Developing Persuasive Business Messages Part II Memo
DevelopingPersuasive Business Messages Part II
To: ProductDevelopment Team
A new fastfood retail store to increase revenue streams
In line with our organizational goal of expanding and diversifyingour product offering to increase our market share, I propose theestablishment of a natural and healthy fast food retail chain to filla gap in the market. The proposed name of the chain is Megan Organic& Healthy Fast Food. The chain will provide a combination ofnatural and healthy fast foods all over America with the option ofexpanding to the global market in the future. The approach to sellingorganic and healthy foods will entail using an ambiance and settingthat mirrors our natural surroundings in different ways bystimulating various senses through scents and colors. Ideally, thestore chain is informed by market trends as indicated by research inthe last few years and the market projections over the next decadeand beyond. Based on existing and data and our capabilities, Ipresent justifications for the food chain and why our organizationsshould invest resources in that direction.
The healthy foods market is rapidly expanding creating newopportunities for savvy retailers. According to a recent report byEuromonitor, the healthy foods market is expected to be worth morethan $1 trillion in 2017 globally (Gagliardi, 2015). The same reportindicates that some of the health issues being raised by consumers inthe market are allergies, gluten, fat, fiber, pesticide use, and saltcomposition of foods. With such food concerns, consumers in the USbought healthy foods worth $43.3 billion in 2015 alone as per OrganicTrade Organization (OTA) figures (OTA, 2016). The USDA, thegovernment agency charged with setting and certifying food standards,has been heavily involved in the shift towards healthy diets with avariety of items being certified organic ingredients. The agency hasalso been at the front line in educating consumers on the need forconsuming natural and organic foods. As a result, there was a 30%growth in the allergen-free food segment in 2014 alone (Gagliardi,2015). Market reports based on other surveys project the market togrow at a compounded annual rate of 16 percent through 2020 (Pofeldt,2016).
The healthy foods retail segment promises higher returns than thetraditional fast food market. Premium prices charged for healthyfoods guarantee higher returns on investment at any given time.Nielsen`s 2015 Global Health and Wellness Survey that involved over30,000 people showed that individuals are increasingly more receptiveto healthy foods and are willing to pay higher for them. Among thosepolled by the survey, 88% were open to higher prices while GMO-free,high in fiber, low-fat, no artificial coloring/flavors and naturalwere the most popular categories of healthy foods (Gagliardi, 2015).The same survey showed that the demand for healthy foods was uniformacross all generations. However, there is a glaring discrepancy inthe access to healthy foods between the rich and the economicallydisadvantaged. In fact, The Food Trust reports that wealthyneighborhoods have as many three times as many stores selling healthyfoods as low-income areas (The Food Trust, 2013). Consequently,low-income neighborhoods are more predisposed to nutrition-relatedailments.
Gapin the Organic Food Market
So is there a gap in the organic and healthy food market for ourorganization to fulfill? Yes, a huge one. Looking at the organic foodmarket as it is currently structured reveals that majority of organicfood stores retail natural ingredients and not primarily ready toconsume organic food. According to OTA (2016), there are more than20,000 food stores dedicated to organic products only while nearly 3out of 4 grocery stores stock them. In essence, these stores seek tomake natural ingredients available to consumers for them to preparehealthier foods at home. However, the organic fast food market isunder-served as there are a few players that offer already preparednatural and healthy foods (Simmons, 2013). Current players offeringprepared natural foods are few scattered and mainly small scale.These stores have neither established strong brands in the market norput enough structures to standardize their products to meet thecompetitive aspect of fast food outlets.
Furthermore, studies have shown that there is new information on themarket that will drive the healthy organic food market. According toa global Nielsen`s Global Health and Ingredient-Sentiment Survey,about 70% of respondents indicated that they have been making dietarychoices to prevent health conditions including diabetes andhypertension (Nielsen, 2016). Thus, there is a gap in the market thatcombines the niche market of organic or green and healthy consumers.Megan as a brand will be offering a product that currently does notexist in the market but sold in bits by existing players. In fact,current players in the fast food market sell traditional and healthymeals as two unique products. Firms that target natural foodconsumers mainly stock raw ingredients. Megan will offer both naturaland healthy foods ready for in-store consumption.
Ideally, fast food stores including McDonald`s, Tim Horton`s, KrispyCrème and Wendy`s have impressed in the market by producingstandardized meals and products whose quality, ingredients and tasteare guaranteed across all their outlets all over the world. Thesestores have achieved such standards through centralized sourcing andstandardization structures. However, these brands are associated withunhealthy fast foods. Nonetheless, they have made attempts tointroduce healthy options in their menus.
In spite of such measures by the players, consumers are skepticalabout the ingredients of organic foods. Most are doubtful thatmanufacturers are committed to changing their ways and find it hardto associate some brands with healthy foods. On the other hand,available natural food in the market is not necessarily healthy orgreen. For instance, Wild Oats, Big Bear Natural Foods and SpoutsFarmers Market all offer organic foods and groceries. These storeshave been forced to engage in mass production of organic foods thatare only natural but not healthy. In doing so, these stores willimport or transport products from distant places for stocking theirstores (Ree, Ariff, Zaukan, & Tajudin, 2014). Consequently, theyignore the social aspect of organic foods that is still an importantissue for a portion of the healthy food consumers.
The traditional organic market involves two approaches to food:health and social aspects. The health element is based on the notionthat organic foods are healthier and free from harmful chemicals. Thesocial dimension, which is ignored by most of the large players inthe market, calls for support for small-scale local producers,reduced carbon footprint, proper remuneration of employees, amongothers. This market is considerably smaller than the organic healthmarket. According to Darren Tristano, vice president of Technomic,
More consumers than ever before tell us that eating healthy andpaying attention to nutrition is important. However, there`s a shifthappening concerning what defines healthy for them. We`re seeing moreconsumers gravitate toward health-halo claims—such as local,natural and organic, as well as whole-wheat and free-range"(Simmons 2013, para 2).
Thus, these are theissues that our organization should be targeting to fulfill.
Currently, several players offer organic fast food in major citiesacross the US. In Chicago, there is Nic`s Organic Fast Food storethat is only a few weeks old in the market. However, the outlet`smenu promises to offer organic foods and not necessarily healthy. Forinstance, the store serves a double cheeseburger combo meal with somefries as an organic meal. To address any misconceptions, the foodstore`s CEO reiterates that "The organic lifestyle doesn`t meanyou`re eating any healthier in terms of the food. What you`rebenefitting from is from what`s not in the food" (Selvam 2017).Ideally, consumers consider food healthy with clear information oningredients and calorie content of food. In most cases, customerswill assume that natural or healthy and organic food is low incalories, fats, and sugars.
Our organization can work best by introducing a fast food retailchain that addresses both concerns health and social aspects oforganic food. The firm will highlight these attributes in themarketing pitch. Thus, Megan will market the outlet based on fourcore qualities: healthy, organic green, and socially responsible.Certain regulations guide organizational seeking to market organicand healthy foods. The USDA is involved in certifying that foods arefree from artificial chemical compounds such as herbicides andpesticides. Megan will employ the guidelines offered by USDA inidentifying respective suppliers so as to meet set quality standards.
Megan Healthy & Organic Fast Food outlets will seek to providemeals that meet both organic and health parameters. The hotel`sconception will be based on making meals a lifestyle option for thosealready keen on healthy lifestyles with a reduced carbon footprint.The meals will be appropriately labeled with an indication ofcalories for each ingredient and each serving to educate consumers.Additionally, the outlet will offer public awareness and educationresources to customers on the sourcing of their ingredients. As asocial organic retailer, the firm will source products from localsmall scale producers at competitive prices to support theirbusinesses. The restaurant will also engage its staff in training onnutritional matters to pass the knowledge to the clientele.
Fresh product offering in the market with a new approach to dining
Expansive human resources experienced in marketing
There is a high demand for green products and services in the market
Consumers are more interested in learning the production process and history of goods consumed.
Unfamiliar concept in the market
Premium prices discriminate low-income earners
Taking over competition
Impressive relationship with suppliers and the market
Marketing and distributional networks
Competitors in the larger food market
Changes in consumer tastes and preferences
The core marketing strategy will rely on delivering what customerswant and making use of feedback on the firm`s product offering. Thechoice for fast foods, as opposed to a fine-dining restaurant, isbased on the notion of price. Fine dining will increase the pricefurther for already expensive healthy and organic meals. Again, fastfoods target a larger market owing to the convenience of the foodregarding preparation and handling.
Provide quality organic and healthy foods using locally produced products
Create a unique menu and associated services that meet consumer preferences and outdo what is provided by competitors
Provide an enlightening ambiance to enjoy the meals
Increase average annual sales from year to year
To summarize, it is evident that our organization has a good chanceof creating an organic and healthy fast food retail chain store inthe market. The store will provide natural and healthy fast foodsthat are not readily available in the market. As it has beenportrayed, consumers are willing to pay a premium price for suchmeals that promise to be healthy and green. There is an alreadyestablished market that provides organic ingredients to the hotelindustry and another one that provides green and healthy ones. Bycombining these approaches, the natural, green fast food retail storewill be serving a growing need in the market that has not been servedby existing players. The firm has adequate resources to mount aneffective marketing campaign to deliver the product offering. Theopportunity will increase the firm`s market share and create a newrevenue stream.
Gagliardi, N.(2015). Consumers want healthy foods–and will pay more for them.Forbes
Magazine. Retrieved fromhttps://www.forbes.com/sites/nancygagliardi/2015/02/18/consumers-want-healthy-foods-and-will-pay-more-for-them/#1e88d0de75c5
OTA. (2016). U.S.organic sales post new record of $43.3 billion in 2015, Retrievedfrom
Pofeldt, E. (2016).The organic food revolution that is minting millionaires. CNBC.Retrieved
Selvam, A. (2017).Chicagoland’s 1st organic fast foodchain set to debut next month.
Simmons, N. (2013).Consumers’ idea of healthy food is changing. Retrieved from
Nielsen (2016).Foods on and off worldwide plates. Retrieved from
Ree,C., Ariff, M.,Zaukan, N., & Tajudin, M. (2014). Consumers perception, purchaseintention
and actual purchase behavior of organic food products. Rev.Integr. Bus. Econ. Res. 3(2). 378-397.
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