Submarine Sandwich and Subway
Subway’s Domestic and International Marketing Plan Presented by Moses Ballenger The University of Houston – Victoria International Marketing (MKT 6377) 2011 Summer Session Table of Contents 2. – Letter of Recommendation 3. – Executive Summary 4. – Introduction, Background, Summary and update of the case study 2. 1 – Target Market Analysis 2. 12 – Primary Target Market 2. 13 – Primary Target Market Demographics 2. 14 – Secondary Target Markets 2. 2 – SWOT Analysis 2. 21 – Strengths (3 strengths) 2. 22 – Weaknesses (3 Weaknesses) 2. 23 – Opportunities (3 Opportunities from the macro environment analysis) 2. 4 – Threats (3 Threats from the macro environment analysis) 2. 3 – Competition Analysis 2. 31 – Primary Competitor 2. 32 – Secondary Competition 2. 4 – Keys to Success (3 keys to success of the company in order) 2. 5 – Macro Environment Analysis 2. 51 – Economy (2 macro economy factors) 2. 52 – Culture (2 macro culture factors) 2. 53 – Politics, Rules, and Regulations (2 factors) 2. 54 – Technology (2 factors) 3. 1 – Mission Statement 3. 2 – Marketing Objectives (3 Objectives in order of importance) 3. 3 – Financial Objectives (From the competition analysis) 3. – Positioning strategy (From the competition analysis) 3. 5 – Marketing Mix Strategies 3. 51 – Product Strategy 3. 52 – Price Strategy 3. 53 – Promotion Strategy 3. 54 – Place Strategy 4. 0 – References 5. 0 – Appendices (Promotion flyer and other) 1. 2 Letter of Recommendation Subway Franchise Headquarters/Doctor’s Associates Inc. CEO, President, Co-Founder 325 Bic Drive Milford, Connecticut 06461 United States Dear Mr. Fred DeLuca, I would like to thank you first for the opportunity to conduct the marketing assessment proposal for your company.
I hope you find my recommendations satisfactory in this letter, which is summarized below. Subway must first be honored for its accomplishments so far to date. Such success has come about from a small business partnership out of Bridgeport, Connecticut to big international success. As stated in your vision, Subway strives to be the #1 quick service restaurants in the world, while delivering fresh, delicious sandwiches, and exceptional experience. I believe that such a vision is achievable for the global, Japanese, and emerging markets.
Despite the challenges and failures of the Japanese market entry, there is much opportunity, lesson, and market share to capture. My primary recommendation discussed in the proposal is that Subway conducts an aggressive and re-entry approach to Japan. This aggressive, re-entry approach needs to be more adaptive to the Japanese/Asian culture this time. This adaptation will need to take place from an advertising and product perspective most importantly. How effective Subway focuses on these two aspects will determine their success in Japan and Asia.
While Subway has been highly successful in their global expansion, the Japanese and Asian markets will call for more adoption and customization. Nowadays, value, expressed as a level of quality for an affordable price seems to have traction in the global marketplace. Emergence of “cost-consciousness” seems to be reshaping business. Subway has done a great job at remaining flexible enough to change its operational policies and wise enough to listen to its franchisees. Subway must continue to take this practice into Japan and Asian, while focusing on their core competencies.
Subway will have to listen to what problems franchisees are having and make adjustments accordingly. It’s the franchisee that’s on the front line, seeing the daily operations, challenges, and customer interaction. I hope you find the research and recommendations sufficient to act on. Thank you again for your time and consideration. 1. 3 Executive Summary Subway represents an excellent case study of a truly globalized company in today’s market place. The company’s focused its roots from owner Fred DeLuca, who has had a clear vision for the future of the Subway ® brand as it continues to grow and serve its customers.
The passion for delighting customers by serving fresh, delicious, made-to-order sandwiches and providing people with quick, cheap, and nutritious meals has contributed Subway to being the franchise leader in the fast food industry. Subway’s clever advertising, pricing strategy, flexibility, and operational efficiency have allowed them to expand and be profitable beyond domestic borders. Such success has allowed Subway to venture into several international markets. Subway has withstood the recent 2009 economic downturns that plague a variety of industries partially due to favorable industry circumstances and its own innovative actions.
Despite Subway’s past domestic and international success, it is having difficulty in other markets like Japan. To be success in challenging markets like Japan and new/emerging markets, Subway will have to continue to think “outside the box”. This thinking may have to be customized to the extent of each particular market or country. These challenging and “un-tapped” markets of Japan, Latin America, and Asia for Subway are saturated with domestic competitors like McDonald’s, Starbucks, KFC and international competitors like Mos Burger, Mister Donut, and Yoshinoya.
Subway is capital rich with a strong brand image and is therefore positioned well and capable of making large investments in the Asian, Latin America, and other markets. The Subway brand success in other countries shows that it can be customized to local cultures and markets for global expansion success. Despite the challenges, Subway has much potential and is well positioned to create profitability and market share in Japan, Asia and other markets. Subway will need to continue to be innovative, market its strengths, make the necessary adjustments to failures, and take advantage of opportunities. 1. Introduction, Background, summary and update of the case study Introduction Subway is an American restaurant franchise that sells mainly submarine sandwiches (subs) and salads. It also offers breakfast items such as bagels and egg & sausage sandwiches. In addition Subway makes personal pizzas and salads upon order. It main office is in Milford, Connecticut, with five regional centers supporting the growing international operations. Regional offices are in the Netherlands, Australia, Lebanon, India, and Florida. Background Subway is owned and operated by Doctor’s Associates Inc. (DAI) and was founded by Fred De Luca and Peter Buck in 1966.
The name comes from the fact that Peter Buck holds a doctorate degree. On August 28, 1965 Fred De Luca borrowed $1,000 from family friend Peter Buck to start his first sandwich shop. In 1966, they opened their second Subway restaurant in New York Summary of Case The case presentation is a marketing plan for Subway’s up coming 2012 fiscal year. In addition, a detailed SWOT analysis is included. The marketing plan contains a target market analysis which explains Subway’s target markets and demographics. A competition analysis is included, which identifies Subway and it competitors in the industry.
The marketing plan includes strategy suggestions in regard to product, price, promotion, and place. These strategy recommendations are aimed toward fulfilling the suggested mission statements as well. Update of Case Study During the construction of this marketing plan, Subway continues to move on its globalization strategy thru its aggressive franchising campaign. The Subway franchise was ranked the number-one franchise in the submarine sandwich category in the 2011 Franchise 500 Issue of Entrepreneur Magazine. As of today Subway has 34,824 stores in 98 countries and hopes to expand 2,010 restaurants in the U. K. and Ireland. 2. 1 Target Market Analysis Subway conducts a standard market analysis that focuses on a target market area. In the target market, Subway focuses on the highest potential opportunity and will render the greatest return. Like any other company, Subway will steer away from unattractive markets that offer low return and opportunity 2. 12 Primary Target Market The primary target market consists of individual customers mostly thru the ages of 16 – 36 years old, who are healthy and cost conscious . Subway intends to market these individuals as a healthier fast-food option as compared to others such as Mc. Donald’s and Burger King. . 13 Primary Market Demographics Subway provides fast food services of sandwiches for individuals and businesses in different industries. In addition, the company provides franchisor services to its franchisee in the form of support and guidance. . The increase in sales of the sandwiches lately has put the hamburger behind as the #1 fast food sought for. Such a desire in sandwiches sales has been a result of a decrease in consumer spending on hamburgers and fries. A more demand has been toward healthier options. Sales of sandwiches are growing 15% annually, outpacing sales of burgers and steaks (McCarthy, 2006).
The demand demographics in this market depends on consumer preferences and consumer preference trends. Currently in the market, particularly the U. S. , there is an increased emphasis on healthier and affordable food choices as compared to the past. Subway typical operates in high metropolitan and condensed areas, but now subway franchises have expanded to outside of urban areas to rural areas. It’s not uncommon to see a subway storefront in a small town. In addition Subway store front also operate out of unconventional locations such as schools, universities, stadiums, museums, military stations, truck stops, and gas stations. . 14 Secondary Target Markets Subway also functions as franchisor, so it continually seeks business opportunities with potential investors of franchises. Subway provides prospective investors with franchise information, guidance, and seminars. There is also a FAQ on the company website to answer the most common questions about franchisee opportunities. Subway main business is to sell sub sandwiches to individuals, which drives the main business and secondly to captured qualified and successful franchisees to grow their business. 2. 2 SWOT Analysis 2. 21 Strengths 1.
Brand Name Subway’s brand image and appeal has grown significantly thru its healthy and nutritional advertising, it celebrity advertising, and it affordable products. According to Entrepenuer. com was the number 1 franchise in 2001. 2. Product Offering Despite the heavy competition in product offering in the fast food industry. Subway has continued to battle in this category against its competitors of Mc Donald’s, Jack in the Box, KFC, and many more. Subway increased its sandwich offerings such as the BBQ pulled pork, along with adding new breakfast items, salads, and pizza.
Along with its increased product offerings, the company has added a healthy and nutritional food concept and has successfully appealed to customers as a healthier option. 3. Simple Franchise operations Subway has a franchise system that is extremely simple compared to other franchises. From an operational standpoint, the preparation of a sandwich is mostly done in front of the customer and has simple steps to make all their sandwiches. From a startup perspective, a franchisee can build a store well under $200,000. According to Enterpenuer. com, Subway has cheaper start up costs than Mc.
Donald’s, Pizza Hut, KFC, and Dunkin Donuts. Low start up costs have allowed Subway to venture out in non traditional outlets like hospitals, schools, and retail stores like Home Depot and Wal Mart. 2. 22 Weaknesses 1. No Product Differentiation Subway’s product offerings have no trademark or patent protection, so it products are no different from its competitors. The only variable that sets Subway apart from its competition is its price. Against its competition, Subway offerings are limited. Other sandwich shops such as Potbelly’s, which-wich, and Quizno’s offer more meat and sandwich type choices. 2.
Franchise Over Saturation in certain markets In an interview with Franchise 500, franchise consultant and CEO of FranChoice Jeff Elgin says that there are complaints about encroachment issues –concerns that they’re putting too many units close together. 3. Bottleneck in Franchise Growth – In contrast to the over saturation of franchise stores, there also has been some stunting of growth in this regard. In an interview with Franchise 500, CEO DeLuca says that there is a bottleneck in Subway’s growth, with many franchisees still searching for a storefront. The real estate bust and frozen credit have slowed openings. . 23 Opportunities 1. Growth ( International) Subway has more potential than its competitors for continued success in profits and growth in the domestic and foreign markets. 2. Improved Franchise Relations Despites the past issues between Subway and it franchisees, there is still room and opportunity for the company to enhance their relationships. Such an enhancement will lead to increased satisfaction among franchisees and improved reputation to Subway. This will eventually lead to increased intrinsic value for the company and increased financial value. 3. Untapped Product Offerings
Subway has the potential to further contend and exceed their competitors in their product offering range. The company will have to make continued investments into research and development and testing to see what products work. Subway has room to experiments with different meats, cheeses, bread, and other fixins. Since the company is global they can expand their product offerings to foreign consumers taste preferences. 2. 3 Competition Analysis The Fast food industry is under constant and evolving competition. The main competitors in this industry are McDonald’s, Yum Brands, Wendy’s, and Jack-in-the- Box.
Yum Brands consists of KFC, Pizza Hut, Taco Bell, and Long John Silver’s. In addition, Subway faces secondary competitive pressures from other sandwich makers like Quiznos, Jimmy Johns, Potbelly’s, Lenny’s Subs, Firehouse Subs, Which-wich and many others. With the increased sales of sandwiches in recent years as compared to burgers, secondary competition should be well on the rise for Subway. (13) 4. Keys to Success According to Michael McCarthy, success factors will include products and marketing targeted to healthier menu selections, brand consistency, low start-up costs, franchisee support, and consumer convenience.
This success factors covers the scope of Subway’s current challenges and concerns. Subways continued success will continue to thrive off its brand, attractive low franchise costs, and healthy menus selection. However, Subway will have to focus on improving their relations with franchisees. A lack of mismanagement of the franchisee issues could lead to catastrophic results for the company. 5. Macro Environment Analysis 2. 51 Economy In 2008 and 2009, the world seemed turned upside down by negative economics events. The financial meltdown in the U. S. lagued several industries, reduced the availability of credit, and created massive job losses. The two effects created massive ripple effects in every regard, such as reduced consumer spending and increase cost consciousness. The fast-food industry seemed unaffected despite and Subway seemed to find a sweet growth in a sour economy. Companies like Starbucks suffered when customers get the jitters about paying for premium coffee. But Subway managed to do supremely well in a down economy where its $5 dollar foot long and other value food items appealed to cost conscious customers.
As a whole the industry has embraced value meals, cutting prices and offering more or less. It has been a reaction to more consumers who are avoiding restaurants in an effort to save money. For the industry, price-cutting is a tested technique to weather an economic downturn. Subway has proven such so far during the U. S. sluggish economy my offering daily value meals and monthly specials like the $2 cold cut and meatball subs for July. 2. 52 Culture Subway has capitalized on the health conscious revolution by focusing its advertising on its healthy but tasty offerings.
It featured a testimonial by a satisfied customer, Jared Fogle, who stated that he lost 245 pounds by substituting on 6’ Subway sandwich a day for one of his meals. The results were impressive and the company embraced the Jared testimonial of the health benefits of eating its food compared to others. The Jared campaign proved to have excellent timing during the health consciousness revolution in America. After the company realized the value of Jared’s testimonial, it applied its professional communications staff to create appealing advertising, harness social media, and develop online relationship building activities. Pina, 2010). From the point Subway launched as series of health initiatives in response to the high demand of the “health culture”, such as “Eat Fresh” and modified its corporate web site to the nutritional and health informative needs of its customers and the public. 2. 24 Threats 1. Franchisee Disparity – Subway has had a continued history of franchisee dissatisfaction. Such dissatisfaction has come from franchisor support, franchise contractual arrangements, and over saturation of franchises in some markets. These disparities will affect the public image of Subway as an investment choice among investors and it profits.
The extent of franchisee dissatisfaction has even led to litigation and class action law suits over Subways’ poor contractual provisions. 2. Franchisee Disparity (Revenues) – Franchisee disparity is two-fold. The other side of the disparity is poor franchise performance. This disparity can be seen as early as 1998. In a CNN Money article, consultant Cliff Marshall estimates that 25% of franchisees are unhappy and suffering, while about 40% are just getting by and making a few dollars, and 30-35% are happy and doing fine, though many of the happiest owners are also agents, who can control the number of competing Subways. . Competition – An ongoing threat to Subway is its own competition with the fast food industry. Its biggest competitor, McDonald’s will constantly stay on its heals in competition in terms of global expansion, product offering, financial performance, and many other variables. In addition, other competitors like Quiznos, Which wich, Jack n-the Box continue to offer more product offerings and competitive prices . Any slow or bad year for Subway could lead it to be easily bumped down in the franchise ranking. 2. 53 Politics, Rules and Regulations
Subway is under regulation over several federal, state, local agencies. In addition the company can become subject to pressure from consumer watch/advocacy groups. Given that Subway is in the fast food industry, the company like its competitors have seen significant pressure in corporate social responsibility on food quality for consumers. For example, according to the Center of Science in the Public Interest (CSPI) and more than 30 other national and local health advocacy groups and experts have urges Subway to set nutritional standards for foods marketed to children.
According to the CSPI and other groups, Subway is missing from industry self-regulatory programs. CSPI and other groups wants Subway to join the Council of Better Business Bureau’s Children’s Food and Beverage Advertising Initiative (CFBAI). Since Subway resides in the fast food industry, it has also came under heavy subjection for calorie content, Trans fat, and portion sizes. In response to such Subway has become more transparent in its product offerings to consumers. In addition is has labeled the fat and calorie content on some of its sandwiches online and in the stores.
If you go to Subway’s website, and click on a given product, it will show the nutritional information. Such a disclosure of informational has resulted from national and local group pressure. 2. 54 Technology The use of technology is playing a significant role in the outcome of international business success. Subway must devise a technology strategy that will keep it well informed on it sales metrics, customer spending behavior, and inventory management. The use of e commerce and web-enables services with suppliers and vendors will be necessary in today’s business climate.
All these technological pursuits will need to aim at customer satisfaction, inventory efficiencies, gathering critical information quickly. The use of technologies such as internet and Point-of-Sale will be pivotal for Subway and its franchisee’s to gather and collect information quickly and efficiently as compared to traditional ways. With POS data can be processed to provide instant information on weekly sales movements and market shares of individual stores. POS also renders better data quality. It can act as virtually comptroller of information. (Kotabe, Helsen 2010).
According to Restaurant Informer. com, another trend in quick-service restaurants (QSR) is the use of kiosk ordering and contactless payment options. Installing Kiosks saves labor and cuts down on staff errors. Such errors can be on wasted food or register errors. The Subway is currently experimenting with kiosks, allowing customers to select their own order. 3. 1 Mission Statement “Delight every customer so they want to tell their friends – with great value through fresh, delicious, made-to-order sandwiches, and an exceptional experience. 3. 2 Marketing Objectives
Globalization is a increasing pattern in today’s markets. Subway success is still heavily dependent on its U. S. operations, since roughly 20,000 of the 34,842 worldwide stores are in the U. S. Therefore revenues are highly dependent on the domestic stores/franchises. Since Subway is a privately held company, any form of marketing objectives will not published. Therefore, I have suggested a set of marketing objectives for the upcoming 2011 and 2012 fiscal years. Objective 1 (Continue International Expansion) – Subway continues to grow globally each year.
Based off the chart below, Subway is expanding 2,000 stores on average since 1995. If this trend continues and all variable remain constant the company by volume will capture more revenues over time. Such increase in volumes may or may not fulfill the financial objectives mentioned below. [pic] Objective 2 (Capture more global revenues and market share) – In conjunction with Objective 1, Subway will need to focus on capturing more revenues for 2011 and 2010 in international markets. More store-front expansion will lead to less dependency on the U. S. market performance and economic climate.
According to Micheal McCarthy the U. S. fast food market has seen a healthy rise in growth in the last three years, with a compound annual growth rate of 2. 3% between 2005 and 2010. The overall market value from this is $57billion by the end of 2010. Given this information, it can be inferred that the growth rate will continue at this pace. So for 2011 and 2012 the fast food industry should be valued around $58 and $59 million respectfully. Given this incremental pattern, Subway should look to increase the market share by 1-5% domestically. Such a market share goal is feasible and reasonable.
This domestic goal should be used as a guidance for calculating international figures. Each individual foreign market would have to be assessed to determine what type of marketing objectives. Objective 3 (Make Key Strategic Partnerships in Foreign Markets) – Regardless if the market is Japan or Latin American, Subway will need to make key strategic alliances with host country firms when necessary. Such alliances will avoid costly and failed entries, such as Japan. Given the nature of Subway’s franchise business, franchisees take majority of the burden for failed performance.
The nature of the strategic alliance will vary from each market. Subway may have to make different types of alliance between Japan and Latin America for example. It is evident that a unique form of strategic alliance will be needed for Japan as compared to Latin America. Clearly Subway will need a strategic alliance, where a Japanese advertising firm will do the promotion and advertising to help get the brand across. Another strategic alliance that could be made in Japan is one with Japanese organic farmers and meat producers.
This alliance could bring in the fresh organic ingredients needed for the appeal to Japanese consumers. 3. 3 Financial Objectives Since Subway is privately held, the company is not subject to stockholder expectations and pressures. However, the company is subjected to heavy competitive pressures. Such pressures have transpired to financial performance. Objective 1 (Increase Domestic & Global Revenues): According to “The Week”, Subway’s revenues in 2010 was $15. 2 billion, while Mc Donald’s was $ 24 billion.. Subway had 33. 749 stores worldwide, while Mc Donald’s 32,737 stores in 2010.
Clearly this shows the top two competitors in the industry battling intensely. Subway clearly is behind in revenues overall and revenues per outlet. Objective 2 ( Increase Franchisee Financial Performance): Given the franchise business model, Subway does have an obligation to service and support franchisees in their store-front goals and challenges. Given this, overall franchise and franchisee financial objectives should be noted separately. Given the revenue figures mentioned above, Subway and its franchisees need work together to reduce operational costs by all measures.
Sure a decrease in operational costs will help increase revenue per franchisee and make them more competitive with McDonald’s and other competitors. Such a focus to work with franchisee satisfaction will increase demand in the long run for Subway franchisee contracts and increase intrinsic value for the company. Objective 3 (Adjust Royalty fees): It can be inferred that Subway needs to increase its overall revenues and revenue per franchise in order to close the gap between its biggest competitor. To meet this financial objective will be challenging.
The company globally is seeing a rise in operational expenses in the form of rising minimum wage, utilities, and food processing. It appears that the quickest adjustment that the company can make to increase revenues is to reduce or increase the royalty franchise fees. According to Subway’s FAQs on its website, royalty fees are 8% of a franchisee’s revenues in the U. S.. However the company may need to make royalty adjustments worldwide and test the effects of a increase or decrease on overall revenue and revenue per franchise. 3. 4 Positioning Strategy
According to Smithfam. com, a positioning strategy results in the image you want to draw in the mind of your customers, the picture you want him/her to visualize of you, what you offer, in relation to the market situation, and any competition you may have. ” Since Subway operates in a highly competitive fast food environment both domestically and abroad, the company will have to keep its competitors in perspective when formulating a positioning strategy. The company should evaluate their competitors’ strengths in the Japanese market and incorporate it into their strategy.
For example competitor, Mos Burger uses good quality ingredients, which reflects the chains higher prices and wholesome image. This has led to Mos Burgers’ success in Japan. While accomplishing all the noted above, Subway needs to stay focused on its core competencies and values that has gotten them to where they are today. 3. 5 Marketing Mix Strategies 3. 51 Product Strategy Subway provides products with a global brand that is well-known and, most importantly, healthy, with lots of flavor and variety on its menu. Subway product line consists of numerous varieties of sandwiches served with different fillings and on different types of bread.
The choices are complex but the product line is anchored by one choice: 6 inches or 1 foot long. Subway has been successful in the U. S. with its product offerings, pricing, and advertising and has led to a strategic advantage for the company. Subway promotes its sandwiches as fresh, healthy and made-to-order. They use the slogan “Eat Fresh”. In the international marketplace where Subway is trying to gain its footing, in terms of market penetration and gained market share, the company will need modify its product strategy differently from its international and domestic strategy to fit the needs of Japan and Asian countries.
Since Japan and Asian countries have been such a challenge for the company, it will critical for Subway to develop a effective product strategy. Out of the four P’s in the marketing mix, Product strategy will be main determinate of Subway’s success in Japan. Subway promotes its sandwiches as fresh, healthy and made-to-order. They use the slogan “Eat Fresh”. This concept and slogan can be effective in Japan, but will have to be taken in a further context to satisfy Japanese consumers. Japanese consumers think of healthy food more in terms of quality – for example, how fresh, pure, or organic ingredients are than in terms of ts calorie or fat content or cholesterol level. Subway may have to modify its product strategy to show its quality more transparently with consumers or switch to organic ingredients. Therefore different investments made have to be made in higher quality foods as compared to other countries/markets. 3. 52 Price Strategy Pricing will correlate with product as an important factor of the marketing mix. A overhaul or significant modification in product strategy will affect pricing strategy accordingly.
Given the product strategies suggested above, Subway may have to adjust its pricing for sandwiches if all organic ingredients will be used in Japan. This however may not translate to a negative response from consumers in Japan. Japanese consumers may be willing to pay more for a sub sandwich if it’s made of quality, fresh, and organic ingredients. Customer’s willingness to pay will vary across cultures [text book] and products that are perceived as good value in one culture may have little to no value in other cultures.
So who knows, maybe the $5 foot long concept will evolve to $ 6 foot long in Japan, where the Japanese see it as the same value as U. S. consumers. Another alternative maybe to pass the costs of “going organic” in Japan to other products, such as chips, drinks, cookies, or salads? In the end, to establish a stronger brand image and sustain/grow a market presence, Subway may have to subsidize their pricing to gain some market share and familiarity in Japan. This approach may be necessary until a market presence has been established and then the company can build in pricing promotions similar to the U. S. such as weekly value meals, monthly values deals ( $2 cold-cut & meat ball sandwiches in July), and foot-long specials ($5 foot long). 3. 53 Promotion Strategy Subway is the one of largest franchises in the world with a global presence that can be felt and seen. Despite this, such a global presence hasn’t been entirely felt in Japan and other Asian countries. Former franchisee owner Tetsuzo, Ono, in an interview with England’s The Times newspaper in 2002, said that “people who didn’t know sandwiches never saw any commercials, never heard any word of mouth and because the chain did not grow, never passed a store on the street”.
Given this feedback from franchisees and the lack of success in Japan, Subway will need to revamp their promotion strategy. Such a promotion campaign will need to be focused on advertising, promotions, and direct marketing. Focusing on these three aspects will cover all distribution channels and get the word out to Japanese consumers. Subway can use channels such as internet, television, sport organizations, and special events. In addition the promotion strategy needs to be strictly adaptive and customized to the Japanese and Asian cultures. 54. Place Strategy
Place refers to distribution and also can be thought of as the “place of purchase”. This strategy asks “Do you want your product to be everywhere? or “ do you want to create demand for it because its’ exclusive and hard to find? ”  Its very important for Subway to be cautious with its’ place strategy because such a strategy makes a statement about the quality and “status” of their product. Typically Subway places its stores in commercial areas or as “stand-alone” stores. Subway will also place store fronts in unconventional locations, what Subway calls “unique stores” on its website.
Such stores will be museums, airports, military bases, schools, colleges, stadiums, supermarkets, and gas stations. At the moment, Subway seems to be well positioned and on track in terms of place. There are already 115 stores in Japan. According to the franchise application guide book, Subway is focusing on opening more stores around Tokyo, Kyoto, Osaka, and Kobe. In these cities, Subway will target downtown areas, business areas, amusement centers, and rail station hubs. References 1) The Week (2011, March 8). Subway, the World’s biggest restaurant chain: By the numbers. Retrieved, in 16h July 2011, from http://theweek. om/article/index/212902/subway-the-worlds-biggest-restaurant-chain-by-the-numbers 2) Subway Restaurant website. History. US. Retrieved, in 16th July 2011, from http://www. subway. com/subwayroot/AboutSubway/history/subwayHistory. aspx 3) Michael McCarty (July 2006). Fast Food Market Forecast- The Subway Example of Strategic Product Positioning. Ezine Articles. Retrieved, in 17th July 2011, http://ezinearticles. com/? Fast-Food-Market-Forecast—The-Subway-Example-of-Strategic-Product-Positioning&id=735770 4) Entrepreneur Magazine (January 2009). Top 10 Franchises of 2009. Retrieved, in 16th July 2011, from http://www. ntrepreneur. com/magazine/entrepreneur/2009/january/199094. html 5) Entrepreneur Magazine (2011) 2011 Global Franchising Rankings. Retrieved, in 16th July 2011, from http://www. entrepreneur. com/franchises/rankings/topglobal-115388/2011,. html 7) Richard Behar (1998 March 16) Why Subway is… Fortune Magazine. CNN Money. Retrieved, in 16th July 2011, from http://money. cnn. com/magazines/fortune/fortune_archive/1998/03/16/239302/index. htm 8) Margie Walker. (2008 August) Using Technology to Increase Your Bottom Line. Restaurant Informer. com. Retrieved, in 17th July 2011, http://www. restaurantinformer. om/2008/07/using-technology-to-increase-your-bottom-line/ 9) Synergy Resources (2008 February 12). Synergy Resources Announces Successful Implementation of ERP System at Visual Graphic Systems in NYC. Retrieved, in 16th July 2011, http://www. synergyresources. net/pdf/Visual_Graphic_Systems_-_Press_Release. pdf 10) Official Subway Restaurant website. US. Retrieved, in 14th July 2011, from http://www. subway. com/subwayroot/index. aspx 11) Subway Restaurant website. World. Retrieved, in 15th July 2011, from http://world. subway. com/Countries/frmNutrition. aspx? CC=AUS&LC=ENG&Mode 12) Official Subway Restaurant website.
Q&A. UK. Retrieved, in 15th July 2011, from http://www. subway. com/subwayroot/index. aspx 13) Wikipedia. The Free Encyclopedia. SWOT. Retrieved, in 15th July 2011, from http://en. wikipedia. org/wiki/SWOT_analysis 14) Entrepreneur Magazine (January 2009). Top 10 Franchises of 2009. Retrieved, in 14th July 2011, from http://www. entrepreneur. com/magazine/entrepreneur/2009/january/199094. html 15) Romero, Dennis. (2009). Subway hit the spot. Entrepreneur, Vol. 37(1), p 125 – 133, 8p. Retrieved from Business Source Complete 16) Comes, Steve. (2010). Fred DeLuca. Nation’s Restaurant News, Vol. 4 (37), p54, 1p. Retrieved from Business Source Complete 17) Nation’s Restaurant News (June 2010). Top 100 Chains Ranked by Growth In U. S. Franchise Units. Retrieved, in 15th July, from Business Source Complete 18) Lee A. Obringer. (June 2010). How Marketing Plans Work. Retrieved, in 16th July 2011, http://money. howstuffworks. com/marketing-plan24. htm 19) CSPI (January 2009). Subway Urged to Set Nutritional Standards for Foods Marketed to Children. Center for Science in Public interest. Retrieved, in 16th July 2011, http://www. cspinet. org/new/200901141. html Appendices A. Subway’s J-Curve [pic]