Red Crab Group Case Study by Crissy Cruz
The
Red Crab Group started as a small restaurant in Clark Pampanga known for its
Crab Recipes and Kapampangan and Filipino Food. When the owners decided to
expand their business in Manila and set-up shop in Malate, they discovered the
shortcomings of the business particularly the brand’s lack of identity. In
spite of the initial success experienced by the Malate and the Tomas Morato
branches, the owners found out that their product offering lacks focus.
After
doing some market research, Mr. Raymund Magdaluyo – Red Crab’s owner, decided
that to reposition his brand and be known as a Seafood restaurant rather than a
Filipino restaurant. Soon after, Red Crab’s Seafood and Steaks were able to
yield success in its three branches in Manila,
The
opportunity to open in Greenbelt and Rockwell has pushed Mr. Magdaluyo to think
of novel ways of creating a crab and seafood restaurant that would fit the
tastes and expectations of the high-end market. For Greenbelt 3. Mr. Magdaluyo
came up with Seafood Club, a casual festive themed restaurant. He envisioned a
casual seafood restaurant where guests are relaxed and happy while enjoying
their crabs. On the other hand, Crustasia in Rockwell, was born out of Mr.
Magdaluyo’s vision of forming an enchanting and transformative bistro that
serves oriental inspired dishes. More than just a seafood restaurant, Mr.
Magdaluyo wanted Crustasia to be a classy place where people will not only
appreciate the food but the whole dining experience.
After
conquering the high-end market, the Red Crab group turned their attention in
developing Blackbeard’s Seafood Restaurant which targeted not only the families
but also the after-work group of works or the barkada crowd. This restaurant became
a place wherein groups of friends can hang out for drinks and top quality
grilled seafood and barbecue for pulutan.
With
the right formula of proper location, good food, ambiance and value for money
propositions, the success of the Red Crab group can also be attributed to
effective Public Relations activities. Mr.Magdaluyo established good relations
with Celebrities and sponsored their shows and events. He banked on the
credibility and popularity of the celebrities that once they say rave reviews
about his restaurants, they will be able to positively influence customers to try
their restaurants.
The
Red Carab Group has successfully developed a One-Product, Multi Concept
approach based on the portfolio of restaurants they have developed over the
past years. However, based on their most recent venture, Heaven ‘n Eggs – an
all day breakfast place, the Red Crab Group is moving on and expanding their
horizons. They are now looking into becoming more than a Crab and Seafood Group
and evolve into a successful chain of top dining restaurants.
This
Case Study has notable points in putting up and managing not just a restaurant
business but an enterprise in general. The story of the Red Crab Group has
established insightful ideologies to follow:
1.
It is important that one must identify the market and what he is selling. A
brand should have focus and a clear identity.
2. There is a challenge to create your own
segment and answer the following questions:
- Where are we going operate?
- What we are going to serve?
- What influences them to buy my products or get my services?
3.
Given clear market segments, we draw out marketing position of the brand.
4.
Based on the story of the Red Crab group it proves that it is easier to look
for a perfect location, and then develop the product from there.
5.
In developing a One-Product, Multi-Concept Approach, prices are differentiated
because of the location of your store.
With
the success of the Red Crab Group on its Crab and Seafood chain, I think the
main concern that the group is facing is their strategy on sustaining and
expanding their business. The challenge is creating new concepts outside of the
Crab and Seafood chain and capturing a larger market.
With
the addition of Heaven ‘n Eggs, the Red Crab Group is now faced with developing
and implementing new strategies that can duplicate the successes of the Crab an
Seafood restaurants to other concept stores.
I
feel that the formula used by Mr. Magdaluyo to propel the growth of the Red
Crab Group can be applied to other restaurant concepts. However, their strategy
of finding a location first and then developing the business idea afterwards can
be a double-edged sword. Without having any concrete business plan in mind, all
the work only happens once the location is specified and finalized. Now that
they are starting to create new business concepts that is outside of the
comfort zone of the Crab and Seafood restaurant, Mr. Magdaluyo should extend
more effort in doing market research before jumping the gun on a new concept.
