Marketing Plan Presented by Team Egg November 21, 2016
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Table of Contents
Executive Summary
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Industry Analysis
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Current Marketing Strategies
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Macro-Environmental Factors - CDSTEP
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Competitive Environment
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SWOT Analysis
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Competitive Advantage
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Marketing Proposal
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Segmentation: Potential Markets
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Targeting and Profiling
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Proposed Marketing Mix
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Campaign Timeline
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Executive Summary
RED Food is deeply invested in the Twin Cities community. An urban island surrounded by flourishing Minnesotan famlands and ranches, the Twin Cities is the perfect place to celebrate food. Yet, restaurant supply chains are not taking full advantage of the local ingredients just miles away. While some restaurants rely on local ingredients through a major supplier, many often seek the cheapest price or import more exotic food from other regions. However, RED Food is determined to help connect restaurant owners to farmers and ranchers directly. The multiple goals of this connection benefit the entire Minnesotan community. For the farmers, this connection allows them to maximize profits without paying for a middleman service. If the majority of restaurants chose to “buy direct,” Minnesota’s agriculture will have a better revenue value as a whole. For the restaurant owners, RED Food provides the ability to advertise food as locally-sourced, guaranteed. Produce and meats are fresher because they have not aged in a large supplier warehouse. For the consumer, having access to local ingredients in prepared dishes provides both lifestyle and environmental value. Buying local and direct reduces the impact on the environment due to shipping to and from warehouses. Because the food is fresher, less food may be wasted and the overall prepared dish can have the peak of flavors, crispness, and ripeness. A major obstacle to RED Food is the lack of immediate demand that propels restaurants to buy directly from farmers. Prices can be somewhat higher for direct purchases than with a major corporate supplier. To combat this, Team Egg has proposed an “InstaRED” marketing campaign aimed at consumers, particularly Twin Cities “foodie” millenials. This campaign will highlight the prepared dishes that use RED ingredients through artistic photos on Instagram. This will create a tangible, sensory response in the target market that generates interest in the RED brand. Once the account gains more followers, RED Food will be able to introduce “collections,” which are categories of RED-registered restaurants according to price to show consumers a wide variety of local food selections, from affordable to luxurious. This campaign will take approximately ten months, from January to October 2017. The outcome is that consumers will support the brand’s sustainable community-centric practices and hold businesses accountable to follow suit. Ideally, consumers will physically go to Twin Cities restaurant to ask about where their food comes from and to request that the restaurant buys local ingredients directly from the farmers and ranchers through RED’s services.
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Industry Analysis
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Current Marketing Strategies Mission Statement: “RED Food seeks to change the way our local restaurant industry eats “local”... Connecting farmers to restaurants through RED’s platform is only a part of strengthening local food systems, just as strengthening local food systems is a part of strengthening community…” ‒ red-food.com
Current Target Market: RED began with targeting restaurants that charge between $15-$30 a plate. As of recently, RED has begun repositioning their target market to include restaurant conglomerates. These are groups of local restaurants that have higher volumes in purchases and corporate kitchens. These markets will allow for sustainable growth to occur in RED Foods for the long-term due to the maturity and stability of the market. RED targets $12-18 per plate restaurants that value ethical food sourcing over maximizing profit. These restaurants mostly use large food distributors but add local food for small quantities when possible. Current Pricing Methods: RED Food uses a competitive service fee of an additional 15% of the purchase total per transaction. Each farm sets their own prices for their goods, which can be found and compared to other farm prices on RED Food’s purchasing database. Product Offerings: RED Food offers ease of access to locally-grown ingredients for Twin Cities restaurants by match making local farmers with restaurants. As of now, this includes four restaurants and one meal planning and grocery delivery service. Current clients include Blackbird Cafe, Cafe Ena, Costa Blanca Bistro, Groundswell, and Homegrown Foods (meal service). RED Food’s services provide value to consumers, restaurants, farms, and the greater community: • A stamp of approval; it is a trustworthy source of truly local food. • Local food encourages local economic growth • Transparency increases awareness of ethical food sourcing • Direct farmer to chef interactions Location and Scope: RED Food is focusing on providing services to Twin Cities and surrounding areas. At the moment, scaling outside of Minnesota is not a short-term goal. However, RED Food hopes to expand into the rest of the midwest by 2019.
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Current Promotional Strategy: RED Food currently is looking to expand their consumer base by connecting with more restaurants.They have been connecting with farmers and restaurants to differentiate their brand from that of other food brokers. Recently they have been trying to connect with restaurant conglomerates and expand their target market. Through the next year, RED would like to create a larger demand for local ingredients from restaurants by inspiring consumers to demand locally-sourced meals. •
Instagram: o o o o
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Vivid colored food photography with captions Almost daily posts Average of 43.73 likes per post over the month of October, 2016 442 followers as of October 27, 2016
Facebook: o o
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Majority shared events and articles related to local food Wide range of posts per month
August 2016: 13 posts
September 2016: 4 posts
257 page likes as of October 27, 2016
• Website: RED Food’s website contains their company objectives and mission. It also has a sign-up for restaurants and farmers to facilitate local food partnerships. It also explains how RED Food connects farmers to restaurants. This online communication may build long term relationships between farmers and chefs. •
Partnerships: Still in development and planning. Plans to work with other food related accounts to increase exposure of content produced by RED Food
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Events: “Farmers Market Throwdown: RED Food and Eat.Drink.Dish MPLS.” This was an attempt to increase Instagram engagement through a photo contest, although Facebook shows that 0 users were “interested” and planned to attend.
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General Industry Considerations: Food Hubs •
A food hub is an organization that distributes local food without a profit as the main incentive. However, they are hard to sustain. o
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“Food hubs can be subsidized in various ways. Growers can donate time and facilities to these hubs, or they can take lower prices or deferred payments. Similarly customers can pay higher prices, or likewise donate time and facilities. In the long run, however, such subsidies are not sustainable.”
Statistics1: o
Restaurants and caterers account for 14.9% of all food hub purchases, which second to grocery/food stores which account for 27.6% of sales.
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“The typical food hub operates at a close to break-even level. The highest performing 25 percent posted a 4 percent profit, compared with the average of -2 percent. Within this relatively narrow spectrum, the most profitable food hubs were larger, older, for-profit operations. Those with sales greater than $1.5 million averaged profits of 2 percent, while food hubs 5 to 10 years in operation averaged a 1 percent profit. On average, for-profit food hubs earned a 1 percent profit compared with not-for-profit food hubs, which posted -7 percent before taking into account grant income or contributions.”
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The average food hub has 6.6 full-time employees.
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Startup hubs require significant financial backing to succeed. Only food hubs with more than 1.5 million dollars in sales were able to turn a profit, and that profit was only 2%.
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Food hubs that have been in existence for 5-10 years are the most profitable.
Risks2: o
As of 2011, the “local food market represents only around 0.3 percent of the total farm commodity market, according to analyst Ken Meter.”
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No easy system exists to get local food directly to consumers’ plates.
1 http://ngfn.org/resources/ngfn-database/knowledge/Food%20Hub%20Benchmarking%20Study.pdf 2 http://www.mepartnership.org/why-middleman-doesnt-have-to-be-a-dirty-word-for-farmers/
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Macro-Environmental Factors
Cultural Factors and Social Trends: •
Fewer consumers are able to define what “locally-sourced” actually means than in 2012 (from 86% to 72%)1
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“62% of consumers are more likely to buy food and beverages described as local, and 57% seek out restaurants offering locally sourced products,” which means that locally sourced food is a positive attribute. There is a fair amount of demand for it, although many people do not find it as important or do not understand its value.1
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Consumers increasingly care more about ethics and altruism in business/farming practices. “... Consumers are seeking direct assurances on specific ‘outcomes’… rather than more complex or multi-faceted claims, such as locally grown, organic, and minimal environmental damages.”1
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“Both companies and consumers are [beginning to] seek a direct route to suppliers in order to cut costs,” and due to this new “scissor economy”, “it’s the middle man who is being cut out of many transactions.”2
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Over the next 10 years, it is projected that limited assortment and fresh format ways of distributing food will take over 33% of the market share. 3
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Consumers are becoming more aware of where their food is sourced in response to the hot topics of “pink slime” and different expectations from the actual quality of real products.3
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People perceive “local food” as less expensive as “organic food,” but consumers are still willing to pay extra for “local food.” Purchase barriers are the main reason preventing more people from buying locally grown food.4
1 http://www.choicesmagazine.org/magazine/article.php?article=109 2 http://www.foodprocessing.com/blogs/toops-scoops/snipping-out-the-middle-man 3 http://www.emerson.com/resource/blob/151204/2750d07cf85feaf08f814e85799fcacc/food-industry-forecast-henk es-090315-data.pdf 4 http://www.sciencedirect.com/science/article/pii/S0950329314001992
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Perceived Quality of Locally Grown Relative to Domestic Fresh Produce1
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51% of consumers look for information about local restaurants online (mainly on search engines), while 31% use newspapers and 23% use word of mouth recommendations.2
Demographics: •
Average age in MSP area: 373 o
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Average income: $66,9402 o
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53% of people ages 18-29 and 48% of people ages 30-49 actively try to include organic food in their diet.4 45% of people earning 30,000-75,000 actively try to include organic food in their diet.
Both per capita income and Median household income are much higher than the country level. Less than 10% of the population are under poverty. o o
Studies show that income and tendency to eat organic have a correlation (SOURCE) According to The Food Institute, the share of annual food expenditures spent on food away from home generally goes up as household income goes up
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91,000 consumer members/owners and an additional 50,000 nonmember shoppers exist within the local food system.5
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Kelly Weikel, senior consumer research manager for Technomic, says Millennials are an indepth group that understands healthy eating and desires more unprocessed, natural foods. “Food Service to them is just so ingrained in their lifestyle,” she says. “They’re relying on it; it’s a part of their life.”
1 http://www.choicesmagazine.org/magazine/article.php?article=109 2 http://www.pewinternet.org/2011/12/14/where-people-get-information-about-restaurants-and-other-local-businesses/ 3 https://www.greatermsp.org/doing-business/demographics/ 4 http://www.gallup.com/poll/174524/forty-five-percent-americans-seek-organic-foods.aspx 5 https://www.mcknight.org/system/asset/document/32/pdf-185-kb.pdf
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The following graphics1 show how often consumers in the Twin Cities eat away from home each week, including restaurants and bars. The statistics show that consumers aged 15-29 eat at restaurants most frequently, followed by consumers aged 30-44 years old. However, these statistics are from 2012 so they may have changed since then.
1 http://www.portal.euromonitor.com
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According to The National Restaurant Association, “68% of Consumers are more likely to visit a restaurant that offers locally produced food items”1
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“Millennials will overtake Baby Boomers as the most sought-after target for restaurateurs in the coming years,” said Bonnie Riggs, NPD restaurant industry analyst. “This is the time to reach them to build their loyalty. It’s important to understand that Millennials are not a one-size-fits-all generation and their needs and wants are varied.”2
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“Social media will continue to stimulate trial. Social media is still evolving, but it’s clear that leveraging the medium has the potential to benefit restaurants, especially in the full-service segment. Social media will be important in stimulating consumer trial and restaurants will use discounts, loyalty and other programs to convert these consumers into regular customers”2
Technology: General: •
Technology users expect services tailor made for them. The user should not have to search extensively for the information they want. Instead, it should be presented in an understable way that targets exactly what the user is looking for.3
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As technology and data collection have become more advanced, data analytics has become key in understanding a customer, based on their previous purchases. “[You] make decisions not based on what you bought today, but what you have bought over the last two years. You don’t have to know, but we know” -Nishat Mehta, EVP of global partnerships, dunnhumby, exclusive marketer for Kroger Foods4
Social Media: •
People who enjoy posts on social media are much more likely to interact with the post beyond just liking it. This includes commenting and sharing a post.3
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“A post published with...advertising in a business segment receives 18.84% more like than posts of fan categories, event, information, and promotion…”3
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Instagram: o
User Data5 o
55% of all online 18 to 29 year-olds in the U.S. use Instagram
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59% of these users use Instagram every day, based on a 2015 study. This a 20% increase from the previous year.
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35% of these users visit multiple times a day
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Promotional posts on Instagram receive 17.15% more likes and 52.36% more comments than traditional posts3
1 http://www.restaurant.org/Downloads/PDFs/State-Statistics/2016/MN_Restaurants2016 2 http://www.fastcasual.com/articles/restaurant-industrys-2012-trends-shaped-by-demographics-nutrition/ 3 https://www.researchgate.net/publication/304675917_Does_social_media_matter_for_post_typology_Impact_of_post_con tent_on_Facebook_and_Instagram_metrics 4 http://www.forbes.com/sites/tomgroenfeldt/2013/10/28/kroger-knows-your-shopping-patterns-better-than-you do/#6666787d396d 5 http://www.pewinternet.org/2015/08/19/mobile-messaging-and-social-media-2015/2015-08-19_social-media-update_09/
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Over time, promotional posts can change a customer’s mindset and way of living
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Post popularity is independent on the day of the week, however the month of the post does have significance. “March, April, May and June showed an average increase of 17.76% [in likes]”.1
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An example study showed users grouped by various Instagram interactions, which could be utilized to target a consumer subset.
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Hashtags:
#food is the 25th most used hashtag, with 191,844,188 posts containing it2
Related Hashtags to #Food, by Correlation3:
Popular hashtags related
to food include3:
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#foodstagram: 17,874,188 posts
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#foodlover: 7,682,341 posts
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#foodblogger: 5,567,194 posts
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#fooddiary: 2,649,731 posts
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#foodstyling: 1,919,126 posts
1 https://www.researchgate.net/publication/304675917_Does_social_media_matter_for_post_typology_Impact_of_post_con tent_on_Facebook_and_Instagram_metrics 2 http://picbear.com/popular-tags 3 http://hashtagify.me/hashtag/food
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Economic Environment: •
Within the local food environment in Twin Cities, cooperative local food system is a major food channel that includes the significant local food restaurant sales with a range of farm-to-restaurant connections, as well as significant consumer or community interest in purchasing local food.1
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The cooperative local food system centered around the Twin Cities is thriving. There are 300350 local farmers and local food companies supply product through this network, in many product categories.1
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Minneapolis has the highest tax rate on restaurants in the country.2
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According to June Mathiowetz of the Minneapolis Health Department, 90% of the food in Minnesota comes from outside of the state, which adds up to 11 billion dollars lost to the wealth flowing through community, even though Minnesota is one of a major farm states and home to some of the world’s largest agribusiness companies.3
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Minneapolis has a higher average income than most metropolitan areas, and according to a 2009 study published by the Southern Agricultural Economics Association there is a correlation between increased income and propensity to purchase organic food.4
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According to U.S. Bureau of Labor Statistics, in 2013 Minneapolis households spent 11.3% of their total household budget on food compared to the average of 12.8% of the country. Minneapolis-area households spent an average $3,371 (44.5%) on food prepared away from home compared to the national average of 40.5%. The customers in the Twin Cities area spend less than the national average of their household budget on food overall, but higher than average on food prepared away from home.5
1 http://www.crcworks.org/tccoops.pdf 2 http://www.startribune.com/study-downtown-mpls-restaurant-taxes-highest-in-nation/140774953/ 3 https://www.mcknight.org/system/asset/document/32/pdf-185-kb.pdf 4 http://ageconsearch.umn.edu/bitstream/56659/2/jaae413a01.pdf?origin=publication_detail 5 http://www.bls.gov/regions/midwest/news-release/consumerexpenditures_minneapolis.htm
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Competitive Environment
Main Competitors: •
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Middleman Suppliers1: o
Able to control food quality and ensure supply amount.
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Often more expensive for farmers/producers.
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Accounts for 50-66% of all local food sales.
Organic Food Brokers2: o
Works with organic-oriented start-up companies to get their products out into the market and build brand awareness.
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A branding company, but could potentially begin to seek restaurants as clients, thus reducing RED Food’s potential clientele.
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Often have much more capital and resources that make it difficult for a small firm to break into their market.
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There is already a large market of food brokers, distributors, and middlemen in the Minneapolis/St. Paul area.
Twin Cities Local Food3: o
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This family business was created to make locally grown food more accessible to Twin Cities residents and strengthen connections between people and the food they consume. According to their Facebook account, they closed on September 1, 2016 after five years of operation. While they are no longer competitors, they may provide a good case study to avoid following in their footsteps.
Wholeshare4: o
Provides consumers a place to group-buy local food in bulk.
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This lowers the cost of groceries and allows consumers to eat locally.
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Unclear whether restaurants have taken advantage of this or not, however this has the potential to move into the market RED Food is currently trying to break into, which would significantly harm RED Food’s attempts.
1 http://www.mepartnership.org/why-middleman-doesnt-have-to-be-a-dirty-word-for-farmers/ 2 http://www.foodbrokers.org/ 3 https://www.localfoodmarketplace.com/twincities/Default.aspx 4 http://mashable.com/2011/02/16/wholeshar/#5jY9ZBDFakq3
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SWOT Analysis
Strengths: •
RED Food’s Instagram account is a food related account, and with #food being the 25th most used hashtag, RED Food’s current food related posts garner a larger audience than those specifically interested in local food.
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Increasing awareness of the importance of “eat local” matches RED Food’s mission statement, and helps RED Food stay relevant and involved in the current market.
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Ability to offer competitive pricing for local food in the form of a 15% transaction fee, which is lower than other competitors.
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Through the online online searchable database, the transaction between farmer, RED Food, and the restaurant is easily transparent.
Weaknesses: •
Minimal Facebook engagement with variable post count leads to an unresponsive follower base.
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As a newer company, brand recognition is low as shown by social media engagement.
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Inability to advertise businesses already using RED Food in order to build reputability
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RED Food is a new company that does not have a lot of data history or a department dealing with data analysis, which could lead to unreached marketing potential and underinformed financial decisions.
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Opportunities: •
The promotion of a healthier and local food-driven lifestyle via promotional-style posts in social media will result in consumers taking action to live a healthier and local fooddriven lifestyle.
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Social media will continue to play a large part for businesses connecting with consumers, and as such RED Food can partner with clients’ social media pages to increase brand awareness.
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Social grouping of users through common social media interactions can be achieved by analyzing RED Food’s social media follower base. This can be employed by RED Food to maximize and target the reach of posts to a large community of “foodie” people.
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Established Instagram follower base can be built upon through popular hashtags such as #foodstagram, #foodlover, #foodblogger, #fooddiary, #foodstyling. These hashtags will also boost post engagement and brand awareness.
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Consumers are willing to pay more for food described as “locally-sourced” and half try to choose restaurants who advertise local ingredients, which is an incentive for restaurant owners to go local (although not necessary direct).
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Endorsements from Minneapolis/St. Paul food journalists and influencers could increase both awareness and demand of “buying direct.” Both online, in print, and word-ofmouth can be effective through these endorsements.
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Minnesota is one of the top ten agricultural producing states, a statistic that RED Food can utilize when conveying importance of local food to consumers.
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In a MN Dept. of Agriculture funded case study published by Cooperative Development Services a maximum of only 12% of goods produced by organic farmers were sold to restaurants, with three farms having no sales going towards restaurants. This leaves a gap that RED Food could use to infiltrate the market.
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Threats: •
Only half of consumers currently value locally-sourced food, the other half may be uninformed or indifferent, which indicates fewer consumers may be interested in RED Food under current market conditions.
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Smaller suppliers can often lead to inconsistent products/ingredients, so restaurant owners might not be willing to commit to direct purchasing because it could decrease their control of food quality.
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Minneapolis’s high restaurant tax rate could prevent owners from taking on the financial risks of switching to a new supplier without proof of cheaper ingredients that retains high quality.
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Most of the food resources come from outside of the state, some restaurant owners might not willing to switching their food purchasing channel, so that it might be hard to be convinced by RED Food’s idea.
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Several potential competitors could dominate the market were they to slightly alter their current businesses and emulate RED Food.
Competitive Advantage: According to a restaurant industry forecast published by Emerson Climate Technologies, the current trend of shifting to local foods will affect purchasing, distribution, and sourcing, putting RED Food at a competitive advantage as they are ahead of the competition in developing new means through which to do business. Additionally, the lack of similar businesses gives RED Food an advantage by being virtually the sole business that directly connects restaurants to local food and by extension consumers to local food. The community-oriented mindset of RED Food translates directly to those consumers interested in local food, and places RED Food in the unique position of offering large-scale service to restaurants and direct interaction with consumers.
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Marketing Proposal
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Segmentation: Potential Markets
Segment 1: Restaurant-Goers in the Twin Cities, ages 18-29 53% of the Twin Cities population is between the ages of 18 and 29. Millennials are on the path to dominate the restaurant market. In terms of social media marketing, this group tends to use platforms that are not as heavily saturated with targeted advertising (like Instagram), but also make use of established platforms like Facebook, which has proven to be effective in marketing. Millennials’ spending power has continued to increase exponentially over the past few years. Spending was up to $400 billion in 2012, up 32 percent over 2009. In a Morgan Stanley Research report it was found that millennials go out to eat more than older generations. In fact, 53% of millennials in the study reported going out to eat at least once a week whereas only 43% of the general population go out to eat once a week.This includes the spectrum from fast food to fine dining. According to Bonnie Riggs, NPD restaurant industry analyst, millennials are the most sought-after target for restaurateurs. Over 81.2% of the age group of 15-29 have dinner in restaurant at least twice a week compare to the average 63.6% in Twin Cities.1 Compared to other generation groups, millennials are increasingly “eating at local restaurant[s]”.2 Millennials are also the most loyal generation to their favorite brands, with just over half (50.5 percent) saying they are extremely loyal or quite loyal to their favorite brands.3 According to the CrowdTwist study, 43.5 percent of Millennials said they use social media to spread the word about products or services, meaning that people within any given network have more access to what their friends, family, and acquaintances are buying. Segment 2: Restaurant-Goers in the Twin Cities, ages 30-44 48% of people ages 30-49 actively try to include organic food in their diet. Consumers ages 35-44 are the most frequent restaurant goers, and spend approximately 43% of their food expenditures per year on dining away from home. This number equates to about $7,483.00 per year. This segment of the market, while old enough to have sustained buying power, is also young enough that they will continue to be a group that can be marketed to in the future without that much of a change in marketing strategy. This group is also very easy to access due to the prevalence of social media usage and the reliance on Facebook. While many see Facebook as a company that is losing traction to competitors such as Instagram, it is a platform that offers many tools that are extremely effective in reaching a wide range of people within a very specific criteria. 1 http://www.portal.euromonitor.com 2 http://www.businessinsider.com/millennials-dining-habits-are-different-2015-3 3 http://www.inc.com/geoff-smith/millennials-becoming-more-loyal-in-era-of-consumer-choice.html
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Targeting and Profiling
Value Proposition: RED Food guarantees that the food one eats at restaurants is local. The perceived lifestyle of eating local food is one that is sustainable and luxurious. Target Market: The target market is the group of restaurant-goers in the Twin Cities in the age range of 18 to 29. This group is also known as “millennials”, who enjoy frequently exploring something new when they go out to eat.1 Economically, they are also expected to peak in the coming year on their food spending habits. They treasure health and consider eating local as a healthy lifestyle more than other generations do. According to the report by Morgan Stanley,2 the definition of “healthy” is different between different generation groups, shown at the graph below:
Within the category of “locally grown or produced,” millennials relate eating local to “healthy” more in comparison with the other generations. They are socially active; going out to eat can not only celebrate special occasions or provide a venue to cheer on a sports team, but also gives value from shared social experiences such as dating or bonding with coworkers. Going out for meals help millennials feel relaxed. They leave responsibilities behind to catch up with their friends. This group has more information than ever before about what others around them are doing, which allows them to be more influenced by trends and shared posts on social media. More than half of millennials use Instagram. They prefer using digital, social and mobile technology when they go out to eat during off peak hours to add entertainment to dinner. For example, they take photos of the food that they order and post it online to share with friends. Millennials therefore can be easily reached and efficiently influenced and persuaded by promotional posts on Instagram as well as the increasing awareness of “eating local.” 1 2
https://www.bcg.com/documents/file121010.pdf http://www.businessinsider.com/millennials-dining-habits-are-different-2015-3
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Proposed Marketing Mix
USP: Consumers will request that restaurants buy direct from RED Food’s system. This could take various forms including online feedback, social media messages/comments on the restaurant’s page, face-to-face interactions with restaurant staff, or increased purchases at restaurants that already use RED services. Marketing Mix Strategy Product: RED is offering an environmentally friendly and locally sourced product to its consumers through the restaurants they eat at. Marketing prepared dishes (using RED-provided ingredients) as well as the raw produce to consumers will contextualize the service. For restaurants, joining RED Food’s service provides free promotion of their meals through this product-oriented mindset. Specializing and focusing on the current services will help solidify RED Food in its early stages. Ads that include food, especially prepared menu items, trigger a hint of tangible sensory responses in the viewer, which will pique their interest. This can be the gateway to learning more about RED Food’s services and see the value in fresh, local ingredients. Price: Restaurants that use RED Food charge an average of $15-$30 per plate. Therefore, consumers need to be willing to spend at least this much on their dining experience. Because price of the prepared dishes is determined by each individual restaurant, prices may vary. Consumers do not interact with prices set by RED Food, so the basis for price is estimated by current RED restaurant average prices. Place: Twin Cities restaurants Central/Southern Minnesotan farms RED restaurants are easily accessible to Twin Cities consumers, but not as accessible to others outside the cities and suburbs.
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Promotion: Proposal for The InstaRED Campaign
The InstaRED Campaign is year-long Instagram campaign of posts on Tuesdays, and Thursdays with a cohesive look that markets the food served at restaurants that uses RED’s service. Additionally, the photos will present a luxurious lifestyle and provide access to that through local food. Initially, the posts will be an assortment of foods ranging from appetizers to dessert in order to appeal to a variety of food interests. Once a base of followers is engaged, the posts will fall under various weekly themes. First, the weekly themes will be based on types of food in the order of a four-course meal. Once the base of followers has grown and the four-course meal cycle is done, the weekly themes will become price-oriented. The price-oriented themes of the images are broken down into three groups, collectively known as the RED Collections. Descriptions for each group are as follows. The Ruby Collection: Comprised of food options <$15 per plate The Auburn Collection: Comprised of food options $15-$25 per plate The Crimson Collection Comprised of food options >$25 per plate Initial Sunday posts will introduce each collection, as well as the overarching idea of the RED Collections. This presents customers with usable information to base their dining experiences for the week on, which in turn provides RED Food with a large customer base to utilize as leverage when searching for new restaurant clientele. Once a larger base of followers exists, promotional posts will begin to persuade consumers to like photos. These promotions will include gift-cards and special date night experiences at participating restaurants. All a user has to do is like and comment on a photo from the past week to be automatically entered into the contest. Each like/comment from the week equates to one entry for a maximum of three entries per week. RED Food will then implement a series of posts based off of previous posts that garnered the most user engagement. Instagram photos will also be uploaded to Pinterest users to reach those who are not on Instagram. Below are examples of successful food Instagram photos1
1 http://www.cosmopolitan.com/food-cocktails/news/a44229/foodstagrams-feed-delicious/
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Campaign TImeline
December/January: Photo sessions with participating restaurants Finalization of graphics for first two weeks of Feb. February: 2/1/17: Begin InstaRED campaign 2/14/17: Introduce weekly themes by four-course meal order Appetizers begins 2/21/17: Soups/Salads begins 2/28/17: Main Entrees begins March: 3/7/17: Desserts begins 3/14/17: Extend the most popular series of posts for an additional week 3/21/17: Highlight new food items not covered yet 3/28/17: Tease the RED Collections with a “Coming Soon…” post 3/30/17: Introduction of the RED Collections April: 4/3/17: Introduction of the Ruby Collection 4/4/17: First post of the Ruby Collection 4/10/17: Introduction of the Auburn Collection 4/11/17: First post of the Auburn Collection 4/17/17: Introduction of the Crimson Collection 4/18/17: First post of the Auburn Collection 4/23/17: Begin recap posts of each collection May: 5/1/17: Begin promotional series ‘May Madness’ $50 gift-cards each every two weeks June: 6/1/17: Begin promotional series ‘Summer Specials’ Begin promotional series of $75 gift-cards every two weeks July: 7/1/17: Begin promotional series $100 gift-card for the month August: 8/1/17: Begin promotional series $150 gift-card for the month September: 9/4/17: Introduction of the New RED Collection 9/5/17: First post of the New Ruby Collection 9/12/17: First post of the New Auburn Collection 9/19/17: First post of the New Auburn Collection 9/23/17: Begin recap posts of each new collection October: Starting in October, RED Food can implement various weekly themes or promotions based on the popularity of previous promotions. This will continue through the end of 2017. 23
Financial Projection: RED Food has a marketing budget of $3,000 for the 2017 fiscal year. The InstaRED Campaign is a cost-minimizing campaign. The first set of expenses are the photoshoot sessions with the restaurants and the hiring of people to model the food. These should not be too costly as to consume the entire annual budget. The next set of expenses comes from the gift-cards. Total gift-card expenses are $400. Potential Setbacks: Seasonal setbacks could arise. If a certain product is not part of a collection due to a bad season or the wrong season, this could lead to a decline in post quality. Taking a photo of a completed meal with only one or two ingredients sourced from RED, but the rest sourced by a standard food supplier, may indicate that the entire meal is locally-sourced, which would be misleading to the consumer If only food is showcased, the farms and local ideologies aren’t emphasized. part because it is only food focused. A beautiful plate can be created with nonlocal food. Only focusing on Instagram posting might prevent RED Food from reaching the target market population that does not use Instagram. Repeating one kind of photo may lead to monotony, which could disengage the consumers. Each photo would have to be unique enough to capture attention while still remaining cohesive with the others to encourage brand recognition.
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