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Hummus Bar: Dipping into International Markets

Submitted By: Group #8


Hari Padmakumar Jijo Francis Navtej Singh Sran

Submitted on 29th October 2013

INDEX:

I.

Introduction....

II.

Market Research..

III.

Market Analysis.

IV.

Marketing Plan..

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V.

Conclusion

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VI.

Bibliography.

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I. Introduction
This case study is based on a successful Hummus bar located in Hungary, which is planning to enter the international market. The founder of the restaurant is thus seeking investors in order to lower the risks, select the right marketing strategies and to enhance the brand. The case study will include all the different methods used to determine the right market, determining the right market entry, brand management and developing decision making skills.

About the Company: Hummus bar is a really successful Middle Eastern Restaurant in Hungary which was setup 7 years ago by Gotlibovitch. It has already got seven restaurants and its turning out into a successful chain in Hungary. As the name suggests, this place is completely dedicated to Hummus which can be enjoyed with several types of dishes. They offer different kinds of salads, soups and vegan and meat dishes. The restaurant focuses on the creating simple and good quality food. It has been recognized and awarded for being the best

exotic cheap eatery by the Time out magazine. Hummus bar have also got take out and delivery service. The restaurant has got huge reputation among the locals and is really active on social media websites in order to promote their services. The restaurant is a huge success due to its prompt and friendly service and they always provide first class, cheap and fresh food to the customers. The restaurant is really clean and the price for a meal is just 8-10 euros for a customer. They have loyal customers due to all this factors. (hummusbar)

II. Market Research


In order to find the peoples growing interest in hummus, we went to several restaurants and grocery stores (Ghazale Restaurant, Jerusalem Restaurant, Sababa, Fiesta farms, Rowe farms and Kalendar) in order to obtain the buying habits and other datas of the customers. We had face-to-face interview with 50 customers, from which about 65% percent were females and the rest (35%) were male customers. Our participants were mostly people of age between 18 and 45. About 92 percent of the participants liked hummus and from which about 83% bought packed hummus and hummus related products. From our research we found out that

there is a market for Hummus and hummus related dishes. Most of the customers like hummus because its tasty, healthy and available in different flavors.

Gender

male, 35 male female, 65 female

Customers
Doesn't like Hummus 8%

Like Hummus Doesn't like Hummus Like Hummus 92%

customers who regularly buy hummus products


90 80 70 60 50 40 30 20 10 0 yes no 17% customers 83%

reasons for usage of hummus


low cost; 12 healthy; 32

low cost tasty healthy

tasty; 56

III.

Market Analysis

Hummus was an Arabian dish introduced among the Jewish people in the early 1950s. The major ingredients of hummus are chickpeas, sesame, lemon and garlic. Majority of the best hummus restaurants are owned by the Arabs. Even though the market for hummus and hummus related food items are in its beginning stage, it is growing rapidly by each day in North America and in many other countries. Nowadays there is a tremendous increase in the number of hummus dedicated restaurants and hummus products. The competition is getting bigger as more people have started using it. In America the hummus accounts for average weekly sales of $600 for each store and the market for dips are increasing at 14%. (For the love of Hummus)More companies have started creating their own hummus and selling it, both locally and internationally. Some of the examples of packaged hummus that are available in stores are Fontaine Sant Hummus, Summer Fresh Hummus, Sabra Classic Hummus, Sunflower Kitchen Classic Hummus and PC Hummus and Vegetable dips. Most of the people are nowadays turning into vegans or part time vegans due to their concern for health. This is proven by the results of latest surveys done by Google and other marketing research teams. (Sareen) , (Go part-time vegan and get healthy)

PEST Analysis: The different factors that affect the industry include competitive, regulatory, economic, socio-cultural, technological, natural environment and demographics factors. The marketing strategy of the company changes along with these environmental factors.

Political/Regulatory factors: The political/regulatory factors can affect the price and the sales of the food products. The price of product varies in different regions depending upon taxes, trade restrictions and other laws.

Economic factors: Hummus bar is a local establishment hence its competition will increase when it enters the international market. Hummus bar is famous for its cheap price which is due to local production. The price of food products will increase when it enters the international market due to changes in economic growth, exchange rates, price of ingredients, transportation, inflation, etc.

Socio-cultural factors: Consumers choose their food by several factors like income, product price, promotions and preferences. A product chosen also depends up on age, race, education and ethnicity. The social and cultural factors affect the consumers need, as well as the size and nature of the market. The socio-cultural factor doesnt affect the usage of hummus food products because of its quality. Hummus is already popular among people from all over the world because it is healthy and cheap. Both vegans and non-vegans love hummus products.

Technological factors: Technological factors can affect the manufacturing, packaging and distribution of products. Company relies less on the technology for the sales of its product. The use of technology includes designing of dip covers and boxes, improving the scale of production, transportation of ingredients and products. SWOT Analysis:

Strengths
High Quality Food Variety Food Items

Weakness
Low brand awareness High competition

Low cost because it is made locally .


Loyal Customers

Less Investments

Opportunities
rapid growth in hummus market

Threats
Threat of over competition while market expansion Possibility of failure in attracting trust & interest in new regions.

fresh & healthy fast food


Increase in brand awareness

Weighted Score Model

IV. Marketing Plan


Target Marketing & Positioning: The target market of Hummus bar is the customers of age between 18 and 40 and who are looking for healthy quick food and customers who are vegan. Due to the busy lifestyle people are not getting proper time for preparation of good food. Hummus food items are loved by both vegan and non-vegan customers. The low price and high quality of freshness make the hummus bar a strong competitor among its rivals. Media advertising can influence the target market. Hummus bar can attract more customers by behavioral factors and psycho-graphic factors. Sometimes products packaging also attracts customers, especially female customers. Hummus bar should use the target market that was obtained through the data collection and market analysis for presenting it to the investors and other retailers. With respect to target market, we can see that Hummus bar will be more successful if it operates in the local/national market. The business will
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then promptly spread to nearby regions. For entering the international market, Gotlibovitch should prioritize the list of foreign markets according to the market size, market growth rate, trade laws, cost of product, availability of channels, cost of market entry and competitive density. (Prioritizing Target Markets) The best mode of entry to international market for hummus bar would be via franchising; as it has low fee, low political/trade risks, allows simultaneous growth in different regions of the globe and more monetary investment and managerial skills to the firms operation. The entry mode will vary with the market as it depends on the market size, demand, costs and other factors. In Budapest the meat dishes were both more popular and more profitable than the vegetarian dishes. For the international market that would be different and it wise to introduce both vegan and non-vegetarian dishes. By doing so hummus bar will be able to target both vegan and non-vegan customers.

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Marketing Mix:

Product: Hummus bar prepares its food products locally. Its hummus is prepared from the ingredients obtained locally. It has got variety of dishes with variety of flavors, all in favor of the hummus eaters. Moreover the food prepared is really tasty and fresh. This attracts a lot of people, especially tourists.

Price: Hummus Bar provides fresh and tasty fast food for a cheap price. Because of this reason it has got lots of loyal customers. Then can easily sell the food items for a cheaper price because they prepare it locally. Thus hummus bar is a great threat for its competitors.

Place: The hummus bar is already successful in Budapest, now it needs to distribute its food items to new retailers. They need to increase the number of wholesale grocery store clients; by doing so they can successfully move their business to the local regions.

Promotion: Promotion is necessary for expanding the business. The main aim is to create good brand name throughout the whole region. Proper online and offline promotions can lead to increase in brand awareness of the restaurant.
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V. Conclusion:
From this case study we have reached a conclusion regarding the market expansion and market entry modes for hummus bar. Based on the data and market analysis we found that, its wise for hummus bar to stick with the domestic expansion. Hummus Bar provides fresh and tasty fast food for a cheap price. Because of this reason it has got lots of loyal customers. Then can easily sell the food items for a cheaper price because they prepare it locally. Thus hummus bar is a great threat for its competitors. Hummus bar should sell its products to the local wholesale stores in order to increase the brand awareness. It is clear that the Hummus bar will be more successful, if it operates in the domestic market and will then promptly spread to nearby regions. In case of international market expansion, Gotlibovitch should prioritize the list of foreign markets according to the market size, market growth rate, trade

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laws, cost of product, cost of market entry and competitive density. The best mode of entry to international market for hummus bar would be via franchising and the entry mode will change with the type of market. For international market it is wise for hummus bar to target both vegan and non vegan customers with a variety of foods.

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VI. References

For the love of Hummus. (n.d.). Retrieved from http://www.paticheri.com/2013/08/24/for-thelove-of-hummus/#.Um85llPjV_U

Go part-time vegan and get healthy. (n.d.). Retrieved from http://www.news.com.au/lifestyle/health/go-part-time-vegan-and-get-healthy/story-fneuzkvr1226683165672

hummusbar. (n.d.). Retrieved from http://www.hummusbar.hu/ Prioritizing Target Markets. (n.d.). Retrieved from http://kamraan.com/marketingsrategies/prioritizing-target-markets/

Sareen, A. (n.d.). Interest In Vegan Diets On The Rise: Google Trends Notes Public's Increased Curiosity In Veganism . Retrieved from http://www.huffingtonpost.com/2013/04/02/interest-invegan-diets-on-the-rise_n_3003221.html

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