Marketing Management Report: Competitive Analysis of Pizza Club

This report provides a comprehensive analysis of the marketing strategies employed by Pizza Club, a food and beverage company operating in New Zealand. The report begins with an executive summary and table of contents, followed by an introduction outlining the competitive landscape of the food and beverage industry. Internal analysis is conducted using Porter's generic strategies, evaluating Pizza Club's differentiation, cost leadership, and focus strategies. The effectiveness of these strategies is assessed, followed by a detailed SWOT analysis, identifying the company's strengths, weaknesses, opportunities, and threats. External factors are evaluated using PESTLE analysis, examining the political, economic, social, technological, legal, and environmental influences on Pizza Club. The report concludes with recommendations for enhancing Pizza Club's competitiveness, supported by cited references. The report highlights the challenges faced by the company, such as competition from global brands and the need for increased market coverage, while also identifying opportunities for expansion and diversification.

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Executive summary
The aim of this report is to discuss about the competitive strategies being involved by Pizza club
in their business operation. Various marketing models such as SWOT and PESTLE are being
used in this report in order to evaluate the competitive strategies of pizza club compared to their
competitors. This report concludes that pizza club is having various competitive advantages in
the market such as local sourcing and product variants. However, there are various issues being
identified, which are creating barrier in effectively competing in the market. One of the key
issues being identified is the lack of capital. Accordingly, various recommendations are being
discussed in this report.

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Table of Contents
Introduction......................................................................................................................................4
Internal analysis...............................................................................................................................5
Porter generic strategies...............................................................................................................5
Effectiveness of competitiveness of pizza club...............................................................................7
SWOT analysis................................................................................................................................7
Strengths......................................................................................................................................7
Weaknesses..................................................................................................................................8
Opportunities...............................................................................................................................9
Threats.........................................................................................................................................9
External analysis............................................................................................................................10
Political environment.................................................................................................................10
Economic environment..............................................................................................................11
Social environment....................................................................................................................11
Technological environment.......................................................................................................11
Legal environment.....................................................................................................................12
Environmental factors................................................................................................................12
Conclusion.....................................................................................................................................12
Recommendations..........................................................................................................................12
Reference.......................................................................................................................................14

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Introduction
In the current business scenario, contemporary business organizations are gaining their
competitive advantages by operating in various diversified sectors. Among all the potential
business sectors, food and beverage sector is one of the most potential sectors. This is due to the
reason that, food and beverage sectors cover a huge area of diverse food culture around the world
(Davis et al. 2013). Moreover, in the present era of globalization, people around the world are
having the access of different food culture, which is being effectively tapped by different
business organizations operating in this sector (Govil & Rashmi, 2013). However, the current
business scenario is much competitive than it was a decade ago. Thus, business organizations
have to gain competitiveness in the market in order to stay ahead in the competition.
Pizza club is one of the leading organizations offering diverse range of pizza in New
Zealand. They are comparatively new in this sector compared to their global competitors.
However, with their diverse product portfolio catering to varied tastes of the customers helped
them to target and attracts the customers effectively (Fernhaber & Patel, 2012). However, in the
recent times, they are facing challenges in maintaining their operational facilities across New
Zealand. Thus, they are in the need of an effective competitive strategy in order to stay ahead in
the competition and to enhance their business potential.
This report will discuss about the competitive strategies being involved by Pizza club in
their business operation. Different models including Porter generic strategies and SWOT will be
discussed in this report in order to evaluate the competitiveness of them. Accordingly,
recommendations will be provided, which will in turn help the organization to enhance their
operational effectiveness.

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Internal analysis
The internal analysis of pizza club will be done in order to gain an understanding of the
competitive strategies being followed by them (Tanwar, 2013). Porter generic strategic model
will be used in order to analyze the strategies of pizza club.
Porter generic strategies
Differentiation strategy
This model states about three competitive strategies namely focus, cost leadership and
differentiation. According to this model, involving these three strategies will help the business
organizations in gaining competitive advantages in the market. The first dimension states that,
initiation of the differentiation strategy will help the business organizations in offering distinctive
and unique products in the market, which will help them in staying ahead in the competition
(Banker, Mashruwala & Tripathy, 2014). In the case of pizza club, the basic products that they
are offering are same as their competitors. However, they have initiated the differentiation
strategy in terms of their service delivery and product variation. According to the official website
of pizza club, they are offering vast range of pizzas ranging from vegetables, chicken, meat and
seafood. Moreover, differentiation is being initiated by them in terms of their service such store
ambience, home delivery in less time and more area coverage. Thus, offerings of more flavor and
variants are helping them to provide their customers unique experience among the competitors in
the market.
Cost leadership
The next dimension is having the cost leadership in the market. According to this
strategy, business organizations having cost leadership in the market will enable them to offer

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their products to their customers in lower prices. Thus, the more affordable will be the cost of
the products, the more market area they will be cover with having more number of target
customers (Valipour, Birjandi & Honarbakhsh, 2012). In the case of pizza club, they have
initiated the process of cost leadership by sourcing their raw materials locally. Local sourcing of
the raw materials helped them in reducing the cost involved in producing the end products.
Eventually it helped them to offer their products in competitive process, which enhances their
competitiveness in the market. Moreover, on the other hand, the reduction in the cost of
production will increase the profitability in their daily operation. Thus, initiation of the cost
leadership is helping pizza club in gaining competitiveness in the market.
Focus
Focus strategy is very much beneficial for the beneficial and effective for the
contemporary business organizations such as pizza club. This is due to the reason that, majority
of the contemporary business organizations has their own target market and according to the
taste and preference pattern of the target customers, they offer their products in the market. In the
case of pizza club, they are not offering niche products in the market and thus they do not have
any niche marketing strategies (Wilson et al., 2012). However, due to the fact that they are
catering to the customers of New Zealand, thus their product portfolio is being designed and
offered accordingly. The flavor and variants of pizzas and other food products are being offered
according to the local food culture and taste. This strategy helps them in effectively meeting the
requirement of the local customers, which in turn are the target customers for pizza club.

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Effectiveness of competitiveness of pizza club
Thus, from the above analysis of the competitive strategies being involved by pizza club,
it is being seen that, they are involving all the three generic strategies in their business operation.
Moreover, it is also been seen that, initiation of the above discussed strategies are helping them
in catering their target market effectively along with offering the products at lower prices
(Chakrabarti & Mitchell, 2013). However, there still some challenges and future threats that may
be faced by them in their business operation. Thus, SWOT analysis will be involved in the
following sections in order to determine the challenges and opportunities of pizza club.
SWOT analysis
Strengths
 One of the key strengths being identified is the brand value gained by pizza club in the
short span of their operation. This is due to the reason that, the service ambience,
products variants and added facilities have helped them to target their customer more
effectively (Wang & Tzeng, 2012). This in turn helped them to gain positive word of
mouth in the market. This positive brand value will be helpful for them to further
penetrate in the existing market and to enter in the new market.
 As given in the official website of pizza club, they are having huge variety of products to
be offered to their customers ranging for the vegetarian and non vegetarian customers
(Chen & Cui, 2013). Thus, they are being effective in targeting in different taste and
preference pattern of the customers.
 Sourcing of raw materials from the local suppliers is helping them in reducing the cost of
sourcing raw material along with having the access to the fresh raw materials. Thus,

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reduction in the cost of production enables them to offer their product in more
competitive prices (Ben-Daya, As’ad & Seliaman, 2013). This is helping them in catering
and reaching out to more number of customers.
Weaknesses
 One of the key weaknesses for pizza club being identified is the lower brand value
compared to the global brands. This is due to the reason that, pizza club is being
originated just a few years ago and gradually they are developing in the market.
However, on the other hand, the global brands in this sector are having huge brand value,
which further helps them to attract more customers. Thus, in the current competitive
scenario in this sector, pizza club is facing difficulty in competing with their global
competitors.
 Pizza club is having their market coverage only around the major cities in New Zealand.
On the other hand, their global competitors are having more market penetration with
having global brand profile (Ross, 2013). Thus, it is difficult for pizza club to cater and
reach out to vast number of customers compared to their competitors. Limited market
coverage is also limiting their business potentiality in the market. In addition, having no
global brand value is refraining them to effectively penetrate in the existing market as
well as in the new market.
 As discussed earlier, one of the key competitive strategies being involved by pizza club is
the lower priced products. Thus, due to the initiation of the lower price of their product
portfolio, the profit percentage for them is lower compared to their competitors. This is
creating challenges for them in investing further to expand their market coverage.

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Opportunities
 Currently, pizza club is operating in any foreign countries however; entering in the global
market will provide huge opportunities for them. This is due to the reason that, entering
in the global market will help them to attract more number of customers along with
enhancement in the brand value.
 Currently, they are catering to different flavor and variants of pizza for their existing
customers (Chernev, 2012). However, with the increase in more flavor and variants, they
will be able to cater and reach out to more number of customers by meeting diversified
requirements. Thus, the size of the target market will get increased.
 Another key opportunity for them being identified is the diversification policy. According
to the concept of diversification, pizza club can also enter in related sectors to their
existing business line (Bowen, Baker & Powell, 2015). For instance, pizza club is
currently offering variants of pizzas for their customers. However, initiation of different
product line such as different other snacks items will help them to increase the diversity
in the target customer base. In addition, it will also help them to reduce the business risk
being associated with single product line.
Threats
 Food and beverage sector is facing rapid influx of new entrants both in the market of
New Zealand as well as in the global scenario. Thus, threat of new entrants is increasing
rapidly for pizza club (Porter & Heppelmann, 2014). Thus, with more increase in the
competition, the business potentiality will gradually decrease for them.
 Taste and preference pattern of the customers is one of the key factors being considered
to gauge the potentiality in this sector. However, in the recent time, the taste and

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preference pattern of the customers are changing rapidly and this is causing threat for the
future growth of pizza club. This is due to the reason that, it will be difficult for pizza
club to frequently change their product offerings according to the change in the taste
pattern of the customers.
 Global customer awareness is increasing regarding the ill effect of the fast food around
the world (Servaes & Tamayo, 2013). Thus, being operating in the fast food sector, pizza
club will face the challenge to attract new customers. Moreover, this awareness of the
customers is rapidly increasing, which will have negative impact on the business
potential of pizza club.
External analysis
Apart from the internal analysis of pizza club, external analysis will also be done in the
following sections. PESTLE analysis will be used in order to evaluate the external factors being
faced by them.
Political environment
Political environment in New Zealand is stable and business friendly due to the change in
the government policies according to the change in the business scenario. Moreover, the political
regime in New Zealand is also favorable for the newly incorporated organizations such as pizza
club. They are also availing the financial benefits due to the sourcing of locally produced raw
materials. Thus, the political environment in New Zealand is favorable for their business
(Kelsey, 2015). However, rapid change in the political scenario will have negative impact on
their business. This is due to the reason that, change in the political scenario may also change the
regulations in the country.

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Economic environment
New Zealand is a developed country and thus the average purchasing power of the
customers is high and favorable for pizza club. Moreover, with having lower rate of
unemployment in New Zealand, pizza club is having good market opportunity. However, with
the increase in the inflow of the foreign direct investment in the country, the competition is
increasing with the increase in the global competitors in the market (Alfaro & Charlton, 2013).
In addition, challenges such as economic rescission may also be faced by them, which will
reduce the business potential of pizza club.
Social environment
The brand image and value that is being gained by pizza club is helping them in attracting
more customers in their existing market. However, the recent development in the market of New
Zealand regarding the rising awareness among the customers about the negative impact of the
fast food is posing challenges in the market growth of pizza club (Carter et al., 2012). Though,
the current business scenario for them in New Zealand is huge due to the high level of fast food
consumption of fast food of the customers.
Technological environment
Technology is rapidly evolving in the food and beverage sector and thus it is important
for pizza club to cope up with the change. However, one issue that they are facing is the rapid
inflow of the updated technology in this sector (Bigliardi & Galati, 2013). This is due to the
reason that, small and new entrants in the market such as pizza club will not have capital to cope
with the rapid change in technology. Thus, their global competitors are having more updated
technologies compared to them, which further attracts the customers.