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Analysis Of Customer Satisfaction At Mcdonalds Kfc Marketing Essay

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Executive summary of the project


With the increase in spending capacity of Indian middle class society, the mind set of
consumers have changed in relation to recreational activities.
More frequently people have started to move out to eat, this has created scope for many
fast food chains. But along with that it has also created competition among different
food chains.
Hence each and everyone plays a major role in attracting customers. The trend can be
seen by the increasing number of food chains.
That is why this topic was chosen for further study as this particular industry is fast
becoming very competitive.
This project comprises a brief analysis of the Indian fast food industry and the
competition that marks the trend, different companies and various players are analyzed
from their competing strategies. Some of these fast food chains are Nirula's, Pizza Hut,
McDonald's, Haldiram's.
Further the main scope of the study is to conduct a comparative analysis on two of the
major players in the food services industry, which is McDonalds and KFC. The research
tries to develop a case study which analyzes McDonalds and KFC's strengths and their
business process very closely with a greater emphasis on how they do a better job than
most competitors at serving their customers. In addition to this a consumer research
was undertaken with the objective of assessing the service quality of McDonalds v/s KFC
on the basis of:

Tangibles
Reliability
Empathy
Responsiveness
Price Sensitivity

Literature Review
A synoptic review of the literature brings to the
fore insights into any past comparison made
between McDonald's & KFC.
A related article published by Vishal Krishna, BusinessWorld, 10 October 2009 on the
Third Eyesight website which is a consulting firm states:
Indian shopping hotspots are sporting more and more golden arches these days. If
McDonald's is expanding like never before, not far away is KFC (Kentucky Fried
Chicken), though on a lesser scale. Their guests are young, their menus glocalized, their
branding established, and their menus are no longer over-priced. After more than a
decade in the highly fragmented quick service restaurant (QSR) segment - only 20 per
cent of the Rs 10,000-crore segment is organized - McDonald's and KFC are growing at
a nippy 20-25 per cent, despite the slowdown.
"In a recession, we see ourselves as a good substitute for premium dining," says Amit
Jatia, managing director of Hardcastle Restaurants, a joint venture partner of
McDonald's. "We are rapidly expanding because we have tested the supply chain for
over 15 years and it has given us the opportunity to scale up." McDonald's, which had 20
stores in India till 2002, today has 160. It plans to open 200 more over five years, with
an investment of Rs 500 crore. KFC, the smaller player with 52 restaurants, plans to
open over 100 more outlets in the next two years.
Though McDonald's foray into chicken nuggets this year has taken it into KFC territory,
the companies give the impression of ignoring each other. "The Indian market is very

large for QSRs and our focus is on large portions of white meat, while the competition
focuses on different products," says Unnat Varma, marketing director of Yum
Restaurants, which has been developing KFC and Pizza Hut in India. The pricing of its
menus makes McDonald's a quick eatery with the average per person spend at Rs 100.
KFC's spend is higher, at Rs 125-150.
In 2009, McDonald's guest count has crossed 30 million; in 1996, when it started, the
count was a little more than 200,000. KFC's annual guest count is expected to rise from
3 million today to 5 million by the end of 2010.
Many Indian retailers have not turned cash positive because they burnt most of their
money on building the front-end. But, "McDonald's and KFC have got an amalgam of
things right," says Harish Bijoor, a Bangalore-based brand and marketing consultant.
"While McDonald's has converted millions of people with its Rs 20 happy price menu,
KFC has done it with its large portions as a QSR-plus restaurant."

Staying Ahead In The Numbers Game


It has taken McDonald's, which has a global turnover of $22 billion (Rs 1.1 lakh crore),
almost 12 years to operationally break even in India (KFC is yet to break even). That in
itself is not unusual; Bijoor says cereal maker Kellogg's took 23 years to break even in
Mexico. "The costs incurred on store design and supply chains are huge," says Jatia.
"Now, I am expanding in Chennai and I have to prepare the back-end to service that
region, which requires large investments." Of McDonald's' Rs 1,200 crore investments
in India so far, Rs 250 crore was for the supply chain alone.
McDonald's supply chain in is decentralised - a store manager sends a requisition to its
logistics partner Radhakrishna Foodland (RKF) though a data management system,
who in turn informs Vista Foods, which McDonald's' global supplier, OSI Global, bought
in partnership with Hardcastle Restaurants. "We source everything for McDonald's
locally and process."
Other than a tie-up with Venky's for chicken, KFC outsources buns, vegetables and
transportation from different vendors. While this explains its slow expansion and gives
McDonald's a clear advantage, KFC's limited, chicken-based menu does not need the
kind of supply chain McDonald's has struggled to establish. It is also the reason why

McDonald's can envisage expanding faster into the metros as well as the tier-I and tierII cities, but KFC cannot for now.

Introduction to Project
Industry
Overview
(Fast Food Industries)
Introduction
The food industry is on a high as Indians continue to have a feast. Fuelled by what can
be termed as a perfect ingredient for any industry - large disposable incomes - the food
sector has been witnessing a marked change in consumption patterns, especially in
terms of food. An increasing number of international fast food chains rushing to India is
because all of them see tremendous potential in for this type of business. The large
upwardly mobile population in the urban areas tend to eat out more often or business or
for leisure.

The various players operating in India are the well established Indian chains like
Nirula's, Haldiram's and multinational companies like McDonalds, KFC, Pizza hut,
Domino's pizza, etc.
In addition to these, apparently some of the best known international food chains are
looking at India. Among them are Great American Disaster, The Burger King, Mexican
food chain Tacogrill, Move-n-pick, etc. are some of them to name.
At present all these players are fighting for a small pie, as fast food is really not a big
habit with Indians, but they see a big potential.
The players are fighting on products, pricing and positioning and trying to convert the
first trials into regular purchase by providing delightful service quality. The focus is on
product quality and standardization of taste. Consistency is the key, as its

standardization in fast food as the consumer is short on time and wants to satisfy his
taste buds with a consistent taste experience.
Beyond this each player has its own strategy to expand consumer base.
- Some feel that pricing is not the deciding factor since fast food industry is not price
sensitive market because it is not a regular diet of Indians.
- Some others are competing on positioning which is surprisingly varied, giving the
small size of the market.
- For most, targeting children seems the right strategy.
- Advertising is popular.
However, with competition rising most chains are increasing reach as well as working
on establishing a national or local presence.
As the fast food companies have expanded around the world, they have had to adapt to
local sensitivities. For instance, there were disturbances in India when it was learned
that McDonalds's food items were pre-cooked in beef fat in the USA, because Hindus
revere cows and cannot eat beef.

Trends in the fast food industry


The fast food industry is estimated to grow at 9-12 per cent, on the basis of an estimated
GDP growth rate of 6-8 per cent, during the Eleventh Five year plan period. Value
addition of food is expected to increase from the current 8 per cent to 35 per cent by the
end of 2025.
The popularity of food and agro products is not surprising when the sector is now
offering a growth of more than 100 percent in sales. With such promise in the sector, a
number of foreign companies have joined the fray. While US brands such as
McDonald's, Pizza hut and Kentucky Fried Chicken have become household names,
more are on their way.

The market scenario

India is among top 10 market for weekly fast food consumption, an online survey has
found. Most of the countries are from the Asia-pacific region, with the US being the
exception.
According to an A C Neilson study of 28 markets across the US, Europe and the AsiaPacific, carried out through the internet in interviews with more than 14000 consumers,
Asians are the world's greatest fast food fans.
Percentage of adult population eating at takeaway restaurants at least once every week:
Hong Kong 61 %
Malaysia 59 %
Philippines 54 %
Singapore 50 %
Thailand 44 %
China 41 %
India 37 %
Europe 11 %
Type of cuisine, price and convenient location were found to be the most important
criteria across all three regions
The competitive factors to be considered to succeed in the fast food industry: To succeed a fast food chain should always be working in improving their quality of
food they offer to their consumers.
The development of new product from time to time is critical to stay on top of the
market; consumers always look forward to new products that businesses have to offer.

The frequent analysis of demographics helps the business to keep active awareness
of a risk in the change of their target market in a particular area. The analysis helps
businesses keep track of any change needed to cater to changing demographics.

Fast food industry in India on the rise


EATING AT home remains very much inbuilt in Indian culture and changes in eating
habits are very slow moving with barriers to eating out entrenched in certain sectors
of Indian society. The growth in nuclear families, particularly in urban India, exposure
to global media and Western cuisine and an increasing number of women joining the
workforce have had an impact on eating out trends. Which has lead us to a new era of
eating- 'fast food'. The name it self says the meaning of the food that can be prepared
and served very quickly. While any meal with low preparation time can be considered to
be fast food, typically the term refers to food sold in a restaurant or store with low
quality preparation and served to the customer in a packaged form for take-out/takeaway.

Market size and major players


Dominated by McDonalds having as many as 123 outlets.
Domino's pizza is present in around 274 locations.
Pizza hut is also catching up and it has planned to establish 147 outlets at the end of
2009.
Subways have established around 145 outlets.
Nirula's is established in Delhi and Northern India. However, it claims to cater 50,000
guests every day. It has future expansion plans for more than 50 outlets every year, for
next three years.
The main reason behind the success of the multinational chains is their expertise in
product development, sourcing practices, quality standards, service levels and
standardised operating procedures in their restaurants, a strength that they have
developed over years of experience around the world. The homegrown chains have in

the past few years of competition with the MNCs, learnt a few things and has made us
proud, for example, today, you might not find McDonald's burger every where but one
can have a sip of Caf Coffee Day coffee.
Reason for emergence
Gender roles: Gender roles are now changing. Females have started working outside.
So, they have no time for their home and cooking food. Fast food is an easy way out
because these can be prepared easily. Workingwomen have no time for cooking.
Customer sophistication and confidence: Consumers are becoming more sophisticated
now. They don't want to prepare food and spend their time and energy in household
works. They are building their confidence more on 'ready to eat and easy to serve' kind
of foods.
Paucity of time: People have no time for cooking. Because of emergence of working
women and also number of other entertainment items. Most of the time either people
work or want to enjoy with their family.
Large population: India being a second largest country in terms of population
possesses large potential market for all the products/services. This results into entry of
large number of fast food players in the country. Relaxation in rules and regulations:
with the economic liberalization of 1991, most of the tariff and non-tariff barriers from
the Indian boundaries are either removed or minimized. This helped significantly the
MNCs to enter in the country.
Menu diversification: Increase in consumption of pizzas, burgers and other type offast
foods.
Challenges for the industry
Social and cultural implications of Indians switching to western breakfast food:
Eating meat is not explicitly prohibited, but many Hindus are vegetarian because they
adhere to the concept of ahimsa. Those seeking spiritual unity may avoid garlic and
onions. The concept of purity influences Hindu food practices. Products from cows (eg,
milk, yogurt, ghee-clarified butter) are considered pure. Pure foods can improve the
purity of impure foods when they are prepared together. But now, Indians are switching

to fast food that contain all those things that are considered impure or against their
beliefs. Some traditional and fundamentalist are against this transformation of food
habit and number of times they provoke their counterparts to revolt against such foods.
And that is what happened when McDonald's decided to enter the complexity of Indian
business landscape, counting only on its 'fast food global formula', without any
apparent previous cultural training.
Emphasis on the usage of bio-degradable products: Glasses, silverware, plates and
cloth napkins are never provided with fast food. Instead, paper plates and napkins,
polyurethane containers, plastic cups and tableware, drinking cartons or PET
(polyethylene terephthalate) bottles are used and these are all disposable. Many of these
items are tossed in the garbage instead of being recycled, or even worse, merely thrown
on the ground. This burdens nature unnecessarily and squanders raw materials. In
order to reduce soil and water pollution, government now emphasises more on the
usage of bio-degradable products.
Retrenchment of employees: Most of new industries will be capital intensive and may
drive local competitors, which have more workers, out of business.
Profit repatriation: Repatriation of profits is another area of concern for Indian
economy. As when multinational enters the any countries, people and government hope
that it will increase the employment rate and result in economic growth. However, with
the multinational operation, host country experiences these benefits for a short time
period. In long run neither employment increases (because of capital intensive nature of
MNC's) nor it increases the gross domestic product or gross national product because
whatever MNC's earn they repatriate that profit back to their home country.
Problems of industry
Environmental friendly products cost high: Government is legislating laws in order to
keep check on the fast food industry and it is emphasizing more on the usage of biodegradable and environment friendly products. But associated with this issue is the
problem that fast food player faces - the cost associated with the environment
friendly products. They cost much higher than the normal products that companies use
for packaging or wrapping their products.

Balance between societal expectation and companies economic objectives: To balance a


society's expectation regarding environment with the economic burden of protecting the
environment. Thus, one can see that one side pushes for higher standards and other side
tries to beat the standard back, thereby making it an arm wrestling and mind boggling
exercise.
Trends in Indian market
Marketing to children: Fast food outlets in India target children as their major
customers. They introduce varieties of things that will attract the children's attention
and by targeting children they automatically target their parents.
Low level customer commitment: Because of the large number of food retail outlets
and also because of the tendency of customer to switch from one product to other, this
industry faces low level customer commitment.
Value added technology services: There is continuous improvement in the technology
as far as fast food market in India is considered. The reason behind that is food is a
perishable item and in order to ensure that it remains fresh for a longer period of time.
Earlier, Indian people prefer eating at home but now with the change in trend there is
also need for improvement and up gradation of technology in food sector.
Attracting different segments of the market: Fast food outlets are introducing
varieties of products in order to cater the demands of each and every segment of market.
They are introducing all categories of product so that people of all age, sex, class, income
group etc can come and become a customer of their food line.

Major players
In India the major players which constitute the Indian fast food industry includes
Indian as well as Multinational companies.
These are:

1. Nirula's

Established in 1934, Nirula's today is a diversified group having a chain Waiter service
restaurants, Family style restaurants, Ice Cream parlors, pastry shops and food
processing plants in India.
The chain with over 60 outlets operating in 5 states successfully caters to the Indian
palate of over 50000 guests every day for over 70 years.
The restaurants serve a wide variety of multi-cuisine foods, both western and Indian
including pizzas, burgers, chana kulcha, saag-roti and much more!
Ice cream parlors offers an extensive range of exciting and innovative ice cream flavors
with one new flavor added every month
Nirula's pastry shops are a one-stop shop for bakery and confectionary items.

2. Pizza hut
In 1996 Pizza hut came to India with a dine in restaurant in Bangalore that has special
vegetarian pizzas. In addition to traditional Italian topping, it incorporates Indian
favorites such as chicken tikkas, lamb korma, etc. In its list of innovative toppings, along
with pizzas the menu features appetizers like garlic bread and soups, fresh salads, oven
baked pastas and choice f\of ice-cream sundaes.
In 1997 pizza hut opened a restaurant in the capital's bustling M-Block market in
Greater Kailash-I, unlike the existing pizza hut at shanti niketan which is delivery
counter for just pizzas, this is dine-in where the entire menu is available.

3. Domino's pizza
It was incorporated in 1995 as the master franchise o Domino's pizza international inc.,
of USA.. the first Domino's pizza store in India opened in January 1996 at new Delhi.
Today it has grown into a countrywide network of over 104 outlets in 30 cities.
Ever since it was established, Domino's Pizza India has maintained its position of
market leadership with its constant product innovation and maintenance of stringent
service standards. It has established a reputation for being a home delivery specialist

capable of delivering pizzas within 30 minutes. It was the first one to start this facility to
customers..
Domino's constantly strives to develop products that suits the tastes of its customers.
Thus time and again Domino's has been innovating toppings suitable to taste buds of
the local populace and these have been very well accepted by the Indian market.

4. Haldiram's
Haldiram began in 1937as a small sweet shop in Bikaner, in Rajasthan state of India.
In 2001 the turnover of haldiram's was Rs. 4 billion. The group has presence not only in
India but in several countries all over world.
Till early 1990s, Haldiram comprised of three units- Kolkata, Nagpur and New Delhi.
Haldiram has many 'firsts' to its credit- It was first company to brand namkeens. And
first company to offer traditional Indian items like 'panipuri', 'chatpapri' and so on.
The company faced tough competition not only from sweets and snack food vendors in
unorganized, domestic and international competitors but also from its own units
because of conflict between them.
At Haldiram's quality is the obsession and this spirit has given its competitors a cutting
edge. Haldiram offers a very wide range of delicacies like- Namkeens, Sweets, Syrups,
Papads, North Indian dishes, South Indian dishes, Pastries.
Sweets itself has a very wide variety Bengali sweets include Sandesh and Rasgullas.
Other popular Indian sweets are:- Kheer, Halwa, Gulabjamun, Rasmalai and Kulfi.
Variety of refreshments include- Chat- a spicy mix of different ingredients, topped with
tangy chutneys 'sauce' example, Bhelpuri.
Snacks include- Samosas, Pakoras, Aloo tikki, Kachori, Pao bhaji, Golgappa, Dhokla and
many more.

Company profile

McDonalds India
Introduction
McDonald's in India is a 50-50 joint venture partnership between McDonald's
Corporation [USA] and two Indian businessmen. Amit Jatia's company Hardcastle
Restaurants Pvt. Ltd. owns and operates McDonald's restaurants in Western India.
While Connaught Plaza Restaurants Pvt. Ltd headed by Vikram Bakshi owns and
operates the Northern operations.
Amit Jatia and Vikram Bakshi are like-minded visionaries who share McDonald's
complete commitment to Quality, Service, Cleanliness and Value (QSC&V). Having
signed their joint-venture agreements with McDonald's in April 1995, they trained
extensively, along with their Indian management team, in McDonald's restaurants in
Indonesia and the U.S.A. before opening the first McDonald's restaurant in India.
As a leader in QSR (Quick Service Restaurant) segment McDonalds has pioneered
various industry benchmark practices over the past decade of serving Indian customers,
including new concepts such as
# Oil alliances in India by linking with petroleum giants BPCL and HPCL. Three such
alliances with BPCL outlets are in mathura (2000) (up), doraha (2002) (Punjab) and
chanakyapuri (new delhi-2005)
# Novel menu formats such as an Express model with a limited menu and kiosks with a
variety of dessert offerings
# Home delivery (mcdelivery -2004); providing even more convenience to our
customers. In 2006, mcdelivery on bicycle at chandni chowk and 2007 all India single
delivery number were introduced.
# First drive thru restaurant in India at noida (up) in1997.

Restaurant count
McDonald's has 155 restaurants in India of which 95 are in north & east India and 60 in
west & south India .

Our Philosophy
"We take the burger business more seriously than anyone else." When McDonald's
founder, Ray Kroc made that memorable statement, he was letting the world in on the
philosophy and secret behind McDonald's phenomenal success.
Our vision to be India's "best" quick service restaurant experience is supported by a set
of principles and core values [McDonald's Way]
The principles that guide us
Quality, Service, Cleanliness & Value - It is an unflinching McDonald's ideology that our
customers must always get quality products, served quickly and with a smile, in a clean
and pleasant environment; and all at a fair price
We are committed to exceeding our customers' expectations in every restaurant every
time.
We have a passion and a responsibility for enhancing and protecting the McDonald's
brand.
We believe in a collaborative management approach, employing a mutually respectful
business philosophy,
We will seize every opportunity to innovate and lead the industry on behalf of our
customers.

The McDonald's Promise


QSC&V......The Foundation that built McDonald's success
When asked to explain McDonald's success, founder Ray Kroc used to say, "We take the
hamburger business more seriously than anyone else."
Kroc was a perfectionist. From the day he opened his first restaurant, he vowed to give
his customers high quality products, served quickly --and with a smile, in a clean and
pleasant environment, and all at a fair price. Quality, Service, Cleanliness and Value
(QSC&V) became the philosophy that drove McDonald's business.

McDonald's Quality Management instills the culture of quality through such principles
as being customer driven, managing with facts, valuing people, and continually
improving every aspect of our business
Service that is fast and friendly and has always been a foundation for success at

McDonald's
Cleanliness for us means having the cleanest and freshest facilities from the kitchen to
the rest rooms and parking lots
Value at McDonald's means the total experience...... great food, friendly folks, a clean
environment, quick and accurate service and fun!

Company profile
KENTUCKY FRIED CHICKEN
Introduction
KFC Corporation, or KFC, founded and also known as Kentucky Fried Chicken, is
a chain of fast food restaurants based in Louisville, Kentucky. KFC has been a brand
and operating segment, called a "concept", of Yum! Brands since 1997 when that
company was spun off from PepsiCo as Tricon Global Restaurants Inc. There are
more than 14,000 KFC outlets in more than 80 countries and territories around the
world, serving some 12 million customers each day.
The company was founded as Kentucky Fried Chicken by Colonel Harland
Sanders in 1952, though the idea of KFC's fried chicken actually goes back to 1930. The
company adopted the abbreviated form of its name in 1991. Starting in April 2007, the
company began using its original name, Kentucky Fried Chicken, for its signage,
packaging and advertisements in the United States as part of a new corporate rebranding program; newer and remodeled restaurants will have the new logo and name
while older stores will continue to use the 1980s signage. Additionally, Yum! continues
to use the abbreviated name freely in its advertising.

KFC HISTORY-AT-A-GLANCE
9/9/1890
Harland Sanders is born just outside Henryville, Indiana.

1900-1924
Harland Sanders holds a variety of jobs including: farm hand, streetcar conductor, army
private in Cuba, blacksmith's helper, railyard fireman, insurance salesman, tire
salesman and service station operator for Standard Oil.

1930
In the midst of the depression, Harland Sanders opens his first restaurant in the small
front room of a gas station in Corbin, Kentucky.
Sanders serves as station operator, chief cook and cashier and names the dining area
"Sanders Court & Caf."

1937
The Sanders Court & Caf adds a motel and expands the restaurant to 142 seats.

1939
The Sanders Court & Caf is first listed in Duncan Hines' "Adventures in Good Eating."
Fire destroys The Sanders Court & Caf, but it is rebuilt and reopened.

1940
Birthdate of the Original Recipe

1952
The Colonel begins actively franchising his chicken business by traveling from town to
town and cooking batches of chicken for restaurant owners and employees.

The Colonel awards Pete Harman of Salt Lake City with the first KFC franchise. A
handshake agreement stipulates a payment of a nickel to Sanders for each chicken sold.

1955
An interstate highway is built to bypass Corbin, Kentucky. Sanders sells the service
station on the same day that he receives his first social security check for $105. After
paying debts owed, he is virtually broke. He decides to go on the road to sell his Secret
Recipe to restaurants.

1957
Kentucky Fried Chicken first sold in buckets

1960
The Colonel's hard work on the road begins to pay off and there are 190 KFC franchisees
and 400 franchise units in the U.S. and Canada.

1964
Kentucky Fried Chicken has more than 600 franchised outlets in the United States,
Canada and the first overseas outlet, in England. Sanders sells his interest in the U.S.
company for $2 million to a group of investors headed by John Y. Brown Jr., future
governor of Kentucky. The Colonel remains a public spokesman for the company.

1965
Colonel Sanders receives the Horatio Alger Award from the American Schools and
Colleges Association.

1966
The Kentucky Fried Chicken Corporation goes public.

1969
The Kentucky Fried Chicken Corporation is listed on the New York Stock Exchange.

1971
More than 3,500 franchised and company-owned restaurants are in worldwide
operation when Heublein Inc. acquires KFC Corporation.

1976
An independent survey ranks the Colonel as the world's second most recognizable
celebrity.

1979
KFC cooks up 2.7 billion pieces of chicken. There are approximately 6,000 KFC
restaurants worldwide with sales of more than $2 billion.

12/16/1980
Colonel Harland Sanders, who came to symbolize quality in the food industry, dies.

1982
Kentucky Fried Chicken becomes a subsidiary of R.J. Reynolds Industries, Inc. (now
RJR Nabisco, Inc.) when Heublein, Inc. is acquired by Reynolds.

1986
PepsiCo, Inc. acquires KFC from RJR Nabisco, Inc.

1997
PepsiCo, Inc. announces the spin-off of its quick service restaurants - KFC, Taco Bell
and Pizza Hut - into Tricon Global Restaurants, Inc.

2002
Tricon Global Restaurants, Inc., the world's largest restaurant company, changes its
corporate name to YUM! Brands, Inc. In addition to KFC, the company owns A&W

All-American Food Restaurants, Long John Silvers, Pizza Hut and Taco
Bell restaurants.

2006
More than a billion of the Colonel's "finger lickin' good" chicken dinners are served
annually in more than 80 countries and territories around the world.

KFC India
KFC is the world's 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 it's 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 Sander's 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 13 cities with close to 72
restaurants.
US-based Yum! Restaurants is planning to invest up to Rs 150 crore to more than
double the number of outlets of its quick service restaurant brand 'KFC' in the country
by 2010. The fast food brands operator is also aiming to tap the 'chilled beverages'
market with its newly launched store-in-store concept of 'Krushers' in the KFC
restaurants. KFC is planning to invest up to Rs 150 crore in the Indian market by 2010
and will expand the KFC chain in the country to 110 restaurants by end of the period,
from 50 now.

Research Methodology
Objectives of research study

The primary objective of the research was to survey the consumers and try to identify
whether the customers are satisfied with the services provided by McDonalds and KFC.
Whether the services provided by them are as desired by the customers or not.
The research also tries to analyze and compare the two fast food chains on different
customer value attributes and try to find their performance.
The services provided by McDonalds and KFC have been compared on the basis on
following dimensions of service quality :
Tangibles: appearance of physical facilities, equipment, personnel, and communication
material
Reliability: ability to perform dependable services accurately
Empathy: Provision of caring, individualized attention to customers
Responsiveness: the willingness to help customers and to provide prompt service
Affordability: prices offered by both chains
Customer Value Analysis
Identify the major attributes that customers value in fast food restaurants
Assess the quantitative importance of different attributes
Compare McDonald's and KFC's performance on different customer values.
Assess the brand recall and brand preference for the two chains.
Assess the economic viability and compare prices of both brands.

Data collection
In this project both primary data as well as secondary data are used.

Primary data

Primary Data are those, which are collected afresh and for the first time, and thus
happens to be original in character. Primary data used in this project is collected
through two methods, namely, Questionnaire method and Direct personal Interview
method. Both these methods proved to be great help in getting the required
information.

Secondary data
Secondary Data are those, which have already been collected by someone else and which
have already been passed through the statistical process. Some related information on
the two companies and any past comparison of the two chains was collected through
secondary data from various sources like Internet, Print Media.

Statistical & Presentation tools used


PRIMARY DATA is:
First classified i.e. grouped qualitatively and quantitatively according to the situation or
the type of the data which was collected.
After classifying is represented in the form of tables i.e. systematically arranged in
columns and rows.
Some of the data is also graphically represented in the form of BAR CHARTS.
Secondary data is represented:
In the form of tables.
By the way of bar graphs and Pie CHARTS

Sample size and Areas covered


A customer-based survey was conducted in which 100 people were asked to fill the
questionnaire covering the cities of Delhi and Faridabad .

Non Probability sampling was used within which convenience sampling technique has
been used. The responses have been collected from the customers depending on their
availability and their willingness to respond.

Findings
and
Analysis
Findings based on Questionnaire
Q2. Name the first fast food chain that comes to
your mind?
Out of the sample of 100, following results were obtained:
McDonald's came out as a clear winner in this aspect, with more than half the
respondents surveyed coming up with McDonald's as their first recall for a fast food
chain.
KFC came in two steps behind McDonald's in the brand recall with only 20%
respondents accepting KFC as their top of the mind brand.

Q3. How often do you visit McDonald's?


A reasonable percentage of almost 20% responded to be frequenting McDonald's at least
once a week.
A majority still rated their frequency of visit as once in 15 days or once in a month.

Q4. How often do you visit KFC?


Over 40% of the people surveyed visited KFC at least once a fortnight.
Not many respondents believed in visiting KFC too frequently with the percentage of
those visiting at least once a week being less than 15%.

Q5. Which fast food chain provides a cleaner and


more comfortable ambience?
Customers generally give a high priority to the physical ambience of a restaurant.
McDonald's was rated as a more comfortable place to eat in by close to 50% of the
respondents.
KFC was not too far behind by 30% rating it still better than McDonald's.

Q6. Which one out of the two maintains


consistency in food taste and quality?
A majority of people came across without any bias on this aspect, with almost 70%
rating both McDonald's and KFC equally at maintaining consistent quality.

Q7. Which fast food chain offers better prices?


McDonald's lived up to its perception of being an economical family eating joint, with
close to 60% respondents being happy with the prices offered, over KFC.
A reasonable percentage of a little over 20% still believed that even KFC was an
economical brand, over McDonald's.

Q8. Whose advertising do you find more effective?


Advertising is a very important part of any brands marketing mix.
McDonald's again arose as the winner with over half the respondents finding
McDonald's advertising and promotional campaigns more effective than KFC.
KFC also found some takers for its advertising campaigns with almost 30% respondents
rating KFC's ads over McDonald's.

Q9. Which out of the two provides quicker


service?

Prompt service is exactly what makes a fast food chain fast. McDonald's was a clear
favorite here with a little over 50% respondents finding McDonald's service faster than
KFC's.
KFC was close behind with 30% respondents saying that it provides quicker service over
McDonald's.

Q10. Which fast food chain's staff is more helpful


and efficient?
Not too much difference was perceived by respondents in the responsiveness of the staff
of both fast food joints, with McDonald's being rated over KFC by only 15% more
respondents.
A reasonable percentage of 20% was observed to rate both chains equally in the quality
and efficiency of their staff.

Q11. What recommendations do you wish to


suggest to McDonalds
When asked about any recommendations that respondents might have for McDonald's,
the two most voiced suggestions were too- further improve overall quality(34%) and
providing a better and cleaner eating area(28%).
Close to 20% people still believed that McDonald's should engage in more Advertising.

Q12. What recommendations do you wish to


suggest to KFC.
In contrast to McDonald's, a majority of respondents (45%) recommended for KFC to
have a cleaner and more comfortable physical location.
Also, almost an equal percentage of 20% respondents believed that KFC should improve
its quality and indulge in more advertising and promotions.

Q13. How would you describe your overall eating


experience at McDonalds?

A majority of respondents, over 50% rated their overall eating experience at McDonald's
as very good or good (taken together).

Q14. How would you describe your overall eating


experience at KFC?
In contrast the percentage of respondents rating their experience as either very good or
good for KFC, was lower than that for McDonald's at around 45%.

Conclusions
and
Recommendations
Conclusions
Going through the analysis of response from the survey conducted, it is concluded that
McDonalds scores a certain edge over KFC in being able to retain at top. McDonalds is
also preferred and the first brand to be recalled when it comes to the fast food category
over Pizza hut, Domino's and KFC.
McDonalds's is perceived as providing a cleaner and more comfortable physical eating
location, over KFC. Also, we can conclude from the survey that both fast food chains are
seen as standardized and offering a consistent quality at equal levels.
Though not wide but its product line is quite impressive. It includes meals for both
Vegetarian and Non-Vegetarian and satisfies both section of customers, which KFC can
not compete with currently.
McDonald's is observed as a more pocket friendly eating experience with satisfactory
prices being offered by the fast food giant. Also McDonald's staff is rated above KFC in
terms of responsiveness and prompt service.
McDonald's advertising has more impact on the people than KFC's. Also, people believe
that McDonald's does a better job of being in the limelight and maintaining a better top
of mind recall than most other fast food chains.

Summarizing all points we conclude that McDonalds is growing faster and better than
KFC by satisfying its customers, by providing quality and maintaining consistency. KFC
needs to look at few crucial aspects to catch up with McDonald's and increase its market
share.

Recommendations
The recommendations for McDonalds is to:
Maintain consistency in the taste and quality of products.
Include more promotional and advertising measures to maintain its brand recall and
increase its market share.
Improve the physical facility at its locations, in terms of a better ambience and more
clean facility.
McDonald's should continue with positioning itself as an economical family restaurant
and constantly look to include more economical offers like the happy meal it offers.
The recommendations for KFC is to:
Maintain consistency in the taste and quality of products.
Include more promotional and advertising measures to improve its brand recall and
increase its market share.
Focus more on providing a more clean and comfortable physical location and try and
help customers have a better eating experience.
Also, KFC should try to include more health friendly food items in their menu and try to
include a few products for the vegetarian section as well.
KFC needs to better train its staff and reduce the turnaround time, to improve the
promptness of service.

Limitations of the study

Since the road to improvement is never ending, so this study also suffers from certain
limitations. Some of them are as follows:
Scope of project is limited in the sense that only McDonalds and KFC have been taken
for consumer research.
The extent of the survey was Faridabad and New Delhi only. So the suggestions or
arguments given in the report may not hold true for other locations in India.
It was a time consuming method in which continuous guidance was required.
Questionnaire method involves some uncertainty of response. Co-operation on the part
of informants, in some cases, was difficult to presume.
Because of time constraints and reserve constraints, a mix of convenient sampling and
judgement sampling was used.
Also because of above mentioned constraints, the sample size chosen for the survey was
100 people.
It is possible that the information supplied by the informants may be incorrect. So, the
study may lack accuracy.
For presenting about McDonalds and KFC, only secondary source of data was referred.
No interviews with the company personnel, whether the operational or managerial
levels were conducted.