Harvard Case - Sharmaji's Canteen: Competing with Online Food Delivery Services
"Sharmaji's Canteen: Competing with Online Food Delivery Services" Harvard business case study is written by Jaydeep Mukherjee. It deals with the challenges in the field of Marketing. The case study is 8 page(s) long and it was first published on : Mar 26, 2023
At Fern Fort University, we recommend Sharmaji's Canteen implement a comprehensive strategy to adapt to the evolving food delivery landscape. This strategy should focus on leveraging Sharmaji's existing strengths, such as its authentic food and loyal customer base, while embracing digital technologies and innovative marketing tactics to attract new customers and compete with online food delivery services.
2. Background
Sharmaji's Canteen, a popular eatery in Mumbai, has been serving delicious and affordable traditional Indian food for over 20 years. The canteen enjoys a loyal customer base, built on its authentic recipes and friendly service. However, the emergence of online food delivery platforms like Swiggy and Zomato has significantly impacted Sharmaji's business. These platforms offer convenience and a wider range of options, attracting a younger, tech-savvy customer base. Sharmaji's, lacking an online presence, faces the challenge of staying relevant and maintaining its customer base in this increasingly competitive market.
3. Analysis of the Case Study
To analyze Sharmaji's situation, we can utilize the SWOT framework:
Strengths:
- Strong brand loyalty: Sharmaji's enjoys a loyal customer base built on years of serving authentic, high-quality food.
- Unique product offering: The canteen's traditional Indian recipes and homemade flavors differentiate it from many online food delivery options.
- Competitive pricing: Sharmaji's offers affordable prices, appealing to budget-conscious customers.
- Strong community presence: The canteen is deeply rooted in the local community, fostering a sense of familiarity and trust.
Weaknesses:
- Lack of online presence: Sharmaji's absence from online food delivery platforms limits its reach to a younger, tech-savvy audience.
- Limited marketing efforts: The canteen relies primarily on word-of-mouth marketing, which is insufficient in the current digital age.
- Outdated technology: Sharmaji's lacks modern technology and systems for efficient order management and customer service.
- Limited delivery options: The canteen currently offers only in-person dining, hindering its ability to reach customers beyond its immediate vicinity.
Opportunities:
- Expanding online presence: Entering online food delivery platforms can significantly increase Sharmaji's reach and attract new customers.
- Developing a mobile app: A dedicated app would enhance customer experience and provide a platform for loyalty programs and promotions.
- Leveraging social media: Engaging on social media platforms like Instagram and Facebook can build brand awareness and connect with potential customers.
- Partnering with delivery services: Collaboration with existing delivery platforms can provide access to a wider customer base and delivery infrastructure.
Threats:
- Increased competition: The online food delivery market is highly competitive, with established players constantly innovating and expanding.
- Changing customer preferences: Younger generations prioritize convenience and diverse options, potentially shifting away from traditional eateries.
- Rising food costs: Increasing food prices could impact Sharmaji's ability to maintain competitive pricing.
- Technological advancements: Emerging technologies like AI-powered food ordering systems could further disrupt the industry.
4. Recommendations
To address Sharmaji's challenges and capitalize on opportunities, we recommend the following:
1. Embrace Digital Transformation:
- Develop a website and mobile app: Create a user-friendly online platform for ordering, menu browsing, and customer engagement.
- Partner with online food delivery platforms: List Sharmaji's on Swiggy, Zomato, and other platforms to reach a wider audience.
- Implement online ordering and payment systems: Enable seamless online transactions for a convenient customer experience.
- Invest in technology and analytics: Utilize data analytics to understand customer preferences, optimize pricing, and track performance.
2. Enhance Marketing Strategy:
- Develop a strong brand identity: Refine Sharmaji's brand image, highlighting its unique selling proposition and appealing to a wider audience.
- Implement targeted digital marketing campaigns: Utilize social media, search engine optimization (SEO), and paid advertising to reach potential customers.
- Launch loyalty programs and promotions: Offer discounts, rewards, and exclusive deals to retain existing customers and attract new ones.
- Engage with influencers and food bloggers: Partner with relevant individuals to promote Sharmaji's through reviews, social media posts, and content creation.
3. Optimize Operations:
- Streamline order management: Implement efficient systems for order processing, preparation, and delivery.
- Expand delivery options: Partner with delivery services or establish a dedicated delivery team to reach customers beyond the immediate vicinity.
- Improve customer service: Provide responsive and personalized customer service through online channels and in-person interactions.
- Explore new product offerings: Introduce new dishes, seasonal specials, or catering options to cater to evolving customer preferences.
5. Basis of Recommendations
Our recommendations are based on the following considerations:
- Core competencies and consistency with mission: The recommendations align with Sharmaji's core competency of serving authentic and delicious food while leveraging digital technology to expand its reach and customer base.
- External customers and internal clients: The recommendations cater to the needs of both existing and potential customers, while also considering the needs of Sharmaji's employees and stakeholders.
- Competitors: The recommendations address the competitive landscape by adopting strategies employed by successful online food delivery players while highlighting Sharmaji's unique strengths.
- Attractiveness ' quantitative measures: The recommendations are expected to generate positive returns on investment through increased sales, customer acquisition, and brand awareness.
6. Conclusion
By embracing digital transformation, enhancing its marketing strategy, and optimizing its operations, Sharmaji's Canteen can successfully navigate the evolving food delivery landscape. The proposed strategies will enable the canteen to attract new customers, retain existing ones, and maintain its competitive edge in the market.
7. Discussion
Alternative options not selected include:
- Maintaining the status quo: This would likely lead to a decline in customer base and market share as online platforms gain dominance.
- Focusing solely on physical expansion: This would require significant capital investment and might not be feasible considering the competitive landscape.
Risks associated with the recommendations include:
- High initial investment: Implementing digital strategies and technology upgrades may require significant upfront costs.
- Competition from established players: Attracting customers in a crowded market requires strong marketing efforts and differentiation.
- Technological challenges: Navigating the complexities of online platforms and technology requires expertise and continuous adaptation.
Key assumptions underlying the recommendations include:
- Customer willingness to embrace online ordering: The success of the strategy depends on customers adopting online platforms for ordering food.
- Effective implementation of digital marketing campaigns: The ability to reach and engage target customers through digital channels is crucial.
- Continued relevance of Sharmaji's unique product offering: The canteen's authentic food and traditional recipes must remain appealing to customers.
8. Next Steps
To implement the recommendations, Sharmaji's should:
- Develop a detailed implementation plan: Outline specific actions, timelines, and resources required for each recommendation.
- Secure necessary funding: Allocate budget for technology upgrades, marketing campaigns, and staff training.
- Build a team with digital expertise: Hire or train staff with experience in online marketing, technology, and customer service.
- Monitor progress and make adjustments: Continuously track performance metrics and adapt the strategy based on data and customer feedback.
By taking decisive action and embracing innovation, Sharmaji's Canteen can not only survive but thrive in the evolving food delivery landscape, ensuring its continued success for years to come.
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Case Description
Sharmaji's Canteen was the only cafeteria on the campus of a prominent management institute in Gurgaon, India. The business had been operating since 1990 and its success depended on a captive residential population of primarily students and staff. The lockdowns imposed by the Government of India in March 2020 to control the spread of the COVID-19 virus led to the closure of the academic programs. During the pandemic, students had become accustomed to more choices offered by online food delivery that they felt Sharmaji's Canteen did not match. The business was losing sales and profitability was eroding. The owner needed to decide between three different revival strategies based on the data collected.
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