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PROJECT REPORT

MARKETING STRATERGIES
WITH REFERENCE TO
KENTUCKY FRIED CHICKEN

Acknowledgement

KFC Corporation, based in Louisville, Kentucky, is the worlds most popular


chicken restaurant chain, specializing in Original Recipe , Extra Crispy

TM

and Colonels Crispy Strips chicken with home style sides and five new
freshly made sandwiches. Every day, nearly eight million customers are
served around the world. KFCs menu everywhere includes Original
Recipe chickenmade with the same great taste Colonel Harland Sanders
created more than a half-century ago. Customers around the globe also enjoy
more than 300 other productsfrom a Chunky Chicken Pot Pie in the
United States to a salmon sandwich in Japan.

KFC

Introduction of
Company

KFC continues reaching out to customers with home delivery in more than
300 restaurants in the United States and several other countries. And in quite
a few U.S. cities, KFC is teaming up with other restaurants, Taco Bell and
Pizza Hut, selling nearly fifty years ago; Colonel Sanders invented what is
now called home meal replacement selling complete meals to harried,
time-strapped families. He called it, Sunday Dinner, Seven Days a Week.

KFC specialized in chicken and they says,


No bodys cooking like KFC today and we are
the chicken experts

KFC

Today, the Colonels spirit and heritage are reflected in KFCs brand identity
the logo features Colonel Harland Sanders, one of the best-recognized
icons in the world.

There is no competitor for spicy chicken which is


made by KFC

Introducing New Product

Pricing Issues
PRICING POLICY FOR PRODUCT OF TWISTER
Manufacturing cost

RS. 100/-

5% marketing cost (PER UNIT)

RS. 5/-

Total cost

RS.105/-

15% G.S.T +15% RETAIL MARGIN

RS.25/-

Total retail Price

RS.140/-

PRICING STRATEGY FOR DEAL 6


Manufacturing cost

RS. 140/-

5% marketing cost (PER UNIT)

RS. 25/-

Total cost

RS.165/-

15% G.S.T +15% RETAIL MARGIN

RS.55/-

Total retail Price

RS.220/-

Mission statement
To be the leader in western style quick service
restaurants through friendly service, good quality
food and clean atmosphere
Goals of KFC
Build an organization dedicated to excellence.

Consistently deliver superior quality and value in our products and


services.
Maintain a commitment to innovation for continuous improvement
and grow, striving always to be the leader in the market place changes.
Generate consistently superior financial returns and benefits our
owner and employees.
To establish in India our position as leading WQSR (Western Quick Service
Restaurant) chain, serving good value. Innovative chicken-based products.
Consistently, providing a pleasant dining experience, with fast friendly, in a
clean and convenient location. At all times we must be dedicated to
providing excellent and delighting customers.

KFC History
KFC is an internationally renowned fast food industry in the
world. They have the main ambition to increase & maintain
the quality in fast food industry. Their aim is to capture the fast
food market. Basically they want to provide their products to anyone that is
why they expanding their branches in all over the world. They want to
increase their profit

through giving maximum satisfaction & other better facilities to people that
they want. Now after catching such a marvelous position in the International
Market, KFC is introducing a new item Boneless Fried Chicken, with
even more attractive and charming taste.

Company overview:
Colonel Harland sanders, born September 9, 1890, actively began
franchising his chicken business at the age of 65. Now, the Kentucky fried
chicken business he started has grown to be one of the largest retail food
service systems in the world. And colonel sanders, a quick service restaurant
pioneer, have become a symbol of entrepreneurial spirit. More than two
billion of the colonels finger lickin good chicken dinners are served
annually. And not just in America. The colonels cooking is available in
more then 82 countries around the world.
When the colonel was six, his father died. His mother was forced to go to
work, and young Harland had to take care of his three year old brother and
baby sister. This meant doing much of the family cooking. By the age of
seven, he was a master of a score of regional dishes. Ate age 10, his first job
working on a nearby farm for $2 a month. When he was 12, his mother
remarried and he left his home near Henryville, Ind., for a job on a farm in
Greenwood, Ind. He held a series of jobs over the next few years, first as a
15-year-old streetcar conductor in New Albany, Ind., and then as a 16-yearold private, soldiering for six months in Cuba. After that he was a railroad
fireman, studied law by correspondence, practiced in justice of the peace
court, sold insurance, operated an Ohio River steamboat ferry, sold tires, and
Operated service station. When he was 40, the colonel began cooking for
hungry travelers who stopped at his service station in Corbin, KY. He didnt
have a restaurant then, but served folks on his own dining table in the living
quarters of his service station. As more people started coming just for food,
he moved across the street to a motel and restaurant that seated 142 people.
Over the next nine year, he perfected his secret blend of 11 herbs and spices
and the basic cooking technique that is still used today.

KFC India

KFC is the worlds No.1 Chicken QSR and has industry leading
stature across many countries like UK, Australia, South Africa,
China,USA, Malaysia and many more.
KFC is the largest brand of Yum Restaurants, a company that owns
other leading brands like Pizza Hut, Taco Bell, A&W and Long
John Silver. Renowned worldwide for its finger licking good food,
KFC offers its signature products in India too! KFC has introduced
many offerings for its growing customer base in India while
staying rooted in the taste legacy of Colonel Harland Sanders
secret recipe. Its signature dishes include the crispy outside, juicy
inside Hot and Crispy Chicken, flavorful and juicy Original
Recipe chicken, the spicy, juicy & crunchy Zinger Burger, Toasted
Twister, Chicken Bucket and a host of beverages and desserts. For
the vegetarians in India, KFC also has great tasting vegetarian
offerings that include the Veggie Burger, Veggie Snacker and Veg
Rice meals. In India, KFC is growing rapidly and today has
presence in 11 cities with close to 50 restaurants.

Values of KFC
Focus all our resources to our restaurants operation because that is
where we serve our customers.
Reward and respect the contributions of each individual at KFC.
Expand and update training with time and be the best we can be and
more.
Be open, honest and direct in our dealings with one and other.
Commit ourselves to the highest standard to the personal and
professional integrity at all times.
Encourage new and innovative ideas because these are the key to our
competitive growth.
Reward result and not simple efforts.

Dedicate ourselves to continuous growth in sales, profit and size of


organization.
Work as a team.

PHILOSOPHY OF KFC
The CHAMPS Program
Champs stands for our belief that the most important thing each of us
can do is to focus on the customer. It stands for our commitment to
provide the best food and best experience for the best value.
CHAMPS stand for the six universal areas of customer expectation
common to all cultures and all restaurants concepts.

THE CHAMPS
These are:
Cleanliness
Hospitality
Accuracy
Maintenance of Facilities
Product Quality
Speed of Service
CHAMPS is the philosophy to ensure that the
customer has the consistent quality experience in
every restaurant, everyday, on every occasions and
you will be playing role in delivering CHAMPS to our
customers.

Situational Analysis
Current Products
Kentucky fried chicken
Zinger burger
Krushers
GameBox
Twister
Boxmaster
Chicken Bucket
Hot wings
Fries
Corn on the cob
Zing Kong
Snacker(chicken & veggie)
Veggie Feast
Soft Drink
Coleslaw
Chicken Thali

Veg Finger
Snack Box
Sundae
Soft Twirl
Brownie Sundae

Entry
For the current Indian market for fast food, it is not difficult
for a fast food restaurant to enter the market. However, it
would be extremely difficult to take over already running
major fast food chains' dominancy in India or even make a
significant amount of profit. While there are enough
people in urban India for any restaurant to survive, KFC
holds the first-mover advantage into the 'non-veg food
specialty food segment' that gives them free reputation.
Customers, especially children who are used to going to
KFC as a treat or reward from their parents or
grandparents, are not going to want to go to other
restaurants theyve never heard of. The brand name is
already established. Also, there is already a large variety in

the numerous western-style dining places in India, such as


McDonalds, Pizza Hut, Domino's and Subway, and any
new fast-food entrants would just be presenting something
very similar to whats already there. While small
Neighborhood restaurants generally have low barriers to
entry, these are the barriers to entry for similar restaurant
businesses to enter the fast-food chain market.
Buyer/Supplier Bargaining Power
The customers of KFC, especially as individual buyers,
have almost no bargaining power because if only one
customer threatens to no longer eat at KFC, the store is not
going to lower its price because the cost of losing one
customer is not very great. The suppliers, like the buyers,
have very little bargaining power.
In terms of food, KFC, upon its move into India, urged
many of its U.S. suppliers to also extend branches into
India. KFC also began helping local suppliers by giving
them technological support to improve their products. This
is a brilliant strategy because the supplies that KFC would
otherwise need to import from the
U.S. can now be obtained domestically, and if the U.S.
suppliers decide to raise their prices, KFC can easily switch
to the local suppliers. This gives us a brilliant strategy. With
this strategy, KFC created competition among its suppliers,
lowering the supplier

bargaining power. In terms of human resources, labor cost


is extremely low because the supply of non-skilled workers
great exceeds the demand for them. With so little buyer
and supplier bargaining powers, KFC is able to have a very
tight control over its prices and expenditures.

Substitutes and Complements


As mentioned above, there are a few major competitors in
the fast-food industry
in India for KFC, namely McDonalds, Pizza Hut,
Domino's and Subway. The substitute products, in this
case, would be burgers, pizza, and sandwiches. Though
they are competitors, their primary products differ greatly
from each other, in that they sell, chicken, burgers and fries,
pizzas, and sandwiches, respectively. Traditional
Indian dining, home-cooked meals, and grocery stores with
ready-to-eat foods are also substitutes, as families could
choose any one of these over fast food for a meal. These
substitutes are definitely considered healthy as compared to
the fast food chains. Even foods from street vendors count
as substitute goods.
While other fast foods serve as substitute to KFC, they can
also serve as complements for fast foods as a whole. If the
general price of fast foods goes up,KFCs price rises as
well, and the same can be said of the quantity sold of these
products, which make them complements to each other.
KFC also sets up stores located near popular tourist

attractions, so tickets to these tourist spots are also


complementary goods because the more people tour these
attractions, the more customers KFC will get.
Rivalry
Unlike what one would expect, KFC has little rivalry with
similar fast-food chains in India. The primary reason is
that their core products are different, as in they sell
different kinds of fast foods with very different tastes and
styles. For example, if KFC raised its price for chicken by
a small amount, Indian chicken lovers who may not be as
accepting to pizzas (many Indian people strongly dislike
the taste of cheese) are not going to switch to Pizza Hut just
because the price for KFC increased. In addition to that,
these restaurants have such different target customers that
the fluctuation of price for one restaurant is not going to
affect the others. For example, a full meal at KFC ranges
about Rs. 100, whereas a full meal at Pizza Hut can cost
over Rs. 300. The drastic difference in price assures no
price competition between these restaurants.

KFC Original Recipe


6 cups Crisco Shortening
1 eggs well beaten
2 cups Milk
2 cups Flour
2 teaspoons ground pepper
3 tablespoons salt
1 teaspoon MSG
1/8 teaspoon Garlic Powder
1 dash paprika
2 Frying Chickens cut into 6 pieces

Place shortening into the pressure cooker and heat over


medium heat to the shortening reaches 400F. In a small
bowl, combine the egg and milk. In a separate bowl,
combine the remaining six dry ingredients. Dip each piece
of chicken into the milk until fully moistened. Roll the
moistened chicken in the flour mixture until well coated. In
groups of four or five, drop the covered chicken pieces into
the shortening and lock the lid. When pressure builds up
cook for 10 minutes.

KFC Outlets in Delhi


KFC in Central Delhi
KFC in Noida
A-12, Inner Circle,
CP, Delhi-110001
Store Timing:8:30am to 11pm

Sector 18,
Noida -201301
Store Timing:11am to 11pm
Great India Place,
Noida-201301
Store Timing:11am to 11pm

KFC in West Delhi


KFC in South Delhi
Back Wing,
Select Citywalk Mall,
Saket, Delhi-110017
Store Timing:11am to 11pm
Vasant Square Mall,
Vasant Kunj-110070
Store Timing:11a.m. to 11 p.m.

City Square Mall,


Rajouri Garden,
Delhi-10027
Store Timing:11am to 11pm
Vikas Surya Plaza,
Sector 4, Dwarka,
Delhi-110075
Store Timing:11 am to 11 pm
Below Netaji Subhash Place Metro
Station,
Pitampura, Delhi-110034
Store Timing:11am to 11pm

KFC in East Delhi

KFC in Gurgaon

Shipra Mall,
Indirapuram, Delhi-201012

JMD Regent Mall,


Mall Road,

Store Timing:11am to 11pm


V3S Mall,

GurgaonStore Timing:11 am to 11 pm

Laxmi Nagar, Delhi-110092


Store Timing:11am to 11pm

Ambience Mall,
Gurgaon-122001
Store Timing:11am to 11pm

Promotions
In India KFC not advertise there products too much
because people KFC due to its reputation in other countries.
They promote their products through special
packages.They promote there products through billboard,
pamphlets and through other promotion strategies

Current target market


Segmentation
KFC has divided the market of India into distinct groups of customers with
different demands, tastes and behavior who require separate products or
marketing mix.
In India the niche marketing is being used for particular classes of people.
They have made segments of the market on the following bases.
Demographical
Behavior
Geographical

By using these three bases they segmented the market as under.


DEMOGRAPHICAL BASIS

In demographics their first segment is consisted of the income factor i.e.


high income, average income and low income.

BEHAVIOR
In behavioral aspect they segmented the market on the basis of quality, taste
and price. Following are the different possible segments in this regard.
Taste conscious
Quality conscious
Class conscious
Combination of price and quality

GEOGRAPHICAL BASIS
On the basis of the geographical factor we have divided our market in three
main segments.
Urban areas
Sub urban areas

Profile criteria:
1. Gender: KFC is for each gender both male and female.
2. Income: Everyone can use the KFCservice upper and middle class .
3. Age: age limitation for using this product above 15
4. Occupation: By profession also everyone can use this product means businessman
student workers and other peoples.
5. Education: It has no need more education that why the person who know something
can easily enjoy with this product.
6. Family life cycle: KFC is suitable in every stage of life like single married couple and
also those who have children can use this product.
7. Lifestyle: This product is used in every level of social class like upper, middle class.
8. Attitude: When the customers once buy this product after that they can use the
product continuously.
9. Purchasing decision: Often KFC changes the purchasing decision of customers
because of its good attributes.
10. Geographic region: Geographically KFC is used in every part of the country as well
as all over the world.

Product positioning
Customer perceive this product as a unique product that other are not giving .

Attitudes
The attitudes of the public is very good people like our this new product like others.

Purchasing process:
Many people come from home to eat this , and some make impulse decision as they saw
it .

Market Coverage Strategy


KFC will be using differentiated market coverage strategy. It means that different
marketing mix will be used for different age groups.

TARGET MARKET FOR FAST FOOD


After evaluation of various segments, KFC has decided to target the market of Urban
and Sub-urban Areas of Pakistan.

Product usage
People are educated and they want variety in their diet.
Normally people of rural areas dont take fast food. On the other hand people of
urban areas take fast food.
Income of the people of urban areas is normally high and they can afford to
purchase such products, which are slightly higher in price as compared to
prevailing prices of local food in the market.

People of Urban Areas are more quality conscious than the people of Rural Areas.
In Urban Area there lived people from every walk of life and profit generation is
easier than in Rural Areas.
Population density is higher in Urban Areas as compared to Rural Areas, so the
number of customers are more in Urban Areas.

Competitive analysis
Competitors
You cannot enjoy the business without competitors. No organization can afford to ignore
there competitors. It is very important for a marketing managers to monitor the activities
of there competitors, what they are doing? KFC adopted such sort of strategy that there is
no competitor for spicy chicken, which is made by KFC.
KFC beats its competitors through the revising marketing strategy at every movement but
the main competitor of KFC are
Mc Donald

COMPETITIVE ADVANTAGE
KFC

McDonalds

Spicy Products
Indian people like spicy products instead of
boiled food

Burger and French Fries

Arabian Rice and Zinger Burger

Big Mac

Free Delivery

Charges for home delivery

Chicken is eaten by every community

Beef is banned in some community


Its Staff consist of simple Graduates and
Local Staff and Highly Qualified because give them training
local staff can better deal

with the customers


KFC uses Top to Bottom and Bottom to
Top Approach in
Management.
KFC is Co branding with Walls

McDonalds Uses Top To Bottom


Approach.
No such Case.

Economic Analysis of Market


A market in this context refers to a number of all actual and potential buyers of a product
(Kotler et al 2003). These buyers have a

Communication

need to satisfy their needs through


exchange (Graphic 1). These needs make

Industry
(a collection
of seller)

up the demand for particular products and


services. Several components must be

Product / service
Money

Market
(a collection
of buyers

Information
Graphic 1

considered, as all these components have a direct or indirect impact on KFCs success.
Changes in the below described components over the last couple of years have led to big
changes in peoples attitudes towards healthy food. It explains why Australians today
want to eat healthy and nutritious-rich food in order to keep themselves healthy and that
KFC must adjust their range of product and their company image to appeal to these new
expectations, people have. (http://www.marketresearch.com).

Macro environment

KFC operates in a larger macro environment of forces that creates opportunities, but also
threats. (Kotler et al 2003). A company such as KFC usually cannot influence trends in
the macro environment, as they affect people and organisations on a larger scale.

However, KFC has to carefully examine macro environmental trends and must create
competitive responses to such trends. There are six major macro environmental forces
KFC has to take into account.

Micro environment
The microenvironment consists of all

Company

Competitors

forces that are close to KFC, and on


which KFC has an impact. They directly
KFC

Consumers
Graphic 3 (Source: Kotler et al 2003)

Micro Environment

affect KFCs ability to serve its customers. (Kotler et al 2003). Three major components
influence KFCs micro environment:

COMPETITORS
Because the fast food market in India is highly competitive, KFC faces a wide number of
direct and indirect competitors. KFCs main competitors are fast food chains such as
McDonalds and Dominos, which are already well established throughout India.
McDonaldss in particular is a direct competitor, as they have already successfully
introduced their Salads plus line (http://www.theage.co.in), which directly targets
healthy food conscious Indians. But, there are a number of other competitors that is also
focusing on chicken types products. All this competition makes it quite difficult for
KFC to maintain or even broaden their customer base. However, with the introduction of
a new and healthy product range, KFC can differentiate itself from most competitors and
will gain a competitive advantage.

CUSTOMERS
KFCs customer market consists solely of the consumer market (Kotler et al 2003).
KFCs products are bought by individuals (males, females, singles, and families).
Therefore, the product range KFC offer should appeal to as many people within this
consumer market as possible, to ensure that the maximum amount of products can be
sold. The characteristics of these individuals and a segmentation of them are discussed
later in this report.

Strengths and weakness of competitor


S

trengths: 38 products, Attractive Outlets, Huge Marketing,


Budget, More entertainment for kids

W eaknesses: Same type of Menu, No Home Delivery


How they compete their competitors ?
It is found that KFC compete its competitors by five ways:
KFC compete its competitors through marketing strategy
They offered different packages at different events like ramdan offer,
midnight offer etc.
KFC compete there competitors by providing good services
They must hired the hard selling persons to market their product in the
market and motivate their employees for the sake of organizations and
employees do well and they compete there competitors
KFC has quality products and through these quality products they
compete their competitors

Current Sales Analysis

Market Share
KFC has a very long history and has the most recognize able brand in
chicken with over 50% of the market share. It becomes difficult for the
companies like Sub way, Mc Donalds, Chicken planet, Dixie or those who
may want to enter in the market of fast food restaurants.
Due to with over 50% of the market share in fast food industry KFC has
recognition around the world and has been globally positioned for many
years in India and to capture the market share in India adopts champs
philosophy

Environmental factors and opportunities


Political :
The operations of KFC are affected by the government policies on the
regulations of fast food operation. Currently government are controlling the
marketing of fast food restaurant because of health concern such as
cardiovascular and cholesterol issue and obesity among the young and
children in the country. Governments also control the license given for open
the fast food restaurant and other business regulation need to follow such as
for a franchise business. Good relationship with government in giving
mutual benefits such as employment and tax is a must for the company to
succeed in any foreign market.

Economic:
Though for last 1 year their was economic slowdown all across the globe but
the sales of KFC and other fast food chains did not slow down to that extent
that of other sectors in. The GDP (Purchasing Power Parity) is estimated at
2.965 trillion U.S. dollars in the year 2010. The GDP- per Capita (PPP) was
2700 U.S. dollars as estimated in 2008. The GDP- real growth rate in 2007
was 8.7%. India has the third highest GDP in terms of purchasing power
parity just ahead Japan and behind U.S. and China. Foreign direct
investment rose in the fiscal year ended March 31 2007 to about $16 billion
from just $5.5 billion a year earlier. There is a continuous growth in per
capita income; Indias per capita income is expected to reach 1000 dollars by
the end of 2007-08 from 797 dollars in 2006-07. This will lead to higher
buying power in the Hands of the Indian consumers. So taking into
considerations the economic factors of India KFC is safe. The only danger to
it will be if there is a terrorist attack in India and the victim is KFC.

Socio cultural:
India is the second most populous nation in the world with an approximate
population of over 1.1billion people. This population is divided in the
following age structure: 0-14 years 31.8%, 15-64 years 63.1% and 65
years and above 5.1%.
There has also been a continuous increase in the consumption of fast food in
India. The social trend toward fast good consumption is changing and India
has seen an increase of 90% fast food consumption from the year 20022007. This increase is far greater than the increase in the BRIC nations of
Brazil (20 per cent), Russia (50 per cent) and China (almost 60 per cent).
Thus this shows a positive trend for fast food industries in India.

Technological:
The Indian fast food Industry is heating up with a lot of foreign players
entering the Indian market. The technological knowhow and expertise will
also enter the Indian market with an increase in competition. With the lower
rates and increase technology the fast food counters are attracting youth by
giving them attractive deals. For e.g. KFC and Dominos pizza. For a fast
food restaurant, technology does not give a very high impact on the
company and it is not a significant macro environment variables. However
KFC should be looking to competitors innovation and improve itself in term
of integrating technology in managing its operation. For example in
inventory system, supply chain management system to manage its supply,
easy payment and ordering systems for its customers and wireless internet
technology. Implementation of technology can make the management more
effective and cost saving in the long term. This will also make customer
happy if cost savings results in price reduction or promotional campaign
discount which will benefits them from time to time.

Environmental:
As one of world largest consumer of beef, potatoes and chicken, KFC
always had been critics for world environmentalist. This is because high
consumption of beef causing the green house effect by methane gasses
coming from the cows ranch. Large-scale plantation has effect the
environment and lost of green forest opening for plantation activities.
Vegetarian environmentalist criticizes the fast-food giant for cruelty to
animals and slaughtering. In America, once KFC want to introduce whale
burger causing uproar because whales are endangered species. Before using
paper packaging, KFC once had been criticized for being insensitive to
pollution because of using ne based packaging for its food products. Imagine
millions of people purchase from fast food operator and how is the impact to
world environment by throwing away those hard to recycle packaging.
Our world is getting concern on environment issue and business operating
here should not just care for profit, but careful usage of world resources for
sustainable development and care for environment safety and health for our
future generation. Critics and concern from all public or activist should be
review and support if necessary to ensure we play our social responsibility
better.

Legal factors:

As a certified fast food operator, there are many regulations and procedures
that KFC should follow. For example is the Halal certification that becomes
a concern to Muslim consumers. KFC should protect its integrity and
consumer confidence by ensuring all materials and process are as claimed or
must followed.
Other legal requirement that the business owner should follow as stipulated
in laws are such as operating hours, business registration, tax requirement,
labor and employment laws and quality & environment certification (such as
ISO) in which the outlet has been certified. The legal requirement is
important because the offenders will be fined or have their business
prohibited from operating which can be disastrous.

Boston Consultancy Group (BCG) Matrix

Question Mark:
Currently KFC have launched a new product in the market. They have also tried to come
into the beverages market by launching its new brand of shakes called KRUSHERS. As it
is a fairly new product it comes in the category of the Question Mark in the BCG Matrix.
It has a low market share thus brings low revenue. KFC is advertising a lot to popularize
this product so there is a lot of expenditure on it. This product is individually not bringing
any profits and is a cash drain for the company. Company may decide to completely
remove this product from the market if it does not do well soon and start bringing in
revenue.

DOG:
KFCs Veg Thali comes under this category. Although company had launched this
product much earlier, it has still failed to become a success. As KFC is known more for
its non-veg food, this also results in low demand for this item. It has a low market share
and although low on expenditure (as company does not spend on its promotion), it does
not bring in much revenue as demand is low. The product is mostly CASH NEUTRAL.

CASH COW:
KFCs Chicken Bucket is the most successful product of the company. It has
the highest market share amongst all the other products. It has good demand
in the market and brings in huge sales revenue. The development and other
expenses are also low and thus this product is a CASH SIRPLUS for the
company.

STAR:
The star product of the company is its crispy Boneless Chicken. It has a high
market share and brings in high revenue. But it also has high developmental
expenditure involved. The profit therefore is generally not very high brought
in by this product. This product is CASH NEUTRAL for the firm. The
company is trying make this product a cow as well, by reducing the
expenditure

Summary of current situation


SWOT analysis mean strength, weakness, opportunities
and threats and the SWOT analysis of KFC are:

STRENGTHS
Goodwill and reputation: The company certainly has earned a good
name and reputation by its previous products and services in the

market. It is even more recognised in other markets outside India,


where the company is among the leading fast food giants. The brand is
recognised and trusted in India for its quality products, price, and
customer service. It therefore has a good head start and enjoys a good
chance of becoming a leader in Indian fast food industry.
Employee Loyalty: Employee Loyalty is one of the major strengths
of KFC. The turnover rate in the company is amongst the lowest in the
industry.
Customer Loyalty: Despite gain by Boston Market and Chick-fill
A, KFC customer base remained loyal to the KFC brand because
of its unique taste. KFC has continued to dominate the dinner and
take out segment of the Industry.
Ranks highest among all chicken restaurant chains for its
convenience and menu variety. It generates $1B revenue each
year.

WEAKNESSES
KFC was losing market share as other Chicken chain increased
sales at a faster rate.
KFC share of Chicken Segment sales fell from 71 percent 1999 , to
less than 56 percent in 2009 , a 10 -years drop of 15 percent.
Huge competition in this segment.
India is still mostly a vegetarian dominated cultured society.
South India is especially very much so. This may reduce the market
share of the company.
KFC has not yet invested much on R&D, and innovating new
products for Indian Markets. This may lead to failure of their
products as they are not in line with the Indian mind set, peoples
taste and preferences and their likes and dislikes. This may prove
fatal for the company.

OPPURTUNITIES
New Markets: Globalisation has opened doors for new markets for
the company. As the developed markets are mostly saturated, the
developing countries like India and China promises a good market and
generation of demand in the future. With more than 70% of the
markets in india being unexplored and un organised, KFC has a good
scope of expanding its operations in the country.
Cross Culture: Generally there is a good acceptance of American
culture of fast food in India. People are opening up to fast foods more
regularly in their daily lives and not just keeping it a once in a month
affair. Thus Indian mindset is fast changing.
Large Youth population: India has a very large share of youth
population a compared to other countries. More than 60% of the
population is under the age of 30yrs. As the young generation are
more open to fast foods and demand it more, this is a good news for
the company.
New variety: Company can also come up with new variety in the
menu like Pizzas, garlic breads to attract more customers.

THREATS
Competition: Competitor companies like McDonalds are fast
catching up with the market.McDonalds with sales of more than
19 billion in 1999, accounted for 15 percent of the sales of the
nations top 100 restaurant chains.

Organisations like PETA People for Ethnic Treatment for Animals


have given a bad name to the company which may prove
disastrous to the image of the firm. Currently, KFC is under

massive attacks from animal organisations, questioning the way


KFCs suppliers are threatening the chicken, before they got
slaughtered. Anti-KFC campaigns, such as the one from PETA are
affecting KFCs brand image in a negative way and result in direct
dollar losses, as less people are consuming KFC chicken

Saturated US Market: Now KFC cannot rely on just its home


market to generate sales. As the US markets are already saturated
and leave no or little scope for growth, company necessarily needs
to look at offshore foreign markets to generate sales and keep up the profits.

MARKETING STRATEGIES OF KFC

There are different strategies adopted by KFC for different events.


They market their products on different events and in different
activities as they are helping SOS village.
According to KFC, kids become the future permanents customers
and we know very well that without any marketing strategy no
marketing program and no product is successful because we
depend upon customers, customer not depend on us.
KFC is following Niche Marketing and Societal Marketing
techniques.
KFC possess a western culture because some of the Indian
people are also following that culture.
KFC are moving from Divisional Level to the District level
by opening branches
KFC also offer free home delivery.
KFC open their outlets on reachable places.
KFC menu consists of more than 30 products.
KFC gives more priority to Family.

MARKETING
Since 1982, KFCs All-American salute to Mothers
national card contest has been KFCs way of honoring
moms and their families for making mothers Day
KFCs biggest sales day of the year. The contest
encourages children to creatively express their
feelings for their moms by making a homemade card
and give them chance to compete for more than
$10,000 in cash and prizes. Educational packets,
including language, history and art exercises
highlighting Mothers Day, were sent to thousands of
schools nationwide.
There are 4 Ps of Marketing:
1. PRODUCTION
2. PRICING
3. PROMOTION
4. PLACEMENT

Production:
Basically the product is anything that be offered to a market for
attention, acquisition, use, or consumption that might satisfy a want or
need. KFC is specially dealing in the chicken products; Basically, KFC
has the special raspy for chicken products that is why, KFC known as a
chicken specialist allover the glob. KFC target the Asia and east side
because they observe that they people are like the chicken products,
so they enter in the market due to the demand of their chicken
products. KFC product variety of product in the chicken, those products
are:
PRODUCTS:

Original recipe chicken


Extra Tasty CrispyTM chicken
Hot WingsTM pieces
Tender Roast chicken
Chunky Chicken pot pie
Kentucky Nuggest
Colonels Crispy Strips
Honey BBQ sandwich
Original Recipe Sandwich
Tender Roast Sandwich
Triple Crunch Sandwich
Triple Crunch Zinger Sandwich

BRAND:

There are three brands of the KFC:


1)
Taco bell
2)
Pizza Hut
3)
Long john silvers

1.Pricing:
KFC during pricing their products keep the different points in the mind
like they adopt the cost base price strategy. Pricing of the product
includes the Government taxes and excise duties and then they come
at final stage of determine the price of their products. KFC prices of
products are a bit high according to the market segment and it is also
compatible to the stander of their products.
Calculation of the price under Cost Based Pricing Strategy:
Total Pounds of Chicken Served in KFC Restaurant Annually =
1.914 Billion
Total KFC Chicken Pieces Sold Annually = 5.89 Billion
Total Retail Sales = $8.9 Billion
Sales Price of per Chicken Piece
= Total Retail Sales / Chicken
Pieces sold
= $8.9 Billion / $5.89 Billion
=$1.51
We assume that Fixed Cost is = $6000000000
Variable Cost
= $675000000
Profit Margin is Or Mark Up = $225000000(25% of Sales)
Per Unit Variable Cost = $675000000 / 5890000000
= $ 0.115
Unit Cost = Variable Cost + Fixed Cost / Chicken pieces Sold

= 0.115 + 6000000000 / 5890000000


= 0.115 + 1.02
= $1.135
Now suppose manufacturer wants to earn 25% mark up on sale. The
manufacturer mark up price is calculated:
Mark Up Price = Unit Cost / (1 Desired Return on Sales)
=1.135 / (1-.25)
= 1.135 / 0.75
= $1.51

3.Promotion:
Promotion is one of the necessary plates in any form of business or in
other words you can say that promotion is the key of success. If you
promote your product at the right time. KFC also known the importance
and significance of promotion so they uses the bill boards the major
source of advertisement and one of the most important thing that they
uses media especially the newspapers to promote their products. They
are also creating awareness among the masses about their existing
product range as well they tell us about the future product.
Marketing efforts to be taken by the restaurant:

Paste delivery posters at petrol pumps, flats, colleges, plazas, and


departmental stores.
Distribution of delivery flyers in residential areas, markets, plazas
and institutions (as per the plan)
Visit offices and business places.

4.Placement:
In the case of the KFC the placement of the product is not important
but the placement of the restaurant is important. The products of the
KFC is cooked at the sport and then served after that. KFC Cavalry
branch opened in June 1998, in the main commercial zone of Cavalry
Grounds near the Jinnah Flyover. The restaurant is a three-story
building including the basement (where the chicky play area is

located). It is ideally located in the center of a main commercial and


residential area of Lahore. The area that KFC Cavalry caters for is the
residential and office area of Cavalry Grounds and Cantt, as the main
target market. Another branch the KFC opened in the Lahore is in
Garden Town (opposite to Barkat Market). KFC also target the
Faisalabad and open its branch in D ground. Now we can easily judge
that the KFC target the place for their restaurant, which is well known
and is in the Porsche area where the income level of the people is high
then the middle class level. Because the prices of the KFC products is
high with comparison to the local products manufacturer who are
dealing in the same kind of product in which KFC is dealing but the
prices of the KFC is high due to special taste, high quality, and due to
international brand, it is the world recognized fast food restaurant all
around the world. So, for the placing strategy, KFC chose the well
income class area for their restaurants.

Product Issues
General description:
Features:
Quality Control Over Ingredients

Every Chicken Tested


K & Ns state-of-the-art Quality Assurance Lab monitors the entire integration process
from livestock to feed and on to preparation of ready-to-cook and cooked products.

Every Chicken Certified

HACCP K & Ns ensures food safety by implementing the international HACP (Food
Safety System) and enjoy the unique privilege of being the first and only HACCP
certified company is India producing chicken and chicken products. Free from diseases
and bacteria, drug residues and other contaminants.

Quality Assurance Certificate


Director General ( Research ) has issued quality assurance certificate for the chicken used
by KFC.

Packaging
We are asked as many questions on our packaging as our products by our
customers. The
packaging for KFC products is chosen according to performance against
three key criteria:

Heat Retention
Moisture removal
Grease absorption
The packaging material and carton design are all adapted to maximise
performance against these three criteria.
Recycled Paper
All our clamshells and chicken boxes contain as much recycled material as it
is legally
allowed. By law we are required to have virgin fibre board in any part of the
packaging that is in contact with food. Any virgin fibre comes from board
suppliers who use pulp bought from managed forest in Scandinavia. This
ensures that any wood cut for paper production is replaced with new
plantings.
Environmental concerns
Over and above ensuring our packaging is supplied via recycled or
renewable resources;
KFC are enthusiastically complying with the new environmental directives
on recovery and recycling of packaging waste.
Litter
We at KFC UKI are aware of our responsibilities to the Management of
Litter and all our packaging carries the Keep your Country Tidy signs

Branding

This research measured and compared the brand identity of Kentucky Fried
Chicken (KFC) in India. Brand identity was defined as the customer
impressions of four different KFC identity elements - properties, products,
presentations, and publications. A survey of young consumers in the
countries (n = 795), showed that the respondents were more apt to eat within
KFC restaurants, and spend more time doing so, than the Americans. The
Chinese also had much more positive impressions of KFC. Brand identity
impressions were correlated with overall customer satisfaction and with
future patronage intentions for both groups. These findings support a model
where differences in cultural frames of reference lead consumers to actively
localize the brand identity of this nominally globalized product.

Promotion Issues

Sales promotion
For the sales pormotion KFC introduced their goods like watches , keychain,
e.t.c to the customers.

Advertisment
The advert titled Pool was done by OGILVY & MATHER, New Delhi advertising agency
for KFC ZINGER BURGER (KFC company) in INDIA. It was released in the June 2009.
Business sector is Fast food outlets & restaurants.

One of KFC's latest advertisements is a commercial advertising its "wicked


crunch box meal". The commercial features a fictional black metal band called
"Hellvetica" performing live, the lead singer then swallows fire. The commercial
then shows the lead singer at a KFC eating the "wicked crunch box meal" and
saying "Oh man that is hot".
In 2007, the original, non-acronymic Kentucky Fried Chicken name was
resurrected and began to reappear on company marketing literature and food
packaging, as well as some restaurant signage.

FEED US BACK
1. Tick Your Choice ()
Perfect

Above

Average

Average

Food Quality
Food Temperature
Waiting Time
Menu Board
Sitting Arrangement
Restaurant Temperature
Music
Restaurant Cleanliness
Overall Experience
2. When will you be back?

Next time I blink (very soon)


May be sometime later
When I win a Nobel Prize (Never)
3. How many people were in your group?

I was alone
Just me and someone
For me, three is company
4 or more

4. Would you rather order than Dine in?

Yaa, I like to mostly order at home


Sometimes, but I mostly like to dine in
No fun without Dine in

5. How close is your house to your nearest KFC outlet?

Within 1 Km
Between 1 3 Kms
Between 3 5 Kms
Above 5 Kms

Below
Average

Poor

6. Do you want a KFC home delivery service?

My dreams are coming true


That would help
Doesnt make much of a difference
No thanks

Thank You

The data we received is as follows:We did a survey on KFC on people with age group of mostly 20-25yrs. Mostly all were
open to non-veg food, and following were the results. As seen below KFC has shown a
good report on all the micro factors that we considered.

We also asked questions on whether they would like KFC to start homedelivery services.

We also inquired How close is the nearest KFC outlet from your house?

Would you like to order at home or Dine in?

DATA INTERPRETATION It is clear from the above report that a high number of
people actually like to order from their home or workplace
rather than coming. This may be due to more convienence,
time shortage or just not willing to come and dine. Certainly
the home delivery market is huge and KFC can take well
advantage of the situation. Thus it would be in the best
interest of the company to start the service as soon as
possible and capitalise on the opportunity. KFC expects a rise
in the orders by at least 20% by starting this service.
Therefore, to conclude we would say that KFC should
definitely have a home delivery service.

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