Marketing
The Four P's (Product, Promotion, Place, Price)
Product
Our product, Restaurant Assistant (RA), is a much needed product for our customers, and it has superior performance compared to any existing products.
Promotion
We will offer up to 7 local (Hampton roads) Applebee's restaurants free promotional use for 6-12 months period. This promotion has 2 goals. The first goal is the testing purpose. We want to confirm our product works as we planned. Our second goal is to propose to Applebee's headquarters to distribute our system to their chains. Our attendance at restaurant conventions like NRA 2005,* and personal sales, will be minor objectives.
Place
This section covers how we are going to distribute our product. We do not want to have many branches to sell our product, because it will cost much money to service all the branches. We want to sell our product nationwide. To make this happen, we will try to associate with each headquarters of a particular chain restaurant and hotel. The distribution under many different chain restaurants and hotels will reduce the need of our branches in United States. Figure 4.1 shows the sales of the restaurant industry in each state of the U.S. The branches will expose in order of bigger market sizes among the states.
Simply, our initial target is Applebee's chain restaurants. We will start from the Hampton Roads area and eventually expose statewide and finally to the whole nation. Succeeding in an initial target will demonstrate a concrete trust and desire of needs to other chains. The number of sales after our initial target is expected to grow exponentially. Some minor sales for non-chain restaurants will be available at anytime while we are targeting chains. We will definitely have a web-page for those minor sales, and expanding branches will be considered later depending on the appropriate number of orders from those different areas.
Price
The estimated price for our standard unit is $7500, and the profit from each sale is $3305. We need to sell only 313 units to reach a breakeven point (see Figure 4.2). There are 15,571 restaurants in Virginia alone. Nationally there are 878,000 restaurants. It is a very probable chance to reach a breakeven point just in Virginia or even in the local (Hampton roads) area. As we target out of state restaurants, profit will exponentially grow. Assuming we get only 1% of the market, we can acquire nearly $33 million in profit. Assuming we are successful to targeting Applebee's of the 1600 restaurants chains, we could generate 12 million dollars of sales and 5.2 million dollars of profit, with just one chain restaurant. We can see now how fast our sales will accelerate as the other chains adopt our system.