Market Analysis And Expansion Of Subway In Melbourne

Competitive Analysis

Question:

Prepare a Market Research brief for Subway.

Background of the company:

Subway belonging to the current era has occupied a predominant place in the realm of food industry for its quality of products and systematic service process. After beginning their journey from 1965 this particular organization has aimed to have 32 stores within 10 years (subway.com 2017). High quality of sandwich is the core product that the service providers of Subway tend to provide to the customers of different psychological backgrounds. The primary mission of Subway is to deliver those products to the customers which are environmental friendly. In order to enhance the range of target market the organization has decided to expand the entire business process in Melbourne. As per IBIS report this particular brand is surviving for five years in the market of Australia by involving around 10 stores in the market (Ibisworld.com 2017).  

Competitive landscape:

As per the current market scenario the three primary competitors with whom subway has to get major market threat includes Pizza Hut, McDonalds and Burger King. As per the market strategy and policy of Dominos customer should get the proper services. Customers should never wait for a long time in order to receive a service of their products (Nunan and Di Domenico 2013). Industry concentration of Pizza Hut is low, with the top four operators holding less than 40.0% of the market share. Subway is having 17.3% market share all over the West only. On the other hand, the market strategy of McDonalds believes that the business experts should render varieties of products within the service centre to enhance the number of target customer. In addition, Pizza Hut has already gained immense reputation for maintaining the quality of product along with its services. In the market of Melbourne the recognition of these three food service centers has already been established. In order to create a new trade mark the product managers of Subway has decided to deliver such kind of products that are very much environmental friendly. In order to give a major threat the business experts of Subway have decided to establish their business in Melbourne. In 2016, wages are expected to consume 24.5% of industry revenue (Ibisworld.com 2017). Product variety is not the primary objective of Subway of drawing customers’ attention. The business experts aim to achieve the recognition by delivering environmental friendly products to the customers of Melbourne.  

Macro Environmental Analysis

Research problem:

It has been observed that Subway fails to catch the attention of Australian people as they have not established sufficient number of counters in this particular country. Therefore, the business experts have decided to establish their business process in the market of Melbourne. The overall population of Melbourne is increasing rapidly (Arvanitis, Deligiannakis and Vassiliou 2012). The business experts have thus decided to expand a new franchise operation in the market of Melbourne for drawing the attention of customers. Therefore, this particular research has decided to conduct an in-depth overview regarding the current needs and demands of the consumers in the market of Melbourne. By conducting an effective competitive analysis the study has decided to do the entire market research for collecting necessary response from the customers. 

The primary objective of the research is

• To highlight the impact of market research in expanding the entire business process of Subway in Melbourne
• To make an effective competitive analysis in order to know the market strategies and policies of other competitors of Subway
• To recommend some of the major ways of overcoming the barriers that marketing managers of Subway have to face for conducting market research

Macro environmental analysis:

In order to expand the business in Melbourne Subway should make an effective macro analysis for gathering data regarding the political, economic, social, technological, environmental and legal factors.

Political	Ø  Among the Asia-Pacific region Australia is one of the most stable countries having co-operation from government. Business experts get support in leading a business process in the market of Australia.
Economic	Ø  Australia is economically developed country. Therefore, based on the income status of the target customers, Subway can fix the price rang of their product.
Social	Ø  Melbourne is possessed with the people of different cultural and religious attitudes. Therefore, Subway should not produce any product that is acceptable for a specific target group
Technological	Ø  Melbourne is technologically developed country. Therefore, the business experts of Subway can maintain their business through online services as well.
Environmental	Ø  The environment of Melbourne is stable enough to run the business process of a food center like Subway
Legal	Ø  While establishing the entire business process in Melbourne Subway should follow government taxation policies.

Table 1: Macro environmental analysis

(Source: Cova, Kozinets and Shankar 2012)

The sandwich and sub store franchise of Subway has developed their menu in order to expand their business process in the multi-national countries. From the competitive analysis it has been observed that the target customers of Melbourne tend to seek for product variety. One of the major strengths of Subway is environmental friendly products. At the same time, it has been considered as a major weakness that Subway is not possessed with product variety (Zhang and Jensen 2012). After conducting the market analysis the business experts of Subway have decided to develop their menu card.  The biggest opportunities of Subway in expanding their business in the market of Melbourne include making a concern on healthier menu option by catering niche market.

Consumer information:

Before launching the business process in the market of Melbourne some of the necessary information can be collected. The information includes demographic attitudes of consumers, consumers’ behavior and consumers’ perception. It has been assumed that Australian customers are having with high rate of income status. In Melbourne, Subway can concentrate on premium customers only as the inhabitants are flexible enough in affording high prices. On the other hand, as per the perception of marketing managers of Subway customers tend to get an in-depth overview regarding the products and services before purchasing the product (Goffin et al. 2012). Therefore, the business experts of Subway can make promotional activities through new media so that customers from different geographical boundaries can get an overall idea about the products and services.

Customer Needs Analysis

Data collection:  

In order to make an effective research data collection procedure is one of the most significant methods of gathering necessary information from various sources. Data collection procedure is constituted of two types including primary data collection procedure and secondary data collection procedure (Gustafsson, Herrmann and Huber 2013). Primary data collection can be conducted with the help of survey, interview and focus group and so on. In primary source of data collection method necessary information is collected with the direct involvement of the respondents. On the other hand, the data analysts can get an immediate response from the participants. On the other hand, secondary data collection is conducted from various books, journals, magazines, newspapers. As a result, data can be critically evaluated with the opinion of eminent scholars.

Data collection method:

Data collection method is constituted with two primary categories including qualitative data collection technique and quantitative data collection technique. Quantitative data collection is the technique of gathering information from survey questionnaires. On the other hand, qualitative data collection is the technique of gathering data from interviews and focus group. For this particular study, market research can be conducted on quantitative data collection technique in order to involve the target customers directly for knowing their needs and demands of the products of Subway (Cechanowicz et al. 2013).  Total 50 target consumers from Melbourne have been selected for gathering necessary data and information.

Sample design is the systematic way of collecting data and information from the specific number of respondents among large number of population. Sampling technique is constituted with two several method including probability sampling technique and non-probability sampling technique. Probability sampling technique is otherwise named as random sampling technique. With the help of random sampling method data can be collected not from a specific group of people (Yang and Cui 2012). On the other hand, with the help of non-probability sampling technique data is collected by involving a specific group of people. For this specific study non-probability sampling approach has been chosen. However, this particular study has focused to select non-probability sampling technique. Total 50 consumers of Melbourne is selected for gathering necessary responses. In order to gather feedback 50 consumers of Subway are sufficient for collecting necessary information.

Data analysis would be conducted with the help of statistical data. After collecting the response from participants, the researcher would like to represent the data with the help of graphical representation by measuring mean, median and mode. Graphical representation helps an individual to analyze data at a glance (Sarstedt and Mooi 2014). Questions would be formulated in such a way that the respondents do not get the scope of giving biased decision. Questionnaires can be like that:

Options	Number of respondents	Total respondents	Percentage representation of the total response
Strongly Agree	20	50	40%
Agree	15	50	30%
Neutral	5	50	10%
Disagree	5	50	10%
Strongly Disagree	5	50	10%

Data Collection Procedure

Main activities/ stages	Month February	Month March	Month April	Month May	Month June	Month July	Budget
Topic Selection	ü						NA
Data collection from secondary sources	ü	ü					$200
Framing layout of the research		ü					$500
Literature review		ü	ü	ü			$700
Formation of the research Plan			ü	ü			$700
Selection of the Appropriate Research Techniques				ü	ü		$900
Primary data collection					ü	ü	ü  $1200
Analysis & Interpretation of Data Collection					ü	ü	ü  $1500
Conclusion of the Study						ü	ü  $1700
Formation of Rough Draft						ü	ü  $2000
Submission of Final Work						ü	Total $9400

In order to make an effective market research Subway has communicated with TNS Australia. The primary responsibility of this particular research agency is to evaluate necessary data and information regarding the needs and demands of the customers of Melbourne. Behind selecting this particular agency a scorecard matrix of selection criteria has been explained below:

Figure 1: Scorecard Matrix

(Source: Nunan and Di Domenico 2013)

The above score card is used at the time of selection of criteria of a market research agency. The selection criterion includes vision and strategy, customer, learning and growth, internal business process and financials. 

While conducting the entire research work, the concerned researcher has to follow necessary code of practice. This particular code of practice ensures that the entire research work has been conducted by maintaining ethics, beliefs and values. Informed consent ensures that data and information would have to be collected with the consent of respondents (Sarstedt and Mooi 2014). Not single respondents would be forced for collecting necessary data and information. Data would be used with the consent of the participants. Data collection and process ensures that every single data should have a proper sources, validity and reliability. Without having accuracy data should not be used within the research work. Code of professional behavior ensures that researcher should be honest in collecting data. An individual while conducting a research should never force the participants for providing iformation.

Conclusion:

The entire study has focused to make an in-depth market analysis based on Melbourne city. Melbourne being one of the most populated countries in Australia is endowed with large number of people having high rate of income status. Over the past several years Subway has aimed to deliver those kinds of products that generate more energy efficiency, water conservation and food and water quality. This particular organization has appointed large number of employees for providing effective services. The business experts have expanded their widespread wings in different geographical boundaries. Therefore, for expanding the business process in Australia for Subway, Melbourne can be considered as the recognizable place for expanding the entire widespread wings. Necessary data and information would be collected for getting an in-depth idea regarding the needs and demands of customers. An effective competitors’ analysis has also been conducted with the help of which the necessary weakness of Subway has been identified.   

Reference List:

Arvanitis, A., Deligiannakis, A. and Vassiliou, Y., 2012, October. Efficient influence-based processing of market research queries. In Proceedings of the 21st ACM international conference on Information and knowledge management (pp. 1193-1202). ACM.

Cechanowicz, J., Gutwin, C., Brownell, B. and Goodfellow, L., 2013, October. Effects of gamification on participation and data quality in a real-world market research domain. In Proceedings of the First International Conference on Gameful Design, Research, and Applications (pp. 58-65). ACM.

Cova, B., Kozinets, R. and Shankar, A., 2012. Consumer tribes. Routledge.

Goffin, K., Varnes, C.J., van der Hoven, C. and Koners, U., 2012. Beyond the voice of the customer: Ethnographic market research. Research-Technology Management, 55(4), pp.45-53.

Gustafsson, A., Herrmann, A. and Huber, F. eds., 2013. Conjoint measurement: Methods and applications. Springer Science & Business Media.

Ibisworld.com. 2017. Sandwich & Sub Store Franchises Market Research | IBISWorld. [online] Available at: https://www.ibisworld.com/industry-trends/specialized-market-research-reports/business-franchises/food-beverage/sandwich-sub-store-franchises.html [Accessed 2 Aug. 2017].

Kharitonov, D., Juniper Networks, Inc., 2012. Integrated packet inspection and modification system and network device for internet service provider market research and influence. U.S. Patent 8,259,722.

Nunan, D. and Di Domenico, M., 2013. Market research & the ethics of big data. International Journal of Market Research, 55(4), pp.505-520.

Sarstedt, M. and Mooi, E., 2014. A concise guide to market research. The Process, Data, and.

subway.com, 2017. [online] Available at: https://www.subway.com/en-IN [Accessed 2 Aug. 2017].

Yang, A. and Cui, Y., 2012. Global coal risk assessment: data analysis and market research. World Resources Institute Working Paper.

Zhang, J.K. and Jensen, J.M., Arbitron Inc., 2012. Methods and systems for mapping locations of wireless transmitters for use in gathering market research data. U.S. Patent 8,229,469.