Vending Machine Businsess Plan Marketing business plan

Location, environment and target market

Value proposition and competitive edge

Marketing and sales strategy

Online marketing technique

Pricing

Business plan:

H.U.M.A.N. Healthy Vending -- Healthy Seven Vending

Location, environment and target market

America's obesity epidemic has been spiraling out of control in the past two decades, and will continue to grow unless drastic measures are taken to change American eating habits. It is of particular concern that the rate of childhood and adolescent obesity is growing so rapidly. H.U.M.A.N. Healthy Vending (Healthy Seven Vending) believes that it is essential that food corporations pair with local municipalities, educational institutions, and other organizations that play a vital role in young people's lives. "More than half of U.S. middle and high schools still offer sugar drinks and less healthy foods for purchase. Students have access to sugar drinks and less healthy foods at school throughout the day from vending machines and school canteens and at fundraising events, school parties, and sporting events" (A growing problem, 2013, Overweight and obesity).

Vending machines and access to unhealthy processed foods is even more ubiquitous at college, given that students have more disposable income, irregular mealtimes, and longer unsupervised leisure hours in which to indulge. Although companies such as Frito-Lay and Coca-Cola have partnered with schools before, H.U.M.A.N. Healthy Vending is unique because it is a company that specializes in healthy vending technology. It does not have a divided interest when it claims to promote health like other food companies, given that all of its products are natural, nutritious, low-calorie, and made with minimal preservatives.

The city of Decatur in Georgia has a particularly high rate of youth obesity. It seems an ideal location to introduce healthy vending machines. For the first effort of H.U.M.A.N. Healthy Vending to expand into the region, colleges will be selected as the primary target. The city's location is a fairly central hub for a variety of educational institutions. The target population will be students ages 18-35. Colleges are ideal because they are highly-trafficked areas with willing hungry, consumers. Students in this age group are often 'striking out' on their own and adopting new tastes. They are more likely to be receptive to changing the types of foods they consume through healthy vending machines.

Decatur is a suburb of 19,000 residents, located just east of Atlanta. According to the city's website, "Decatur residents have one of the highest education levels in the metropolitan Atlanta area. Decatur employees, primarily concentrated in the downtown commercial district, also represent an important demographic category in our community. Emory University, Agnes Scott College and DeKalb County are among our top employer groups with the professional and service sectors well represented" (Demographic information, 2013, Decantur Georgia). This high level of education suggests a population that is malleable and willing to make positive changes. Even if the obesity rate is high, higher levels of education are also associated with reduced risk for obesity overall.

Value proposition and competitive edge

The obvious competitors for this healthy vending initiative are the current snack food giants of Coca-Cola, Kraft, and Frito Lay. Coca-Cola in particular has a close relationship with Emory University, which is often nicknamed 'Coca-Cola' university because of the close ties between the company and the campus. However, concern about the risks of consuming soda is growing. H.U.M.A.N offers tasty snack foods and drinks that still satisfy cravings, but without high-fructose corn syrup and with demonstrated nutritional value. According to the corporate website, these products include milk rather than soda, Pirate's Booty (in contrast to potato or corn chips), Kashi Go Lean Bars, and all-natural juices. Offerings can be customized according to the needs of different locations. For example, vending machines near cafeteria areas can include meal-type foods like yogurts, carrot sticks, and string cheese, while vending machines near the campus gym can include energy bars and drinks.

The 'value' of these machines for students is that they allow students to eat healthfully, without feeling sluggish and weighed down by junk food. Many teens are worried about gaining the 'freshman 15' and H.U.M.A.N. allows teens to pursue a busy, on-the-go lifestyle and remain weight conscious, fit, and active without going hungry. The 'value' of the machine for the campuses is that schools are increasingly subject to criticism from the media for claiming to promote active lifestyles while allowing companies that peddle an unhealthy product to be present on their campuses. However, doing away with vending machines entirely is not a feasible option, given...

H.U.M.A.N. allows vending machines to remain in a less controversial fashion.
According to a recent study in the Journal of Adolescent Health, surveying 150 different U.S. schools, "eighty-three percent of the studied schools housed vending machines with foods containing minimal nutritional value -- such as chips, soda and candy. The remaining schools' vending machines contained fruits and vegetables. Students without access to junk food-filled vending machines ate more produce overall" (Oz 2010). Studies like these have raised the call for schools to do something to make vending machine offerings healthier and H.U.M.A.N. Healthy Seven Vending can fill that void. It allows students to 'have their snack food cakes and eat them too' without gaining weight.

Marketing and sales strategy

The marketing of the healthy vending machines will require a dual effort: it will draw upon the media, larger community, and city of Decantur by stressing how the company serves a civic function by improving young people's eating habits. It will also promote itself to its target demographic in terms of its taste, ability to promote a slimmer figure, and novelty. To generate buzz, Healthy Seven will advertise in local weekly newspapers read by college students such as Crossroads News and Creative Loafing and showcase the company on radio advertisements on WAOK 1380 Atlanta, WVEE 103.3(V-103) Atlanta, and WSB News and Talk (750AM) Atlanta.

These advertisements will have a rough, edgy quality to them to attract college students, as the actors in the print and radio promotions talk frankly about their concerns about their health and weight in a funny way. The advertisements will also implicitly criticize the offerings of the competitors. "Does this vending machine make my butt look big?" one print advertisement could ask, as two students look at themselves reflected in vending machine of unhealthy snacks, which would be followed by an image of themselves looking into a healthy vending machine of fresh snacks, sporting slim figures. Another image could show an unhealthy vending machine filled with snacks and sodas, all of which were labeled 'Freshman 15.' As commuting students often make use of public transportation and are a captive audience as they wait on the trains, billboards on metropolitan Atlanta public transportation (M.A.R.T.A-Metropolitan Atlanta Rapid Transit Authority could replicate some of the print advertising. VISTA print for flyers and banners on campus would further supplement these efforts.

Because of the 'public service' and educational component of its advertising campaign, Healthy Seven representatives could also offer to do interviews on educational channels/networks, such as the Georgia Public Broadcasting System (GPS). These interviews would not explicitly be 'advertising' but they would transmit the message implicitly that the types of high fiber snacks offered in the vending machine have a much better effect upon the body than those offered by more conventional snack companies. The fact that the vending machines can stock fresh food, including produce and milk, which has been shown to have a positive effect upon lowering the obesity rate through scientific studies makes reaching out to educational media particularly essential (Mann 2010).

When first launched upon the campus, the company will have a 'free day' of vending machines -- all vending machines will be free for a day, to celebrate the launch, and there will also be representatives of the company handing out information about the product and staging various events with company 'talent,' such as public exercise 'flash mobs' and healthy 'snack mobs' of people running through campus, brandishing the snacks featured in the vending machine and handing them out to students.

The hands-on marketing will include a representative and a sample of the product at the Health and Wellness Expo and Back to School Expo at The Mall at Stonecrest. If the campus vending machines at local college campuses in the Decatur area are successful, the company will branch out and feature the machines at all three of the local DeKalb County malls, The Gallery at South DeKalb, Market Square, and The Mall at Stonecrest where young people frequently 'hang out.'

Online marketing techniques

Although the product will not be sold 'virtually,' young people are heavy consumers of online media. A web presence advertising the company is essential, preferably on websites frequented by college students, such as the colleges' websites; websites that sell discounted textbooks and dorm furniture; and local sites that chronicle popular nightlife and discount events.

Blogger, Facebook, Tumblr, Twitter, and other personal webpages and social media can also be useful. As well as advertising through conventional channels, using 'stealth' advertising can be particularly effective when trying to reach the fickle college audience. More and more college students (as well as the population in general) are…