Academic Master


Marketing Strategy of P.F Chang


For this assignment, marketing project of a company will be introduced in the paper. This marketing project will develop a strategy for the business to become global and analyze different areas of the company. For the analysis of the marketing project, P.F Chang is selected in the region of USA. Further, detailed marketing and competitive analysis will be done for the company to expand its business to UK. P.F Chang is an Asian themed Chinese restaurant which was founded in 1993. The name of the company is derived from its founders; Paul Fleming and Philip Chiang which was merged as P.F Chang from their initials. In the US, the company is operated and owned by Centerbridge Partners its headquarters are in Arizona. Being a US based restaurant chain, P.F Chang specializes in American Chinese cuisine and other specific Asian dishes. According to the survey report of 2017, P.F Chang operates a maximum of 208 restaurants in US and almost 100 restaurants across the globe which include; Mexico, China, Chile, Canada, Argentina, Costa Rica, Turkey, Panama, Colombia, Phillippines, Lebanon, Egypt, South Korea, Kuwait, Saudi Arabia, UAE, Jordan, and Qatar. Based on their market settlement, this marketing project will introduce P.F Chang into the market of UK and expand its global business. For better understanding of the company’s marketing strategy, industry and competitive analysis will be done; which will give an overview to the company about the competitors and industry of UK. It will also include the traditional 4 Ps of the marketing mix and promotional mix strategies. By analyzing these strategies, it will help P.F Chang to enter the UK market which was not considered by the restaurant gaints in the prior years.

Competitive and Industry Analysis

Competitive Analysis

Competitive analysis is a crucial part of a company’s marketing plan which provides a deep analysis that how the product and services are unique as compared to the competitors (Fleisher & Bensoussan, 2015). It also gives deep insight about the elements which need to be considered to attract the target market. By observing competitive analysis in a company, it provides data of the competitors and making evaluations according to it. Analyzing the competitors strength in the market, helps the company to understand what the competitors are giving and what type of products/services are required by the customers (Fleisher & Bensoussan, 2015). In this phase, it is important to examine that who are your competitors in the market, and what type of products do these competitors sell. It is also vital to analyze the market share of these competitors, which gives an overview to the company that the competition companies are in this market for how long and what has made them to make such a market share. Then, each competitor is analyzed that what is their strategy in the market and what market share they acquire (Fleisher & Bensoussan, 2015). Before entering in to a new market, first step of any company is to analyze the market and its competitors. It provides an overview of the competition in the market and what will be faced by the company. It is mandatory for a company to analyze the current and future competitors of the market which can impact the business of your company (Fleisher & Bensoussan, 2015).

When we talk about P.F Chang entering into the UK market, we have to consider the top Chinese restaurants in UK which are serving the market of UK from a long and short time. Park Chinois and Kai are the main competitors which need to be considered by P.F Chang to enter the UK market. These competitors have been in the UK market for almost 10 years and have made grounds in the market, by providing high end Chinese dishes and promoting their restaurant themes.

Next, market share of the competitors need to be analyzed. Identifying the market share of the competitors helps in understanding that what strategy they have acquired to continue their sales and growth of the restaurants (Giannakopoulos & Koutsoupias, 2015). Here, market share does not mean the numeric value of the market acquired by the companies, but it relates to the business strategies and area which has been acquired by the competitors. Park Chinios has made efforts in developing traditional Chinese food like wagamama in their menus and opened their restaurants in a place where they had more public to get sight of their outlets. While, Kai have established themselves as a 5-star restaurant which is mostly placed in expensice places like Mayfair, North of London and all across the UK.

In analyzing the market of the competitors, it is important to know about the SWOT of the competitors. It helps in better understanding of the competitors that what internal and external advantages and disadvantages they have in the business (Giannakopoulos & Koutsoupias, 2015). These findings are then compared to the company which is doing the research and helps in eliminating the errors in the company. For Park Chinios, their strengths are basically the way they serve their food and the wide range of dishes. Weakness of Chinios is the retention of their employees. Threats to the restaurant chain is the globally expanding business, which is also a risk for them. Opportunities for Chinios, are the niche market areas of London and affliated cities which are not touched yet. However, Kai has the strength that they have made a proper segment for their business where they serve the niche market specifically. Kai’s weakness is the limited amount of outlets in UK. Threats to the company is the risk of segmented market which sometimes can make a problem if other competitors show flexibility in their business. Opportunities for the company is to introduce a full range of Chinese food, which is limited at the moment (Giannakopoulos & Koutsoupias, 2015).

After all these factors, feedback is gathered by the companies in response to the execution made by P.F Chang and it will help in better understanding the entry strategies in the market.

Industry Analysis

Industry analysis is a technique which helps a company to understand their position with relation to the industry and the competitors in the industry. Opposite to the competitive analysis, industry analysis provides insight to the factors which should be considered in entering any industry (Dobbs, 2014). These factors are important to understand as a marketing strategy plan. In small or large businesses, analyzing the industry helps in identifying the resources which are important for the business, and the capabilities which can lead to a competitive position for the company.

Ease of entry

This term tells about how easy or difficult it is for a company to enter any industry. It is important for a company to make sure that it easy for them to enter any industry, as it tells about the ability of a firm to compete in the industry. Ease of entry depends on two factors; competitors reaction to new entrants and barriers in the market (Dobbs, 2014). Reaction of competitors towards new business entries in the market depend upon the factor that how the competitors react to the business. It might be an attacking strategy, where the competitors make it difficult for the businesses to enter the market, and it might not be as effective to the competitors and allow the new entrants to enter the market (Dobbs, 2014). Based on this theory, we can say that the UK market is very segmented and competitive. It might be a difficult task for P.F Chang to enter the UK market, as the competition there is very high and the competitors will make strategy parallel to P.F Chang to prevent them from having a new competitor in the market. The UK market is in fast growth structure in terms of restaurants and the market has a huge customer database. For this purpose, the competitors acquire a fast business growth and identify that their business is not threatened by the new entrants.

As far as the barriers of the entering the industry are concerned, these barriers are the factors which should be kept in mind when a business has to enter a new industry. In every industry/market, there is always a switching cost of the customer where the customer tends to pay less for a low quality product or pay high for a high quality product (Dobbs, 2014). Based on this information, P.F Chang has to manage their products in such a way that the customers do not find it high or low, but in a middle so that they have a huge customer base. New markets also require high capital, and the economies of scale. Economies of scale means that cost of a single unit is decreased due to the large amount of output produced. Sometimes, it can become dangerous for P.F Chang as they had to match the quality of their products as well, which cannot be achieved by producing cost effective meals.

Power of Suppliers

One of the major factor to be considered in the industry is the power of suppliers. It is determined by the number of suppliers which exist in an industry. Suppliers might have bargaining power over the business entity, if there are less suppliers in the industry (Shockley & Fetter, 2015). Directly it effects the business flow of the company as the product resources are gained from the suppliers. Suppliers can also move their chain of production to becoming a manufacturer instead of remaining just like a supplier. The suppliers might take upon the business and become a competitor to your business.

Power of Buyers

The reverse situation is where the buyers have some power over the business/industry. In this situation, the buyers tend to behave differently because of a number of reasons. They might have alternate options in the industry or purchase the product, a single customer might have to buy a big volume of product which is return demands low pricing from the business, or require additionial services from the business while making a purchase (Shockley & Fetter, 2015). As for the business, it becomes a difficult situation to manage, where they have to offer the best product for the customers with the best service as well. P.F Chang needs to accept the buyers criteria because if a new industry is selected by the restaurant change, they have to alter their rules and regulations accordingly.

Availability of Substitutes

In an industry where there are a number of competitors working at the same time, it is known belief that the customers have a lot of ways to buy the product. The companies then analyze their inner department situations, which are not matching the competitors of that industry. For example, a customer might find that he/she can buy the same product at a low price from a different company, and move towards it. To satify this need, companies change their business strategy because of the threat of substitutes imposed on the business (Shockley & Fetter, 2015). In UK restaurant market, there are a lot of Chinese restaurant which are categorized as high brands and low brands as well. Based on this situation, P.F Chang need to adopt the industry’s criteria of serving the customers from low price to high price products.

Market Analysis

Market analysis is about the dynamics and attractiveness of a specific market in the industry. It tells about the market in which a company is going to enter or is already in the industry. In the market analysis, companies tend to talk about their strengths, weaknesses, opportunities, and threats. A SWOT makes it more easy for a company to analyze themselves about the position it is in the market (Pegels et al., 2015). For P.F Chang, UK market is selected where the company is going to enter UK as a traditional American Chinese cuisine. The stengths of P.F Chang can be considered the tenure from which the company is serving the customers. They have the power of an old brand, which gives a perception of quality in the customers mind. One of the major weaknesses of the company is that, they serve a traditional American Chinese cuisine which sometimes makes ambiguity in the customers mind and they tend to think that it is a pure Chinese restaurant. While entering the UK market, it should also be a weakness for P.F Chang that they have a low supplier base. Threats imposed on the company is followed by the already existing brands like Park Chinios and Kai, which are their main competitors in UK. Opportunities for P.F Chang are the diverse demographic areas where they can open their outlets as UK has more adoption to the Chinese food.

Target Market

Market analysis also include the target market which is selected for the business to serve the specific customers. It can also vary from different industries and places. As P.F Chang is an American Chinese cuisine restaurant, the basic target market for their business is the Chinese food lovers in the UK market. It is also as same as USA because the portfolio and business of P.F Chang is the same which was in USA, so the company will be serving the customers who love Chinese or American Chinese food in the UK.

Nature and Size of Target Market

For the starting business, P.F Chang will serve London which has the size of almost 8.7M people. from this figure, almost 40% of the population has craving for Chinese food which can be considered as the total size of the target market. The nature of the target market includes almost every type of nationalies in London i.e. Asian, European, South America, and African. Being the heart of England, London has the most population and therefore we have selected it as our target market for the start of the business.

Profile for the main segment

As the target market is selected for P.F Chang, following describes the profile evaluation of the segment of the industry:

Key Measures
Segment size measures Almot 8.7M population in London. 40% of which is Chinese food lovers (Pegels et al., 2015).
Segment growth Effected from the population, almost 6.7% people become residents in London (Pegels et al., 2015).
Proportion of the market Specifically, 40% of the London population consume Chinese food.
Geographic Majority of the segment are heavy workers, almost working all day and living in the suburbs of the city.
Demographic Aged from 18-50, well educated, disciplined, single and married having children, mostly employeed, working in flexible shifts.
Psychographic Mostly people are social, tend to talk less in public, enjoy travelling, likes spicy foods, concerned over their career and future.

Pricing Strategy

Companies tend to use effective pricing strategies to make higher profits by selling their products in the competitive industry and marketplace (Huang & Sarigöllü, 2014). For this purpose, the managers focus on a range of factors which can include the different pricing methods acquired by the competitors, positioning of product image in consumers, demographics of the buyers, and cost of distribution and production. There are a lot of strategies which are acquired by the companies to make effective pricing techniques.

  • Premium Pricing: premium pricing is used by businesses when they have to launch a new product in the market. The products have a higher price compared to its competitors, due to some competitive advantage of the product (Huang & Sarigöllü, 2014). For using a premium pricing strategy, companies tend to place an image in the customers mind that the product is worth the higher price.
  • Penentration Pricing: opposite of premium pricing, penentration pricing tends to offer products at a lower price compared to its competitors (Huang & Sarigöllü, 2014). The purpose of this pricing strategy is to flow the products in the market so that the consumers can conceive more of the companies products.
  • Economy Pricing: also known as low pricing program, centers its interest on offering low pricing products and increase the volume of sales (Huang & Sarigöllü, 2014). This pricing strategy is best when a company has a bulk quantity, and in order to sell those products companies place it at lower price.
  • Price Skimming: in this pricing strategy the company place its products at a higher price to sell, due to less competitors in the market (Huang & Sarigöllü, 2014). It is best when there is a little competition in the market, but not effective in high competition markets.
  • Psychological Pricing: in this strategy, companies tend to use an emotional pricing rather than going for a traditional sense logic for pricing. For example, a best psychological price product will be displayed as $299, instead of $300. It makes an emotional perception in the consumers mind that the product is less expensive than the competitors.
  • Bundle Pricing: bundle pricing includes selling multiple products at the same time, instead of giving away just one product. This strategy is beneficial for the company and customer both. Customer tends to think that he/she is being valued for what he/she is paying. Companies get advantage of freeing up space for new products compared to the products which were not selling separately.

Based on the details listed above, the best pricing strategy for P.F Chang will be penentration pricing. As P.F Chang is entering the UK market, which means they are expanding their global business where the company was not serving before, P.F Chang will need to enter with a low pricing method. As the competition of Chinese food in London is very high because brands like Kai and Park Chinios are already serving the market with high prices, P.F Chang needs to offer their products (same as the competitors) at a low price at the start. As the company’s workflow is increased, they can change their pricing strategy in the future.

Product strategy

There are a few concepts related to a product strategy when entering any new market or serving an existing market. The product of a company follows a product lifecycle, which is affected to every product in each company (Aras et al., 2017). First, the product starts from an introduction phase, where the product is designed and introduced to the market. With the passage of time, the product gains growth, where the sales and volume tend to rise with a speed. By the time, the product achieves it maturity stage where the company enjoys the competitiveness over the competitors (Aras et al., 2017). At last, the product reaches a decline stage which might be caused by changing consumer behavior or better products in the market. Companies deeply analyze the life of a product from launching to discontinue. Each step is linked the reaction of the customers, which determines the time period of a product to be more or less. If the product is doing well in the market i.e. its growth rate is expanded to more than a year, than the company tries to increase its production and distribution in the local market (Aras et al., 2017). Based on the situation, P.F Chang has a good customer base in the US. They have made efforts in brand loyalty and improving the image of the products. So, if they are entering the UK market, it will help them in sustaining their products for a long time because P.F Chang has made their customer base by establishing a product image in the customers mind.

For every new product, there is a relation between its response from the customers and the product itself (Huang & Sarigöllü, 2014). The local response of the customer is influenced by differentiation of the product compared to its competitors. If the product is different from the competitors, it directly increases the response of customers towards the business (Aras et al., 2017). As P.F Chang serves a traditional American Chinese food, which is already different from its competitors (Park Chinios and Kai), the company is already playing differentiation strategy in their products. The reaction of customers towards the company will he more because they will be getting a unique Chinese food in the area. There will be more consumer turnover which will increase the overall strength of the company.

There is a big relation in the company’s product and the culture of the area. As different countries have different cultures, companies tend to adopt in to the culture of that country to make their product/services more attracted and presentable. Bases on the culture, the consumer preferences also change in terms of a business and its products (Huang & Sarigöllü, 2014). For example, an Italian restaurant culture allows the customers to smoke in the restaurants while, US based culture does not allow that. If the restaurant changes its organizational culture to allow smoking in a restaurant in US, it will change the preference of the customers as well and they will move to some other restaurants. Same is the case with P.F Chang, that they need to focus the culture of UK and especially London which is their main market segment. The products of P.F Chang do not have any alcoholic substance included in it. This factor is most important because London has a lot of immigrants from different religions, who do not want any alcoholic substance in their food. P.F Chang will make sure that they observe this culture in their business to make the workplace more effective and adopted to the culture of London.

As P.F Chang is already a multinational restaurant and they have the most desired products in their menus to offer. P.F Chang will going to focus on using the same menu in London as well. By observing this stance, it will make the customers more attracted, as some customers might know about the products which P.F Chang is offering. Their highlighted menu includes main entrees like Chinese, noodles and rice, chicken, seafood, vegeration Chinese, and beef or pork. Other starts like dim sum, prawns, and salads are also P.F Chang’s basic menu strengths. P.F Chang uses light flavors in their menu, which is also the basic preference of London market as well.

Placement Strategy

Placing strategy is one of the element of the marketing mix, which tells the strategy that where and how the companies tend to place their products and service in the market (Datta, Ailawadi & van Heerde, 2017). This strategy ultimately helps in gaining market share and increasing customer purchases. Placing strategy is sometimes referred as distribution strategy, which include the outlet/stores, which make it easy for the companies to reach the customers. As in for P.F Chang, there is the need to open a direct store in the heart of London because, P.F Chang is a restaurant chain and it is needed for the company to open an outlet in the city so that the customers can reach the company more easily. For the more increased sales and effectiveness, P.F Chang should open the stores in the shopping malls of London, because there will be more public there, and as the P.F Chang was not in UK before, it will be the best way to get more interaction from the customers. The famous malls in London are Westfield London, Hay’s Galleria, and One New Change. These places will be selected for P.F Chang to open their stores in London.

As far as the distribution of the operations it concerned, P.F Chang will manage its distribution same as they do it in other countries. The distribution process starts from the producer, then it goes to the wholesellers, and further passes to the retailers, and then given to the customers (Datta, Ailawadi & van Heerde, 2017). In P.F Chang, they will get the materials from the producers/suppliers in the market. These materials can include the raw materials like chicken, meat, salad material, and other things used in making a good meal. After taking these materials, it passes on to the store outlets of P.F Chang so that the chefs and cooks can make it. Finally, a P.F Chang meal is given to the customer.

The supply chain of the firm will be handled by gathering relations with the inner market contractors, which can help in the improvement of the quality of their products (Datta, Ailawadi & van Heerde, 2017). Supply chain of P.F Chang will cover everything from making the product, product manufacturing, retailing, and giving the product to the customers. The entry strategy for this purpose will be direct sales, as the customers and P.F Chang do not have third party in between their working channels.

Promotional strategy

The most important element in the marketing mix is the promotional strategy, also known as the promotional mix. It is the most important part of the marketing mix, as it creates a direct link with the customer base in a specific area (Oladepo & Abimbola, 2015). In the promotional strategy, we are going to discuss about the promotional mix strategy which will be acquired by P.F Chang. As product promotion is very important for a business, it is of great importance that the company manages its promotion to the customer needs (Oladepo & Abimbola, 2015). Promotional mix consists of public relations, advertising, sales promotion, personal selling, and direct marketing. Acquiring and implementing the right mix of these promotional activities, promises high customer demand and achievement of long and short term customers.

Personal selling is the process in which a company interacts with the customers on face to face conversation or over a telephone to persuade and help in giving the product knowledge. It is sometimes the most effective way to attract a customer, for a company which is engaged in personally selling the products to customers (Oladepo & Abimbola, 2015). For this purpose, sales meetings and sales trainings are conducted for employees, to make them skilled in interacting with the customers.

Advertising is a paid representation of a company’s goods and services through a mass medium. It is the most effective way of promotion, which is done by a nonverbal technique of presenting the products and services to the customers (Oladepo & Abimbola, 2015). Advertising can be done using billboards, tv ads, print media ads, direct mailing, brochures, posters, web pages, banner ads, and mobile ads.

Sales promotion is a non-media or a media communication, which is used to increase customer demand and improve availability of a product for a limited time. Companies might put promotions on their most running products for a given limited time, to increase the revenue of the company (Sagala et al., 2014). Sales promotions can be done by offering coupons, product samples, exhibitions, and trade shows for the customers.

Public relation is the strategy of conveying information about a product or service, which is carried by a third party for the benefit of the company itself. It might be a free or paid publicity, depending on the mutual interest of both parties. It is the most effective strategy when a company wants a huge amount of public to interact with the product and service of the company (Sagala et al., 2014). Newspaper ads, magazine articles, charity contributions, and seminars can be included in public relations.

Direct marketing is a form of advertising which make ways for the businesses to directly interact with the customers using emails, mobile messaging, fliers, promotional letters, and outdoor advertisement (Sagala et al., 2014).

The best promotional mix for P.F Chang will be advertising and sales promotions. As P.F Chang is entering the London market, they will make billboard designs in the local areas of London where the public is more. These billboards will say “The best Chinese cuisine is in your city now” followed by the product details, and description of the location of the outlet. P.F Chang can also use Social media advertisements on Facebook, Twitter, and Snapchat where an advertisement is played when a person is watching a video or playing a game. These ads will also include the product description like the Chinese chicken cuisine, pork food, and traditional soups of the company. Keeping in mind that, P.F Chang is offering a non-acoholic product in the market due to the nature and culture of the market, they have to convey the same messages to the customers. The messages should be identifying that “we serve the best American Chinese cuisine which matches your need”.

For the purpose of sales promotion, in the start of the business P.F Chang will be focusing to giving an ice cream or beverage free with the main course of the meal. The company will be using memberships cards, in which the customers can have a 20% discount on the purchase of every meal they dine-in. As the store location is in malls of London, they will use the promotion techniques of giving samples of their noodles and prawns to the customers passing by the store.


It is important of P.F Chang to take account of their marketing prospects while entering the London market. It is benefical for the company to consider their marketing plans which will help them in increasing sales and revenue of the market (Sagala et al., 2014). Alongside the effective operations of the company, it is also important to satisfy the marketing needs of the company and matching the customer criteria of the market. By following this, it is expected that P.F Chang can achieve a revenue of 12M in the next year, which is based on the number of stores. The unit sales can be forecasted at 250 US units, which are also based on individual store performance.

Work Cited

Aras, M., Syam, H., Jasruddin, J., Akib, H., & Haris, H. (2017, July). The Effect of Service Marketing Mix on Consumer Decision Making. In International Conference on Education, Science, Art and Technology (pp. 108-112).

Datta, H., Ailawadi, K. L., & van Heerde, H. J. (2017). How Well Does Consumer-Based Brand Equity Align with Sales-Based Brand Equity and Marketing-Mix Response?. Journal of Marketing81(3), 1-20.

E. Dobbs, M. (2014). Guidelines for applying Porter’s five forces framework: a set of industry analysis templates. Competitiveness Review24(1), 32-45.

Fleisher, C. S., & Bensoussan, B. E. (2015). Business and competitive analysis: effective application of new and classic methods. FT Press.

Giannakopoulos, Y., & Koutsoupias, E. (2015). Competitive analysis of maintaining frequent items of a stream. Theoretical Computer Science562, 23-32.

Huang, R., & Sarigöllü, E. (2014). How brand awareness relates to market outcome, brand equity, and the marketing mix. In Fashion Branding and Consumer Behaviors (pp. 113-132). Springer, New York, NY.

Oladepo, O. I., & Abimbola, O. S. (2015). The influence of brand image and promotional mix on consumer buying decision-a study of beverage consumers in Lagos State, Nigeria. British journal of marketing studies3(4), 97-109.

Pegels, N., García, T., Martín, R., & González, I. (2015). Market analysis of food and feed products for detection of horse DNA by a TaqMan real-time PCR. Food analytical methods8(2), 489-498.

Sagala, C., Destriani, M., Putri, U. K., & Kumar, S. (2014). Influence of promotional mix and price on customer buying decision toward fast food sector: a survey on university students in jabodetabek (Jakarta, Bogor, Depok, Tangerang, Bekasi) Indonesia. International Journal of Scientific and Research Publications4(1), 2250-3153.

Shockley, J., & Fetter, G. (2015). Distribution co-opetition and multi-level inventory management performance: An industry analysis and simulation. Journal of Purchasing and Supply Management21(1), 51-63.



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