Fast Food Turns Healthy

Group Members

What do you have in mind about Fast food?

– Fried Chicken– Hamburger– Fast, Convenient– Fat, Oily, SaltyUnhealthy (Obesity, Heart Problem,…)

But now, you have to change your mind coz of SUBWAY!!!

A Glimpse at Subway• 1965: Partners Fred DeLuca and Dr. Peter Buck open Pete's Super

Submarines.• 1974: The first Subway franchise opens in Wallingford, Connecticut.• 1979: Subway stores surpass 130 locations.• 1984: The first international Subway opens in Bahrain, Saudi Arabia; U.S.

locations total 360.• 1989: Subway stores number more than 3,500 worldwide.• 1995: The company celebrates its 30th anniversary by opening the

11,000th Subway.• 1999: Subway's 14,000th store opens; wraps become part of the

permanent menu.

A Glimpse at Subway• 2000: Jared Fogle makes his first commercial; gourmet breads and sauces

are added to Subway's menu.• 2001: Subway surpasses McDonald's as the United States' largest fast-

food chain; the 15,000th Subway opens.• 2002: Systemwide Subway sales have reportedly reached $5 billion

worldwide.• 2004: Subway surpassed 22,000 stores worldwide; Atkins-themed wraps

are added to the menu.• 2005: Subway celebrates its 40th year in business.• 2010: the company hopes to expand to 2,010 restaurants

Fast Food & Healthy

Awareness

Fast Food• Fast food is the term given to

food that can be prepared and served very quickly

• Fast food outlets are take-away or take-out providers, often with a "drive-through" service which allows customers to order and pick up food from their cars

Fast Food• Common menu items at

fast food outlets include fish and chips, sandwiches, Pitas, hamburgers, fried chicken, French fries, chicken nuggets, tacos, pizza, hot dogs, and ice cream

Healthy AwarenessStudies have found associations between fast food intake and increased body mass index (BMI) and weight gainA regular meal at McDonald's consists of a Big Mac, large fries, and a large Coca-Cola drink amounting to 1430 calories. A diet of approximately 2000 calories is considered a healthy amount of calories for an entire day (which is different depending on several factors such as age, weight, height, physical activity and gender).

Healthy Awareness

Fast food consumption has been shown to increase calorie intake, promote weight gain, and elevate risk for diabetes

• obesity as the number one health threat for Americans, and the second leading cause of preventable death in the United States and results in 400,000 deaths each year.• Health issues associated with obesity causes economic despair regarding health care

Healthy AwarenessChildren who ate fast food, compared with those who did not, consumed more total fat, carbohydrates, and sugar-sweetened beverages in ways that could significantly increase the risk for obesity

In the context that the dangers of “Fast food” were obviously proved, customers more and more concerned their health issues, especially obesity and its related diseases, Subway took this chance to reposition its image as providing healthy fast food to customers.

Jared’s Story & Subway’s New Image

The Jared’s StoryJARED S. FOGLE tipped a scales at 425 pounds while a student at Indiana University. After unsuccessfully attempting numerous diets, Jared grabbed a nutritional information brochure at his local SUBWAY® restaurant and started a reduced calorie diet by eating two SUBWAY® submarine sandwiches a day.-For lunch, six-inch turkey, no mayo, no oil and hold the cheese.- For dinner, a footlong veggie sub, a bag of baked potato chip and a diet beverage.-Walking 1.5 miles/day, 5 days/week.A year later, he was down to 180 pounds

SubwayNew Image

Subway’s RepositioningStrategy: • Products andmarketing targeted tohealthier menuselections,• Brand consistency, • Low start up costs,• Franchisee support,• Consumer convenience

Products Subway added some healthier sandwiches to their menu: Heart-healthy sandwiches, Atkins-friendly wraps

The SUBWAY® chain's sandwiches with 6 grams of fat or less have a calorie range of 230-380 and have as little as 3 grams of fat

Subway menus vary by store (SOP) by country (COM) and by market (MOP) but retain core items which are included at every store (Submarine Sandwiches)

RESTAURANT CALORIES FAT (Grams)

SUBWAY® Sweet Onion Chicken Teriyaki 380 4.5

SUBWAY® 6-inch Turkey Breast 280 3.5

Burger King Whopper 670 40

KFC original recipe chicken (1 chicken breast, 1 wing) 480 28

Taco Bell 3 regular beef tacos 510 30

McDonald's Big Mac 540 29

Brand Identity Slogan & Logo:

Inside Store Décor: images of fresh tomatoes and other vegetables.

Outside -Store Décor: depicting the New York City system

Brand Identity Website Design is well consistent with other brand identity’s materials.

Subway’s Brand Identity System is well-matched with the company’s new positioning strategy. It and together with other marketing activities create a fresh image of Subway as a place where you could get healthy fast food.

Brochures & Leaf lets : emphasizing the freshness and low fat of fast food

AdvertisingThe target for SUBWAY® chain's advertising is adults aged 18-49 (later expand to children, the potential customers)

The goal of advertising campaigns is to increase the brand presence in the consumers’ "consideration set“ and to build the brand on the "freshness" platform.

The majority of the advertising is done via national TV during prime time, sports and late programming on major broadcast networks and cable networks. SUBWAY® restaurants also promote advertising messages and specials in-store with point-of-purchase material such as posters, menu translites, etc.

.

Advertising“Jared, The Subway Guy”Based on Jared’s successful story of losing 245 pounds in weights by eating two SUBWAY® submarine sandwiches a day and daily exercise routines, Jared has been Subway’s spokesman and appeared in numerous commercials for SUBWAY® restaurants and has traveled throughout the world talking about the importance of proper dieting and exercise - “Friend of Jared" : share some of the wonderful diet stories about the "friends of Jared." -“Jared & Friends School Tour”: teach children the benefits of healthy living- “Oprah” and “Larry King Live,” show on the CBS News and featured on Washington Post.

Advertising“Jared, The Subway Guy”• Since Jared’s commercials aired, the SUBWAY® corporate headquarters has received thousands of letters, e-mails and photos from people who have been inspired by Jared to lose weight and live healthier lifestyles• It also helped Subway’s stores grow their sales, as concerns over obesity became a compelling public health issue. More people signed up as franchisees and open new Subway Stores in the U.S and abroad.

Advertising SponsorshipThe SUBWAY® Brand is a national sponsor of the American Heart Association's Start! Heart Walk.

Walking has the lowest dropout rate of any physical activity, and it’s

the simplest positive change people can make to improve their

heart health

The Start! Heart Walk is the American Heart Association's

premiere event for raising funds to save lives from this country's No. 1

and No. 3 killers - heart disease and stroke.

Designed to promote physical activity and heart-healthy living, the Start! Heart Walk creates an

environment that's fun and rewarding for the entire family.

Distribution Subway’s Franchising ModelThe parent company does not operate any restaurants•Local franchisees operate the stores•The Development Agent is responsible for developing new locations, evaluating stores on at least a monthly basis, and assisting franchisees with whatever needs they may have •DAI takes an 8% royalty on all net sales from each store.

Subway is one of the fastest growing franchises in the world with approximately 31,835 restaurants in 91 countries as of September 2009.

Distribution Subway’s Support•Low franchisee start up costs.• Access to formulas, systems & publications• Leasing assistance• Store design guidance• Equipment ordering guidance• Training program & Operations Manual• Representative at opening & periodic intervals

CONCLUSION AND DISCUSSION

Conclusion• The repositioning strategy is a great milestone

for the rapid development of Subway in some ways.– Subway proactively took the advantage of

customers’ consciousness of health issues relating to fast food to reposition its products as ever-healthy fast food.

– Subway’s consistently built up a brand image of “Eat Fresh” in mind of customers via brand identity system, TV commercials (Jared Subway Guy), Sponsorship (Start! Heart Walk)

Conclusion– Thank to its consistent brand identities and a

standardized franchising model with low start-up costs and supports , Subway has been one of the fastest growth franchises in the world.

• On the other hands, Subway has also dealt with the competition since its major competitors like Mc Donald, King Burger began offer healthier fast food menu for customers.

Q&AQuestions

Answer: 3 success factors of Subway

after implementing the repositioning strategy:

1.Differentiate its fast food as healthy food.

2.Consistently build up its brand image of Subway as the place you can get healthy fast food.

3.Franchising system

What are the success factors

of Subway after carrying

out the repositioning

strategy?

Q&A Questions

Answer: Thanks to its perfectmarketing activities, wealways have in mind aboutSubway as the place offershealthy fast food.

What do you have in mind

about Subway?

Q&AQuestions

Answer:1. Subway owns a Strong

Brand.2. Standardized franchising

model3. Appropriate support from

mother company for franchisees.

What makes Subway one

of the fastest franchises in

the world?