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Macro-Environment Forces that Affect Marketing Strategy

People depend on food in order to survive. Without food people would become weak and consequently be unable to work. This in turn would lower the economic growth for the country and living standards of people would go down. Nevertheless, there is need to eat healthy as food consumption is concerned. Eating healthy is not easy but with commitment to healthy eating you can save yourself a great deal of problems. Eating healthy has an advantage in the long run in saving your money on health costs. Some diseases such as cancer and diabetes can be prevented by healthy eating. You are also able to provide your body with necessary nutrients that are required for proper functioning of the cells as well as clearing of toxins and body detoxification. YouFoodz therefore, was built based on the idea of healthy eating. Its slogan is that every person in the world eats and everyone deserves to eat good and healthy food. Their mission is to help every individual to be able to eat good food every single day. They provide food that you can enjoy, have fun and feel good while eating. They believe good food does not just involve the food itself but also the surrounding environment and people as well. So, in YouFoodz, you will find many amazing people sharing information on healthy eating and meal ideas. This paper therefore, discusses various strategies adopted by YouFoodz to enhance their performance such as; cultural forces analysis, customer driven strategy, marketing mix strategy, competitor analysis, political and legal analysis as well as technological forces.

Business environment affects the performance of an organization either negatively or positively. Macro-environment factors that influence the operations of an organization are; political, legal, technological, social-cultural and economic variables. These forces come from the outside of the organization and as such the organization has no direct influence on them. Therefore, it requires the firm to have a better understanding of these forces and the opportunities or threat they can create and hence make adjustments to their strategic plans.

Cultural macro-environment forces involve the cultural factors that affect the organization operations (Lusch and Laczniak, p. 289). The customs of the people, values, lifestyles and their belief affects their decision on type of food they take. The culture of the people in a society especially where a company is located plays a key role in success of any business. Norms and values differ from one region to another and from geographical region to another. It is important therefore, for an organization to re-evaluate its marketing as well as its production strategies so as to accommodate every person. The cultural environment affects the societal basic values, behaviors, perceptions and preferences (Sagiv and Schwartz, p. 183). Our industry however has been able to overcome this challenge, since many people now days prefer greener and healthier food such as vegetable burgers and salads. Due to the rise of people suffering from diabetes and heart problems, the trend in behavior of many people in the society is towards healthy eating. Putting into consideration people’s attitudes and behaviors towards type of food they prefer, is a key factor in ensuring good performance of any food company.

Cultural Macro-Environment Forces

Segmentation is the process by which a large unit is subdivided into smaller units having similar, less similar or related features and characteristics. Market segmentation therefore, is a concept applied in marketing that bifurcates the large market into smaller groups made of consumers with similar demand, taste and preference. Segmentation enables an organization to design a marketing mix which will cater for the needs of the people in a specific segment (Datta, p. 803). For a big company like YouFoodz, segmentation becomes important since different people have different taste, preference and needs. Due to other macro environmental factors such as social-cultural, segmentation becomes important due to the different cultures, norms and beliefs of people when it comes to food. YouFoodz has segmented its market in terms of ethnic race, income of individuals and age group. A certain race may prefer a different food type from the other. Africans, Asians, Chinese, all have different taste and this should be considered and their preference included in the menu. Considering the income of the people also is important so as every person can be able to afford depending on their pocket. YouFoodz has been able to prepare various food types of varying prices affordable to every person.

Various types of market segmentation have been postulated. Psychological segmentation which puts into consideration the lifestyle of the people. The altitude of an individual, their interests and values helps the marketers to know how to serve their customers to their satisfaction. Behaviouristic segmentation- The behaviour of the customers and their loyalties towards a certain commodity or food, will help a company to classify certain people according to their loyalty to certain food type (Kesic and Piri-Rajh, p. 169). Geographical segmentation- This enables a company to make proper marketing strategies since people of different geographical locations vary in their taste. Demographic segmentation also allows a company to make the right decisions and thereby able to reach and maintain their customers. It classifies people according to race, religion, age, family size, gender, income, ethnicity, marriage status and occupation (Lea and Worsley, p. 862). Some people do not take food containing meat and others are completely vegetarians. Therefore, knowledge of the market and segment you targeting plays a key role in making the right plans and strategies which can enhance your business operations.

Proper marketing strategies is essential in success of any business. An organization needs a proper sales and marketing plan to be able to sell their products and services to many people. Marketing strategy and marketing mix is different though many people tend to think they are the same thing. Marketing mix is made up of four components, commonly known as the 4 Ps; Place, Price, Product and Promotion (Magrath, p. 48). This helps a company to know how much to charge for a product or service, and also when and where to sell their products and services. Marketing mix also encompasses other parameters like customers, the environment, employees and work vehicles required in product presentation. Promotion strategy is the most important part of marketing mix as it makes the services being offered by the company to be known. Promotion makes people know the features, characteristics and benefits of the products as well as persuade them to buy your services (Zeriti et al., p. 56). Social media is one of the commonly used method by our YouFoodz. Through our website also we are able to advertise various food we offer. Internet plays a key role in the promotion process. Internet previews that expresses the customer views enables us to know on areas we are supposed to improve. Technology remains the best promotion strategy since it covers the whole world and reaching many customers.

Market Segmentation

Reference List for Section 1

Datta, Y., 1996. Market segmentation: an integrated framework. Long Range Planning, 29(6), pp.797-811.

Kesic, T. and Piri-Rajh, S., 2003. Market segmentation on the basis of food-related lifestyles of Croatian families. British Food Journal, 105(3), pp.162-174. 

Lea, E. and Worsley, T., 2005. Australians' organic food beliefs, demographics and values. British food journal, 107(11), pp.855-869.

Lusch, R.F. and Laczniak, G.R., 1989. Macroenvironmental forces, marketing strategy and business performance: a futures research approach. Journal of the academy of marketing science, 17(4), pp.283-295. 

Magrath, A.J., 1986. When marketing services, 4 Ps are not enough. Business Horizons, 29(3), pp.44-50. 

Sagiv, L. and Schwartz, S.H., 2007. Cultural values in organisations: insights for Europe. European Journal of International Management, 1(3), pp.176-190. 

Zeriti, A., Robson, M.J., Spyropoulou, S. and Leonidou, C.N., 2014. Sustainable export marketing strategy fit and performance. Journal of International Marketing, 22(4), pp.44-66.

Micro-environment factors are those variables that have a direct impact on the operations of an organization. The common micro-environment factors that affect organization performance are; customers, competitors, media, shareholders, employees and suppliers. Competitor analysis however is very critical because failure to keep at per with your competitors will make your company become obsolete and lack customers. Competitor analysis seeks to understand the strategies and marketing mechanisms that your competitor uses and be able to come up with better strategies than theirs (Dragni?, p. 141).

The greatest competitors of YouFoodz are; The Cook’s Grocer, Dietlicious and Gourmet Dinner Service.

Gourmet Dinner Service has a wide range of healthy and ready-to-eat meals. It also has the advantage over YouFoodz since it caters for special foods or dietary requirement such as vegetarian, diabetic, gluten-free, dairy free and low Gastrointestinal intestinal (GI) options. It is ideal for those people who want to watch their weight. It uses fresh and seasonal sourced ingredients in its meal preparation. It offers meals at affordable price of about $7.50-$14.50. However, their delivery costs are slightly higher (Falcone et al., p. 132).

Dietlicious offers variety of foods including cleanse and detox diet and ready-to-eat frozen meals which are healthy and convenient for weight loss. Dietlicious delivers in many regions such as Syndey, Brisbane, Central Coast, Newcastle, Wollongong and Melbourne. The cons of Dietlicious is because it offers only frozen meals.

The Cook’s Grocer offers meal delivery services that are ready-to-cook. The ingredients are measured and hence exact portions offered and therefore it reduces wastage. It has an advantage of partnering with celebrity chefs and nutritionists such as chef Scott Gooding (Booth and Whelan, p. 1399). However, YouFoodz has the advantage over them since the meals requires cooking as they are not ready to eat.

Marketing Mix Strategy

Political and legal macro environment involves the laws that governs the operations of a business. Political environment limits the operations of a company since they do not have direct control over them. Rules and regulations set by the government may negatively affect how an organization works. Legislation may lead to a failure or success of business. Laws affects the environmental aspect, product safety, competition and pricing (Busse and Hefeker, p. 407). Legal and political rules affect operations of YouFoodz especially on marketing strategies. High tax rates is one aspect of legal environment that has a negative impact on our operations.

Focussing on the needs and wants of your customers can give a company a competitive advantage over others. Therefore, in customer driven strategy, the emphasis should be put more on satisfying your customers so as to retain them. You should be able to identify their needs and fulfil them, otherwise you will be overtaken by other companies. A company should be able to target their market and locate the right segment (right positioning). This allows a company to grow since no time will be wasted in trying to reach the wrong prospects. Once you identify the market you can then meet their needs (Olhager, p. 326). Customer feedback is also crucial in enhancing the performance of a company. Complaints from the customers can be an opportunity for a company to improve on their products and services. A customer driven strategy also enables a company to gain referrals.

To reach many clients, YouFoodz need to start offering many meals with vegetarian options. To be able to serve many regions like Dietlicious company, YouFoodz needs to invest more on individual options. To have fresh meal at affordable price, YouFoodz is the only company that offers high quality ingredients with no added preservatives whatsoever.

Pricing is one element of marketing mix strategy. Pricing strategy is essential in success of any company. It enables a company to find a price point whereby they can minimize losses and maximise on profits and sales (Yoo et al., p. 205). There are different pricing strategies a company can use depending on their marketing objectives and goals.

Premium pricing strategy which seeks to charge a higher price of your services than your competitors. Penetration pricing whereby a company enters the market charging relatively lower price than others so as to attract buyers. Economy pricing which focusses on the economy of the people. It seeks to attract a specific group of people who are price sensitive. Other strategies include price skimming and psychological pricing (Davcik and Sharma, p. 775).

Competitor Analysis

YouFoodz uses ecomomy pricing as well as psychological pricing strategies. It is able to target its customers in various parts. It offers its services to Metro, Gold Coast, Brisbane, Melbourne, Sydney Metro, Adelaide, Canbera and Sunshine Coast. This strategy is effective since its able to reach many customers and have an advantage over other food delivery companies which supplies to one or few regions.

Reference List for Section 2

Booth, S. and Whelan, J., 2014. Hungry for change: the food banking industry in Australia. British Food Journal, 116(9), pp.1392-1404.

Busse, M. and Hefeker, C., 2007. Political risk, institutions and foreign direct investment. European journal of political economy, 23(2), pp.397-415. 

Davcik, N.S. and Sharma, P., 2015. Impact of product differentiation, marketing investments and brand equity on pricing strategies: A brand level investigation. European Journal of Marketing, 49(5/6), pp.760-781. 

Dragni?, D., 2014. Impact of internal and external factors on the performance of fast-growing small and medium businesses. Management: Journal of Contemporary Management Issues, 19(1), pp.119-159. 

Falcone, R., Viola, J.J. and Reinhold, D.J., Gruppo Due Mondi, Inc., 2013. Food Delivery Service. U.S. Patent Application 14/036, p. 132.

Olhager, J., 2003. Strategic positioning of the order penetration point. International journal of production economics, 85(3), pp.319-329. 

Yoo, B., Donthu, N. and Lee, S., 2000. An examination of selected marketing mix elements and brand equity. Journal of the academy of marketing science, 28(2), pp.195-211.

Technological macro environment is very crucial for the success of a business. Technological forces relate to factors that influence introduction of new technologies in the industry. Implementation of technology in an organization generates new products and services. It also creates new market opportunities. Technology plays a vital role in the operations of an organization. As new technology emerges, it is crucial for the marketers to adopt these new technologies so as not to become outdated. Technology leads to innovation and creativity (Baden-Fuller and Haefliger, p. 423). Technology has changed the customer’s lifestyle and also their buying patterns. With internet, YouFoodz interacts with their customers and can get their feedback immediately. Now days a customer can make his or her order at the comfort or his or her home and we deliver. Production and processing processes have been accelerated by use of technology (Fowler et al., p. 5130). Now days we can prepare food within short period of time due to advancement of machines and do faster delivery. It is important however to check how your competitors are embracing the new technology.

Political and Legal Analysis

Target market for YouFoodz is active people, busy parents, professionals (young to middle aged) and the healthy conscious. Segmentation enables a company to target the right customers so as to avoid wastage of resources. YouFoodz targets active and busy people since it delivers already prepared meal to them. People involved in busy activities may lack time to prepare their meals. However, there is no reason for alarm since YouFoodz is there to sought them out. The good thing with this company is that their foods are healthy and made to client’s specifications. Parenting is not easy especially when both parents are working. Busy parents may lack time to prepare meal for the family. YouFoodz however comes to their rescue since they prepare foods for many people, to about seven people. YouFoodz as well caters for young and middle professionals. This group of people have no time prepare food for themselves. They are at the prime of their jobs and want to climb up the ladder. The healthy conscious is another group targeted by YouFoodz. This because people lifestyle, values, beliefs, attitudes and behaviours vary (Xu et al., p. 447). YouFoodz is widely known to offer healthy and safe foods. For people who love eating healthy and watching their weight so as to avoid some diseases, YouFoodz is the best company for them. Targeting this group of people has given YouFoodz an upper hand over their competitors.

For successful provision of a service or product, it has first to meet the needs of the customers. It has also to function has promised so as to be able to retain the customers. Communication of the product’s features, characteristics and benefits is essential since no person can buy something he knows nothing about. Branding of your service is also crucial as it distinguishes service offered by your company from others (Chan and Tong, p. 1543).

YouFoodz offers its food services at reduced costs as compared to other food-delivery companies. This gives it a competitive advantage as it accommodates all people from low to high earning individuals. It also delivers its foods free of charge to people living around Queensland. YouFoodz has invested much in their services especially in product design, product features, quality and packaging. It tries to provide various types of food with different modifications but remaining classy and healthy. The quality of services provided by YouFoodz is of high standard. YouFoodz meals have been known to stay safe for over one week without going bad. These product strategies have ensured this company to grow and thrive despite high competition in the industry.

Place or distribution strategy determines mechanisms that a company undertakes to ensure their services or products reaches their customers. There is no reason why you will make a product if it does not reach it end user. Distribution strategies ensures the products reaches the customers at the right time and in the right place. Effective and efficient distribution strategies should be adopted for the success of a company (Chari et al., p. 156). YouFoodz uses direct distribution mechanism whereby it ensures they deliver the services to their customers in person. It ensures their meals are refrigerated especially when using freight transport. 

Reference List for Section 3

Baden-Fuller, C. and Haefliger, S., 2013. Business models and technological innovation. Long range planning, 46(6), pp.419-426.

Chan, J.W. and Tong, T.K., 2007. Multi-criteria material selections and end-of-life product strategy: Grey relational analysis approach. Materials & Design, 28(5), pp.1539-1546. 

Chari, S., Katsikeas, C.S., Balabanis, G. and Robson, M.J., 2014. Emergent marketing strategies and performance: The effects of market uncertainty and strategic feedback systems. British Journal of Management, 25(2), pp.145-165. 

Fowler, D., Pitta, D. and C. Leventhal, R., 2013. Technological advancements and social challenges for one-to-one marketing. Journal of Consumer Marketing, 30(6), pp.509-516. 

Xu, Y., Yen, D.C., Lin, B. and Chou, D.C., 2002. Adopting customer relationship management technology. Industrial management & data systems, 102(8), pp.442-452.

Conclusions

There are many challenges that are faced by businesses in this volatile world. For a business to prosper, it has to plan effectively and come up with strategic plans. Sectors that need key analysing are; production, sales, marketing, branding, storage and delivery. In this report however, we have realized key strategies that a company can undertake to ensure its success. Adoption of marketing mix strategy will ensure a company will take an advantage over others.

The success of YouFoodz company can be attributed largely to proper planning and adoption of appropriate marketing strategies. However, I would recommend for additional variety of foods to be added to their meals so as to accommodate more customers. It can also increase their target customers so as to deliver to many places and also be able to go global.

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