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PROJECT REPORT

MARKETING STRATERGIES
WITH REFERENCE TO
KENTUCKY FRIED CHICKEN

Submitted by-
AMIT KATARIYA
BBA (gen) SEM 3
CERTIFICATE

This is to certify that AMIT

KATARIYAstudent of MSI of course BBA

Batch (2008-2011), has completed her

research work titled “Marketing Strategies of

PVR Cinemas” under my guidance and

supervision .The work submitted is genuine

and authentic. Certificate

PARAMVEER
ACKNOWLEDGEMENT

With profound sense of gratitude and regard, I express my


sincere thanks to my guide and mentor Mr.PARAMVEER, for
his valuable guidance and the confidence he instilled in me,
that helped me in the successful completion of this project
report. Without his help, this project would have been a
distant affair.

His thorough understanding of the subject and professional


guidance was indeed of immense help to me.

Also, this acknowledgement would remain incomplete


without thanking the staff of KFC(RAJOURI GARDEN), New
Delhi for their whole-hearted and kind co-operation.

I am also greatly thankful to the faculty members of our


institute who co-operated with me and gave me their
valuable time. Acknowledgement
Introduction of
Company
KFC Corporation, based in Louisville, Kentucky, is the world’s most
popular chicken restaurant chain, specializing in Original Recipe ®, Extra
TM
Crispy , and Colonel’s Crispy Strips® chicken with home style sides and
five new freshly made sandwiches. Every day, nearly eight million
customers are served around the world. KFC’s menu everywhere includes
Original Recipe® chicken—made 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 products—from a Chunky Chicken Pot Pie
in the United States to a salmon sandwich in Japan.

KFC
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.”

Today, the Colonel’s spirit and heritage are reflected in KFC’s brand
identity – the logo features Colonel Harland Sanders, one of the best-
recognized icons in the world.
KFC specialized in chicken and they says,

“No body’s cooking like KFC today and we are


the chicken experts”

“There is no competitor for spicy chicken which is


made by KFC”

Introducing New Product

KFC
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/-


M issio n sta te m en t
“ T o b e t h e l e a d e r i n w e s t e r n s t y l e sqeur ivcikc e
r e s ta u r a n ts th r o u g h fr ie n d ly se r v ic e , g o o d q u a lity
f o o d a n d c l e a n a t m o s p” h e r e

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 colonel’s “finger lickin’ good” chicken dinners are served
annually. And not just in America. The colonel’s 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-year-
old 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 didn’t
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 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 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
they’ve 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
McDonald’s, Pizza Hut, Domino's and Subway, and any new fast-food entrants would
just be presenting something very similar to what’s 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 McDonald’s, 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,KFC’s 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 Sector 18,
Store Timing:8:30am to 11pm 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
City Square Mall,
Back Wing, Rajouri Garden,
Select Citywalk Mall, Delhi-10027
Saket, Delhi-110017 Store Timing:11am to 11pm
Store Timing:11am to 11pm
Vikas Surya Plaza,
Vasant Square Mall, Sector 4, Dwarka,
Vasant Kunj-110070 Delhi-110075
Store Timing:11a.m. to 11 p.m. 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, JMD Regent Mall,


Indirapuram, Delhi-201012 Mall Road,
Store Timing:11am to 11pm Gurgaon-
V3S Mall, Store Timing:11 am to 11 pm

Laxmi Nagar, Delhi-110092 Ambience Mall,


Store Timing:11am to 11pm 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 don’t 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 Burger and French Fries


Indian people like spicy products instead of
boiled food

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
McDonalds Uses Top To Bottom
KFC uses Top to Bottom and Bottom to Approach.
Top Approach in
Management.
No such Case.
KFC is Co branding with Walls

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


Industry Product / service Market
exchange (Graphic 1). These needs make (a collection (a collection
of seller) Money of buyers
up the demand for particular products and

services. Several components must be Information


Graphic 1

considered, as all these components have a direct or indirect impact on KFC’s success.

Changes in the below described components over the last couple of years have led to big

changes in people’s 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

forces that are close to KFC, and on Company Competitors

which KFC has an impact. They directly

affect KFC’s ability to serve its


KFC
customers. (Kotler et al 2003). Three

major components influence KFC’s micro

environment:
Consumers

Graphic 3 (Source: Kotler et al 2003) Micro Environment


COMPETITORS

Because the fast food market in India is highly competitive, KFC faces a wide number of

direct and indirect competitors. KFC’s main competitors are fast food chains such as

McDonald’s and Domino’s, which are already well established throughout India.

McDonalds’s 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

KFC’s customer market consists solely of the consumer market (Kotler et al 2003).

KFC’s 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 Donald’s, 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; India’s 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 2002-
2007. 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 Domino’s 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 cow’s 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.

KFCIndia - BCGMatrix

Crispy
Boneless
Chicken
Krushers
?
Chicken
Bucket

Veg
Thali

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:
KFC’s 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:
KFC’s 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.McDonald’s with sales of more
than 19 billion in 1999, accounted for 15 percent of the sales of
the nation’s 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
KFC’s suppliers are threatening the chicken, before they got
slaughtered. Anti-KFC campaigns, such as the one from PETA are
affecting KFC’s 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, KFC’s “All-American salute to Mothers”


national card contest has been KFC’s way of honoring
moms and their families for making mother’s Day
KFC’s 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 Mother’s Day, were sent to thousands of
schools nationwide.

There are 4 P’s 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®
• Colonel’s 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 & N’s 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 & N’s 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 Below Poor
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
6. Do you want a KFC home delivery service?
 My dreams are coming true
 That would help
 Doesn’t 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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