up cost is a good advantage for SUBWAY. Franchising facilities setup, Support from major suppliers, Growing market for healthy foods, Perceived value for money and increasing disposable income are the main economic factors SUBWAY face.

Social Factors Busy life style of the new generation is very good advantage for any kind of fast food industry. Awareness of healthy eating and obesity, increasing vegetarianism, homogeneity and social activities regarding fast and healthy foods are the main social factors which effect to SUBWAY marketing environment.

Technological Factors Investments in technological innovations and computer orderings are the technological factors.

2.4 Five forces analysis According to Porter‘s five forces analysis followings are the main forces and their effects for SUBWAY marketing environment.

Threat entrants

of

1.Setting up 2.Product differentiatio n

Threat of substitute s 1.Convenience shops

Power of Power supplier buyers s 1.Farming industry

2.Mid range 2.Worldwide restaurants market suppliers 3.Pre cooked food

of

1.Consumer s 2.Little of brand loyalty

Competitiv e rivalry

1.New likely

entrants

2.Price wars 3.Overall demand is increasing


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social

5.Health shops

food

Threat of Entrants Major threats of entrants are setting up of the entrance and differentiation of products which is important for market penetration and market development.

Threat of Substitutes There are lots of convenient shops, mid range restaurants and health food shops are there in the market. So customers can have much kind of alternatives to select their option. SUBWAY marketing strategy should cover these every kind of competition as well. Pre cooked foods which customers can easily consume are the other threat. Different kind of other social activities regarding fast food industry also could be a threat f for SUBWAY market.

Power of Suppliers We can consider as power of suppliers for SUBWAY market as farming industry, worldwide market of suppliers and alliances.

Power of Buyers Any kind of industry power of buyers is specially consumers. Some kind of little brand loyalty also can be considered as power of buyers.

Competitive Rivalry Mainly we can consider as competitor rivalry for SUBWAY are new entrants likely , price wars and increasing of overall demand.

3.0 Marketing Strategy Marketing strategies reflects the company‘s best opinion as to how it can most profitably apply its skills and resources to the market place. It is invertible broad in scope.


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―Marketing strategies are the means by which a company achieves its marketing objectives and are usually concerned with the four ―P‖ s. (McDonald, 2003) Subway's marketing program addresses health, fresh, custom-made sandwiches expectations of consumers through a number of approaches. The most notable were the television commercials featuring Jared. These commercials emphasize the healthy aspects of a Subway sandwich by highlighting the 245 pounds Jared lost by eating a Subway sandwich diet. Subway also markets through a national sponsorship in events such as American Heart Association Heart Walks and local events such as triathlons, and children's sports teams. The Subway example represents marketing and product strategies that are classic examples of focusing on market demand, consumer trends, product leveraging, and innovation. The marketing strategies of creating clear brand recognition, brand and product association, and market demands, have strategically positioned Subway to advance market share into the near future. These marketing strategies are also repeatable fundamental marketing strategies transcending the fast food market. The Subway Franchisee Advertising Fund Trust or SFAFT governs advertising. SFAFT functions independently of Doctor‘s Associates Inc., which is the franchisor of the SUBWAY business franchise concept, and its affiliates.SFAFT manages funds contributed by SUBWAY franchisees. It was established to create advertising and marketing programs that are designed to build restaurant sales and promote the system‘s image. SUBWAY has a customer care team, dedicated specialists who are in constant communication with consumers. Success factors for fast food franchisees will include products and marketing targeted to healthier menu selections, brand consistency, low start-up costs, franchisee support, and consumer convenience. Subway represents a poignant example of a fast food franchisee ready for success in the future fast food market. Their strategies transcend the fast food market and apply to many other markets and products Branded fast food continuing to move into other nontraditional venues such as colleges, airports, military bases, hospitals, and amusement centers. Part of their marketing strategy, Subway includes identifying which venues and retail chains would be most amenable to quick-service brands.

3.1 Mission


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― Mission is an organization‘s rationale for excising at all and/or its long term strategic direction and/or it‘s values ; its basic function in terms of the products and services the organization produces for it‘s clients‖ (CIM , 2005 )

Subway Mission ― To provide the tools and knowledge to allow entrepreneurs to successfully complete in the QSR industry worldwide by consistently offering value to consumers through providing great fasting food that is good for them and made the way they like it‖ (Subway , 2005 )

3.2 Core values and Philosophy SUBWAY is always committed to customer satisfaction through offering high quality food with exceptional service and good value. They always maintain their quality of customer service every franchisee outlet. They take great pride in serving each other, customers and communities. They seek continuous improvement in that entire do. SUBWAY Value a sense of urgency and emphasize an innovative, entrepreneurial approach to business because especially they are in fast food industry. They expect fairness and mutual respect in all activities. They know their success depends upon the initiative they take individually and their ability to work as a team.

3.3 Marketing objectives SUBWAY main marketing objectives are maintain positive , strong growth each quarter and achieve a steady increase in market penetration. SUBWAY posses good information about the market and knows a great deal about the common attributes of the most prized customer. This information will be leveraged to better understand who is served, what their specific needs are, and how SUBWAY can better communicate with them through marketing. SUBWAY use marketing segmentation, targeting and positioning strategies to develop their market.

4.0 Target Markets The process of breaking down the total market for a product or services into distinct sub groups or segments , where each segment might represent a distinct target market to be reached with a distinctive marketing mix.― A market segment consists of a group of customers or consumers who share the same or similar needs‖ (McDonald, 2002) Segmentation Methods


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1. Demographics (Age, Life cycle , Gender , Income , Occupation, Religion , Education , Race ,Nationality ) 2. Geographic ( Location , Regional , Urban , Density , Climate ) 3. Psychographic (Social class , Life style , Personality ) 4. Behavioral (Occasions , Benefit sought , User stages , Usage rate , Loyalty status ) SUBWAY Segmentations Age group – (18 – 39) Income level – (c 1)

Kid‘s meals worldwide locations

Healthy Life style Urban Areas (South east etc…) Halal sandwiches Subway is always improving their geographic segmentation from their early development ages. By studying Subway‘s geographical expansion we can identify what kind of segmentation they include their marketing strategies. Where did the SUBWAY chain open its first international location? It wasn‘t in Canada, Mexico or somewhere close to the United States. It wasn‘t in England, Australia or somewhere that English is the official language. It wasn‘t in Germany, France or somewhere else where many different types of sandwiches are popular. It‘s not where you might think. The SUBWAY chain tested international waters when it opened its first unit in the small exotic Middle Eastern island nation of Bahrain in December of 1984. In a relatively short time, the SUBWAY chain started to appear in such distant lands as Iceland, Poland, Nicaragua and China. The SUBWAY chain, the world‘s largest submarine sandwich franchise, goes to tremendous lengths to bring great taste and fresh ingredients to consumers in the farthest reaches of the globe. With more than 2,400 locations outside the U.S. and Canada, the SUBWAY® chain is a leader in fast-food international development. In upcoming months, the plans for SUBWAY® restaurants in countries such as Belize, Luxembourg, Thailand Romania and Hungary are on the drawing board. Despite the diversity of cultures. We can see SUBWAY target some kind of cultural and religious segments while keeping their original values maintaining. Wherever SUBWAY restaurants are located, the core menu stays relatively the same—with the exception of some cultural and religious KIIT SCHOOL OF RURAL MANAGEMENT

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variations. World travelers can expect the same high quality ingredients regardless of what nation they are visiting. On the other hand SUBWAY always target different kind of age segments, through their existing product lines and product developments, specially improving kid‘s meals.

4.1 Targeting Marketers do targeting for segmented markets. After the market has been segmented into its segments according to their segmenting strategies he will select a segment or series of segments and ―Target‖ it /them. Resources and effort will be targeted at the first is the single segment with a single product. Secondly the marketer could ignore the differences in the segments, and choose to aim a single product at all segments. Finally marketer will target a variety of different segments with a series of differentiated products.― The advantage of target marketing is marketing effort can be focused on the market segment(s) that offer the greatest potential for the company to achieve its objectives ― (Lancaster & Reynolds, 2003) Year 2003SUBWAY improves the nutritional content of its Kids Pak meal by switching the carbonated soft drink to a juice box and changing from a high calorie cookie to fruit roll up fruit snack that is high in vitamin C. Many of the Kids Pak toys are now designed to inspire physical activity. The web site includes a resource for parents striving to manage their children‘s diet and exercise levels. Parents and children can also ask Jared Fogle about how he lost his weight or how they can incorporate fun exercises into their everyday lives. SUBWAY restaurants begin to distribute 'Jareds Steps to Healthier Kids' information cards in efforts to educate customers about preventing childhood obesity The increase in sales of the sandwiches has been a result of decreases in consumer interest in hamburgers and fries and increases in demand for healthier options. Sales of sandwiches are growing 15 percent annually, outpacing the 3 percent sales growth rate for burgers and steaks. SUBWAY target virgin international markets using their strong brand name.

4.2 Positioning Positioning is all about ―Perception ―. The term ―Positioning ―reefer‘s to the consumer‘s perception of a product or service in relation to its competitors. ― Positioning relates to the


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task of ensuring that a company‘s market offerings occupy a predetermined place in selected target markets, relative to competition in that market ― (Lancaster & Reynolds, 2003) SUBWAY positioning their products by continuing to build the brand on the "freshness" platform. The SUBWAY chain is expanding its universe of potential customers as a place for "TASTY" and "HEALTHY" food. This positioning, communicated via an effective advertising campaign, will serve to make the SUBWAY chain part of customers‘ everyday consideration set. SUBWAY use lots of strategies to position their kid‘s meals. In year 2004 Jared Fogle and WNBA superstar Lisa Leslie kick off the Jared and Friends School Tour in NYC, stressing the importance of healthy eating and exercise. The in-school curriculum, 'One Body! One Life! Eat Fresh! Get Fit!' is developed by the SUBWAY brand and Weekly Reader. The curriculum is intended to help teachers of fourth, fifth and sixth grade students and instill proper eating and fitness values Develop more partnerships with movie producers and toy manufacturers to promote new movie releases through children's menu packaging and co-branding opportunities

4.3 Strategies We can use strategic tools to explain marketing strategies of the company.

4.3.1 THE ANSOFF MATRIX Some of the more common marketing strategies are illustrated by the Ansoff matrix. Existing

Market penetration

Products

New

Product development


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Diversification Markets

New

Market Penetration Market penetration is when a firm increases its share of a market in which it already operates. SUBWAY always focuses their marketing strategies to penetrate the markets which they are already operating. They have one operating department, it is Franchise sales, this group is dedicated to finding those individuals who possess the entrepreneurial spirit required to open a SUBWAY franchise of their own. They find new franchisees to penetrate the market. Other way they use existing franchisees to penetrate the market. For this purpose also they have separate department, Profit Building & Local Marketing This department helps franchisees in local markets with initiatives designed to increase sales at their restaurants.

Market Development This strategy involves finding new markets for the products a firm already makes. SUBWAY has developed a team specifying for market development. New Business Development This team works closely with potential franchisees who wish to open a SUBWAY restaurant in non-traditional locations--such as in a supermarket, movie theatre or gas station Subway restaurant sites are adaptable to any type of location. The simplicity of the Subway Restaurant operation and the ability to fit into spaces that competitors cannot enables them to open restaurants in many unusual and non-traditional sites, such as:   

Airports amusement parks business centers


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coliseums and stadiums colleges and universities convenience stores convention centers hospitals military bases recreational facilities elementary and secondary schools supermarkets travel centers/truck stops

Diversification Diversification involves the firm going into new markets which are totally different from those targeted by the existing activities of the firm. SUBWAY is going for real estate markets, mobile phone markets and some financial markets to reduce their business risk through diversification. They have a team called Subway Real Estate Corp the men and women of this division assist franchisees with real estate leasing and negotiations.

Product Development Improvement of products over time to maintain their competitive position. Product development is one of the main marketing strategies of SUBWAY, specially introducing improved healthier menus. SUBWAY has a Research & Development team this department is responsible for developing and test marketing the food that we serve and the equipment that is used.IN 2005 SUBWAY; their low-fat sub choices are expanded to 8 Subs less than 6 Grams of Fat. In 2007 The SUBWAY restaurant chain launches its Fresh Fit and Fresh Fit for Kids meals, which feature healthier-for-you side options such as apple slices, plump raisins, low-fat milk, bottled water and Dannon yogurt. The meals are developed to fit into the American Heart Association‘s approach to a healthy lifestyle. All trans fats are removed from SUBWAYs core menu items. Menu choices now include higher fiber Wheat and Honey Oat Breads, personal size Pizzas, Black Forest ham, and The Feast Double Stacked sub.

4.3.2 PORTER‘S GENERIC STRATEGIES Competitive Advantage Low cot

Higher cost


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PRICE

PROMOTION

Level Advertising Discrimination Sales promotion Overall selling Discount Personal cost Differentiation leadership PRODUCT PLACE

Narrow

Competitive scope

Broad

Cost focus

Differentiation focus

Porter‘s Generic strategies Focus means the company consolidates its efforts on a small range of products in a market niche.Differenciation means to establish a unique sales proposition or feature that competition cannot match. Cost leadership means the lowest price in the market. SUBWAY menu offered a wide variety including salads, pasta, dinners, soups and desserts. They have steps taken to improve business during dinner and late night sales and marketing to children. Their nutrition factors- fresh and so much healthier than others. More value for money improving quality will increase the value of the product. They have differential pricing strategy with value pricing. But create value products by service in terms of quality, ambience, variety and convenience.

5.0 Marketing Mix Marketing mix consist of four Ps. Product, Price, Place and Promotion.


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Design Packaging Display Brand

Warehousing Transportation Service Stockholding

Available marketing tools to target customers (Lancaster & Reynolds, 2003)

Product The marketing mix combines many factors, but customers view marketing effort in more tangible terms of the product (or service). (Lancaster & Reynolds, 2003) SUBWAY menu offered a wide variety including salads, pasta, dinners, soups and desserts. They offer wider menu and better quality fresh products .In 1996 The chain's flagship sandwich, the classic BMT, is first introduced.IN 1997 The 7 under 6 menu, featuring seven submarine sandwiches with 6 grams of fat or less, is first introduced! In 2001 Another fresh veggies, the cucumber is added to the SUBWAY menu, which already boasts lettuce, tomato, red onion and green peppers. 2004 The SUBWAY chain introduces a line of new crab-controlled wraps. The wrap itself, has only 5 grams Net Crabs. In 2005 Delicious, fresh toasted subs are added to the SUBWAY menu, Quality of food Subway prides them on always having the freshest ingredients available for sub, and they hide nothing from the customer. All their products are made on the spot while the customer chooses what toppings he/she wants on the sub. Unlike most fast food franchises, nothing is deep-fried or frozen.

Price Price is a potent element of the marketing mix because of its direct impact on customers, the company and the economy. SUBWAY use upscale pricing little higher than normal subs in the market. They offer differential pricing strategy with value pricing. But create value products by service in terms of quality.


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Place This is concerned with activities needed to move the product or service from the seller to the buyer. (Lancaster & Reynolds, 2003) SUBWAY target is open another 1600 locations in U.K by 2010.SUBWAY use their major selling locations as franchisee shops and their another new market development places in nontraditional places like Airports ,amusement parks ,business centers ,coliseums and stadiums ,colleges and universities ,convenience stores ,convention centers ,hospitals, military bases ,recreational facilities ,elementary and secondary schools ,supermarkets and travel centers/truck stops. People who in any kind of SUBWAY sales point are on hand to ensure customer‘s needs are matched with the right product and to explain the different options available. And SUBWAY do market research on the location preferences and they close poor and predatory franchisees regarding customer satisfaction. They upscale to stripped down shops to quasi deli restaurants. At Subway, you don‘t wait for your order. You order it at the counter and watch it being made by the highly efficient team of staff. When the product is ready, you pay and take it with you. No bills, no queues, no hassles.

Promotion Promotion covers four areas. Advertising, Personal selling, Public relations and Sales promotions. The target for the SUBWAY chain's media buying is adults aged 18-49, in order to maximize our buying power with a skew toward programming that delivers better to the younger 18-34 audience. The goal of the chain's current advertising campaign is to increase the brand presence in the consumers‘ "consideration set"--that is, which fast-food restaurants consumers consider when deciding where to eat. The majority of the advertising is done via national TV during prime time, sports and late programming on major broadcast networks and cable networks. Additional advertising is done via local markets on TV, radio and in print. SUBWAY® restaurants also promote advertising messages and specials in-store with point-of-purchase material such as posters, menu translates, etc.

5.1 Branding Strategy SUBWAY brand position as a very healthy fast food chain providing healthier and fresher food brand value. Positioned between a stripped down version of subs and full theme restaurant. Service is more like a fast food style but in terms of food quality, quantity, presentation and fresh, puts it closer to theme restaurant.


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6.0 Recent and Future Changes in Marketing Environment at SUBWAY Although, SUBWAY has achieved better marketing position and brand image in the fast food industry, they face much kind of challenges in marketing environment. Specially most of the recent challenges are been created by economic down turn in the world. Economic downturn is being affected all of the markets in the world as well as fast food market. So each every marketer are finding ways, how to survive in this environment and what strategies have to use to develop their own market activities. SUBWAY also badly affected from this crisis environment. On the other hand there is a emerging competition for subway product line. Especially for their health conscious products. Because, all the other fast food competitors are introducing and improving their health conscious product line , which SUBWAY use to maintain leadership. Being part of a highly competitive and dynamic market, Subway faces a strategic marketing challenge as to what specific marketing mix to use in order to sustain a diffencial advantage while maintaining sales growth and above all profitability. Subway effectively competes with burger chains and others that are in the fast casual segment of the market. Including healthier meals into his menu and giving much attention to obesity and diabetes have supported consumer‘s choice for subway. However, subway has not been satisfied thus far, instead, more intensified efforts have been made to improve business during the dinner hour. Additional menu options have also been added to answer competitor‘s trends and to place more focus on the children‘s segment. Like all kind of companies SUBWAY also facing the rapidly advancing of technologies. SUBWAY also introduces and gets use of new technological innovations to expand and penetrate their markets. When they designing décor for franchisees they widely use new technological designing tools. Food contaminations are increasing in recent years and SUBWAY marketing badly effect from it. In future it will be more due to lots of pollutants in environment. On the other hand genetically modified food rejections also will be a big challenge for all kind of food produces specially for fast food producers. And environment friendly groups always make problems for meat and in future it will accelerate , so SUBWAY should have think about alternatives for meats like flavored soy products, but SUBWAY can take advantage of that problem since SUBWAY go for healthy and low calorie food product marketing .


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7.0 Appendix References

McDonald, M. (2003) Marketing Plans, 5 th ed.., Kent: Butterworth-Heinemann publications. CIM (2005) Marketing Environment, 4 th ed.., London: BPP professional education. Swift, I. (2005) Marketing, 4 th ed.., London: Holder & Stoughton. Lancaster, G and Reynolds, P (2003) Marketing made simple, 2 nd ed.., Oxford: Made simple. Subway (2009) ‗Mission and values‘, web page accessed on 02/08/2009 from http;//www.subway.co.uk. European Franchising (2009) ‗Subway‘, webpage accessed on 27/07/2009 from http;//www.europeanfranchising.net Subway (2009) ‗student educator‘, webpage accessed 20/07/2009 from http;//www.subway.co.uk


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