Channel Management and Distribution
The channel management technique is through choosing the most effective channels or routes to market for Olive Garden. This will be a derived force to achieve the best outcomes from those channels. The application of the significant financial, training or marketing resources help in accomplishing best results from the channels (Bowersox & Cooper, 1992).
The major factors influence the channel management decision on the marketing are the usage of specific channels for market share or sales volume, costs changing of delivering to market and achieving customer satisfaction (Bowersox & Cooper, 1992).
The main consumers have been recognized as people who like Italian dishes, but cannot find Italian food due to lack of Italian restaurants. Consumers are chosen based on their preferences, long-term value and potential for Olive Garden. Illuminating Olive Garden position and recognizing growth potential through deep study of sales channels, brands and markets. This adds to the market share of competitors, consumer trends and potential of product sales (Bowersox & Cooper, 1992).
Accurate distribution channels should be selected for To-Go-Menu. This explains the order, delivery and placement. The defined distribution channels are the one facilitating customer through To-Go-Menu service. Olive Garden order and delivery channel should be based on satisfaction of consumer needs. This is for retaining consumers of Olive Garden (Bowersox & Cooper, 1992).
Marketers are the one using channels of distribution to show, deliver and sell the service or product to the buyer or consumer. This adds to, agents, retailers, distributors and wholesalers. The service channels that have been used by the marketers to process transaction with potential consumers/buyers (Bowersox & Cooper, 1992).
These kinds of services include transportation companies, warehouses, insurance companies and banks that help in transactions. Mostly the problem faced by the marketers is designing of the problem. This problem includes combination of service channels, communication and distribution for the offerings presented by marketers (Bowersox & Cooper, 1992).
Presence of coordination is very important in managing programs activities and resources. Such coordination for another section provides consumer value by addressing creation, delivery or communication for To-Go-Menu product and service. The cost of take-out dishes is based on family sizes with 2, 4, 6, or 8 that will have additional charges of packaging fee i.e. $2. Also adding sales tax. The figures are the same as shown in the following chart.
Although, the service and packaging charges are nominal. Also, cost effective for the Olive Garden. This cost estimation is based on the placement and delivering of Olive Garden products. Cost of To-Go-Menu will be based on the number of dishes, food type and size of the family. However, no presence of middlemen, because Olive Garden is direct selling to its consumer (Bowersox & Cooper, 1992).
Olive Garden has numerous ways to market its product through advertising. A budget required for conducting the research in this particular area will be of $500,000. The best price and bulk price need to determine through tested result offered by the region.
Further, need to educate the consumer about the latest product and the way to use it. Such explanation of the To-Go-Menu will cost $200,000 for the company to tell the benefits of the new product/service to their potential consumers.
Marketing Research and Expenditures
Olive Garden needs to know the advertising best suitable for promoting their new product. For this evaluation, the marketing team required $400,000 for ads made in future and bringing new changes in the product.
$200 budget is required to stock the products for the shelves. The packaging cost of each order will be $2 per purchase including sales tax. The offered price for the dishes is according to the family size such as family of 2 will be offered at $10.99 and size of 4 will be offered at $15.99 and so.
The pricing strategy of To-Go-Menu is according to the service provided by Olive Garden to fulfill their consumer needs. Also to encourage their loyal and future consumers to buy Italian dishes from Olive Garden using the To-Go-Menu service (Bowersox & Cooper, 1992).
Marketing major portion relies on the pricing strategy for a restaurant or any other company offering it’s services. Moreover, different pricing strategies are set for new services. This is according to the offered price by the restaurant related to their competitors. Analyzing the value, conveniences and quality of the product service is very important (Bowersox & Cooper, 1992).
Olive Garden is using the pricing strategy for their new service i.e. To-Go-Menu to satisfy their customers. The restaurant is using “the price penetrating strategy”. This will help Olive Garden to stand and gain against the areas where high competition is present. Another way used by Olive Garden for To-Go-Menu is psychological pricing. Such pricing includes $19.99 instead of $20 that will encourage the consumer to buy the product at discounted rates (Bowersox & Cooper, 1992).
Quantifiable Elements Used for Effectiveness of the marketing Plan Used for To-Go-Menu
The quantifiable elements are the ones when utilized for monitoring, evaluating and controlling effectiveness of the marketing plan. The best way to define quantifiable element is the degree to which a marketer can quantify easily. For example, details of mathematics or science or measurement. Tracking the delivery of the product and it’s sales will allow Olive Garden to analyze the profit of To-Go-Menu service. The breakeven formula will help in analyzing whether any profit is gained by the new product (Bowersox & Cooper, 1992).
The effectiveness of Olive Garden marketing plan will help in reaching their organizational goals through introducing a new service of To-Go-Menu. The channel management effect on decisions related to the marketing of the To-Go-Menu service was examined. Also, suitable distribution channels were chosen for the new product (Bowersox & Cooper, 1992).
Moreover, costs were analyzed in a context to delivery and service. Budget was made and quantifiable elements were recognized to measure sales profit for Olive Garden new service of To-go-Menu (Bowersox & Cooper, 1992).
Bowersox, D. J. & Cooper, M. B. (1992). Strategic marketing channel management. Mcgraw-Hill New York.