Dennys Case

Japan raised sales tax on April 1 in 2014. It increased from 5% to 8%. A tax increase has been discussed in Japan for several years. And in October 2013 finally a big decision for a tax increase was announced. It will continue to rise again to 10% in October 2015. In response to the tax increase, Denny’s which is one of the family restaurants has been trying something new to prevent from losing customers. One of the main things the restaurant is trying to better compete with the tax rise is to make an improvement of product. The big strategy consists in terms of marketing influences on consumer decision making relates to consumer behavior. My topic is how the company challenges the tax increase by a product improvement to persuade consumers to spend from now.

        Among other factors of marketing influences on consumer behavior, the restaurant decided to continue to sell 100% beef hamburger stake with same price, 980 yen in terms of price influences. What happen is that it was 980 yen before the tax rise, but after the tax rate hike to 8 %, it comes to 1,008 yen. As shown of research on prices before the company did, it indicates that customers who do not want to order have increased from 1 % to 12% between 999 yen and over 1000 yen. This is the reason why Denny’s decided to make the price remain the same.

        Other thing the restaurants did is to operate the company in a way that is consistent with concerns of customers in a modern society. The manager focused on avocado hamburger stake which is one of the popular menus among women. Avocado hamburger stake has been sold for 890 yen and the restaurant decided to sell 915 yen due to the tax rise, but instead of it, added new value that can affect consumer behavior in terms of product influences. What the company did is to realize a new concept witch is you can eat with salad. The restaurant added healthy vegetable, such as okra or broccoli and increased the amount of vegetable 1.5 times. Not using tartar sauce enables to cover the cost of using more vegetable. Moreover, to attract women customers, the restaurant tried to lose a calorie value. Originally, avocado hamburger stake has 543 cc and succeeded in reducing its calories by 400cc. According to a tasting party that was held for public, Denny’s got a good reputation the restaurant wanted. Many people seem to have been satisfied with new avocado hamburger stake within 1,000 yen in terms of cost performance. The restaurant expects to sell new avocado hamburger for 915 yen to women those who are health-minded.