Since its establishment in 1996, there has been a lot of changes in the business of Chipmunk cafe. With the passage of time, Chipmunk’s administration has brought changes according to the new trends which is the reason behind successful expansion of its business. Although Chipmunk Café’s main focus remains the children of age 0-11, but now they are also trying to adopt the policy of engaging families as much as possible. It uses its merchandise, branding and customer engaging programs for this purpose. These programs are also updated with the passage of time. Initially they were only offering indoor adventure playground for children. However, with the passage of time they have introduced services like: birthday parties, before and after school care, beverages and coffee, themed rides, and special programs for schools and colleges.
Now in modern world, usually both husband and wife go for jobs and the concept of house wife is vanishing. Moreover, now parents do go for gym and other activities where it isn’t suitable for children to go. Chipmunk introduced services of daycare to deal with this issue. Their professionally trained staff and awesome environment attract parents to select Chipmunk as daycare for their children. Another change they made was start giving the services of arranging birthday parties. Now families, especially kids, love to celebrate their birthdays outside. Chipmunk’s specially designed café provide separate and private party areas to families where they can have fun. They also provide decoration and other similar stuff to their clients which can make their birthday more colorful. Chipmunk administration saw another business opportunity and they started providing beverages, cakes and other food items to their clients. Now, those who come for parties, day care or any other program, they can get food items as well inside the premises. Chipmunk also introduced personality program for kids. They use different challenges and activities to develop the personality of a child. So, children gets to learn something useful while they are in playground. Chipmunk also introduced newly manufactured and uniquely designed playground for kids. As the trend change, the interest of children also change. Chipmunk adopted new changes according to the like and unlike of general opinion of children. In short, there have been few changes in overall trends of the world. There is addition of new elements in culture. Chipmunk managed to change its services with the overall change of trends.
Chipmunk was started in 1996 and now it has 38 stored globally which shows that company has been expanding gradually. Chipmunk has expanded their branches in New Zeeland, Australia and Indonesia, which is a proof of their successful business. They have recognized the needs of their customers and their marketing strategy is based on it. Now there are more people who are willing to use the daycare services of Chipmunk because people consider it reliable. Now more schools are inclined to organize events and special functions in such places because it is more attractive for students. Although chipmunk hasn’t revealed their financial details, it can be seen that their business is expanding. Chipmunk has targeted working class where both parents have jobs. Moreover, they have also targeted schools. Similarly, their trained staff, proper system and unique playgrounds are the factors which attract general public.
2.0 Pricing Strategies
Pricing for a business can be a tricky, challenging, and complex thing. Chipmunk café has added new items in the menu. These items include different type of burgers, various drinks and coffee, and cakes. Chipmunk cafe think they can serve these items not only to the children but also to the parents who accompany their kids. In short, this will also be a great source of revenue for Chipmunk.
Chipmunk Café’s is going with a rebranding strategy and introducing new menu. There are multiple reasons behind that. Chipmunk is looking to compete at higher level while entering in new market. It wants to come up with a new vision which will attract customers and investors. In short, Chipmunk Café is coming up with rebranding strategy and new menu because it wants to expand its business and compete at higher level.
In new menu, Chipmunk cafe is going to introduce special items, burgers and pizzas, and there are separate dishes for children. In favorite item’s portion, Chipmunk cafe is introducing Toasted Chipmunk Melts, Tomato and Basil Bruschetta, Chicken Salad Rap, and BLT. In burger and pizzas portion, Chipmunk cafe serves beef and chicken burger, and different types of Pizzas. There are a lot of options available for kids as well such as: Chicken Nuggets, Hot Dog Munch Meal, Kid’s sandwich, and Charlie’s fairy bread.
The prices of these items are derived from cost-plus approach. Cost plus approach means that pricing must be done in a way that all the overhead costs that occur when running a restaurant such as: rent, wages for chefs and staff, and electricity and gas bills. Moreover, profit margin must be considered wisely. The owner should get attractive profit to run the business smoothly. Then the money required for maintenance and repair of café must be kept in mind. In the end, percentage of profit, wages and other expenditures must be added to the original price of the food (Matterhorn, n.d.). Chipmunk café’s administration know the expected types of clients they want to attract, and consider this clientele when setting their prices. Owners know that most people they attract usually comes from middle class and they have set the prices according to their customers. These prices are considered generic, meaning that it is customary pricing. In other words, Chipmunk cafe has set the prices of most of the food items almost similar to other restaurants. For example, price of healthy burger or hygienic pizza on any restaurant cost around 8-12$ and at Chipmunk, the price range for these food items is similar. However, there are some products whose price is less than what other restaurants are charging. This can be described as penetration strategy. For example, the prices of food items are low as compare to other restaurants. There are multiple reasons behind this. Chipmunk is basically an indoor playground for kids, so when kids come to Chipmunk they will obviously buy the food and if prices are attractive then parents will surely buy their kids food from Chipmunk cafe.
Market fluctuation is also another factor to consider while setting pricing strategy. Food prices fluctuate due to several reasons. However, usually food prices on menu remains same. This means that dish will earn profit when price of raw items required for that food it low and vice versa (Kooser, 2015). It is very important that Chipmunk cafe creates a value statement. It is necessary that it tells its customers that why they should dine at Chipmunk cafe. Last but not the least, bundle pricing strategy is also useful. There are deals that with small additional money, one can buy extra fries, drinks or ice creams. In short, Chipmunk cafe knows who are their main customers and it must develop an effective strategy to serve them.