Marketing Report: Analyzing Subway's Promotional Mix and Strategies

This marketing report provides a comprehensive analysis of Subway's marketing strategies. It begins with an overview of Subway, its mission, and values, followed by an outline of the report's purpose. The report delves into the evolution of marketing, contrasting product and market orientations, and identifying Subway's market-oriented approach. It examines the marketing environment, including political and environmental factors impacting Subway's operations and consumer behavior. The report explores marketing strategies, comparing psychographic and behavioral segmentation, and identifying geographical segmentation as valuable for Subway. Furthermore, it analyzes Subway's marketing mix, including product offerings, pricing strategies, and distribution channels. The report also investigates Subway's promotional mix, specifically its video campaign, analyzing its key message, target audience, and effectiveness using the AIDA model. Finally, it discusses methods for gathering feedback on the campaign's effectiveness. The report concludes with a summary of the key findings and recommendations.

Marketing Report on Subway

Table of Contents
Introduction.................................................................................................................................................3
Overview of Subway................................................................................................................................3
Outline the purpose of the report...........................................................................................................3
Task 1: Evolution of Marketing...................................................................................................................3
Describe the marketing and product orientations, highlighting the advantages and disadvantages of
each.....................................................................................................................................................3
Identify and explain the orientation adopted by Subway, and provide 2 examples that demonstrate
Subway’s use of the approach.............................................................................................................4
Task 2: Marketing Environments................................................................................................................5
Identify and discuss one political factor and one environmental factor that could impact Subway’s
business operations and consumer buyer behavior................................................................................5
Task 3: Marketing Strategies.......................................................................................................................5
Explain how psychographic segmentation differs from behavioral segmentation..................................5
Discuss one type of segmentation that would be considered the most valuable for Subway to use
when segmenting the market..................................................................................................................5
Task 4: Marketing Mix................................................................................................................................6
Identify and describe...............................................................................................................................6
Explain the role of the Promotional Mix..................................................................................................7
Discuss the promotional mix element that Subway adopts in the video campaign followed by the
advantages and disadvantages................................................................................................................7
Conduct research and discuss the channels used by Subway to increase its market share.....................7
Discuss the key message in the video campaign.....................................................................................8
Discuss the key target audience of the video campaign and their characteristics...................................8
Using AIDA (Attention, Interest, Desire, Action) marketing theory, explain how the video campaign’s
source attributes and key message achieve Subway’s new objective.....................................................8
Discuss one method to be used by Subway to gather feedback on the effectiveness of the video
campaign.................................................................................................................................................8
Conclusion...................................................................................................................................................8

Introduction
Overview of Subway
Subway is a US based firm that deals in selling of sandwiches (submarine) and salads all over
the world. These sandwiches are basically made from fresh and oven baked bread that has low
fat and healthy toppings so as to be able to serve large variety of mouthwatering hot as well as
cold sandwiches (About us, 2018). The company has a presence of more than 45000 stores in
100 nations and half of which are located in United States. It has been known to be the largest
single brand restaurant chain in the world (Subway Restaurants: advertising & marketing profile.
2018). The working of the company is further based on the mission to eat fresh and live green. It
also adheres with certain core values and principles such as providing exceptional service to the
guests; highest quality menu items that can be afforded by everyone. All this is done by keeping
the operational cost to a low level. Based on the above, the company has been delighting the
consumers by serving fresh as well as delicious sandwiches are made right in front of them. The
company had taken large number of marketing activities which has been 508.5 million US
dollars in advertising itself during the year 2016 (Statista, 2018). This has made a general
perception of the consumers that its salads and sandwiches are a lot healthier than traditional
burgers (Subway Restaurants: advertising & marketing profile. 2018).
Outline the purpose of the report
As a newly appointed Marketing assistant of Subway, this report is prepared on the instruction of
the Marketing Director of Subway addressing the following tasks. These revolved around the
concepts of marketing and product orientations and the one used by Subway. Emphasis is also
given on overall marketing environment, strategies as well as marketing mix used by the
company. Last but not the least emphasis is also given on promotional mix of Subway used in a
video campaign.
Task 1: Evolution of Marketing
Describe the marketing and product orientations, highlighting the advantages and disadvantages of
each
Market orientation is a technique where focus of the company is on discovering the needs and
desires of consumers and making an attempt to meet them. The technique is advantageous for
Subway as it helps the company in becoming responsive to the needs and wants of consumers;

helps to drive the process of constant improvement (Choi and Reid, 2018). It also assists in
building up the overall consumer loyalty by creation of satisfied consumers which in turn
provides a competitive advantage over rival firms. On a negative note, this approach may require
subway management to be quick enough in responding to demands of consumers; followed by
need to adhere with planning challenges as well as investing a lot in market research. Along with
this, two major risk factors are also involved in this orientations being risk of underestimating the
market as well as consumer (Bublitz sand Peracchio, 2015).
Product orientation on the other hand can be defined as that marketing philosophy where focus
of management attention is making products and services for the consumers. Subway is likely to
benefit from the approach as there will be a provision of quality foods that is the main demand of
consumers (Lundgren, 2015). The firm will also get a chance to invest in technology so that
varied products can be provided to the consumers in form of making sandwiches and salads in
new ways. There can further be a development of economies of scale through this approach
which can lead to lowering of prices (Sumaedi and Yarmen, 2015). However the studies have
revealed that if Subway will adopt this approach then it will have to ensure that its sandwiches
and salads are of first grade. There may further be a rise in its research and development cost due
to investment in overall technology.
Identify and explain the orientation adopted by Subway, and provide 2 examples that demonstrate
Subway’s use of the approach.
As per my understanding, Subway has basically adopted a marketing oriented approach as it is
aware of the fact that consumers are very knowledgeable these days and have also became
choosy with respect to the kind of product offerings they wish to have. Hence emphasis is given
on what the consumers want to buy rather than what is being sold by the company. In this
respect, two examples have been provided that demonstrates how Subway uses this approach.
This is done by always making an attempt to connect with the consumers through social media
sites. It is also more interested in providing what is wanted by the consumers’ through its
ordering system where all the ingredients are displayed to the client. It also provides increased
choices to the consumers through tis menu items (Moran, Ramirez and Block, 2017). This is as
while ordering sub sandwich, the consumer can choose from different breads; cheese; veggies;
sauces and also other side dishes that may go with the sandwich.

Task 2: Marketing Environments
Identify and discuss one political factor and one environmental factor that could impact
Subway’s business operations and consumer buyer behavior
There is a presence of varied political as well as environmental factors that are putting an impact
on the overall business operations of Subway and the behavior exhibited by consumers. For
example, there were concerns about minimum wages to be paid to the employees who were a
part of Subway. Issues arose when some of the franchisee stores were not paying minimum wage
to the employees. As per the lawsuit, there have been some violations in the labor laws as it
failed to pay the employees for their time spent on doing the nightly closing routine. Illegal
deductions were also made from the wages of employees on account of cash register shortages
which led the pay to fall below minimum wage criteria (Pisano, Rieple and Pironti, 2017).
Other than the above, Subway is also required to adhere with go green and environmental
friendly concepts on its business offerings. The company has done quite a lot in this area such as
saving electricity and flow of water (Zheng and et.al., 2016). It further lays emphasis on
packaging by using recycled content. The stores are also designed in a more energy efficient
manner.
Task 3: Marketing Strategies
Explain how psychographic segmentation differs from behavioral segmentation
Psychographic segmentation is the one that divides the market on the basis of principles like
social class, personality, value, belief system as well as lifestyle. It has been found to be less
concrete and less tangible in nature. On the other hand, Behavioral segmentation is all about
dividing the consumers into groups as per the attributes being loyalty, awareness, purchase
patterns as well as occasions (Leschewski and Weatherspoon, 2014).
Discuss one type of segmentation that would be considered the most valuable for Subway to use
when segmenting the market
The type of segmentation that can be used by Subway while segmenting the market is
geographical one. Here the markets can be classified on the basis of geographical location where
the store is present. For example, the company can use halal menu in Middle East nations as
people prefer eating halal products more than the others. It can also ensure that there is no beef in
the products of India as cow from where beef is produced is considered as a sacred animal. It can

further make use of increased vegetables in the product menu that are also seasonal in nature so
as to suit the taste and preferences of consumers. Likewise, the Americans prefer more sauce in
there food offerings. Hence the same can be used in its products in USA. This segmentation is
most likely to benefit Subway as it will get a chance to meet the needs and preferences of a wide
variety of consumers at the same time. The firm will further be recognized as the one that
adheres with a localized approach in its products.
Task 4: Marketing Mix
Identify and describe
 Subway’s product offerings – the first product to be served by Subway was of submarine
sandwich but today it has a presence of diversified offerings where sandwiches are
available in 6 to 8 different sauces; brand types and also in veg and non-veg options. In
fact the consumers get a chance to customize their sandwiches as per the needs (Subway
Sandwiches - product overview, 2018). Other than this, it also sells baked items such as
cookies; muffins; doughnuts; salads as well as wraps. Some of the items present in the
menu are variable as per the place. For example, in the year 2009 the company
introduced Seattle’s Best Coffee in its menu (Subway, 2012). In the same way, with
respect to its menu in India it does not have the presence of pork and beef products
instead the focus is given on vegetarian items. Through its product offerings it has been
trying to fulfill the goal of quality made-to-order sandwiches that are customized as per
the order of consumers and to fulfill their tastes.
 Subways’ pricing strategies – As subway is a global restaurant hence the prices of
products varies from one restaurant to other and also as per nations where it has got its
presence. But still the company has adhered with premium pricing strategy as compared
to its competitors such as KFC and Mc Donald’s. However the presence of low calorie
content; better food quality as well as quantity of is sandwich which is too big than the
other makes it a value for money offering. Subway has further been found to offer
products or meals that are usually above 3 pounds and there is also a lack of low priced
options that sometimes steer the consumers away. Along with this, it does not change its
price too often as done by Mc Donald’s (McDonalds vs Subway. 2016).

 The place where Subway’s products are sold ensuring you provide detailed descriptions
and examples – the products of subway are sold through its franchise outlets that are
present almost all over the world. These franchisee shops have got their presence in
malls, food courts, gas stations, airports among others (About us, 2018). Along with this,
it also lays emphasis on opening its outlets in premium areas where people are most
likely to show consciousness with respect to calorie consumption. The restaurant website
also has a presence of a section being find our stores where postal code, country and city
name can be posted. The restaurant further has a presence of eat-in and take-away
services followed by the presence of home delivery services in some of the nations.
Part Two
Explain the role of the Promotional Mix
The role of promotional mix is to create synergy with the other elements being product, place
and pricing. This is done in such a manner so as to optimize the consumer as well as profit
potential of company (Choi and Reid, 2018). The promotional mix further aids in strengthening
the product, its availability and the fairness of benefits that are given at particular price. Overall
it helps to influence the buying behavior of targeted consumers.
Discuss the promotional mix element that Subway adopts in the video campaign followed by the
advantages and disadvantages.
The promotional mix element used by Subway in its video campaign is of advertising where the
consumers on a mass scale are communicated together about the product and service offering of
the company. It is an advantageous means of communication as the platform used by Subway
being YouTube is seen by large number of consumers hence they can be targeted very easily
(Makki, Ozturk and Singh, 2016). On a negative note, if someone sees the video ad once then
there is a chance that he or she may not see it again and any mistake made in the ad can turn out
to be quite costly.
Conduct research and discuss the channels used by Subway to increase its market share
Varied traditional as well as non-traditional channels are used by Subway to increase its market
share. These are inclusive of advertising, pamphlets, magazines, videos on YouTube among
others. All the above mentioned channels have aided the firm to increase the overall market share
(Pisano, Rieple and Pironti, 2017).

Discuss the key message in the video campaign
The key message given in the video campaign is about telling the consumers that the product
offerings of Subway is good in quantity; made in an epic manner and also at a fast pace. The
consumers are most likely to enjoy eating or drinking the products. Moreover, the products are
hot as well as cold and prepared from fresh ingredients. Most importantly, the firm ensures that it
made in the manner which is wanted by the consumers (Subway video, 2018).
Discuss the key target audience of the video campaign and their characteristics
The key target audiences of the video campaign are the youngsters who love to eat the products
of Subway and also the ones who want any sandwich in good quantity that is prepared from fresh
ingredients.
Using AIDA (Attention, Interest, Desire, Action) marketing theory, explain how the video
campaign’s source attributes and key message achieve Subway’s new objective
As per AIDA theory, the promotional video released by Subway on YouTube has presented good
pictures and also focused on providing reasons as to why the products of Subway are good for
any consumer. The video has also assisted in generating interest of the users to find out as to
whether the company delivers what has been showcased in the ad or not. This can only happen
when they give a try to the product at least once. The pictures about Subway sandwiches are so
vivid that it is most likely to make them want more of the product. However it has not been able
to generate immediate action from them which could have been done by giving a good deal for a
weeks’ time. As of now, the consumers may see the ad and forget about the offer soon.
Discuss one method to be used by Subway to gather feedback on the effectiveness of the video
campaign
The best technique to gather feedback about the effectiveness of the video campaign is to prepare
a survey questionnaire that is posted just at the end of video. The consumers can answer the
question as soon as they watch the video and the answers can then be used by the company to
judge the overall effectiveness and the impact it has been able to make on the viewers.
Conclusion
A conclusion can be drawn from the study that Subway is a well-recognized brand in the world
that has always offered what it has promised. This is in form of freshly prepared, quality focused

and customized set of sandwiches to the consumers. Same ideas have also been shown in the
promotional advertisement released by the company on YouTube. The strategy is most likely o
aid in getting Subway’s market share by 15% by December 2019.

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