Subway Franchise: Global Marketing Strategy in North & South America

This report provides an overview of Subway's global marketing and strategies in North and South America. It begins with a company background, including its history and product identification, focusing on the submarine sandwich. A SWOT analysis is presented, examining internal strengths and weaknesses, as well as external opportunities and threats. The report discusses the target market, primarily young adults, and the marketing mix employed by Subway, including product, place, price, and promotion strategies. The product strategy involves customizable sandwiches, while the place strategy focuses on premium locations. A differential pricing strategy is adopted, and various promotional strategies, such as advertising and public relations, are utilized to promote the brand and its 'Eat Fresh' slogan. The report concludes that Subway's marketing mix positions it well in the market, emphasizing freshness and quality.

Running head: MARKETING
Global Marketing and Strategies
Name of the Student:
Name of the University:
Author Note:

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Executive Summary:
The aim of the report is to provide overview of global marketing and strategies of Subway
franchise in North and South America. The report commences with the company background
with a focus on the history and product identification. The report also provides an insight into the
SWOT analysis. The report also provides discussion on the target market and marketing strategy
adopted by Subway franchise in the continents of North America and South America.

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Table of Contents
Introduction:....................................................................................................................................3
Company Background:....................................................................................................................3
History:............................................................................................................................................3
Product History and Product Identification:....................................................................................3
Situation Analysis............................................................................................................................5
SWOT:.............................................................................................................................................5
Strength and Weakness Internal to Company..................................................................................6
Opportunities and Threats External to Company............................................................................6
Target Market..................................................................................................................................7
Marketing Mix:................................................................................................................................7
a. Product Strategy:..........................................................................................................................7
b. Place Strategy:.............................................................................................................................8
c. Price Strategy:..............................................................................................................................8
d. Promotion Strategy:.....................................................................................................................9
Conclusion:......................................................................................................................................9
References:....................................................................................................................................10

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Introduction:
The report aims at providing an insight into global marketing and strategies of Subway
franchise in North and South America (subway.com, 2019).
Company Background:
Subway is one of the privately owned American fast food restaurant known for its salads
and submarine sandwiches. Subway has one of the fast growing franchises across the world with
close to 42,000 stores located across 100 countries (subway.com, 2019). Most of the Subway
stores are located in United States. In other words, it is one of the largest single branded
restaurant chain and one of the largest operators of restaurant across the world.
History:
The first Subway was opened in Fresno, California in the year 1978. Subway also
opened an outlet in Bahrain in the year 1984 and United Kingdom in the year 1996. In the year
2004, Subway opened its stores within the Walmary supercenters and was also found to surpass
the McDonalds locations in the year 2007 (subway.com, 2019).
Product History and Product Identification:
The core product of subway has been the submarine sandwich also known as the ‘sub’.
Besides, the fast food joint is also known to sell salad, wraps, paninis and the baked goods that
included the doughnuts, muffins and cookies (subway.com, 2019). The best selling sandwich of
Subway is known as Brooklyn Manhattan Transit which is believed to contain salami, ham and

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pepperoni and is known for being the meatiest, tastiest and the biggest. Besides, Subway also
sells English muffins, breakfast sandwich and the flatbread. However, the product under
discussion in this report would be the submarine sandwich.
Figure 1: Submarine Sandwich
Source: (subway.com, 2019).

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Situation Analysis
SWOT:
Strength
 Greater degree customization of subs
 One of the largest fast food chains
having number of outlets.
 Unique marketing and promotional
strategies
 Options of choosing healthier meals
 Have partnership with the Britain and
the American Heart Associations
 The restaurants are mostly owned by
the franchisees
 Lower cost of
Weakness
 Interior design for the outlets often
have cheaper look.
 Higher turnover of employees
 The services does not remain consistent
from one store to another
 There is too much control over the
franchisees.
Opportunities
 Growing demand for the healthier food
 Options for home delivery for meals
 Change of newer customer groups and
customer habits
 Introduction of the drive through
Threats
 Saturated market for fast foods in
developed economies
 Increasing trend towards healthier
eating
 Fluctuations of currency
 Localized fast food chain
 Lawsuits against the Subway.

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Strength and Weakness Internal to Company
The strength of the company would lie in size and locations of the company giving it
considerable advantage in terms of the access and visibility of the customers. The franchise
should source its raw ingredients from the suppliers certified by the Subway which allows it in
meeting quality standards thereby ensuring supply of standard products.
The weakness in the operation of the franchise system lies in varied levels of the
customer service and the income that might be generated across locations. The lack of innovation
in the menu and the presence of competitors offering lower price point might result in the loss of
the market share of Subway.
Opportunities and Threats External to Company
The opportunities for Subway includes improvement in customer experience through
offering higher convenience by means of online ordering, delivery service, choice of greater
varieties in menu and the payment system. Subway might provide considerable opportunities for
the franchises through lower cost investment and operating in various locations of varied sizes.
The Subway franchise should use feedback from customers for improving its business model.
As far as the threats are concerned, Subway faces threat from other players within the
industry which might lead to the fall in the position in spite of it having larger number of outlets.
The threat also leads to the downward trend in the sales which might lead to the saturation of the
outlets and loss of the market share.

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Target Market
The target market of Subway for its submarine sandwich comprises of the young adults between
the age group of 16 to 39 although people belonging to all background and ages enjoys healthy
and delicious sandwiches (Pearson, 2016). It has been found that majority of the population lies
between this age group.
As far as the differences are concerned, North America represents the fourth largest
continent with an approximate population of 529 million while South America holds the fifth
largest population with close to 371 million people across twelve countries. Hence, the target
market of South America will be smaller than the North America.
Marketing Mix:
a. Product Strategy:
The size of the submarine sandwich would range between 3 foot subs to 6 foot sub.
Besides, the platter of sandwich in both the continents would include turkey breast, chicken ham
and the trademark sandwich like the veggie delight and the Subway club (Nour & Almahirah,
2014). Through the franchise Subway would aim towards bringing the vibrant and useful energy
back to the brand. The store would also have a new logo along with store refurbishments.

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Figure 2: Showing Old and New Logo of Subway
Source: (subway.com, 2018)
b. Place Strategy:
The subway franchise in both the continents would be located in the premium locations that
could act as a boon for the brand. Hence, they would not only be located in the malls, airports,
amusement parks, military base, hospitals and the business centre. Besides, the outlets would
also target a location where customers are not only calorie conscious but remains willing in
paying higher prices(Khan, 2014).
c. Price Strategy:
The Subway franchise would follow a differential pricing strategy along with value
pricing based on its quality. In other words, Subway charges a higher price compared to the
competitors based on the claim that it would serve a better quality of food in comparison to the
competitors.

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d. Promotion Strategy:
Subway would adopt various promotional strategies for promoting the brand. The fast
food chain could not only advertise the products, employ personnel, involve the public relations
but also undertake sales promotion (Hjort et al. 2013). Their slogan ‘Eat Fresh’ enables them in
promoting the higher quality and the freshness of the food made. Most of the promotions would
remain directed towards the adult within the age group of 18 to 35; hence the advertisements
should be broadcasted during the prime time on the cable networks. The advertisements of
Subway remains targeted such that the customers are able to move the brand from the set of
awareness to consideration whenever the concern remains in eating in the fast food chains.
Besides, the Subway Franchise could implement the option of making sandwiches in front of the
customers thereby flaunting the freshness and quality of the ingredients. It could also involve
cartoon characters like the Peter Griffin for undertaking the promotion of the sandwiches. The
Subway Franchise could resort to promotional series for the product placement or undertake a
promotional campaign by delivering one free sandwich.
Conclusion:
On a concluding note, it can be said that, the marketing mix of the chosen products
implies that Subway could be over ruling the newer market being one of the best examples of
targeting, positioning and segmentation. It would also help in making the life simpler by making
them eat something fresh. It also makes the fast food chain one of the quick service restaurant
across the world. This could not only make the franchise popular but make it the largest and the
fastest chain across the world.

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References:
Hjort, K., Lantz, B., Ericsson, D. and Gattorna, J.,( 2013). Customer segmentation based on
buying and returning behaviour. International Journal of Physical Distribution &
Logistics Management, 43(10),852-865.
Khan, M.T.,( 2014). The concept of'marketing mix'and its elements (a conceptual review
paper). International journal of information, business and management, 6(2), 95.
Nour, M.I.& Almahirah, M.S., (2014). The impact of promotional mix elements on consumers
purchasing decisions. International Business and management, 8(2), pp.143-151.
Pearson, S.,( 2016). Building brands directly: creating business value from customer
relationships. Springer.
subway.com (2019). Retrieved from http://www.subway.com/en-us/exploreourworld
subway.com (2019). Retrieved from
http://www.subway.com/en-us/menunutrition/menu/featured
subway.com (2019). Retrieved from
http://www.subway.com/en-us/menunutrition/menu/howtoorder
subway.com (2019).Retrieved from http://www.subway.com/en-us/aboutus/history [Accessed 7
Jun. 2019].
subway.com( 2018). Retrieved from https://subculture.subway.com