The Philadelphia kosher catering market is an interesting one. There are several caters that offer services that are quite similar to each other in terms of price and menu options. For whatever reasons, there has been little demand by consumers to get caters to innovate their menu. This is not too say that consumers would not welcome new kosher menu items, it is just that people have incorrectly made the assumption that kosher meals have to be boring. Fressen will occupy a niche in the kosher catering market that offers new, creative menu items, broadening people's conception of kosher food. This market consists of two target segments that are differentiated by household income.
4.1 Market Segmentation
Fressen Catering has two distinct target populations:
Middle class kosher clients. This group of people does not have huge amounts of disposable income, recognizes that it is costly to sponsor a kosher dinner party, and is willing to incur the expenses, but will try to minimize them.
Upper class kosher clients. This group has intertwined kosher values throughout their lives and is willing to spend whatever it takes to throw a high-end kosher dinner function. Typically, this group is characterized by a wealthy one-income family where the male works and the female does not. The female of the household typically thoroughly enjoys the planning of these events.
Middle-class kosher customers
Upper-class kosher cutomers
4.2 Target Market Segment Strategy
The target market segment strategy will not be significantly different to address the two different groups. Both groups, regardless of income typically belong to the same group of religious congregations. Therefore, to reach the different groups does not require a distinctly different strategy. What differentiation it will require is different menu offerings needed to satisfy the different groups. The upper-end menu items are cost prohibitive for the middle class target segment.
4.3 Service Business Analysis
The kosher catering business in Philadelphia is fairly unique. At the low- to mid-price point of the cost spectrum, there are four other kosher caters. These caterers tend to serve the part of the market that must have kosher food served at an occasion due to religious beliefs, but struggle to able to afford the cost variance between standard and kosher catering. All four of these caters have fairly standard menu offerings. There is a fifth caterer that also serves the lower end of the market (defined as middle class) but serves the high end of the market as well. Although there is a large wealthy population in Philadelphia that follows the laws of kashrut, they have been underserved.
4.3.1 Competition and Buying Patterns
As stated in the previous section, there are four other kosher caterers that serve the low to middle end of the market. These caterers compete to some degree on cost (due to budget constraints of some clients), but more so on service. The quality and the serving of the food are the main areas of service that the caterers compete on.
There is one high-end caterer who will compete with Fressen. This caterer, while serving the upper-end market, does not provide its clients with upper-end service. This company is not a strong competitor because of their overpriced service offerings relative to the service provided, and its business has been declining over the last few years. Lastly, one competitor for the high-end market is kosher caterers from New York City. When cost is no object, there are many people that are willing to pay the additional cost of bringing in the caterer from NYC.
The buying habits of consumers of kosher catering is to some degree price sensitive at the middle end of the market. Between two different service providers, the middle class group will choose the service provider with the best services. However, cost is certainly an issue and some of the caterers are not even options because they are priced out of this consumer groups price range. The buying habits for the high end of the market is price insensitive. Choices are made by menu offerings, reputation, and attention to service.