Sticks Kebob Shop first opened in Charlottesville, Virginia in the year 2001.

The idea of
opening this fast food chain was to not only offer high-quality healthy food, but to deliver it
quickly. They aimed to offer a brand of carefully selected ingredients and healthier options
overall. To ensure that its food was appealing to a broader audience, Sticks did not categorize
themselves as a Middle Eastern restaurant. Instead of putting ethnic terms on their menu, they
used a more original (American) term. They tried to position themselves along with familiar
chains such as Panera and Chipotle. However, Sticks Kebob Shop still fell under the ethnic
foods segment for fast casual restaurants, which made up 9% of the industry.

A majority of Stick’s customers were people in their mid 20s to 40s, professionals on their lunch
breaks, or “soccer moms.” Most of these customers came into the restaurant on weekday
afternoons. Eventually, Sticks decided to start partnering with University of Virginia due to the
breakdown of the population. These were typically sports fans on the go, or those coming from
higher household incomes. The main focus on targeting U.Va. was to target families and long-
term local residents, a crowd which similarly represented their current audience.

Being in the fastest growing segment in the food-service industry, Stick’s executive team hoped
to open many more locations, going from its current four locations to eight locations by 2014.
Along with opening more restaurants, Sticks was in the process of selling their signature
hummus in retail stores and starting a food trailer for offsite vending. Their long term plans for
the fast casual restaurant chain focused on starting expansion across Virginia, where the brand
had already been established. Advertisement campaigns were put in place in Charlottesville to
show brand recognition. From there, Sticks planned on expanding their chain more throughout
the East Coast. In order to do this though, they needed to figure out who exactly their customers
were. So the Sticks management decided to distribute a survey to both customers and
noncustomers to help better decide where to open their next location.

1.) How do people choose the fast-food restaurant to visit?

a. What is important: location, price, assortment, or cuisine?
i. People choose a fast-food restaurant to eat at based on many factors such
as whatever location is convenient to them, the price they are willing to
pay, and of course the variety of what type of food is offered. However,
out of all these factors, I believe that location is the most important when
choosing a place to eat at. People tend to usually grab fast food at a
location that is along their route to work, practice, home, etc. It’s all about
convenience.

2.) Who do you think are Stick’s customers and what are their motivations for visiting
Sticks?
a. Stick’s customers tend to either be single people in their mid 20s to 40s,
professionals on their lunch breaks, or “soccer moms” on the go. The motivation
behind eating at Stick’s is because this fast casual restaurant chain not only offers
a quick meal to go, but it is also offers healthier food options. As mentioned by
customers, Stick’s was known for their filling but nutritious food, its good prices,
 and its fast delivery. For customers who are in a hurry and are watching their
budget, this is very important.

3.) What does the survey tell us about differences between customers and noncustomers?
a. Customers who have taken the survey can provide information about their
experience, as well as how often they visited Sticks. Most of the noncustomers
that took the survey have never even visited a Sticks Kebob Shop. These people
are more likely to bring their lunch to work, and are mainly male. When choosing
a place to eat at, this audience makes sure that there is a healthy menu, friendly
staff, pleasant ambiance, consistency/reliability, and that the restaurant is part of
the community. As for the customers of Sticks that did take the survey, we see
that there is a mixture in the number of people who make or bring their lunch to
work. But we do see that when it comes to buying food while away from home,
these customers are more likely to purchase food from a restaurant/food
court/food truck. Also while looking at the survey results, one can see that Sticks
customers tend to eat at more of the healthier casual fast food restaurants such as
Chipotle and Panera. On the other hand, noncustomers tend to choose the
unhealthier options such as KFC, Burger King, Wendy’s, and McDonalds.

4.) What survey questions would you use to identify the customer segments?
a. I believe that “I carefully consider the health benefits of what I eat” is a good
identification in identifying different customer segments. More specifically,
asking customers their age and income are also good ways to determine customer
segments. In the case of Sticks Kebob Shop, this is essentially what determines if
the person will be eating there since Sticks’s customers are known to be in a
certain age group and looking for healthier options.

5.) How many customer segments can you estimate from the survey data? – I estimate about
four different customer segments from the survey data.
a. What are the profiles of the customer segments? 1.) Professional singles age
group 20-40 who are in a rush, 2.) Families which have children and a higher
household income, 3.) Students from the university campus, 4.) All other
household consumers who spend money on meals
b. Which customer segments should Sticks target? Sticks should target the
professionals that buy their meals during lunch, as well as the families who buy
food for their children on the go.

6.) Provide a recommendation for the location of the next Sticks Kebab Shop based on the
segmentation analysis and the demographic profiles of the locations in the following
table.
a. Based on the segmentation analysis and demographic profiles in the provided
table, Sticks Kebob Shop should open a new restaurant in Location D. The
median age rage is 34.8, which falls in the typical age range of most of Stick’s
customers. This location also has a higher population compared to the other
locations, as well as a higher spend per household.