Marketing and Subway Sources

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1. What marketing PRICE strategy would you recommend to Subway to counter the threats to its business? I would recommend Subway to pursue a differentiation strategy. First of all Subway’s meals and foods are prepared for a unique customer segment. The majority of its customers are very health conscious people who prefer low calorie foods or diet products unlike MacDonald’s Burger King’s or KFC’s customers. Since the firm can be able to differentiate its products and create meal menus that are not similar to other top competitors’, it can adopt a premium pricing strategy with prices that are a little bit higher than those of its competitors. Besides Subway doesn’t have similar followers in the international markets. Customers will pay the price premium because they perceive a value in its products.

2. Why do you recommend this marketing PRICE strategy to Subway to counter the threats to its business? I especially recommend this strategy because a differentiation strategy will protect the firm from downward price pressures. Other global giants like MacDonald’s and KFC have more experience in the international markets and they can use their economies of scale advantage with brand awareness and distribution efficiency at the same time. Thus a low cost strategy wouldn’t work for Subway in the short term.

3. What marketing PRODUCT strategy would you recommend to Subway to counter the threats to its business?

Hot and cold sandwiches, turkey wraps, and salads are currently Subway’s core products. However there are other meals such as meatball marinara that are prepared for a less health conscious customer segment. I think Subway should increase the product varieties without changing its image. For example a middle aged housewife who is on diet may come to the restaurant with her kids. When she orders a low calorie salad she may want small pieces of chocolate cakes or ice-cream for her kids.

4. Why do you recommend this marketing PRODUCT strategy to...
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