WENDY’S INTERNATIONAL CASE STUDY
Wendy’s aim is to achieve international success by expanding its operations globally whilst pursuing its notions of superior quality and competitive prices. In order to do this, it must take into account the needs, attitudes, culture as well as many other determinates of consumer behaviour to be able to penetrate the market and gain market share over its competitors. Wendy’s will need to consider which factors are most important to its target market in influencing their purchase decision and strive to gain a competitive edge in the market. This essay will analyse Wendy’s marketing strategy in its international expansion and in particular, into Germany by identifying the decision making process and determinates that contribute to the attitudes and behaviour of its potential customer base.
Consumer Decision-Making Process
The consumer decision-making process is a series of steps which a consumer will go through before, whilst and after purchasing a product.
The first step is need recognition, where the consumer realises a need that needs to be resolved. This need is often stimulated by advertisements or sighting a product. Consumers go to Wendy’s to satisfy their need for food, which Wendy’s aims to satisfy with its menu. In Korea, Wendy’s restaurants are located in high-traffic, prime visibility locations that keeps the store in the public eye – which may stimulate latent needs of consumers. For example, a consumer who was not overly hungry may decide to drop into Wendy’s to grab a quick snack just because he/she saw the large attractive signs.
Next is information search, whereby customers search for information through their evoked set of recognisable brands. The relevant ones in this case study being McDonalds, Burger King, KFC and of course Wendy’s. In order for Wendy’s to gain an advantage in this stage, it must differentiate itself from its competitors – and it tries to do this by perceiving itself as a higher quality, more health conscious alternative to its main rivals. However, for fast food products, the main determinate in whether a store enters a consumers ‘evoked set’ is the amount of advertising that is done, thus to ensure success, Wendy’s should make sure that enough advertising is done to promote its brand. It must then carry through the promises it makes about the quality of its products and stores to gain customer loyalty and hopefully generate positive word-of-mouth and hence increased brand recognition.
Alternative evaluation is where the consumer evaluates the particular product against its competition. Because Wendy’s products are in the fast food category, and thus very low involvement, a typical consumer will not go through a long search process, as the benefits of search are not worth the effort involved. For a potential customer of Wendy’s, all they want is a quick efficient product that symbolises the ‘American lifestyle’ that Wendy’s is meant to portray. The product itself is low importance and low risk as consumption is usually swift and US hygiene standards are of a high level, thus these are not factors which usually comes into a consumer’s mind when they are deciding where to eat. Generally, a customer will usually just go to the most convenient fast food outlet that they have heard of and trust. Thus for Wendy’s to have maximum success, they should place emphasis on advertising to let its brand name be known to consumers. It should particularly emphasize its main business proposition of being number one in quality and service in the advertisements as this will influence a customer’s understanding of perceived benefits when visiting a Wendy’s store. Placing its stores in strategic locations where customers are must likely to frequent, whether it be near office buildings, discotheques or shopping centers etc depending on the country’s culture, will also ensure that there will always be large traffic into its restaurants.
Once a customer has selected Wendy’s as their place of hunger satisfaction, it is then up to Wendy’s to ensure that it carries out its promises and fulfills the desires and perceived benefits from visiting the store. Determinants such as store hygiene, experience and friendliness of staff, speed of service, product selection etc can all influence whether or not a customer is satisfied with their visit. This in turn will determine whether or not the visit will leave a positive view of the store in their mind, if it doesn’t then the customer is unlike to return to the store in the future.
The post purchase evaluation stage should confirm that the customer has made a correct selection in choosing Wendy’s and that their overall experience with the restaurant was a positive one. This means that all or most of their expectations were satisfied and that Wendy’s truly does represent a high quality American style meal. If this is so, then the marketing strategy of Wendy’s has been a success and it should ensure customer loyalty and repeat purchases.
Individual Determinants of Consumer Behaviour
By understanding and analysing what drives a customer into its stores and eventually buys its products, Wendy’s can start to understand the individual determinants of consumer behaviour. These attitudes include consumer resources, motivation, involvement, knowledge, attitudes and personality/lifestyle, each of these will be discussed below.
Consumer resources will affect what decisions the decisions that they make, whether it be economic, temporal or cognitive. A potential Wendy’s customer is likely to want a cheap, quick yet tasty meal. They are not likely to do much research into what they are buying and unlikely to stay in the restaurant for a long period of time. Wendy’s must therefore take all of these factors into account whilst planning its marketing and sales strategy. The prices must be affordable, delivery time quick and must still be of good quality – if these criterion are not met, a customer’s actualised experience will be lower than their perceived experience and will therefore be unsatisfied and unlikely to rate the brand favorably. The amount of resources a consumer has may also affect their motivations towards purchasing a product.
Motivation is ‘the state of drive or arousal that pushes behaviour towards a goal-object’ (Widing et al, 2003). The motivation of a potential Wendy’s customer can range from a simple hunger which needs to be satisfied to someone wanting to enjoy an ‘American experience’, which they seek to find at Wendy’s. In order to influence customers’ motivations, Wendy’s will need to ensure that their stores fits what motivates its customers and satisfy their needs whether they be basic, ie hunger, or more complex, ie the need to satisfy self-esteem by purchasing the higher quality Wendy’s products over its alternatives. Because fast food is such a low involvement product, temporal resources motivate consumers much more than economic and cognitive ones. If a customer gets what he/she desires in a timely manner, and it is priced reasonably, they will usually be content.
The knowledge aspect is an important determinate that Wendy’s needs to capitalize on – if a person does know about Wendy’s or know what kind of products they serve, then they are far more likely to go somewhere that they are more accustomed to. Wendy’s must focus on getting its brand name out to potential customers en mass. Not only must they deliver their brand name, but they also have to let consumers know their value propositions and how they differentiate themselves from their rivals such as McDonalds or Burger King. Their management specifically focuses on a higher quality product with their slogan ‘the best hamburgers in America’ being their main advertising gimmick. In European cultures, consumers see going to Wendy’s as an ‘American experience’; thus advertisements and promotions should promote their slogan strongly in order to tell consumers that Wendy’s represents the experience they are looking for and also happen to offer the best product available.
Similarly, these marketing campaigns are likely to affect a person’s attitudes towards Wendy’s. Attitudes are learned predispositions to respond to an object or class of objects in a consistent manner (Widing et al, 2003). Consumers’ attitudes towards Wendy’s will be affected firstly by advertisements and related marketing campaigns – these will influence the brand belief of the consumer and create an expectation of the brand. If this is a positive expectation, then the consumer is likely to go to the restaurant for a meal and this will leave another impression on their mind. This impression will then affect future attitudes towards the brand, if their experience was a positive one then it will leave a good impression and a positive attitude and the opposite if their impression was a negative one. A person’s attitudes towards a brand or product is perhaps the main determinate in whether or not a product is purchased – in order to maintain a positive attitude by its customers Wendy’s must not only promote itself as a great place to eat, but must also carry out this promise.
External Influences of Consumer Behaviour
Lastly, we shall look at the external influences that contribute to the behaviour of consumers. These include such factors such as demographics, family, culture and social class. All of these factors will affect certain characteristics within consumers and may determine whether or not they will purchase a product. Wendy’s will need to research all of these influences, especially in its international expansions to learn about the different cultures and way of life of the different consumers in order to gain maximum market share.
The main change in culture and demographics all over the world is the increasing number of women who are working full-time. This of course means less time to cook at home and hence families are eating out a lot more. Wendy’s can take advantage of this trend by establishing itself as a nice place where the whole family can come in and enjoy a meal.
As the case study suggests, Wendy’s is looking to expand its market share globally, especially in reentering the German market. In order to do this, they must fully understand and analyse the German culture, way of life and what motivates German consumers to buy fast food products. Germans see Wendy’s as a relatively cheap and convenient way of getting some fast food. They consider Wendy’s quality of food as a large incentive to go there – they also value taste and nutritional quality of food as well as cleanliness and environmental friendliness of the restaurants. Hence Wendy’s must make sure that they comply with the German expectations of their restaurants if they are to be successful at penetrating that particular market.
In order for Wendy’s to continue its success in the domestic market and create success while expanding into international markets, it must fully analyse the ways consumers behave. Each country will have different cultures, values and demographics and Wendy’s will need to market its brand name and products accordingly. Research into the attitudes and motivations of the different market segmentations will greatly increase the probability of prosperity for the company. Because fast food is such a low involvement and the market is very saturated, the best Wendy’s can do is create convenient and efficient service at reasonable prices while still providing a high quality product for the consumer. This way, the perceived benefits of the consumer are met and the are satisfied with their experience, which will most likely result in a positive attitude and repeat purchases in the future. In conclusion, by building a good brand image and exceeding expectations, Wendy’s will go a long way in meeting the explicit needs and creating customer satisfaction.