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White Castle Case Analysis Essay

When someone usually thinks of White Castle restaurants they usually imagine those steamed “Slyder’s” as they like to call it. They are 2.5″ square patty made with 100% USDA beef. What make them special are the five evenly spaced holes, which allow the steam to encompass the burger. This may not sound healthy but compared to other fast food restaurants, it is. For example, one double hamburger from White Castle has 285 calories while the McDonald’s quarter pounder w/ cheese is 530 calories, the Whopper w/cheese from Burger King is 780 calories, and the big bacon classic from Wendy’s carries 580 calories (Heath Check, 1997).

In 2003, there are a total of 340 White Castle Restaurants located through out the United States. With the growing number of other fast food establishments each year, White Castle still remains very competitive even though their menu remains the same. While other fast food restaurants are offering new healthier products such as salads, chicken, baked potatoes and yogurt, White Castle has added a chicken, fish, and breakfast sandwich to comply with this growing demand. Of course, they still offer cheeseburgers, chicken rings, onion chips, cheese sticks, French fries and shakes which keep customers coming back (White Castle, 2001). Over 500 million hamburgers are sold each year, that’s what we call a masterpiece.

Fun Facts

What would a hamburger be without the bun? Lucky for us, we never have to find out. White Castle owns and operates three bakeries in Rensselaer, Indiana, Evendale, Ohio, and Carteret, New Jersey. These bakeries produce the special small, soft, white bread buns that help to deliver the distinctive steam-grilled goodness that has made our hamburgers famous! (White Castle, 2001)
Building History

Is that a real castle? You betcha. White Castle’s medieval motif was inspired by Chicago’s famous Water Tower. Original White Castles sported rooftop battlements and a turret

Good looking on the inside and out, the name, White Castle was chosen to signify purity and cleanliness.

SWOT Analysis

Strengths

* Convenience. Opened 24-hours-a-day. Consumers avoid high involvement decisions.

* Unique taste. Small, steamed bite-size burgers, which are different in appearance and taste from competitors’ burgers.

* Low personnel turnover. Ten percent of employees have 10 to 45 years of continuous service.

* Industry leader in sales per store. Surpasses competitors.

* Higher traffic in White Castle restaurants than competitors.

* Nostalgia that passes down from generation to generation.

* Quality Product. Owns the bakeries and meat processing plants that supplies product to its own stores.

* Access. White Castle burgers can be purchased in the grocery store as well as its restaurants.

* Low priced meal items.

Weaknesses

* Limited Menu. Does not include some of the healthier food items some health conscious consumers crave.

* Does not appeal to the middle class market.

* Location. Restaurants are mostly in upper-lower class neighborhoods.

Opportunities

* Advertising. Feature employees with tenure in advertising campaigns.

* Global Expansion.

* Develop a more effective pricing and promotional strategy.

* Expanded and consistent menu.

* Capitalize on the uniqueness of its products.

Threats

* More consumers are eating at home because of convenience and economical reasons.

* Competitors’ business has grown rapidly in the last 20 years even though White Castle started in the fast-food business before them.

* Rivals segmenting business

Recommendations

Marketing Strategy

White Castle’s hamburgers are unlike any other fast food chain. They offer a unique menu which millions of customers flock to each year. With all of the competition from other restaurant chains offering inexpensive menu items, White Castle’s popularity could decline because of this. In order to boost popularity and to keep’s it customers coming back there are a two marketing strategies they could imply that would make this

happen. The first of these strategies is advertising and whom they are targeting. By advertising to on different television/radio stations, newspapers, billboards would increase sales and get attention from new customers. Within these ads, reference what White Castle stands for and the history the company. The final strategy that White Castle could offer to counter other restaurant acts would be to offer a wider, healthier menu items. This menu could include salads, yogurt, and low fat turkey burgers. By completing this could turn consumers of other fast food establishments to White Castle.

Pricing

White Castle hamburgers cost on average 59 cents apiece (Parkinson, 1997). In today’s society, consumers want more for their money. White Castle can increase the price of its products by creating “castle meals”. Because White Castle hamburgers are so small, “castle meals” would include several burgers of one kind, along with a larger “castle size” french fries and drink. Consumers will feel they are getting more for their money. This pricing strategy would also make White Castle more competitive with McDonalds and Burger King. White Castle would continue to offer crave sacks.

Distribution

A box of six White Castle hamburgers today can be found in the frozen food section of your local grocery store. To capitalize on the “crave sacks” promotion, White Castle should offer larger boxes of frozen burgers. These boxes can be purchased in the warehouse stores like Sam’s Club and Costco.

White Castle can also capitalize on its other products that have a unique taste. The White Castle onion rings and chicken wings could be offered in the frozen food section of the grocery store. This would expand the company’s frozen food product line. The frozen food product line could be offered in all grocery stores, not just in White Castles core restaurant areas. Customers who are not familiar with the White Castle brand would just look at products as new products they may want to try.

Lastly, White Castle should look into adding more restaurants internationally. The restaurant would then be able to compete with the global fast food industry.

Promotion

Given the fact that many older patrons are nostalgic about White Castle hamburgers, the company can create a campaign where these customers speak about their experiences growing eating White Castle hamburgers and why the third generation of the “Clark Family” continue to eat White Castle hamburgers. Employees would also be featured and discuss why they continue to work for a great company like White Castle, Inc.

In order to appeal to the middle class market, White Castle can experiment with color and dйcor inside the restaurant while keeping the restaurant the same outside. A more modern decorating color scheme, seating and lighting can be used.

Product

Although White Castle is open 24 hours a day, they have a very limited breakfast menu. The menu should expand to include additional breakfast items such as breakfast sandwiches using the same tasty bread customers like.

White Castle also needs to expand its menu to include more items such as salads, low fat yogurt and grilled items. The concept will work well with the steamed hamburger they currently offer and the expanded menu would appeal to the health conscious consumers.

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