California Pizza Kitchen

Facts:

• A casual dining restaurant chain that specializes in innovative and non-traditional pizzas. California Pizza Kitchen also provides various soups, salads, pasta, sandwiches, and desserts at higher quality for lower prices.

• By 2007: 213 locations in 28 states and 15 international franchises in 6 foreign countries

• Three sources of income: sales at company owned restaurants, royalties from franchised restaurants, and royalties from a partnership with Kraft foods to sell CPK-branded frozen pizzas

• CPK’s share price dropped 10%

The problems CPK currently face:

• More wealthier families were known to dine out at CPK but CPK’s inventive menu prices were much lower than their competitors such as, The Cheesecake Factory, Olive Garden, P.F. Chang’s, Chili’s, Red Lobster, and Panera Bread

• Many restaurants had weaker sales while California Pizza Kitchen was showing an increase in revenues

• Increasing commodity prices and labor costs

• Intense interest in the industry by active shareholders

One way Susan Collyns can facilitate success is by increasing advertising for CPK in order to attract a larger customer base, not just wealthier families. CPK spent CPK spent 1% of its sales on advertising, which is far less than the 3% to 4% of sales that casual dining competitors, such as Chili’s, Red Lobster, Olive Garden and Outback Steakhouse, spent annually. Some sources of advertising she could use would be magazines, TV commercials, and billboards. In addition, she could use social media (Facebook, Twitter, Instagram) to promote special deals, sweepstakes, or new exciting menu items. Social media is free, it can reach a multiple customer segments, and it can help her personally connect with her customers as well. All the social platforms can also be easily connected and accessible on mobile devices as well. Not only could they market their high quality food with low prices to attract a larger customer base, but they should also market the CPK frozen pizza brand since those are sold in groceries stores internationally and not a lot of people may be aware of that.

Another way Susan Collyns can facilitate success