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Brief Business Description
Subway is one of the key worldwide competitors of KFC and McDonald’s. The company was established in the middle of the 20th century. The creator of the Subway brand defined the essential values of the company. He claimed that the quality of the food and outstanding customer service should be the key strengths of the company. Subway restaurants are aimed at providing excellent production while trying to ensure the lowest production costs possible (Valentin 202). This managerial incentive defines the international success of Subway restaurants. The company offers numerous sandwiches to its customers and expands Subway’s product mix annually. The company carefully listens to their customers’ feedback and is motivated to adjust its strategy for the variability of the clients’ wishes and needs.
The country that is chosen as the next expansion opportunity within the framework of this paper is Indonesia. Subway may experience significant growth in this country due to its economic peculiarities and financial state of affairs. Indonesia is a perfect candidate for expansion because there is only a small number of local competitors. Introducing Subway as a contender to the market of fast-food restaurants will be a great opportunity to test the survivability of a major corporation in tough commercial conditions and all-inclusive bureaucracy. It is also important to take into consideration the occupational and personal values of Indonesians who will work for Subway. Therefore, several issues should be addressed by the marketing specialists before entering the Indonesian fast food market.
Marketing Issues and Their Solutions
The first issue is the lack of risk-taking and innovative mindset among both Indonesian managers and employees (Simi and Matusitz 60). This aspect of the business is a crucial characteristic of the future success of Subway in Indonesia. The expansion of the chosen fast food restaurant chain can be undermined by the lack of motivation of local employees. The company should identify all applicable approaches to improve the morale of the employees and implement several incentives that are typical of the United States and Australia (Lee and Edwards 42). Subway should also look out for the issues that may transpire during the brand registration process. In Indonesia, these rules are fairly authoritarian. On the other hand, the availability of natural and human resources may mitigate the adverse impact of the strict government on Subway’s practices. On a bigger scale, the resources that are available to Subway in Indonesia should be perceived as the most significant asset intended to help the company in the battle against the local marketing issues (Min and Min 286).
Another marketing issue typical of Indonesia is a high probability of commercial fiasco. There are numerous personal and business factors that should be taken into account before expanding the business. The majority of these external factors have an adverse influence on the Indonesian business and Subway will not be an exception. Therefore, the issue can be described as an array of business-related troubles that transpire due to the incompetence of the local workers (Krishna 138). There is a risk of losing control of the Subway’s financial aspect. Another related issue is the business culture in Indonesia. Discussing business predicaments is considered to be discreditable in this country, and this may lead to negative business transformations instead of collaboration.
The Best Marketing Strategies
Subway’s strategy should be aimed at driving consumer traffic and competing with the local contenders. This will be possible if the company uses several widespread marketing strategies. The first strategy is to build connections with Indonesian kids by selling various collectibles. These collectibles may relate to a popular movie, game, or anything else that may grasp the attention of the potential customer. This strategy can also be improved by offering a free collectible with a certain meal. At this point, Subway needs to find a niche that is not exploited by its competitors and make the best use of it (Pitt et al. 65). Another marketing strategy that may be useful in Indonesia is market segmentation. Subway administration will have to conduct research and identify the groups of customers that visit their restaurants frequently.
This demographic information is necessary to fine-tune the restaurants’ practice in alignment with the needs of their loyal customers (Pitt et al. 66). These clients can be offered special discounts and coupons. In Subway’s case, the third marketing strategy that may be profitable is societal marketing. This strategy is based on volunteer activity and charity events. The implementation of this marketing strategy is supported by Indonesian mentality and respect toward humanitarian values. The core objective of this marketing strategy is not to make more sales but to come up with more valuable ideas and build positive relationships with the company’s customers (Pitt et al. 68). In turn, this will motivate the customers to patronize Subway and its practices. The long-term objective of this marketing strategy is to build a loyal follower base and dynamically adjust the company’s approaches to the needs of their customers.
Krishna, Ketana. “Analysing Competition in the Quick Service Restaurant Industry.” SSRN Electronic Journal, vol. 15, no. 2, 2014, pp. 135–144.
Lee, Alvin, and Mark Edwards. Marketing Strategy: A Life-cycle Approach. Cambridge University Press, 2013.
Min, Hokey, and Hyesung Min. “Benchmarking the Service Quality of Fast‐food Restaurant Franchises in the USA.” Benchmarking: An International Journal, vol. 18, no. 2, 2011, pp. 282–300.
Pitt, Leyland, et al. “Managing the Franchised Brand: The Franchisees’ Perspective.” Advances in Corporate Branding, vol. 5, no. 4, 2017, pp. 59–71.
Simi, Demi, and Jonathan Matusitz. “Glocalization of Subway in India: How a US Giant Has Adapted in the Asian Subcontinent.” Journal of Asian and African Studies, vol. 4, no. 11, 2015, pp. 45–62.
Valentin, Erhard. Business Planning and Market Strategy. SAGE Publications, 2015.