Team Omega: Tim Hortons

10,601 views
10,012 views

Published on

University of Michigan Sport Management: Marketing Capstone

Published in: Business
0 Comments
1 Like
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total views
10,601
On SlideShare
0
From Embeds
0
Number of Embeds
299
Actions
Shares
0
Downloads
142
Comments
0
Likes
1
Embeds 0
No embeds

No notes for slide

Team Omega: Tim Hortons

  1. 1. SM 346 Final Project! Analysis of andRecommendations for Tim Hortons"
  2. 2. Introduction to Tim Hortons•  Founded in 1964 as a “coffee and donuts” shop•  Dedicated to satisfying the changing tastes of consumers through product innovation•  #1 seller remains their “legendary” coffee•  95% franchise owned in Canada, similar strategy in U.S. •  Merged with Wendy’s International, Inc. in 1995 in order to place greater focus on United States expansion
  3. 3. Identification of the ProblemWhile Tim Hortons does a great job of attracting thesegment of consumers that are “on the run,” theydisregard several other segments of coffee drinkerswho need a comfortable space to spend time and “calltheir own” when buying and consuming coffee. After our analysis, we have proposed a plan that will leave Tim Hortons better positioned to gain customers seeking a comfortable place to call their own, while maintaining their established customer base of ‘on-the-run’ consumers.
  4. 4. Current Situational Analysis
  5. 5. Strengths•  Largest quick service restaurant chain in Canada •  3,200 locations in Canada •  600 in the United States•  Iconic in Canadian culture •  40% of all fast-food revenues •  80% of the baked goods market •  66% of the coffee market•  Demonstrates corporate social responsibility through various programs
  6. 6. Weaknesses•  No brand recognition in the United States •  Small presence in the U.S. with just 606 units •  Locations are not as profitable as Canadian counterparts•  Competition in the U.S. is fierce •  All-American brands like Starbucks and Dunkin Donuts have many more locations per capita
  7. 7. Opportunities•  International expansion •  In 2011, Tim Hortons expanded internationally to the Gulf Cooperation Council •  5 restaurants opened in the United Arab Emirates•  Canadian expansion•  Product line expansion
  8. 8. Threats •  Competitors are continuously moving into Tim Hortons’ territory •  Global economic recession can result in increased costs for labor, production, and resources •  Threat of market saturation
  9. 9. Segmentation, Targeting, & Positioning
  10. 10. Overall Strategy & Objectives•  Based  on  the  mission  statement  below,  Tim  Hortons’  strategy  focuses  on   two  main  objec;ves   •  Deliver  quality  products  and  services   •  Be  the  industry  leader  in  all  that  they  do  •  They  deliver  on  this  mission  through  their  CSR  ini;a;ves  and  dedica;on  to   quality  product  sourcing   “Our guiding mission is to deliver superior quality products and services for our guests and communities through leadership, innovation and partnerships. Our vision is to be the quality leader in everything we do.”
  11. 11. Segmentation Methods GEOGRAPHIC   DEMOGRAPHIC   PSYCHOGRAPHIC        Heavily  Canadian.  In  the   Gender  and  age  ranges   Fast-­‐paced  lifestyle,  “on-­‐states,  localized  in  near-­‐ generally  similar;  decrease   the-­‐run”  consump;on   north  ci;es  such  as   in  consump;on  by  seniors.   style.  May  appreciate   Wealthy  more  likely  to   Detroit  and  Buffalo;   CSR  and  environmental   frequent  Starbucks  than  TH   scaIered  elsewhere. or  DD.     ac;ons.   GEODEMOGRAPHIC   BENEFIT   BEHAVIORAL         Suburban  and  “small-­‐ Those  who  seek   Loyal  and  frequent  urban”  subsectors.  Lack   convenience  and   consumer  base  of  “on-­‐ of  penetra;on  in   economy  receive  both   the-­‐go”  coffee  drinkers.   affluent  and   from  Tim  Hortons. Tim  Hortons  fans  are   sophis;cated  areas. avid  –  LOVE  Tim   Hortons.  
  12. 12. Evaluating Segment Attractiveness Current Strategy" Proposed Strategy" Identifiable? Identifiable?Convenience and economic-driven consumers Maintain convenience-driven base while extendinglooking for a quality product in a QSR setting reach to those looking for a comfortable place. Substantial? Substantial?Large proven customer base in Canada; working to Coffee market in the U.S. is huge: 64% of surveyedbuild similar base in U.S. Americans consumed coffee in past 30 days. Reachable? Reachable?Current marketing strategy includes all traditional Similar marketing strategy with an emphasis onforms of media (TV, Radio, Print, Outdoor) as well as digital and social as well as event-based marketing. social platforms (Facebook, Twitter, YouTube) Responsive? Responsive?Current customer base accepts Tim Hortons’ value Based on our survey data, consumers are receptiveproposition, reacts positively to offerings with high to our proposed ideas. levels of customer loyalty Profitable? Profitable?In Canada, yes: 66% of Canadian coffee market; Similar options profitable; these consumers are80% baked goods, 40% QSR. Need to build in U.S. some of most engaged.
  13. 13. Selecting Target MarketOur proposed strategy shift will maintain the mass-marketing approach that TimHortons currently employs •  TV •  Radio •  Print •  Outdoor (billboards, etc.) •  Social: Facebook, Twitter, YouTube However, we will focus heavily on digital and event-based marketing, which will become clear later in our presentation.
  14. 14. Developing a Positioning Strategy High Quality •  Lab •  Dunkin •  Starbucks Donuts •  Tim Hortons •  Rendezvous •  Bert’s On-the-run Leisure •  Espresso Royale •  Biggby •  7-11 Low QualityTarget Market: Benefits Offered: Price:Convenience & price- Low price, quick service, Inexpensive (comparableminded consumers good quality to competitors)
  15. 15. Marketing Mix Product     Price     Value  Crea)on   Value  Capture   Promo@on   Place     Value   Value  Delivery   Communica)on  
  16. 16. Product•  Wide variety of goods •  Coffee, specialty beverages like espresso and iced coffee, baked goods, and breakfast and lunch options•  “On-the-go” options•  Don’t offer many things you have to sit down to eat
  17. 17. Price •  Coffee is priced around $1.20 •  Less expensive than other coffee shops•  More focused on offering convenient items with less variety•  Tim Hortons is about value and convenience   Place•  Tim Hortons is primarily consumed in Canada •  Majority of outlets are located in Ontario•  Their restaurant are the main way they get their products to the consumer and generate profits •  Some items can be bought online
  18. 18. Promotion•  TimmyMe •  Allows user to find the 10 closest store locations, get directions to the nearest location, check the balances of a gift card, and get nutritional information on all their products•  Facebook and Twitter•  Roll Up the Rim to Win •  Customer rolls up the rim on their coffee with chance of winning anything from free coffee or doughnuts to a brand new car •  Held annually since 1986
  19. 19. Recommendations HANGOUT Ω   Quick Caffeinators   What business are coffee shops really in?" The simple answer might be “selling coffee” PLug-INs   Comfort Creatures   But every brand has an emotion behind it, else it’s just a product. " For many coffee shops, that emotion tends to be" A la central perk   “Apart from their home and office, Hip-sperts   people tend to seek out a place they can call their own”
  20. 20. Our recommendationsreflect the knowledge thatthere are several consumersegments who want theircoffee shop to be a place toplug in and do work, relaxwith a good book, or meetup with friends.Our research reinforced this by reflecting the perceptions of TimHortons and Dunkin Donuts as less inviting, with few having ever satdown in either establishment. Our primary recommendation is to create “Hortons Hangout” in all locations, incorporating HANGOUT event-marketing as part of the launch.
  21. 21. These sit-down consumers are often the most engaged withthe brand, frequenting their choice of coffee shop severaltimes a week for extended periods of time, and oftenpurchasing multiple drinks and snack items during their stay.
  22. 22. Coinciding with the launch of “Hortons Hangouts” we will create pop-up hangout events in cities, on campuses, at bus shelters, etc. Two great examples from Absolut and Caribou Coffee
  23. 23. Adding Value to TimmyMeCompetitors’ apps incorporate payment systems andcustomer loyalty programs, where perks are receivedafter a given number of purchases, on birthdays, etc. The new and improved TimmyMe will incorporate thesefunctions with the added benefit of WiFi enhancementsand the best new function…
  24. 24. Is This Seat Open?Have you ever planned to go to Starbucks or even the UgLi to study, only to be denied an outlet or a seat altogether? Each Hortons Hangout will be equipped with the technology for access on TimmyMe Before accessing the WiFi – which Tim Hortons has alreadyimplemented in all locations – users will be obligated to disclose whether they are seated in the Hangout and using an outlet TimmyMe will know the logistics of each location and be able to inform users whether there are seats or outlets open
  25. 25. Each of these marketing innovations HANGOUT will drive value to Tim Hortons" allowing them to access the consumer base of coffee drinkers who need a comfortable place, while maintainingtheir established “on-the-go” customers
  26. 26. That concludes our presentation Would you be more likely to frequent TimHortons if these options were available? That concludes our presentation Are there any questions?

×