Marketing Strategy For Entering New Zealand Market Marketing Essay

Published Date: 23 Mar 2015

Auckland is the largest city in New Zealand. It has approximately 401,500 people live within the city boundary and 1.25 million in the greater Auckland area. This represents about one third of the population of the whole country. Auckland City (informally Central Auckland) is the city and local authority covering the Auckland isthmus and most of the islands of the Hauraki Gulf, in the North Island of New Zealand. It lies in the Auckland Region, and the Auckland Regional Council is also based in Auckland City. In 2009, it was rated the 4th best place to live in the world, in human resources consultancy Mercer's annual survey. Thus, Auckland is a potential market.

In order to market Auckland, we are going to launch out Malaysia local foods, satay. Satay is a type of foods that are grilled or barbecued over a wood or charcoal fire, then served with various spicy seasonings. Satay is cheap and easily prepared if you are experienced worker. We are launching traditional satay which has six types of satay meat. Six types of satay meats that we launched out are mutton, beef, rabbit, deer, chicken, and fish. We will produce our own secret recipe that cannot be found in others place. It is use to attract the local market of Auckland. Our objective is to lets the foreigner experience new flavour and new sensation of Malaysia local food. In making consideration of the health issues, our satay is modified to be less oil, less calories and less fat.

We will set up our own outlet that has traditional design of Malaysia style. Customers can feel the Malaysian culture when they come to our outlet. Waiter and waitress in our outlet are required to wear the custom of Malaysian style. The speciality of our outlet is customers are able to see the satay producing process. Besides that, online purchase service also available. Customers can either purchase satay directly from our outlet or indirectly by online booking. These make them more convenience. Delivery services are also provided and free of charge if it is within specific area.

Price

Price is one of the important issues in marketing mix that determine whether a product can be success or not. Price that we offer is following ethical issue. We are using penetration strategy to attract the customers. Difference types of satay meats are charge at difference prices. Customers can get special discount when they reach certain level of consumption. Low price but high quality of foods is provided. There is no price discrimination to end customer which is an illegal actions.

Promotion

Promotion efforts that we offered to local people of Auckland are include flyers, newspaper, free sample, cash vouchers, delivery services and weekly discount. If we can promote our products and outlet well, customers will automatically come to us. Flyers and newspaper are more economic ways to promote certain product. Due to we are relatively new in Auckland, we have to heavily promote our products and outlets to reach the sales. Free sample for testing are only available in the first three months of opening.

As a conclusion, we are target to tourists and local people in Auckland. In short term, we wish to add on new types of satay such as satay celup and satay lok-lok. We will expand to other city in New Zealand when the market is mature and able to expand.

Macro environment analysis

PESTEL analysis

Introduction

PESTEL analysis is an external analysis of the macro-environment in which a business operates. The main objective is to understand the affect of those reasons on business or trade policy because external factors of a country are different within each others. Therefore, we should choose a suitable location to operate the business by viewing the analysis to ensure that the business has potential to enter the country. The country that we had chosen to analyse is in New Zealand which is Auckland. Our analysis is based on three main factors which are political and legal factor, economy factor and finally social and culture factor.

Political and legal factor

To run a business at other country, one of the important factors which affect trade policy is their legal rules, regulations and their government. Each of the world's national government regulates trade and commerce with other countries and controls the access of outside enterprises to national resources. The operations and activities of the global enterprise, including the global marketer's ability to address market opportunities and threats are affected by every country's unique legal and regulatory system.

The risk is lesser if the government is stable. This is because legal rules and regulations would not be change in short period. In Auckland, the risk of operating new business is high. This is because after every three year, the new government of New Zealand will apply new rules and regulations which benefit for an organization. So, although a business can going into the market in this year, but it does not meant that it can permanently set up at Auckland due to the new rules and regulations. Therefore, before our satay business is going in the market of Auckland, we need to analysis and do estimation on the rules and regulations of Auckland. This is to ensure our business can live longer at Auckland and can survive in Auckland market.

Beside the risk of operate business, the labour force is very expensive in New Zealand. Labour force in New Zealand is highly appreciated, thus the labour are given high salary. The labour force in Auckland is also same situation with New Zealand. Due to the high labour force, we planned to assign some of the workers from Malaysia to operate the business in Auckland. This can save our operating expenses. However, we still need to hire local workers because of the local people more understanding the rules and regulations of their own country. Thus, if there are changes in rules and regulations in New Zealand, we can do some adjustment pander to the changes.

To operate new business, every organization needs a vast amount of money. The lending rate in New Zealand is high, company has to paid more interest. This situation could be good for the government but it might reduce the profit of a company. The capital of our satay business needs to be high to prevent lending money from government of New Zealand. Exporting a business to New Zealand is already high cost activity, if our business still needs to bare the high lending interest, it will be very hard to earn profits. This is because the profits had been used to pay the high lending interest. Thus, our business needs to have a large amount of capital to export the business to Auckland.

Business freedom in New Zealand is 99. 9 % and trade freedom is 84.6 %. It meant that New Zealand has better environment to do business and trading. Due to the freedom of government of New Zealand, our satay business can be exported to Auckland. There is less restriction on doing business in Auckland. The government allows the business to create their own market. Any business that the businessmen want to do, they can apply for the license. The license will always be approved by the government. Therefore, we can easily bring our satay business into Auckland.

Economy Factor

Inflation rate is less in New Zealand. If inflation rate is low, every commodity and service such as labour, rice, sugar and others products will available at low price where as the organization can produce more. Therefore, we can buy the local products with a low price and fully utilized the resources to increase the productivity. By the lower price of resources, we can launch our business successfully because we need not to worry about the high operating expenses. We can spend our money in other activities that need more investment such as advertising.

In New Zealand, people prefer to spend more to help carry on the circulation of money all over the country by buy capital goods, luxuries products and necessary products. This meant that they support their local products. They like to buy their own country product to help the economic growth. In this situation, we decide to buy mutton and beef from New Zealand. We will let our consumers know that our satay is made by the mutton and beef come from their own country. Since they are supporting local products, they will tend to support our satay that produced by local mutton and beef.

Moreover, the unemployment rate in New Zealand is low. The citizen will have their own work. Therefore, they have purchasing power that allowed them to buy the products they like. The consumers will consume from the shop because they have money to consume products that they prefer. Our satay is not very expensive compare to local food. If the consumers found that our satay is much better than their expectation, the will consume more. Once the food is cheaper and delicious than other, the consumers can be attracted easily.

Social and Culture factor

Every country has different culture to each other. New Zealand has majority of Christian's religion. According to the 2006 census, Christianity is the predominant religion in New Zealand, which have 55.6% of the population, another 34.7% had no religion and around 4% affiliated with other religions. The Christians have no much restriction about the food that take. Not like Muslims, they have more restriction on food. Therefore, the Christians can choose the food they prefer to have. Besides, the consumption and imports of foods and beverage and electronic gadgets will increase during festival like Christmas in New Zealand. This is because the Christians are concern on their special festival. They prefer cook some special foods and invite their relatives and friends to have a gathering. Thus, our satay maybe can be a choice for them to serve their relatives and friends.

Moreover, New Zealand is concern in education sector. 99% of populations are literate in New Zealand. Education sector contributed 6.2% to New Zealand GDP. New Zealand is famous on education sector. Many foreign students are study English and mostly foreigner study in university at New Zealand. One of the famous universities in New Zealand is University Of Auckland. The floating population in Auckland is high due to the famous university. This is an opportunity for our business to launch in Auckland. The population is high and we can target on the students. Students always dare to try new things and they always search for new things to try. Thus, we can attract the students by promoting our satay to them.

Furthermore, life expectancy rate is more and mortality rate is low in New Zealand. This is because their lifestyle is free and less stress, they do not like to stay in stressful life. They prefer leisurely lifestyle. After work, they would not think about the work again. They will clear their mind and enjoy their rest time. Thus, they like to do some leisure activities such as go for a walk in the park. One of the famous parks in Auckland is Albert Park. The Auckland citizen will visit to the park during their leisure time. Therefore, we can target on this group of people. They maybe will like to have their meal after they tired and feel hungry because our satay shop is near the park. By giving some flyers to the people, they will acknowledge that there have a stall just set up and they maybe will try it.

Conclusion

As a conclusion, our business should do enough survey and analysis before going into the New Zealand market to ensure that our business can successfully launch at Auckland. Moreover, the analysis will help us to prevent loss because it does not make sense if we export a business that does not have potential market in the country. In such situation, we will not bring the business into the country. Thus, we will not jump into the loss stage in business because of launching a failure business in a not suitable country.

Besides, we can also reduce the risk of operating new business in foreign country if we practise macro environment analysis. This is because we have enough knowledge about the environment factors of the country and we have to judge whether the country has potential for us to export the business.

Furthermore, our satay business is discovering a new market in Auckland because there were few store that selling satay. Satay is considered as a new product because satay is a type of traditional food from Malaysia. If the local people have noticed that our satay is met their expectation on food, they will eat at our store.

Global Market Segmentation

Introduction

Market segmentation is an effort to identify and categorize a group of customers and countries according to common characteristics such as gender, income and education level. Global Market Segmentation is defined as the process that identifies specific segments of potential customers with homogeneous attributes who exhibit similar responses to a marketing mix. There are five types of Global Marketing Segmentation which are demographic, psychographic, behavioural characteristics, benefit sought and ethnic. Our satay shop is using the demographic segmentation and psychographic segmentation.

Demographic segmentation

Demographic segmentation is based on characteristics such as income, population size, age distribution, gender, education, and occupation. We have chosen the income to segment the market.

We have segmented the market by using income. There are three level of income segmentation which is high income level, middle income level and low income level. High income level is referred to the people that have income NZ$ 5000 and above each month. Middle income level is referred to the people that have income NZ$ 3500 to NZ$ 5000 each month. While income below NZ$ 3500 is considered as low income level. These situations are because of the living costs in New Zealand is very high. The activities that involve labour force will charge at a high price. The rental of house is also very high in New Zealand.

Psychographic segmentation

Psychographic segmentation is grouping people by their attitudes, values and lifestyles. By analyze the attitudes, values and lifestyles of the people, we can segment them into different groups.

There are several groups of people that stay in Auckland which are students and citizen of Auckland. Students have a high floating population because New Zealand is famous and concern on its education sector. Therefore, there are many local and foreign students that study in Auckland. Citizen is the local people that born and live in Auckland. Different groups of people have different attitudes, values and lifestyle. We are segmenting them based on two aspects which are values and lifestyle.

From values aspects, the students are daring to try new things. Thus, promoting is encouraged to the students. They can easily be attracted and dare to try for the things. Meanwhile the citizen is more traditional because they had been affected by the culture. They need to be given more information to motivate them to try the new things.

Moreover, from lifestyle aspects, the students are tried to save their living costs. Therefore, they will seldom having meals at the shops. They will cook at home to save the money. Our satay is selling at a low price that afford by the students. Besides, the citizen of Auckland also preferred leisurely lifestyle. From our analysis, we found that the citizen of Auckland do not think about the work after the ended of working hours. So, they can have meals at our shop to reduce their annoyance for what to cook for the day.

Conclusion

There are different values for students and citizen of Auckland but both of them have similar lifestyle. Therefore, different promotion strategies have to use to attract these groups of people. By segmenting the market into smaller groups, we can determine what we can do to attract the consumers and gain the market share.

Targeting

Introduction

Targeting is defined as the process of evaluating the segments and focusing marketing efforts on a country, region, or group of people that has significant potential to respond. Such targeting is reflected to the reality that a company should identify consumers to reach most effectively, efficiently, and profitably. We are target on middle income level people and mainly target in students.

Middle Income Level People

We are targeting on middle income people because middle income people will always find for the foods that are delicious but not looking at the price to judge whether the food is good or not. High income people always look for the food that is expensive. They will perceive price as the quality of the food. Thus, we are not aiming for high income people. Middle income people are our target. Middle income people will seldom perceive the price as the quality of the foods. Therefore, they will be attracted if the food is delicious and met their expectation. However, the price of satay is not very high compare to other local food in Auckland. Therefore, for the people that having a low income also can taste our satay.

Students

Students have a high floating population in Auckland because of the famous of education sector in New Zealand. Students are our target is because the values of students. The mind set of students are more open, they dare to try. Thus, if the promotion can attract their attention, they will find out whether the food is good or not. They can accept new taste more easily.

Besides, to save the living costs in Auckland, many students have tried to cook by their own. However, sometimes they have no time for cook. Thus, our satay shop can help them solve the problems. The price of satay is not very expensive and they can have their meals in our shop. It is a low spending and also brings convenience to them.

Conclusion

By concentrate on target market, we can understand better what the market wants and needs. We can try to fulfil the needs and wants of the consumers to bring more satisfaction to them for maintaining our long term relationship that may affect our profits in long term.

Justification of new business venture

Why our company choose satay as our new venture to enter Auckland, New Zealand? There are few reasons that prove there are opportunities on our product. Everything starts with the customer. We pride ourselves in knowing what's going on in the minds of our consumers. We spend vast amounts of time each year researching the markets where we operate and our customers' changing tastes and lifestyle habits. We know what our customers want now.

Fusion of Asian recipes

In restaurants and at home, New Zealanders are enthusiastic about the fusion of traditional Asian recipes with fresh New Zealand produce. Authentic ingredients for Asian cooking are available in most supermarkets and specialty food stores. This means that New Zealanders can accept well and quite interests on Asian cooking style. So, satay also can be accepted by New Zealanders, since satay is also one of the most popular foods toward Asian and it has a very high potential market value in food industry. It can be seen when the tourist having their vocation in Malaysia, they like to try local foods such as 'nasi lemak' and 'laksa'.

No or less competitions

Since satay is Malaysia's local foods, it is only little or few competition for us. in New Zealand, thus our company biggest advantage is we are the pioneer in producing satay in New Zealand. So, our company will not face any competitor in same sector. Besides that, New Zealand is a very good place for growing things. At present, much of what we grow is on the basis of potential export receipts (cows, pines). So, our company will not facing any shortages in raw resources such as beef. Since New Zealanders like to eat beef, so our company will firstly decide to produce beef satay by fresh beef to introduce to domestic citizens.

Low start-up cost

Another reason that make we choose Auckland to start new venture is our company has advantage such as low start-up cost and low producing cost .Since satay is a quite simple food to produce, the material handling cost are low. It does not require investing in research and development. It just requires some labour skills and fixed machine. We have to paid fixed amount of salaries to employ the experience workers and buying the machine. Besides that, New Zealand is famous with the production of cow and sheep. From the date that we recovery ,we found out that the number of sheep and cow in New Zealand are more than nine times if compared with the population in New Zealand. We can easily get raw material from local supplier. It saves a lot of cost. We also no need to worry about shortage of raw material.

Lifestyle

Malaysian is looking for fast foods to counter caused by their busy lifestyles. The lifestyles of New Zealanders are slightly difference with Malaysian. They are very busy and serious during work. So, as a result they do not bring work into home. They know how to enjoy their life. Our company is decide to make satay as a part of fast food which can satisfied those who are always in busy lifestyle since it is easy to consume. However, nowadays, consumers are also looking for foods to counter poor health caused by busy lifestyles, insufficient exercise and fast food. As a consequence, people all over the world are recognizing that diet is important to their health. So our company will introduce low fat satay which can let consumer eat in a healthier way but still can taste a delicious satay. Our satay is low calories, low fat and less oil. Besides that, consumers want to know that their food is safe, and proof of claims is becoming a key requirement, especially in the health benefit area. Certification and tracking of food production for safety reasons is increasing. There is a growing desire for "safe" food. Our company products are all have been clinically tested and proven that satay is safe to eat.

As a conclusion, the above reasons make our company interested to start new venture in Auckland. It is really an interested facts that encourage we to do so.

Product strategy

Satay

The product that we plan to launch out in Auckland, New Zealand is satay. Satay can be found throughout every state in Malaysia either in restaurant or beside street. Popular kinds of satay are usually pork satay, beef satay, and chicken satay. Difference cultures may have difference types of satay. For an example, Indonesia's satay is different with Singapore's satay.

A variation of meat satay is the satay lok-lok from Penang and satay celup from Malacca. Raw meat pieces, tofu pieces, century eggs, quail eggs, fish cake pieces, offal or vegetable pieces are skewered on bamboo sticks. These are cooked by being dipped in boiling water or stock. The satay is eaten with a blackish sweet sauce with or without chili sauce. If the satay is eaten with satay sauce, it is called satay lok-lok. If the satay is cooked with boiling satay peanut sauce, it is called satay celup. This is available either from street vendors or at certain restaurants.

We are selling traditional satay in Auckland. We do not selling satay lok-lok or satay celup. When the market share are increase and become more stable, we will try to add on other types of satay. There are total six types of satay meat that we will launch out in Auckland. The six types of meat satay are chicken, mutton, beef, deer, fish, and rabbit. As you can see, we do not sell pork satay. This is because one of our target markets is tourists. The tourists may be including other religion such as Muslim. In order to attract this type of tourists, we do not launch out pork satay.

Different types of satay will be selling at different price. The satay that we sell is in the form of string. Before the satay are grilled or barbecued over a wood or charcoal fire, it must first marinate by turmeric and other seasoning. Turmeric will be used to marinate satay, which gives the dish its characteristic yellow colours. After marinated, satay is stringed to the midrib of the coconut leaf. After that, satay will be grilled or barbecued over a wood or charcoal. We are using traditional ways to grill the satay. The charcoal fire can make satay tasty. Lastly, satay is served with various spicy seasonings.

We will serve our satay with a spicy peanut sauce dip, or peanut gravy, slivers of onions and cucumbers, bread and ketupat (rice cakes). Our sauce includes ground chilli, onion, tomato, shrimp, oil, and nuts inside. We also will make our secret recipe sauce to attract difference taste of customers. Customers can choose either they want spicy sauce or sweet sauce.

Beef and mutton that our restaurant will use is all origin from New Zealand. This is because European prefers to eat beef and mutton that origin from their own country. Besides that they also more trusted to those which are come from their country since it has been approve by their Hygienic Agency that the meat is totally safe to be eat and free of harmful virus. Thus, European are also culture that support to their country so if our restaurant use material that origin from their own country it will encourage them to purchase more in our restaurant and also will ensure them come back over and over again.

People nowadays are more concern about their health. They no longer prefer oily foods. If we did not customization our satay to meet local demand, then it will bring failure for us. Due to this, our satay is modifying to become less oil and less salts. We are also following the ethical issue. We will definitely provide clean and healthy satay. We will ensure that the supplier will provide us healthy meats and are ethically. Besides that, all of our workers are need to wearing gloves to ensure the cleanliness. Experienced cook and worker are employ in our outlet to make sure the flavour of satay will perform well.

Herbal tea

Our restaurant also provides traditional Chinese herbal tea such as chrysanthemum tea, Chinese watermelon tea, barley, siraitia prosvenorii (luo han guo) and herbal jelly ". We provide Chinese herbal tea is because herbal tea can bring many health benefits for human's body. The health benefits of herbal tea are capable of keeping balance, control over cholesterol, clearing heat, neutralizing toxins, and protecting the liver. Since our satay are grilled or barbecued over a wood or charcoal fire, herbal tea can help our consumer clearing heat and neutralizing toxins after eating the satay.

Teh tarik and others

Furthermore, because our food is a traditional food in Malaysia, we also have provide traditional drinks in Malaysia such as teh tarik . Teh tarik is a common and favourite drink for Malaysians. Teh tarik is very easy to prepare because the ingredients are black tea and condensed milk. However, we also will provide sky juice and soft drinks for our consumers. This is because not all the consumers can accept the taste of Chinese herbal tea and local teh tarik. We need to provide some drinks which acceptable by the consumers.

Distribution Channel

We will distribute our satay by two ways, either by own outlet or online mode.

Outlet

We will open our first satay shop in Auckland. We will set up our own and specific outlet in New Zealand. We are using Malaysian styles of design. When customers walk in to our outlet, they will feel and experience the Malaysian style. Waiter and waitress are required to wear Malaysia customs. Therefore, when customers are visiting to our outlet, they can really impressed by our culture. One speciality of our outlet is customers can see the process of producing satay. Our restaurant's seat can be found in personal seat, couple seats, four person seats, six person seats, and ten person seats. Customers can choose either to dine in or take away. Besides the residents, it also consists of the most potential customer for our shop. There are many students that study in this city no matter local students or foreign students. Students like to hanging around after school with their friends whether they go to shopping mall or having their meal together. Usually they prefer special meal that they seldom or never taste before. They will also take consideration into the price issue. Our satay is suitable food for them. Satay is a kind of food that origin from Malaysia. So, it is quite special and unique in Auckland. For sure students will like it since them always curious and excited to something that is relatively new for them and them willing to pay for a try.

Besides that, Auckland is the retail and commercial centre of New Zealand. Workers that have monthly salary will have a higher purchasing power which also means that they also are our shop important potential customer. A higher purchasing power will encourage them to purchase more in our shop. Workers also like to find some place to relax after they finish their work in office. Our shop provides them a place to enjoy their delicious meal, have a good conservation with their friends, and a place to enjoy the culture of others.

Another important potential customer is tourism. Auckland is the 'gateway' to New Zealand for tourism and immigration. Every year there are more than 6digits of tourism that tour to Auckland and this provide our shop a chance to earn money from them. Our shop provides a perfect environment for tourism to rest and full their empty stomach. Our shop will have a good view of seaside in front of our shop which will present a comfortable environment for our customer while they enjoying their meal especially for tourism who purposely come to Auckland because of the beauty of landscape of Auckland.

Drive-thru service

We will open a drive-thru window to lets customers enjoy more convenience services. Due to the busy lifestyle, consumers are more prefer the fast services. They try to find out ways that bring convenience for them. Citizen of Auckland prefers drive their own vehicle to travel. As we know that, 95% of Auckland citizen are travelling by their own vehicles. Therefore, the parking lots maybe is insufficient for the number of vehicles. Thus, we should have drive-thru service to provide convenience for consumers who cannot find the parking lots.

Besides that, drive-thru service also convenience for office workers. This is because during lunch time hour, they are prefer meal which is fast and easy to consume. For them, drive thru service will become their first choice service because they can get their meal at the time and straight away can drive their vehicle leave the restaurant. Furthermore, for consumer who ordering food from our officer website, they also can get their food from drive thru service in order to save their time for searching to the parking lot.

Sometimes there are not enough seats for consumers during peak season such as Christmas and New Year celebration. For consumers who want to eat our satay but do not have patient to waiting for our restaurant seats, they may just purchase satay by using our drive thru service and enjoy satay at their home with their friends and family.

Online mode

For online mode, customers can visit to our restaurant's officer website to make their orders. Menu will be display in our officer website. Picture of meals and drinks will be display in the menu so that customer can easily know what foods are available. These make them easy to make order too. Quality and time can be selected inside the order blanket. Besides that, customers can also select type of meat that they want for their satay. Type of sauces will be serving based on the customer's want and needs. Customers can also order drinks previously at our officer website if they not willing to waste time waiting the drinks to be serve.

Besides making orders, customers can also reserve seat in our restaurant though our officer website. A blueprint of our restaurant will be show in the officer website so that customer able to choose the seat that they prefer. Seat that had been reserve will be filling up with green colour while those which are still available will be filling up with red colour. If customer request for more seat then they can straight away type the number of seats that they want in our website and our restaurant will prepare the seats for them.

Thus, internet is also used to promote our outlet and meal that provided by us too. Our restaurant will make an e-advertisement in website that have high rate of people visit everyday like Facebook, Twister, Google, Hi5, live.com, msn, yahoo and youtube. There will be a link that able to link to our restaurant's officer website paste in the advertisement. Besides that, video will be play automatically when user access to those website too. This few website have over millions of user everyday so for sure it will generate a good respond and good sales to the our restaurant.

Pricing Strategy

Penetration strategy

In order to target customers in Auckland, we are using penetration pricing strategy. This strategy involves the setting of lower, rather than higher prices in order to achieve a large, if not dominant market share. Penetration pricing strategy is most often used businesses wishing to enter a new market or build on a relatively small market share.

Since our satay shop is new entry to Auckland food industry, we priced with a low mark-up to attract consumers to make purchase from us. Since our target market are include the local population and tourists from all around the world, the price must be reasonable.

The price of food in Auckland is very expensive, so the local people are more prefer to cook and enjoy their meals in their own house. This is also a main reason for us not to set the price too high. When price is high, it causes consumers does not want to spend in our shop as the price is a burden of them.

Chicken, mutton, beef, fish, deer and rabbit are our main dishes for satay. Below is the price list of satay:

Types of satay/ Price per string (NZ$)

1 string

11 string

22

string

35 string

Beef

50c

$5.00

$10.00

$15.00

Mutton

50c

$5.00

$10.00

$15.00

Chicken

60c

$6.00

$12.00

$18.00

Fish

60c

$6.00

$12.00

$18.00

Deer

70c

$7.00

$14.00

$21.00

Rabbit

70c

$7.00

$14.00

$21.00

The price of beef and mutton are the cheapest among these satay meats. It is because beef and mutton are common in New Zealand; they do serve as a main course on local people's daily meals. Fish and rabbit meat is not easily to be found in New Zealand, so the price is the highest among these meats.

A successful penetration pricing strategy may lead to large sales volumes/market shares and therefore lower costs per unit. By the use of this penetration pricing strategies,we are trying to gain market share. But we are worried about the image of our outlet. This is because of the impact of the reduced price on the image of the offering. We are worried that local people will doubt about our satay's meat quality.

Quantity discounts

Besides penetration pricing strategy, we also used quantity discounts. Quantity discounts is known as price reductions granted for a large-volume purchases. For the customers who purchase 10 strings of satay, we will free 1 string satay for them, if they purchase 20 strings we will free 2 strings satay for them and if they purchase 30 strings of satay we will give 5 strings in free of charge. In others words, purchase a large amount of the satay in our shop will gain more discounts, it is worth if more people consume in one single receipt. So, we encourage customers bring their family and friends gather together and consume more in our shop. In a long term journey, our shop will had a brand image that suitable for family and friends gathering.

Promotional pricing

Promotional pricing is a pricing policy in which a lower- than- normal price is used as a temporary ingredient in a firm's marketing strategy. This pricing policy is really useful and it can really help a new business to earn a market share in a short- term periods. Set lunch and unlimited refill herbal teas that will be explained more details in promotional part is said to fulfill this pricing policy, because unlimited refill herbal teas will ended after first 3 months of our outlet operated. Set lunch service will terminated when we feel that we had gain market share and create consumer retention.

We will serve herbal tea as our main drinks in our outlet. There are 5 type of herbal tea that sells in our outlet, chrysanthemum tea, Chinese watermelon tea, barley, siraitia prosvenorii (luo han guo) and herbal jelly. These herbal teas are considered new in Auckland market and it is stranger for Auckland consumers, so we will display the photos of these herbal teas in our menu so that consumer will more familiar on them. Front staffs that responsible in taking customers order will trained in order to give more information to consumers regarding to the taste of these herbal teas. The price of these herbal tea are same and standardized by us, as each glass of the herbal tea that order by consumers, we charged only 1 dollar for the herbal tea. Below is the price list of herbal tea.

Type of herbal tea

Price/Nz dollar

Chrysanthemum tea

1

Chinese watermelon tea

1

Barley

1

Siraitia prosvenorii

1

Herbal jelly

1

Last but not least, the pricing decision that our company used is followed the ethical issues. There is no price discrimination to end customer which is an illegal actions.

Price discrimination is a strategy that used for maximize the products' profits by charging each market segment the price that maximizes profits. Every company wishes to have a high profits, but for us, the main reason of coming out satay outlet in Auckland is to fulfill the customers' needs and wants, not only for profits. We aim to let the local people experience a totally new sensation.

Periodic discounting

Therefore, our outlet will comes out with periodic discounting as taking a consideration to appreciated loyalty customers that giving support to us. Periodic discounting is a specific pricing tactics which is a strategy varies price over time. For example, during the anniversary of our outlet, there will be half- day discount on all the satay meats. Customers that buy during this period will have cheaper price compared to usual period.

In conclusion, the pricing decision for our satay is reasonable because it has good quality and good taste.

Promotion strategy

To promote satay in a totally new market place, it is exactly a big challenge. One product will be success or not are depends on the promotion effort. In order to make the citizen know about satay and our outlet, we are using several types of promotion strategy.

Flyers

Auckland is one of the tourists' favorite places. More than 8,000 sheets of flyers will be prepared and distributed to all residents and tourists in Auckland. Colorful and attractive real picture of satay will be taken and printed out on these flyers. A simple description such as address and contact numbers is added onto the flyers to let readers more understand about our satay. Other than using manpower to help us to distribute these flyers, we will also use local distribution channel such as newspapers stalls to distribute these flyers. These flyers will clip along with local newspapers. When people buy newspapers, they will get these flyers.

Newspaper and TV channel

Newspaper and TV channel in New Zealand are the fastest channels for to lets people know about the existence of our shop. We decided to buy one page of layout of local newspaper to advertise our products. New Zealanders like to watch television after work. So, we will advertise on the peak time on television everyday although the fees may be higher.

Free sample

Every Sunday, during 1100-1200 we will prepare some sample satay for public to try. For those who passed by our outlet will be able to try these sample satay for free. Normally, people will be free during Sunday; they choose to have a walk with their family members or friends. The testing of satay may found success because it provides chance for the public to try. If consumer found that the taste of our satay is suitable for them, they may stop at our outlet and buy it. This way of promotion will attract the attention by word of mouth too.

Delivery service

People in New Zealand love to take away food, this is one of their modest lifestyle. So, delivery service is available in our shop and consumers have to pay for it. Delivery service makes consumers life become easier and convenience. This is because the distance between city and household area is far from each others.

Cash voucher

We prepare some cash vouchers to sell to customers. The vouchers served as 2 functions. One of the function is it is a discount vouchers. For customers who purchase these cash vouchers, they are entitled with 5% discount for their next visit. Discount is always a powerful marketing tool that will influence consumers to purchase our products. Another function of cash vouchers is it can serve as a gift; consumer may purchase these cash vouchers and send it to their friends and family members. Indirectly, consumers may save their time for searching birthday gift to others.

Weekly discount

The last promotion strategy that used by us to promote is weekly discount of selected items. 10%-15% discount is entitled for the weekly promotion items. For every 10 string of satay is purchased, consumers can get 1 cluster satay for free. A mystery gift will be given for consumers who spend more than 80dollar in our shop.

Unlimited refill of Herbal tea

For the first 3 month of our business launching in Auckland, for customers who dine-in in our outlet will able to enjoy unlimited refill of herbal tea service that provided by us. These herbal teas are included: chrysanthemum tea, Chinese watermelon tea, barley, siraitia prosvenorii (luo han guo) and herbal jelly. These herbal teas are very famous in Malaysia especially in Chinese culture. It is a nice and healthy drink because herbal teas can help to cold down the bio-system of human if the person always drinks the herbal teas. Our menu will have some explanation regardless to the herbal teas since the herbal teas are also considered new in Auckland.

Set Launch

We had decided to launch a set lunch that only available at weekdays from 1200 to 1400. Consumers who purchase any 5 strings of satay in our shop during that period, free rice or bread and a glass of herbal is given. Meanwhile, consumers only need to pay the price of the satay and they are able to get rice or bread and a glass of herbal tea for free. This is totally worth especially for those who like to save money. But, the set lunch is limited for 50 sets, so that besides attract consumers our shop profit was also maintained. The set lunch is first come first served basic and we will not provided take away and delivery service for this special set lunch.

These promotion strategies perhaps will help us in gain more profit and market share in Auckland's food industry.