Marketing Focus for Kudler Fine Foods Virtual Organization Roslyn Broadhurst BSA/502 July 26, 2010 David Moore Abstract Kudler Fine Foods currently has three locations-La Jolla, Del Mar, and Encinitas-throughout San Diego, with a fourth location possibly in the company’s near future. The company maintains several systems including strategic plan, legal, finance and accounting, sales and marketing, human resources, and operations. This paper is an analysis of the marketing system for Kudler Fine Foods, and touches briefly on the company’s background and strategic plan.
Marketing Focus for Kudler Fine Foods Virtual Organization Kudler Fine Foods is an “upscale specialty food store located in the San Diego metropolitan area” (Apollo Group, Inc. , 2008, Intranet home, para. 1). The company, founded by Kathy Kudler in 1998, opened its first location in San Diego’s La Jolla area. With the opening of her first store, Kathy Kudler hoped “to create one store that would stock a wide selection of the freshest ingredients as well as all of the tools a gourmet cook could ever want” (Apollo Group, Inc. , 2008, Internet home, para. 1).
After the success of her first store, Kathy opened a second store in the Del Mar area in 2000. Inspired by her success with the first two stores, she decided to open a third store in 2003, this one located in the Encinitas area. Currently, she hopes to find a location for a fourth store. “Each store has approximately 16,000 s. f. of retail space located in a fashionable shopping center. The stores are stocked with the very best domestic and imported foodstuffs and divided into” five departments-Bakery, Meat and Seafood, Produce, Cheese and Dairy, and Wine (Apollo Group, Inc. , 2008, Intranet home, para. ). Kudler Fine Food’s mission statement states, “Kudler Fine Foods is committed to providing our customers with the finest selection of the very best foods and wines so that your culinary visions can come true” (Apollo Group, Inc. , 2003, p. 3). Kathy Kudler envisioned “a premiere gourmet grocery store” for those shoppers who wish to find the freshest possible “meats, produce, cheeses, and wine” to satisfy their taste for gourmet meals (Apollo Group, Inc. , 2003, p. 3). Strategic Objectives Kudler Fine Foods “experienced significant growth” during the first five years of operation.
Currently the focus is to expand its services as it improves “the efficiency of its operations,” and increases its “consumer purchase cycle as a means to increasing the loyalty and profitability of its consumers” (Apollo Group, Inc. , 2008, Sales and Marketing, para. 1). Kudler’s strategic objective is to increase the loyalty of the consumers and the profitability of the company. To accomplish this objective, a discussion of the following three areas will ensue: expanding services, frequent shopper program, and increased efficiency. Expanding Services
One way in which Kudler may expand its services is by offering parties in the store. At each party a different world-renowned chef, local celebrity, other food expert, or Kathy Kudler will teach customers how to purchase and prepare specialty foods. Customers will also receive invitations to some of the exclusive and upscale events that take place in and around San Diego. “The anticipated outcomes will be to increase the customer purchase rate of high margin food and beverage items and to get consumer to make an evening at Kudler Fine Foods part of their social network” (Apollo Group, Inc. 2008, Sales and Marketing, para. 2). Kudler hopes the increased time spent in the store will help to increase the amount of money customers spend at the store as well as the frequency of the visits to the store. One way in which the company hopes to increase both the frequency of visits and increase amount spent by each customer is through contests offered at each store. One such contest is to see who brings the most guests to each party. For each guest brought, the customer bringing the guest will receive an entry in a high-ticket item.
Kudler hopes to hold most of the events in the stores. However, customers may request cooking classes be held in their homes, for a price. By holding cooking classes in customers’ homes, the company hopes to encourage consumer loyalty as well as word-of-mouth advertising. As the word of the cooking classes makes the rounds through the city, Kudler’s fame will increase, as well as the company’s revenues. Implementing a customer relationship management (CRM) program should fulfill each aspect of expanding Kudler Fine
Food’s services, which should increase the company’s revenues and customer base. With the increase in the customer base, implementing a consumer database is necessary. Frequent Shopper Program Implementing a frequent shopper program at Kudler Fine Foods will help track the purchase behavior of consumers, at the individual customer level. Tracking the purchase behavior patterns of consumers helps to refine the company’s processes. This, in turn, offers Kudler the best means of satisfying its customers’ needs.
The company’s consumers focus more on the quality of the specialized items they purchase, and less on the price of the items. For this reason, providing discounts to the customers depending on the frequency of their purchases is an incentive for the customers to make purchases more often. Implementing a frequent shopper program will also help provide high value incentives by initiating a partnership with a program providing loyalty points. Such a program will provide consumers with points redeemable on more expensive gift items, airline tickets upgradable to first class, or specialty food items.
By implementing a consumer database, Kudler Fine Foods will be able to keep track of those consumers eligible for the frequent shopper program. A consumer database will also keep track of each item purchased, who purchased it, and the frequency of the purchase. Increased Efficiency To increase the efficiency of Kudler’s internal and external processes, the company benchmarked Nordstrom department store. This provided Kudler with the ability to improve these processes and deliver increased value to the company’s customer base.
The company also developed employee-training programs with the ability to integrate new software systems into the established systems facilitating any efforts to prevent such integration. Marketing attempts encouraged Kudler’s purchasing department to reduce certain costs by minimizing the amount of food stored on the premises. By not storing as much food locally, it minimized the amount of room needed for storage. This led to the company maintaining a zero stock out policy. In response to the new policy on food storage, the purchasing department developed a supplier relations program.
This program solicited the help of the marketing department in rolling out the program. Tracking “information such as dollar value and profit margin per transaction, dollar sales and profit levels by day, and dollar sales and profit margins by item” helps to increase the efficiency of Kudler’s internal and external processes. Conclusion Kudler Fine Foods currently has three locations-La Jolla, Del Mar, and Encinitas-throughout San Diego, California, with a fourth location possibly in the company’s near future.
The company maintains several systems including strategic plan, legal, finance and accounting, sales and marketing, human resources, and operations. This paper included an analysis of the marketing system for Kudler Fine Foods, and touched briefly on the company’s background and strategic plan. Historically, Kudler Fine Foods has tracked information such as dollar value and profit margin per transaction, dollar sales and profit levels by day, and dollar sales and profit margins by item.
However, in an effort to leverage the information to create a more intimate relationship with their customers, the firm is integrating a system to track customer purchase behavior over time. The firm is in the process of developing this system now (Apollo Group, Inc. , 2008, Sales and Marketing, para. 5). References Apollo Group, Inc. (2003). Strategic plan. Kudler Fine Foods. Retrieved from https://ecampus. phoenix. edu/secure/aapd/cist/vop/Business/Kudler/Admin/StrategicPlan2003. pdf Apollo Group, Inc.. (2008). Kudler fine foods. Retrieved from Apollo Group, Inc. , BSA502 – Business Systems II website.