The leading trends in culinary themes on restaurant menus in the United States as forecasted by
professional chefs for 2017 had hyper-local sourcing take the lead, followed closely by chefdriven fast-casual concepts.1 Moreover, leading trends in food items on restaurant menus in the
United States point at street food-inspired dishes.2 In fact, 66 percent of the respondents in a
survey stated that authentic ethnic cuisine was a “hot trend” for restaurant menus in 2017.3 This
research demonstrates that street vending of small meals is growing in popularity, coinciding
with a rising interest in local food systems and mixed-use planning in urban neighborhoods.4 The
demand for a vibrant street food culture to develop in Santa Barbara’s Funk Zone is clear.
With Mexican food popularity hitting new highs, young adults in Santa Barbara are an ideal
target for our product. Street-food and food trucks have become increasingly popular among
young adults. This is especially pertaining to those in the 18 to 35 age range, as they find it to be
cheap and time-effective.5 The Mexican Food Public Market would alleviate the struggle for
time as well eliminating unnecessary financial burdens when eating out. Santa Barbara’s vibrant
atmosphere makes it a popular destination for students and young adults, and is therefore the
ideal target market for our concept. The following market analysis assesses the growth of public
markets in the restaurant industry, the rise of popularity of Mexican food in the US, young adults
as primary consumers, possible competition, and why the Funk Zone is the ideal for the
placement of the Mexican Street Food Public Market.
WHY PUBLIC MARKETS ARE PROSPERING
The public market phenomenon has transcended trendiness, as these sprawling markets now
showcase a variety of ethnic foods through retail food vendors.6 The number of food halls in the
U.S. grew by 37 percent in 2016 and is predicted to double by 2019.7 In fact, there are more than
100 of them scattered across the country, conquering metropolitan cities including New York,
LA, Portland, Atlanta and even in places like San Antonio and Kentucky.8
As the public market industry continues to grow and expand across the region, they will continue
to shape the way many Americans dine out. According to leading chef David Chang, there is an
“impending affordable restaurant apocalypse” as mid-price restaurants have a tough go as rents
and wages rise, cost of food rises, and many Americans turn to fast-casual chains.9 The
restaurant market is therefore shifting to accommodate food halls.10 In addition, real estate
developers have come to see them as an attractive option for anchoring the ground floor of their
mixed-use projects.11 As far as the consumers are concerned, the Mexican Food Public Market
will appeal to Millennials as the street food inspired sharing platters give them a social eating out
experience.12
Mexican Food’s Popularity
Aside from Mexican food being a delicacy from America’s neighbor, Mexican food is enjoying
widespread popularity as it has become the fastest growing food segment in the last two to three
years.13 The distribution of U.S. consumers eating ethnic cuisine by menu type is shown below.
Table: Frequency U.S. Consumers Eat Ethnic Cuisine 2015, By Menu Type
Source: “Ethnic cuisine popularity in the U.S. by menu 2015 | Statistic.” Statista,
www.statista.com/statistics/460323/frequency-us-consumers-eat-ethnic-cuisine-by-menu/
According to Nation’s Restaurant News, Mexican food is the second most popular ethnic cuisine
in the U.S. Therefore, it would be the most strategic choice to target a market segment in the
restaurant industry with one of the largest proportion of potential customers. Seeing that this
trend has remained consistent over the years, there is no fear of a declining market as 94% of
consumers plan to maintain or increase the amount of street food they eat in the next 12
months.14
The Street Food Report shows that the influence of this level of interest in street food is
inextricably connected to the current trend for small plates and sharing dishes, as “people look to
taste many different things in one meal.”15 Therefore, the Mexican Food Public Market should
aim to create easily sharable meals, hand-held dishes, and mix-and-match options through a
Mexican food cuisine.16 As a matter of fact, a report showed that people preferred Mexican food
because it was “easy to eat in your hand while you are walking.”17 In addition, burritos, tacos,
and carnitas have won a new entry at number one as the top 10 dishes in street food.18
A Rise in Street Food
For our purposes, street food is defined as “prepared or cooked food sold by vendors in a street
or other public location for immediate consumption.”19 Street food dining is having a growing
influence on eating out and catering sectors across the globe--and it is not just among the young,
urban “hipster” crowd. In fact, street food has grown in popularity in the last two years and 54%
of consumers are eating street food more than ever before.20 People are becoming more aware of
street food, and therefore has become more trendy.21
The figures on The Street Food Report 2014 showed that nearly half (47%) of consumers plan to
eat more street food in the next 12 months than they do already.22 Moreover, 1 in 4 of the
interviewees buy street food at least 2-3 times a week, and out of these 74% intend to keep eating
street food.23 This is because “street food introduces people to new, global flavors; makes
sharing plates and hand-held, easy-to-eat dishes more attractive; is perceived to be good value;
and increases the social element of eating out.”24
The profit opportunity from street food is greater than ever before as consumers explore and
indulge their more adventurous food preferences. This is because “consumers now put it on a par
with casual dining and they are willing to pay more for an authentic street food experience-- the
variety, freshness, pack-a-punch flavors, theater, interaction, and personalization.”25 As a matter
of fact, a survey found that only 35% spend less than normal on street food than in 2014, 46%
spend the same, and 17% are spending more.26
Street Food Remastered
From food trucks to kiosks, street food is taking the restaurant industry by storm. This new trend
has gained recognition, as “consumers [are] loving more urban styles of dining.”27 They have
gained their popularity for being casual, innovative, and healthy dining spots.28 As a result, the
public market should take advantage of the steady decline in number of high street retail shops
and use this room to create a casual dining outlet that will open their doors to consumers and
introduce them to new, exotic, and fast flavors. This will bring the desired “urban styles of
dining” into a comfortable and option-maximizing space in the Funk Zone of downtown Santa
Barbara.
Figure: Industry Value of Food Trucks in the U.S. 2014-2020
Source: IBISWorld. "Value of The U.S. Food Truck Industry from 2014 to 2020 (in Million U.S.
Dollars) ." Statista - The Statistics Portal, Statista, www.statista.com/statistics/444924/industryvalue-us-food-trucks/, Accessed 3 Dec 2017
From the graph, the U.S. food truck industry was valued at 856.7 million dollars in 2015 and is
forecasted to increase by another 140 million U.S. dollars by 2020.29 Therefore, our team firmly
believes that this concept will be value-maximizing as the concept’s popularity and demand
grow.
THE PUBLIC MARKET’S PRIMARY MARKET
In addition to having limited time to both purchase and eat food, Millennials “crave the bold and
adventurous flavors they have tasted when travelling,” therefore making them the ideal
customer.30 In fact, they tend to have the highest visit frequency and make the biggest
contribution to eating out spend, driven by a desire to try new things.31
Ideal Customers
Millennials are defined as those born in 1982 and approximately 20 years thereafter-- making the
desired demographic range 15-35 year olds.32 Research from The Street Food Report in 2014
showed that the majority of those polled to answer a survey about street food were in the 25-34
age bracket.33
Figure: Consumers Who Have Purchased a Meal from A Food Truck in The United States in
2014
Source: “Restaurants: food truck use by age U.S. 2014 | Statistic.” Statista, Jan. 2015,
www.statista.com/statistics/384922/consumers-who-have-purchased-a-meal-from-a-food-truckby-age-us/.
A survey published by the National Restaurant Association stated that consumers aged 18 to 34
years of age were the most likely to purchase a meal from a food truck, followed by 54 percent
of diners aged between 35 and 44 years.34 The results of the survey are shown in the figure
above. From the result of these studies, it is reasonable to believe that residents or tourists of
Santa Barbara in the age ranges between 18 and 35 would make for a good target audience for
the Mexican Food Public Market.
The Funk Zone
Santa Barbara’s vibrant atmosphere makes it a popular destination for students and young adults,
and is therefore the ideal target market for the Mexican Food Public Market. There are currently
89,669 individuals in the Santa Barbara area that would fit our target demographic.35 Households
in Santa Barbara have a median annual income of $66,107, which is more than the median
annual income in the United States.36 As far as diversity is concerned, the most common country
of origin for those not born in the US is Mexico.37 Hispanic residents in Santa Barbara compose
37.5% of the populating, totaling 35,708 individuals.38 The trend also seems to be infiltrating the
West coast, as shown by the figure below.
Figure: U.S. States with The Highest Share of Food Trucks
Source: Forbes. "U.S. States with The Highest Share of Food Trucks as of September
2015." Statista - The Statistics Portal, Statista, www.statista.com/statistics/454614/us-stateswith-highest-share-of-food-trucks/, Accessed 3 Dec 2017
California makes for the perfect location as it experiences a renaissance of mixed-use planning
and a reinvigoration of previously underused downtown cores. Santa Barbara’s Funk Zone
contains several elements of urban form that make it particularly conducive to a successful street
food industry. The unusually small blocks in the area creates a walkable community and
therefore generates diversity.39
Santa Barbara’s Funk Zone spans in the area between the ocean and Highway 101 and is
adjacent to the Amtrak station, making it the ideal location for a market of this sort. It is an everevolving artistic neighborhood which caters to residents and tourists with its boutique tasting
rooms, cafes, galleries, and shops. In fact, an article in the LA Times said that it had become the
“hottest neighborhood in town, the place celebs go to dine and where everyone else goes to hang
out.”40 The unique culture of the Funk Zone, in combination with demographic and spatial
factors, will help to foster a thriving street food scene inside the Mexican Food Public Market.
I’s prosperity and stability as will only increase as it gains popularity and thus a wider audience.
COMPETITION AND POTENTIAL PROBLEMS
In terms of Mexican food providers, the Mexican Food Public Market has direct competition
from casual dining venues throughout the Santa Barbara area such as Los Agaves, Lily’s
Taqueria, Casa Blanca, and La Super Rica Taqueria. Other competition in the area is comprised
of Topa Topa Brewing, Figueroa Mountain Brewing Company, Llama Dog, and Bar-Non.
However, the latter competitors tend to be more beverage and bar-oriented. This will be covered
in the latter portion of the Focus Group and Survey assessments.
Other Problems
Aside from competition, there are other problems that may concern investors. One concern is
that the target area for our product tends to have higher-than-average rents. This is a reasonable
claim because the average rent in the area is $1.2 million, and has only increased over the
years.41
Table: Average Rent in Santa Barbara, CA by Neighborhood
Source: “Santa Barbara, CA Rental Market Trends.” Apartments for rent – RENTCafé,
www.rentcafe.com/average-rent-market-trends/us/ca/santa-barbara/.
SOLUTIONS
Street food of this sort will offer quick and relatively inexpensive takeout meals. Unlike the more
regularized restaurants in the area, the Mexican Food Public Market will add a degree of
spontaneity to the urban landscape. While it could be expected that the Mexican Food Public
Market will compete with downtown restaurants, it will be more complementary than
competitive. Its mission and product will be too dissimilar to provide any real competition to any
restaurants in the Funk Zone. They will also serve to draw tourists and attract mobile labor to the
area.
Other establishments in the Funk Zone target a much broader audience as their menus are very
comprehensive. By limiting our products to Mexican food, we are able to cut down on cost.
More so, we will have the possibility of leasing spaces within the Mexican Food Public Market
to local, licensed vendors which could prove to be a less expensive and more rewarding business
strategy. In addition to subsidizing rent with our overflow of profits, the Mexican Food Public
Market will ensure that the prices fall in the range adequate for those in the 18 to 35 age range.
Young adults will be more incentivized to attend the public market if prices are cheap, the
atmosphere is vibrant, and the happy hour is a go.
In addition, the menu will have to feature that “something special” such as a signature sauce, and
should offer customers the option to personalize their choice.42 The Mexican Food Public Market
should aim to satisfy the consumer’s appetite with flavorful and spicy food, as its popularity has
reached an all-time high.43 Along with this, the street food should be served on “funky yet
functional packaging to suit the food being served.”44 This will create a great opportunity to
increase sales and repeat custom by giving the consumers freedom to experiment with different
tastes.
CONCLUSION
The Mexican Food Public Market has identified a primary market and the data supports our
market. Young adults in the Santa Barbara area have limited time and money to spend in the
Funk Zone. Offering a location that serves cheap food and allows the customer to decide if
he/she wants to dine-in or take the food out will be appealing to them. Despite competition from
neighboring restaurants, food stands in the Mexican Food Public Market will “supplant fast-food
chains that sell quick and inexpensive meals, while providing greater diversity of available
foods, catering to differing personal tastes and cultural preferences, and allowing vendors to
distinguish themselves by providing healthy meals and catering to different conceptions of
healthy eating.”45 Our product is set up for success given the socio-economic circumstances in
Santa Barbara and careful selection of primary market.
MARKETING PLAN – IMPLEMENTATION
To attract Millennials, the public market will need to engage with them on their level via social
media, apps and online advertising, using trend-led language, visuals and food pics (CITE:
Source 11). Social media engagement plays a key role by both engaging and leading the
conversation, thus capturing what the targeted consumers are looking for.
The Website
The Mexican Food Public Market team has worked to create a website that our targeted audience
can use to learn about the food stands and the overall project. The website will include bright
colors on the welcome page as well as images of the grounds. The home page will be able to tell
its story by providing information in a fun and unique way as to where dishes, ingredients, and
flavors come from. The team will then implement clever ways to market The Mexican Food
Public Market by creating a section in which individuals can choose their desired language. Our
website will allow customers to select dishes based on: vegetables, dairy/cheese products, fish &
meat, bread, coffee & drinks, candy & sweets, as well as gastronomy. Once selected, articles
pertaining to each section will pop up, giving the viewer an intimate look into the food and their
chefs.
Facebook
As of 2016 there are 1.65 billion people who actively use Facebook. Knowing these statistics, we
have decided to advertise The Mexican Food Public Market on Facebook with an image of our
Funk Zone warehouse. Our team will also implement an advertisement that promotes food
delivery services such as Uber Eats or SB Menus, which will comprise part of our marketing
strategy.
Instagram
As a means to getting our product out into social media we have utilized Instagram. The
Mexican Food Public Market team will take posts tagged “@MexFoodPublicMarket” and
“@SantaBarbaraEats” and re-post them from those consumers. This will make the product more
accessible to view for individuals within our targeted audience.
Public Relations
Our team has taken advantage of the connections we possess locally that enable us to spread our
products’ name. We will be in close contact with universities in the area to employ “brand
ambassadors” which will spread the word on the new Funk Zone concept. It will also work with
Funk Zone-adjacent businesses to promote the products.
CONCLUSION
As more spaces are revitalized downtown Santa Barbara, the need for an affordable, delicious,
and social space has increased. With a strong understanding of the online advertising market,
The Mexican Food Public Market will create a connection with young adults in the area. By
using online advertisements, direct emails, and an organized website, The Mexican Food Public
Market will be accessible to an uncountable number of people who seek the all-time authentic
Mexican food dining experience. The use of online advertisements provides an inexpensive way
to market our product, which in return will increase our profit margin.
“Menu trends: leading culinary themes U.S. 2017 | Statistic.” Statista, Statista, 2017,
www.statista.com/statistics/293972/leading-trends-in-culinary-themes-on-restaurant-menus-us/.
2
“Menu trends: leading food items U.S. 2017 | Statistic.” Statista, 2017,
www.statista.com/statistics/293885/leading-trends-in-food-items-on-restaurant-menus-us/.
3
Ibid.
4
Ibid.
5
"Universities Glom onto Food Trucks." Foodservice Director, vol. 25, no. 12, 15 Dec. 2012,
pp. 42-43. EBSCOhost,
search.ebscohost.com/login.aspx?direct=true&db=bth&AN=84296378&site=ehost-live.
6
Filloon, Whitney. “13 Food Halls That Prove This Trend's Not Dead Yet.” Eater, Eater, 30
Aug. 2017, www.eater.com/2017/8/30/16181016/food-hall-boom-2017.
7
Dizik, Alina. “Take Control at the Food Hall.” The Wall Street Journal, Dow Jones &
Company, 25 July 2017, www.wsj.com/articles/take-control-at-the-food-hall-1500998926.
8
Withney. Ibid.
9
Withney. Ibid.
10
Withney. Ibid.
11
Withney. Ibid.
12
Severa, Martin. “What's Next in Street Food?” Santa Maria Street Food Report , Santa Maria
Food Service ,
www.martinservera.se/files/Inspiration/Santa%20Maria%20street%20food%20report%202016_e
ng.pdf.
13
Johns Pool, Jessica. "Mexican food popularity hits new highs." NPN-National Petroleum
News 89.1 (1997): 50-51.
14
Severa. Ibid.
15
Severa. Ibid.
16
Severa. Ibid.
17
Severa. Ibid.
18
Severa. Ibid.
19
Severa. Ibid.
20
THOMPSON, HANNAH. "Street Food Continues to Grow in Popularity across
Sectors." Caterer & Hotelkeeper, vol. 203, no. 4828, 30 May 2014, p. 6. EBSCOhost,
search.ebscohost.com/login.aspx?direct=true&db=bth&AN=96807421&site=ehost-live.
21
Severa. Ibid.
22
Severa. Ibid.
23
Severa. Ibid.
24
Severa. Ibid.
25
Severa. Ibid.
26
Severa. Ibid.
27
Earls, Elly. "How Street Food Moved Indoors." Caterer & Hotelkeeper, vol. 203, no. 4828, 30
May 2014, pp. 22-24. EBSCOhost,
search.ebscohost.com/login.aspx?direct=true&db=bth&AN=96807441&site=ehost-live.
28
Ibid.
29
IBISWorld. "Value of The U.S. Food Truck Industry from 2014 to 2020 (in Million U.S.
Dollars) ." Statista - The Statistics Portal, Statista, www.statista.com/statistics/444924/industryvalue-us-food-trucks/, Accessed 3 Dec 2017
1
30
Severa. Ibid.
Severa. Ibid.
32
Bump, Philip. “Here Is When Each Generation Begins and Ends, According to Facts.” The
Atlantic, Atlantic Media Company, 25 Mar. 2014,
www.theatlantic.com/national/archive/2014/03/here-is-when-each-generation-begins-and-endsaccording-to-facts/359589/.
33
Thompson. Ibid.
34
IBISWorld. "Value of The U.S. Food Truck Industry from 2014 to 2020 (in Million U.S.
Dollars) ." Statista - The Statistics Portal, Statista, www.statista.com/statistics/444924/industryvalue-us-food-trucks/, Accessed 3 Dec 2017
35
“Santa Barbara, CA.” Data USA, datausa.io/profile/geo/santa-barbara-ca/#economy.
36
Ibid.
37
Ibid.
38
Ibid.
39
Newman, Lenore Lauri, and Katherine Burnett. "Street food and vibrant urban spaces: lessons
from Portland, Oregon." Local Environment 18.2 (2013): 233-248.
40
McClure, Rosemary. “The hip Funk Zone adds color to often-Stodgy Santa Barbara – LA
Times.” Los Angeles Times, Los Angeles Times, 2 May 2015, beta.latimes.com/travel/la-tr-dsanta-barbara-20150503-story.html.
41
“Santa Barbara, CA Rental Market Trends.” Apartments for rent – RENTCafé,
www.rentcafe.com/average-rent-market-trends/us/ca/santa-barbara/.
42
Severa. Ibid.
43
Severa. Ibid.
44
Severa. Ibid.
45
Newman. Ibid.
31