Evaluating Marketing Strategy of Pret A Manger

“Marketing Plan for Pret A Manger in United Kingdom.”

ABDUL HASSAN ­ 6022538 MOO3LON ­ Assignment II Submission Date ­ 15th December,2014.

Word Count ­ 3461 Lectures ­ Dr.Joshie Juggessur and Mr.Jon Kitto.

About the Company:

Pret A Manger is a fast­food chain of restaurant based in UK and present across 4 countries (UK, USA, France and Hong Kong) with 335 stores worldwide. Pret A Manager is a French word meaning ready to eat. The company specializes in making healthy and fresh organic food every day. The key products of the company are Sandwiches, Baguettes, Salads, Salad Wraps, Organic coffee, Hot Drinks, Desserts and Snacks.

The company was founded in the year 1986 by college friends Sinclair Beecham and Julian Metcalfe. The idea behind starting up of Pret was Sinclair and Julian craving for proper sandwiches which didn’t contain obscure chemicals, additives and preservatives but they couldn’t find it anywhere. This led to the journey of opening up Pret, a fast­food chain restaurant which serves Healthy, Fresh and Organic Food. The first store was opened in Hampstead; London (Pret, 2014).Pret was sold in 2008 to Bridgepoint Capital an International Private Equity group.

The mission of the company is to create handmade natural food avoiding the obscure chemicals, additives and preservatives common to so much of the 'prepared' and 'fast' food on the market today. The company attains this mission by preparing healthy and fresh food everyday in its In­house kitchen which is present in every Pret store. Leftover foods are removed of the shelf overnight and donated to Charities and Homeless people.

The company follows a sustainable strategy which helps in reducing the impact on environment by its business operations. The sustainable strategies focus on sustainability around food, energy, ecosystem security, health and well­being.

SOSTAC:

Situational Analysis:

Strength: The company's product offering is unique compared to other fast food outlets in the market,it uses key fresh ingredients and is the only fast food outlet to have organic coffee in its menu.It has stores in popular attractions and financial hub areas across London there are more than 200+ stores in London.Pret A Manger Sustainable strategy is another key strength which makes its outlets popular and a hit among the customers, the companies donates leftover food overnight to homeless people and also a specific amount on certain products is donated to Charities.Pret A Manger also offers online delivery and catering at events, none of the existing fast food outlets in the market offer catering option.

Weakness: Pret A Manger food products are expensive compared to other fast food outlets in the market.Although other outlets don’t use key fresh ingredients as Pret everyday the pricing strategy plays a big role as the customers look for quantity over quality.For Instance a meal deal at Subway costs £3 it includes a 6 foot subway sandwich and a beverage.They aren’t many options for customers to choose from the menu, other fast food outlets have varied .

Opportunities: Unlike other fast food outlets and business houses, currently Pret A Manger doesn’t offer Franchise options,but by offering this option it can increase its market outreach and sales revenue.It also doesn’t rely on TV and Newspaper medium for promoting its product.Many of its existing and new consumers in the market don’t know about the social initiatives of Pret A Manger.An increase in the usage of advertising will help it gain new customers and also create awareness about its CSR programmes.It currently doesn’t has any applications for mobile devices developing of an “app” will help it to connect with the customers,update them about the new pret products,chef’s special and Impact of Pret CSR programme.

Threats: The rising cost in the production and procuring of the key ingredients such as organic coffee from Peru and procuring of organic food and ingredients might lead to increase in the total cost and cause for changes in the operation of the outlets.The company should

make sure it comes up with alternative offerings so it wouldn’t affect its business operations in the future.

Objectives:

SMART ­ Specific, Measurable, Achievable, Realistic, Time Bound.

S ­ The company's objective is to provide good natural food which uses natural ingredients and avoids preservatives and obscure chemicals.The company doesn’t believe in “greenwashing” and has set up Sustainability Strategy to 2015 which sets out the 5 key sustainability strands,these areas reflect the current global trends in sustainability around food,energy ,ecosystem security,health and well­being.

M ­ The company has set benchmarks standards in its key business areas by implementing of the 5 key sustainability strands to achieve the goals by 2015.

A ­ The company has been able to achieve these goals and has a track record of being the most sustainable company in the market.It uses key fresh ingredients which are procured from selected suppliers,makes fresh sandwiches everyday in its own kitchen stores,uses free range eggs,chicken and grass fed beef in its product.It has installed AMR metres in its stores to minimize the usage of electricity and water hippos in washrooms to reduce the wastage of water.

R ­ Pret A Manger is one of the top choice for fast food outlets takeaways in the market.It had an increase of 17% in profits last year even after contributing huge amounts of revenue for charity. It has more than 200+ stores in London with such vast resources and revenue it is possible for the company to achieve the objectives.

T ­ The company plans to achieve these objective by the year 2015.

STP:

Segmentation:

Geographical: The target area for Pret A Manger outlets are urban areas and metropolitan cities.The store locations are present at business hubs and popular tourist attractions.It currently has 335 stores worldwide.

Demographics: The target customers for Pret A Manger are students and young business professionals.Between the age group of 18­35.They are mostly middle­class income earners and International students.

Behavioural: The customers are looking for a quick lunch to grab by during the breaks which is affordable and inexpensive.The consumers are picky as they have many alternative to choose from such as in Liverpool street they are 100 of cafes and fast food outlets to choose from,the customers aren’t brand loyal.They might just go into a new restaurant or fast food outlet for a change or to try new cuisine.

Psychographic: The consumers are cautious about the food they are consuming, looking for food which is healthy and fresh.It shouldn’t be too expensive and affordable.Easy to grab by and convinet for take away without any hassels of long queues.

Target:

The target market for Pret A Manger consumers are selective they are emerging young professionals,business employees and students.The consumers are looking for food which is healthy,fresh and is easy to grab by and isn’t too expensive .They are health conscious and are looking for quality over quantity.For Instance a consumer can go to a Subway and get a meal deal for £3(Sub+Coffee), instead of going to Pret and get a freshly made sandwich and organic coffee for £4­£5

Position:

Pret A Manger is the only company in the market which uses fresh key ingredients in its products every day.The company products are of High Quality and Low price.Its customers are middle class income earners and business professionals.The company

sustainable strategy programmes have made it popular in the market for contribution to the society.

Free State Coffee(Niche) ­ The company key product is coffee.It uses some of the world’s best coffee beans in its product.Its product give tough competition to Pret’s key product Organic coffee.

Eat(Challenger) ­ It is the company’s primary competitor.Both the brands have the same business concept model providing of fresh and healthy food.Pret’s CSR programmes and made fresh and gone by tonight concept gives it a competitive edge over Eat.

Gregg’s(Follower) ­ It is an old established bakery brand found in the year 1930.The company has changed its strategy and

Starbucks(Rising Leader) ­ The company faces intense competition from Starbucks.It is an emerging and prominent brand in the market.Many of the young and professional business workers prefer going to starbucks due to its brand value and product offering

Strategy:

The company objective is to sell good natural food which are free of obscure chemicals and additives and uses natural ingredients in its products.The companies sandwiches are made fresh everyday in its kitchen and its ingredients are bought from selected suppliers.The companies aim is to be the most sustainable organization in the business which has efficient business practices, doesn’t believe in green washing and minimizes the wastage of resources.It has come up with strategy for 2015 that is Sustainability Strategy to 2015 which sets out the 5 key sustainability strands that it is working on ; these areas reflect the current global trends in sustainability around food, energy, and ecosystem security as well as the health and well­being agenda.The Five sustainability strands are Resources,Waste management,Sustainable Sourcing,Freshly Prepared,Good,Natural Food and Positive Contribution to society.

● Resources (Carbon & Water) ­ Using of energy efficiency sources to minimize the usage of water and energy. ● Waste management ­ Minimising wastage at all stages of the supply chain,food production and zero waste to landfill from shops. ● Sustainable Sourcing ­ Procuring resources from suppliers who are practicing higher levels of animal welfare and environmental stewardship all the time. ● Freshly Prepared,Good,Natural Food ­ Sticking to its mission statement & being synonymous with by providing healthy,fresh and nutritious range of food. ● Positive Contribution to Society ­ Pioneering charitable activities across all the markets through the works of Pret Foundation Trust.

Tactics:

Product: Pret A Manger products are Healthy, organic and fresh.They are free of additives,preservatives and chemicals.Key products are Sandwiches,Baguettes,Organic coffee,Salads, Salad wraps, Soups, Sushi,Drinks,Crisps,Desserts and Fruits.The prominent products for take away during lunch hours are Sandwiches,Baguettes and Organic coffee.

Price: The products aren’t expensive compared to other fast food outlets in the market.It’s current pricing strategy is penetration.It’s prices are cheaper compared to its competitor.

Place: Pret a Manger target markets are Urban areas and office going customers who are looking for a healthy grab to pick up during Lunch time.The outlets in London are present across downtown office areas and prominent tourist places ,there are currently 200+ Pret A Manger outlets in London.It offers in­dining and take away option.

Promotion: Unlike other fast food outlets, Pret doesn’t use various promotional tools such as broadcasting of ads on TV, usage of newspaper and magazine medium,sponsoring events,product placements and celebrity endorsements.It has a unique way of attracting customers it highlights its CSR activites for attracting customers,the company brands its products and stores with the intitatives it takes for sustainable business and by highlighting that they are contributing too by using its product.For Instance for every Pret Coffee purchased 5pence is donated to a charity, this message is written on the packaging of its product to create awarness about the intiative and thanks the customer for contributing.This strategy of branding the product gives the customer a feel good feeling and encourages him to use Pret products often.

The company actively uses social media sites such as Facebook and Twitter to interact with its customers and promote its newly launched menus and campaigns.It social networking team uses quirky and humorous tone to engage with it audience and resolve their complaints.

People: Pret A Manger employees at outlets are skilled and highly trained.The current staff members are well known for being friendly,helpful and complete the orders of the customers without any hassles.It runs courses for its employees at its Training Academy in Victoria and invests heavily in its employees development.The company

has created an energy awarness guide for its shop staff, so that they can understand and implement energy efficient practices in its outlets.

Process: The company uses freshly selected ingredients which are of high quality standard and free of additives in its product,the suppliers of these products go through critical evaluation before being appointed and go through great lengths to meet its standards.For Instance its wasabi mustard is brown (not fluorescent green), ham is pale (not bright pink) and dried apricots are brownish (not orange).It has in store kitchens where fresh food is prepared everyday.Pret A Manger food team meets every wednesday afternoon to discuss about food and take in suggestion of customers.The company launches upto 20 new ideas every month.For Instance it took Pret A Manger 3 years of work to come up with the perfect Porridge recipe.

Physical evidence: The companies products are made fresh everyday in its in store kitchens and are labelled with tagline “Made today,gone by tonight”.Its menu consists of fresh,healthy and nutritious products they of low calorific value.It uses paper bags from sustainably managed sources and follows the “one napkin per item purchased” guideline and recyclable plastic pots.By redesigning its baguette bags it has reduced the material used by 8.27 tonnes a year and by redesigning its Pure Pret bottles it is able to save around 28,000kg of plastic.

Action: Pret a Manger is one of the prominent organization in the world which has a unique sustainable strategy business model.The company has been able to make profits and at the same time contribute to the welfare of the society.These are the steps that have been taken by the company to achieve its goals of sustainable strategy to 2015

1)Resources – To minimize the reduction of electricity consumption in its stores it has AMR smart meters in 194 shops.Water hippos have been installed in its staff and customer toilets to reduce water wastage,it has been able to save around 144,000 litres of excess water.

2)Waste – Pret believes in supplying of fresh food to its customers every day, the leftover fresh food off the shelves is donated to Homeless people, Shelters and Charitable organizations every night.12,000 fresh meals are supplied to shelters for the homeless in London every week and annually 2.5million products are donated to U.K charities every year. This strategy is helping Pret to save around 250 million tonnes of food from ending up in Landfill.

3)Sustainable sourcing ­ The company has “no air freighting policy”. All the ingredients are imported from the developing countries by shipping. This helps in reduction of environmental impact. The company uses Free­range Eggs, Chicken, Grass­Fed beef and Outdoor & Indoor bred Pork in its products.

4)Freshly Prepared, Good, Natural Food – Pret menu consists of healthy food alternatives and consists of fresh and nutritional ingredients. The food is prepared every day using the finest of ingredients from chosen suppliers.

5)Positive contribution to society – The company has set up an charitable trust known as Pret Foundation Trust all the money raised goes to the following organizations, each of these organizations are targeted to help a specific community •Pret Charity Run – Delivering unsold food at night to homeless and shelters at night.

•The Simon Hargraves Apprenticeship scheme – Helping vulnerable people get back into employment.

•Grass roots charities and projects – Supporting homeless charities and projects throughout UK.

Control: The company has set benchmarks standards and has developed new project such as Project­Kill­A­Watt for reduction of electricity consumption in its stores.It is also part of The Carbon Reduction Commitment Energy Efficiency Scheme (CRCES) UK’s mandatory climate change and energy efficiency programmee, it submits relevant energy and carbon usage information to the government on an annual basis.

There is an awareness guide for its shop staff, so that they can understand and implement energy efficient practices.This guide is designed to complement and maximise the gains brought about by the installation of energy efficient equipment across the Pret estate.

To reduce food wastage at the stores, Pret Charity Run operates a fleet of LPG vans that deliver over 12,000 fresh meals to numerous shelters for the homeless in London every week.Many charities across the UK collect directly from our shops at the end of each day too. In total, Pret donates around 2.5 million products to UK homeless charities every year, with the added bonus of ensuring its fresh natural food goes to the homeless at the end of the day and not to landfill. This prevents up to 250 tonnes of food from ending up in landfill.

Conclusion:

Pret A Manger was founded in the year 1986 by college friends Sinclair Beecham and Julian Metcalfe.The idea behind starting up of Pret was Sinclair and Julian craving for proper sandwiches which didn’t contain obscure chemicals, additives and preservatives but they couldn’t find it anywhere.This led to the journey of opening up Pret, a fast­food chain restaurant which serves Healthy, Fresh and Organic Food.It has been in business since 26 years and has performed succesfully and has been able to acheive its goals of being a prominent fast food outlet, it currently has 335 stores worldwide.

The companies “Sustainable strategy to 2015” aims for sustainable business model and practices which will help it in achieving its mission and contribute for welfare of the society.It has come up with 5 key sustainable strands which have been implemented in all of its business operations for effective and effecient management.

It has been able to bank on the popularity of its CSR programmes by using them as a tool for marketing promotions across its brands and outlets.This has helped in creating of a positive image about the brand in the market which cares and contributes for the welfare of the society and doesn’t believe in greenwashing like other companies.

The company faces competition from upcoming and existing brands but is able to have a competitive advantage over its competitors in terms of product offering,promotional tactics,pricing and brand loyalty.

As a business student,I personally would find it risky to implement the business model of Pret A Manger.But the company’s corporate strategy and mission of being different from the other companies in the industry has made its business successful and has made it a key player in the industry.With its increasing expansion strategy and growing popularity of the brand,Pret A Manger has the potential to become the No.1 fast food outlet restaurant.

Recommendation:

Although the existing usage of promotional strategy tools has been successful, with the advent of new competitors and increase in alternative for customers it is high time it changes it existing marketing strategy as currently the brand is in its Maturity stage. By changing its promotional tools the company will be able to increase its brand awareness,gain new customers and educate the consumers about the impact they create to the society by purchasing its product.The company doesn’t uses any TV ads to sell its product.It needs to increase its usage of marketing promotional tools.As Pret A Manger is a company which promotes healthy lifestyle eating its main target areas for communicating with its customers will be health and Lifestyle magazines and websites such as Women’s health,Health & Fitness,Body building.com,Muscle & Fitness and many more.

The company also needs to come up with new menu as its product offering are less compared to other outlets in the market.Its key competitor Eat has varied products for offering.It should introduce new products in Sandwiches and Bagguettes section as these are two most popular products of the brand

With the advent of technology it is essential for every business to use every platform,currently Pret A Manger doesn’t has any mobile application the company should develop an application which will help it to connect with the customers and increase their engagement with the brand.

Reference:

1.Company Websites: http://www.pret.com https://eat.co.uk https://www.greggs.co.uk http://www.starbucks.co.uk

2. Andy Knowles, Chairman, JKR ,Pret A Manger,[Online],MarketingMagazine.co.uk,Available:http://www.marketingmagazine.co. uk/article/1119347/pret­manger [Accessed 20 November 2014].

3.Rebecca Smithers,Store Wars: Pret a Manger and Eat,[Online],theguardian.com,Available:http://www.theguardian.com/money/2012/jun/22 /store­wars­pret­a­manger­eat [Accessed 20 November 2014].

4.Sadie Hale,Coffee countdown: Which is the best high­street student coffee shop?,[Online],Independent.co.uk,Available: http://www.independent.co.uk/student/student­life/coffee­countdown­which­is­the­best­h ighstreet­student­coffee­shop­8867073.html [Accessed 21 November 2014].