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let's discuss some of the research methods used by Jason and Karen in determining the efficacy of starting a food truck business, as set out

let's discuss some of the research methods used by Jason and Karen in determining the efficacy of starting a food truck business, as set out in Case #1 - Street Food Rocks.

Questions:

  1. Evaluate the quality and variety of the research methods used in the research performed by these budding entrepreneurs. Do you think they have enough information to proceed to a marketing plan?
  2. What might you consider as additional primary data, if any, that you would want to retrieve from the research methods used in the Case? Where are the holes in their research, if any? Give at least one thing you might want to know that is not yet covered in the Case to make evaluation of the business opportunity more definite; alternatively, defend the research as complete.
  3. Given the description of the target market Jason and Karen seem to be gravitating toward, use Maslow's Hierarchy of Needs to identify what level on the Maslow pyramid you feel they are positioning their marketing approach towards. Do you feel this is the right level or not? Justify your conclusion.

Case 1 - Street Foods Rocks

Jason Alton and Karen Andersen, both now in their 30s, were "best" friends since their school days in Missoula, Montana. They shared an irrepressible love for the outdoors. Hiking, swimming and exploring were regular activates they enjoyed together since the early days.

Upon completion of high school, Jason stayed in Montana, attending Montana State University School of Agriculture, specialization in Land Resources and Environmental Sciences.Karen ventured beyond Montana, attending University of Portland in Oregon, majoring in Integrative Health and Wellness. Despite the distance, both stayed in touch and eventually decided to take a year off after graduation in search of more "exotic" places and experiences. What was to be a year of travel, turned into multiple years of itinerant living, following their instinctive desire to enjoy the "experiences of a life time".

Now in their early thirties and without stable incomes, both Jason and Karen realized it was time to move towards developing career plans. Both loathed joining the job market and were determined to turn their experiences of the last decade into a promising future. Karen recollected college learning on integrative wellness, while Jason recalled his interest in agriculture, especially food production. "Why not put together wellness, food and our years of experience eating delicious street food to start a business offering healthy, flavorful street food", said Karen.

Both Jason and Karen were enthusiastic about this possibility. They knew from experience that street food was accessible, fast and delicious, and commonplace, but usually not perceived as healthful, or even "gourmet". They were both confident about their capabilities in creating a cuisine that represented a fusion between familiarity, healthful and exotic. However, questions about market interest, demand, location, and other marketing matters remained unexplored. Where would they begin? Who could help with the early investment?

For starters (no pun intended) they decided to explore a few of the street food capitals near them (Austin, Seattle, Portland..) in order observe vendors, patrons, possibly survey the upscale offerings, and gather direct market research on customers. Maybe they reasoned, their direct observed data could be combined with secondary sources and social media search to help them determine the particulars of their business and marketing strategy. The questions paramount on their mind were: which city should they select as their initial entry and what would be the contours of their business differentiation.

After six months of travel to cities to observe customer buying process and direct conversations with street food patrons, they summarized their finds.

Washington DC - Relevant Top Street Vendors

  • Basil Thyme:Fresh lasagna each day, served in large portions.
  • Captain Cookie and the Milkman:Different types of freshly baked cookies.
  • Red Hook Lobster Pound: lobster rolls and authentic clam chowder.

Seattle - Relevant Top Street Vendors

  • Curbside: Vietnamese
  • Cheese Wizard: grilled cheese and soups

Portland - Relevant Top Street Vendors

  • Bing Mi: Chinese
  • Nong's Khao Man Gai: Thai
  • Chez Dodo:Fusion

Los Angeles - Relevant Top Street Vendors

  • Roy Choi: Korean Mexican fusion with social mission."
  • Free Range: free range chicken menu

Based on their research of the vendors and patrons in the cities they visited, both Jason and Karen became increasingly upbeat about their prospects. Both knew that the lower end market, fast food ethnic offerings, was price competitive and concentrated by location. They doubted their ability to survive in this intensely cost competitive sector of the industry by forging a "new" ethnic market that would be another version of the "fast food". Both aspired to build a business offering healthful offerings that appealed to a more refined palette, modelling their business model to Roy Choi and Free Range truck.

Jason was excited at the prospect of starting on the food truck marketing campaign - name, logo, brand, truck graphics, website, and social media. He knew he was up for this. But Karen seemed to be moving in another direction. She demanded that they select the market entry into a city and community that they were already familiar. By doing so, she argued, they would be more effective in reaching out to the larger community, engaging in community events where partygoers loved food, and forging relationships/partnerships with suppliers and booking agents. This, she argued would be a great opportunity to prototype their business and learn directly from their experiences. Finally after much thought, they agreed on Portland, Oregon.After having travelled around the major cities in the west, south and the Midwest, the city that they both found emotionally drawn to was Portland.

Another important factor in selecting Portland was the weather, a major risk factor for the food truck business. "Summers are Grand", so goes the common saying in Portland. Summers are usually drywith mild to warm temperatures and low humidity for much of June through August and possibly into September. The first frost arrives in early November, and the last frost departs early April.

Karen was also familiar with the major events during the spring and summer months, including Cinco de Mayo and Rose festivals in April, Beer Week, Festa Italiana in June, Oregon Brewers Festival, Cathedral Park Jazz festival, and Waterfront Blues festival in July, PDX Adult Soapbox Derby, Dahlia Festival in August, and Feast Portland and Rose City Comic Con in September.

They both paused in their excitement to ask other basic questions - Do we know our potential customers?Who they are? What do they value?Can we be different in a way the customers would value our service? So, they set to work pouring over their market research of the last six months.

Portland Demographics

Secondary Sources: United States Census

Population (July 2019) 654,741
Percent of population between 18 and 65 36%
Female 51%
White 77%
Foreign Born Persons 14%
Households 264,428
Households with broadband internet 87%
High school graduates 92%
In civilian labor force 70%
All firms 75,583
Median Household Income $66,740
Per capita Income $38,764
Average commute time 20 + mts

Going beyond the demographic data, Jason and Karen summarized their survey information into a digestible format. They had asked open ended questions in customer interactions, but the responses could not always be easily categorized, due to contradictions and non sequiturs. So, they calculated percentages based on judgement and the numbers did not always add up neatly into a pie chart of 100%.

Question Responses

How do you feel about street food?

Eat regularly for lunch (80%); Once a week (12%).

Too salty, but I like it (15%). Very tasty and filling (18%). Like it too much, but I shouldn't (35%). Yes, ok (45%) My boyfriend like it, but I don't. (19%)

What do you like best about street food?

Fast (95%), Quick service (90%) Very tasty.(30%) Don't want to walk into a diner. (95%). Cheap, Less than $7, can't get any better. (89%). Love, rice (25%). Love Chinese, but I shouldn't.

What is the things you hate about street food?

Too hot, hate to stand in line; Don't like the plastic or Styrofoam (30%). Probably not healthy (28%)

What different food trucks do you usually patronize?

Lunch: Chinese (30%); Middle East (35%), Hot dogs (60%), Pizza (35%)

Evening: Middle East 60%, Chinese 10%, Pizza (40%)

What motivated you to come to this food truck?

Been coming here. Know the cook, Fast service. Tasty. Not really healthy.

Do you crave the quick meals from food trucks and why?

Yes, tasty and fast. (20%) No, Not healthy (65%), line is too long (10%). Want Chipotle fresh (5%)

What things could street food do better?

Better food (25%). More healthy(30%); Some ice cream too (10%)

Lunch crowd: How do you usually have your lunch?

Some days I bring my own (25%); I walk to the nearest place (20%). I go to the same place (45%); I go where I feel (10%)

Lunch crowd: How do you decide your lunch plans?

To the nearest street food (10%); I go to the same place (35%); Don't have plans (20%)

Evening crowd: How do you decide your plans?

Restaurant with friends (60% ). Cook at home (20%); Go to a food truck (20%) if I did not eat street food for lunch (55%)

Evening crowds: How would you family react if you brought dinner home from food trucks?

My family would kill me. No, too long to carry, Smells too much

They would like it (15%)

How much would you willing to spend for great, healthy Street food for lunch?

$7 (50%) Maybe $9 (25%. If it is really good, then $11 - $12 (20%)

For great healthy foods how much would you willing to pay for dinner?

Is healthy food tasty? (5%); Maybe $15 (30%). If it really healthy, I want to know what is in it (55%).
Do you feel that free range chicken is healthy? Yea (30%) No (10%). Don't know, maybe (35%).
Do you think that corn fed beef is healthy For burgers, yes (45%). Don't know (30%). What is corn fed (20%)
How do you feel about ethnically mixed fusion food What is that (30%). No, don't care for fusion (35%). Maybe (25%)
Like Chinese American, Tex Mex? Yea I like Tex Mex (40%). Go to Chipotle (10%). Chinese American? (10%) Mix Chinese with French Fries (5%)
Like ice cream made from organic milk? Oh Yea (60%). Don't care 20%. Love chocolate (10%). Organic? Who cares? (5%)
How often do you check our reviews of street food vendors Never (35%); Yea, once in a way when I get tired of the regular joint (25%); Is there a review site(35%)? I didn't know, but now I will (30%)

Karen and Jason know that there is a thriving market in Portland for street food, especially during the lunch hour. They tried to count the customer traffic between lunch and evening hours. They noticed often a 45% decrease in the evening traffic in several locations.

Karen wanted to flush out the customers beyond the summary data, above. She used her notes to build a customer persona/archetype of street food patrons.

Tanisha

Tanisha was a regular patron of street food twice a week. She visited the same vendor around 12:30 PM. She ordered the same items from the menu. Tanisha stated that she worked at a busy office two blocks away from the vendor. She had patronized several vendors closer to her office, but preferred to walk the two blocks so that her colleagues would not observe her lunch habits. Tanisha also liked the warm greeting she received each day at the lunch stop and noted that the cook/server no longer required her to spell out her order.

Tanisha liked street food and said that it was affordable. She sympathized with the street food vendor as a hard working person like her, and felt a certain degree of loyalty to the vendor and his family.She stated that she tried to bring lunch of healthy salad every day, but treated herself to a meal outside at least twice a week.

She did not stop at any street vendors during the evening hours, preferring to hurry on with her commute and head back home.

Steve

Steve is a middle aged skilled worker, employed in construction or related jobs. He was on his lunch break and needed to grab a quick lunch and a quiet soda before heading back to work. He noted that his work required physical strength and he wanted to have a solid lunch meal before heading back. The street vendors offered him the quantity and taste that he craved and he felt strong and able after his meal.

Steve was concerned that he patronized street food too often. He had limited time in the morning to prepare his lunch for the day and he hated standing in line for a deli sandwich. Often, he ordered evening meals from street food vendors to take back home.

When asked about his health, Steve confirmed that his meals were not the healthiest. He preferred to eat better, but did not find the time to prepare or seek out healthy take outs. He stated that he is willing to try new healthy choices, but the food must be served fast and it must be satisfying (like with rice or noodles).

Christine

Christine was not comfortable with buying street food. Sometimes she patronized them for lunch and sometimes she carried home the evening meal.She searched on the review sites for different options, but they all seemed the same to her, just different in the type of food.

Christine did not want to eat some much "fast food", but with a family at home that needed her time, the options were so limited. "How do I get affordable food in a hurry, other than pizza"?

Christine views "healthful" eating was about eating vegetables, less fried food and maybe better quality of meats. She could not define what she wanted better in healthy food, but she claimed that if they existed she would try them. It "just must be affordable".

There were several other stories that Karen could draw from notes, conversations on food blogs, Facebook, Twitter, Reddit, among others. But, they both felt that they had reached a stage when some clear planning should start based on the research they have at hand.

References

Quick Facts. United States Census Bureau Retrieved from https://www.census.gov/quickfacts/fact/table/portlandcityoregon/PST045219

https://weather.com/weather/tenday/l/Portland+OR?canonicalCityId=c40ea029567346e5ac018cfad4d1949d051f3098aff5aa605e0009ef5576d804. Retrieved July, 15, 2020.

https://www.travelportland.com/events/festivals/. Retrieved July, 15, 2020. Retrieved July, 15, 2020.

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