144601597 OxyBar a New Business Launch

8/13/2019 144601597 OxyBar a New Business Launch

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2013Service

Marketing

[OXY BAR RESTORE AND REFRESH WITHOUT THESIDE EFFECTS]

Ali Ammar Yousuf, M. Fouad Siddiqui, Ozair Qadir, M. Aizaz Haq, Farzan Sheikh, Furqan Lakhani


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Table of ContentsBackground of Service Concept and Company: ............................................................................. 4

Service Concept: ............................................................................................................................. 5

High Contact Service ...................................................................................................................... 7

Facility Layout ............................................................................................................................ 7

Quality Control ........................................................................................................................... 7

Capacity ...................................................................................................................................... 7

Front Line Worker Skills ............................................................................................................ 7

Rhythm & Schedule .................................................................................................................... 7

Service process............................................................................................................................ 8

Service Offer ............................................................................................................................... 8

People Processing ........................................................................................................................... 8

8 Ps Of Marketing: ........................................................................................................................ 9

Product Elements ........................................................................................................................ 9

Stressed Businessmen ............................................................................................................. 9

Athletes ................................................................................................................................... 9

Young adults ........................................................................................................................... 9

Primary Product .................................................................................................................... 10

Supplementary Products ....................................................................................................... 10

Price .......................................................................................................................................... 10

Place .......................................................................................................................................... 11

Promotion & Education ............................................................................................................ 11

Physical Environment ............................................................................................................... 12

People ........................................................................................................................................ 13

Process ...................................................................................................................................... 13


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Productivity & Quality .............................................................................................................. 14

Conclusion: ................................................................................................................................... 15


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Background of Service Concept and Company:Blood is loaded with Oxygen, When air is inhaled the lungs siphon the oxygen into the blood,

and the heart pumps these oxygen rich blood cells into the muscles and up to the brain. The

quicker the body and brain receive oxygen, the quicker it will rejuvenate and the sharper it willfunction. The typical air we breathe is 20.8% oxygen, not all of which is absorbed into the body.

Oxygen bars is a growing concept worldwide and is catching popularity as an industry. The trend

has been catching on in Pakistan with one opening in Lahore and Islamabad each. There has

been no such bar in Karachi yet and this provides an excellent opportunity and a first movers

advantage into the business. Karachi currently is saturated wi th sheesha bars which is a

modified version of huqqa with flavors. These are the most popular hangout spots for young

adults all over the city. Sheesha contains harmful ingredients like Nicotine and consumption ofsheesha is more harmful than smoking cigarettes. Therefore these young adults and parents alike

are looking for alternatives that are less harmful and can provide the similar feeling of freshness

and heightened senses. One such alternative is oxygen for recreation.

Oxygen session has many benefits and few risks for the average person. Generally it takes 10

minutes to oxygenate ones blood, although a 15 - 20 minute session is mostly recommended.

Whilst sitting at the Oxygen Bar one may not notice any immediate difference, however not long

after the session is complete people will feel like they have more energy and less aches and pains. If the person suffered from lactic acid build-up in the muscles this will generally reduce

and their stamina will be noticeably increased. If drinking, patrons are less inclined to experience

a hangover the next day. The blood alcohol level will NOT change much although patrons can

expect an increased tolerance to alcohol. oxygen has the potential to increase memory and

awareness following an oxygen session.

There are no risks and no adverse effects with short term use of oxygen. The American lung

Association has said that breathing oxygen from an oxygen bar has no harmful effects and there

is no evidence that oxygen used in bars can be dangerous to a normal persons health. Oxygen

bars have been operating in several countries, for over 8 years; millions of people have enjoyed

the sessions without a single health related incident. Oxygen bars are not intended to treat, cure,

prevent or diagnose any illness or disease.


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Service Concept:Oxygen Bar will be a lounge or caf which will sell oxygen for

recreational use. It is a new trend appearing globally. The purpose

of this new respiratory innovation is to substitute the use of otherharming vapors and smoking practices, primarily Sheesha/Hookah.

According to a study conducted by Agha Khan University Medical

College, 61% of the respondents smoked sheesha occasionally

which indicates that there is a big market which is vulnerable and

ready to be tapped and converted. 1

Hence our positioning statement would be:

A posh cafe serving oxygen for recreation to young adults aged between 16 to 30 years, as an

alternative to harmful smoking habits.

As evident by the aforementioned positioning statement, our core target market will have the

following characteristics:

Age bracket of 16 to 30 years Occasional Sheesha users Belonging to SEC A and B Occasional visitors of cafs

Moreover, customers will be coming to our cafs where they will enjoy the core service of

oxygen shots in different flavors along with a few supplementary offerings of a usual caf. Key

point of differentiation except for the core offering would be the ambiance where different rooms

will be allocated to different flavors, for example, apple flavor will be available in apple farm

and mint flavor will offered in a room where nice, refreshing scenery would be simulated by wall

1 Cross-sectional study identifying forms of tobacco used by Shisha smokers in Pakistan , Aga Khan UniversityMedical College, Center for Non-Communicable Diseases, Karachi, Pakistan.

16-30 years

SEC A & B

Occasional

Sheesha

Users

Occasional

Caf

Visitors

TARGETMARKET


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paintings and mild sound effects etc. Hence overall offering will be touching customers senses

of smelling, hearing and sight.


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High Contact ServiceThe service is categorized as high to medium contact. The service entails serving customers with

oxygen shots, according to their order.

Lets analyze using different aspects:

Facility Layout

Our service facility is set up keeping in mind customer preference, rather than feasibility of our

own resources, ie, it is a customer centric facility.

Quality Control

Perceptions of quality standards are subjective depending on our customers. The deliverance on

quality will be validated by the customers, externally, and not by metrics defined by the

management. Management is going to try to extract this feedback by feedback form to gage their

experiences and perceptions. Management may also set its own metrics, but those will be limited

to production time, employee performance.

Capacity

Capacity required is directly related to demand by the customers at various times, and to be able

to serve more customers, excess capacity is necessary.

Front Line Worker Skills

Frontline employees will have to be trained to interact well with the customers and deliver on

their expectations. With time, for regular customers, employees may also be able to cater

specifically to their needs, using their judgments.

Rhythm & Schedule

More customers present at location can make delivering orders, taking orders, seating new

customers, slightly more difficult.


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Service process

The service process if partially driven by customer, depending on when they get seated, decides,

and then places an order. Otherwise, producing and preparing order depends on the typical

timings in the kitchen.

Service Offer

More variations may be introduced in terms of oxygen variants and more food items and drinks.

People ProcessingOur oxygen bar can be categorized under people processing.

The customer enters our oxygen bar, the physical location, where he is received by ouremployees, taken to a table, handed out menu cards. The order-taker notes the order and serves

the order, and helps customers with the service. Most users will have to be informed or helped in

taking the oxygen shots, by our employees.

By and large the customers will largely be responsible for consumption of the service with

assistance, thus they too will have to participate in service deliverance.

Consumption and production are taking place at the same place, and the same time.


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8 Ps Of Marketing:

Product Elements Restore and r efresh wi thout th e side effects. No calories. No carbs. No caff eine. No crash.

The product will be targeted to three different segments if the markets:-

Stressed businessmen Athletes Young Adults for recreation

Stressed BusinessmenStress comes in many forms all which can be unbearable, emotional, physical, toxic, and mental

stress. All forms of stress can affect the bodys capacity to take in and utilize oxygen, the most

important nutrient to your body. Lengthy periods of stress can cause serious life threatening

diseases. When people are stressed they are told to BREATH, this is because breathing gets

more oxygen into the body, and more oxygen in the body helps people cope with stress. Recently

Oxygen bars have become extremely popular. Most people who visit the oxygen bars report

increased energy levels, a clearer mind and a relaxed euphoric feeling.

AthletesInhaling 90% oxygen is like driving 4-5 times the oxygen into your muscles. Many athletes are

now using oxygen during competition and between training sessions. With oxygen being a keyfactor in muscle recovery and brain stimulation, its benefits are finally being introduced to

athletes in sports ranging from football, basketball, professional fighting, soccer and tennis. In

the Gym when training oxygen allows you to do more reps and sets, whilst lifting heavier

weights with minimal rest. This makes 90% oxygen is great for competition or track and

training sessions.

Young adults

Since there are no health risks associated with breathing oxygen at oxygen bars. Therefore it provides a healthy activity for young adults to socialize and enjoy with friends. Breathing higher

concentration of oxygen has several benefits; the most commonly reported benefits are increased

energy, an uplifted refreshing feeling, clearing the mind, relief of toxic headaches such as

hangovers, relief of stress and promotion of higher concentration levels. Therefore parents need

not worry about the childs health.


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Primary ProductOxygen Bar and relaxing ambiance is the core service product aimed at

providing a relaxing environment which is healthy and socially

acceptable. The equipment allows you to wear the inhaler like a mobile

headset and emits fresh scented and flavored oxygen to inhale while

enjoying the ambiance and talking to your friends.

Flavors available:

Mango Bubblegum Cappuccino Ginger

Vanilla Lavender Peppermint Ginger

Apple Orange

Supplementary Products Fast food and snacks Drinks and shakes Canned Oxygen Spa Massage corner LCDs (movies and cricket matches)

PriceSince it is the one and only oxygen bar in Karachi and the concept is new a market skimming

pricing strategy will be used to create a premium positioning the market. The product will be

priced at a premium to ensure that the quality of service is not compromised.

The oxygen shots will be priced on the basis of time rather than consumption level. We will be

having the following prices

S. No Product Pri ce per uni t (Rs) Group discount on 6

1 Flavored Oxygen (all flavors) 500 /30mins 2500 / 30 mins

2 Club Sandwich (beef, roasted chicken) 250 1300

3 Soft drink (500ml) 50 250

4 MilkShakes 200 1100

Canned Oxygen


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1 Spa treatment 500 -

2 Massage 700 -

Since the booths will be made for a group of 6 to aid yield management a discount will be givento groups of 6 and multiples. This would allow us to run on capacity without wasting seats. Also

deals would be introduced on weekend lunches to attract more guests in this time.

Place

Due to the nature of the product the location chosen is Zamzama Street. It is a posh area known

for high profile cafes and the target market is already going there for sheesha bars and cafes. We

would also have an advantage of a cluster already prevalent there. Our location would be a

separate building instead of a basement or a floor in a building. This would allow usfuture

expansion possibilities and valet parking facilities would be provided as there is a known parking

issue at Zamzama street.

Promotion & Education

This P of the marketing mix of our service

will be dealing with introducing the

concept of Oxygen Bars to the market. Our

promotions strategy will be based on the

category development and conversion from

smoke-inhaling market, primarily by

educating people about the benefits and

superiority of oxygen bars over traditional

inhaling utilities. However, since we are

positioning it as one of the recreational

item, the health benefits will be a sub-set

of overall strategy.

According to the already mentioned study,

most of the people dont know about the


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actual contents of Sheesha and the fact that it contains harmful elements like heavy metals and

Carbon Monoxide. Tobacco is perceived as the only harmful content of sheesha. Moreover, only

a few health hazards of sheesha smoking are perceived, like respiratory and cardio diseases,

whereas there are several other hazards like Cancer, Infertility and Low birth babies with very

less awareness.

After coming up with the communication message and estimating the size of the market, our

promotional strategy will be using the following marketing tools:

Social Media: Most of the recent caf chains have leveraged this medium to reach out to

the masses and generating the business. Similarly, our strategy will also ensure that we

are present on Facebook and Twitter to create awareness among the relevant groups.

Although, there will be campaigns related to discount coupons and creating the required pull, but this medium will be kept specifically to create and maintain the awareness

levels.

BTL Activations: Since our target market is primarily the young adults, we will organize

the BTL activations at schools, colleges, and universities. Moreover, different malls and

sports complexes will also be targeted in order to directly reach out to our targets. Since

in the human life cycle, sheesha smoking is started at around 20 years, all these

aforementioned areas will provide us the point to market entry, where we will be tapingthese individuals from the very beginning of their consumption cycle.

Word of mouth: Our major focus would be on the customer satisfaction and providing

best of class experience. One of the by-products of this would be the word-of-mouth by

the well-satisfied customers. Special efforts will be dedicated towards generating word of

mouth so that our service is marketed properly.

Physical Environment

As mentioned previously, physical environment

of our overall service package would include the

in-take of oxygen shots in the simulated

environment. There will be different rooms


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dedicated to a group of flavors, and upon choosing a specific flavor; the consumers will be taken

to that room. Simulated environment is present in order get support from the sensory marketing

tools 2 like mild sound effects, 3-D wall paintings, specific scent (air-freshner) and furniture. This

will not only provide a good ambiance, but also help us to focus and touch the senses of

consumer (smell, sight and hearing).

People

Major Suppliers, i.e, our vendors from whom we will be getting our supplies of Oxygen

Cylinders. One team member would be dedicated to ensure that the supplies meet the safety and

quality requirement set by the Health Care organizations. Well trained and well groomed staff

would be hired to provide a unique experience to our customers. The prime focus of these

waiters would be to create maximum awareness and advocate the customers about the services provided by our caf.

Our duty managers would keep vigilant supervision that the guests are served by the waiters in

the best possible manner and with high courtesy. Our duty would also include Bar Serving

Team( Drinks) , Oxygen filling team, Food Serving team, Security Team, Quality Inspection

officers.

Process

Process involved in this unique Oxygen Bar Cafes would involve various external and internal

customers connected to this service. This is a unique service that is completely new to the

Pakistani Market. The Chain would begin with finalizing our Primary vendors who shall be

ensuring a constant supply of Oxygen gas Cylinders at our Caf.

Our Vendor selection process would include:

Analyzing the business requirement

Vendor Search Request for Proposal/ Request for Quotation Proposal Evaluation & Vendor Selection Contract Negotiation Mistakes

2 Th e Sense(s) and Sensibilities of Marketing , Dividend (Alumni Magazine), Ross School of Business.


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Once we have developed a strong vendor network then we would focus on acquiring consulting

services from an expert. With his knowledge we can expect to attend to administrative business

tasks while keeping up with laws, regulations, permits and licenses that affect the ownership and

distribution of oxygen equipment, particularly reimbursements that are contingent upon

Medicare and Medicaid billings.

Investing in quality equipment would ensure that we keep a healthy supply of cylinders of liquid

oxygen, compressed oxygen, transtracheal oxygen, oxygen concentrators, contents indicators

(pressure gauges) and flow meters.

We would also need to track trends in the medical oxygen supply industry so you're always at the

forefront of new advances and delivery systems. Pay particular attention to updates on low-cost

modalities, cylinder duration tests, lightweight cylinder material introductions and time- andcost-efficient Trans filling systems and equipment.

Productivity & Quality

Oxygen Bars is the service that requires initially investments in terms of time and money to

achieve a certain level of quality and productivity. After making these investments, maintenance

of the apparatus is required only. Moreover, as promised by our brand, the apparatus used will be

up to the international standards and special focus will be giving in order to maintain this image.


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Conclusion:Oxybar is a great opportunity we can foresee. This opportunity can be tapped by our business

plan. Being the first movers in the market we will have the advantage of a quicker and bigger

customer base. We plan to target the athletes, young adults and stressed businessmen. Thisservice bar will be premium priced and since location is the deciding factor of quick breakeven

we will locate at Zamzama street which already has the target market who can afford our service.

Apart from the main oxygen shots our revenue stream will be including snacks and drinks.

Our future outlook is having multiple branches in the posh localities of the city and later on

expanding to other cities.

144601597 OxyBar a New Business Launch

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