Kentucky Fried Chicken (kfc) - Detailed Marketing Analysis

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Submitted by:

Assma Zareen

Submitted to:

Mrs Sehar Naveed

Subject:

Marketing Management

Topic:

Project Report

Date of Submission:

26-07-18

BBA 6th Semester

KENTUCKY FRIED CHICKEN (KFC)

Introduction:

KFC, also known as Kentucky Fried Chicken, is an American fast food restaurant chain that specializes in fried chicken. Headquartered in Louisville, Kentucky, it is the world's second-largest restaurant chain after McDonald's, with almost 20,000 locations globally in 123 countries and territories as of December 2015.

History:

Harland Sanders was born in 1890 and raised on a farm outside Henryville, Indiana (near Louisville, Kentucky). When Sanders was five years old, his father died, forcing his mother to work at a canning plant. This left Sanders, as the eldest son, to care for his two younger siblings. After he reached seven years of age, his mother taught him how to cook. After leaving the family home at the age of 13, Sanders passed through several professions, with mixed success. In 1930, he took over a Shell filling station on US Route 25 just outside North Corbin, Kentucky, a small town on the edge of the Appalachian Mountains. It was here that he first served to travelers the recipes that he had learned as a child: fried chicken and other dishes such as steaks and country ham. After four years of serving from his own dining room table, Sanders purchased the larger filling station on the other side of the road and expanded to six tables. In 1937 he expanded his restaurant to 142 seats, and added a motel he purchased across the street, naming it Sanders Court & Café.

Sanders was unhappy with the 35 minutes it took to prepare his chicken in an iron frying pan, but he refused to deep fry the chicken, which he believed lowered the quality of the product.  In 1939, the first commercial pressure cookers were released onto the market, mostly designed for steaming vegetables. Sanders bought one, and modified it into a pressure fryer, which he then used to fry chicken. The new method reduced production time to be comparable with deep frying, while, in the opinion of Sanders, retaining the quality of pan-fried chicken.        

In July 1940, Sanders finalized what came to be known as his "Original Recipe" of 11 herbs and spices. Although he never publicly revealed the recipe, he admitted to the use of salt and pepper, and claimed that the ingredients "stand on everybody's shelf".

Mission and Vision Statements:

Vision statement:

To be the leading integrated food services group in the ASEAN region delivering consistent quality products and excellent customer-focused service.

Mission Statement:

To be the leader in western style quick service restaurants through friendly service, good quality food and clean atmosphere

Need Analysis:

Needs analysis can be defined as a process focused on how a product addresses the needs of its consumers.

Kfc has effectively captured the market by positioning its product in the minds of customers in such a way that they believe only kfc can deliver them superior satisfaction. The question then arises that how has kfc managed to do so? Some of the steps taken by kfc in this regard have been enlisted below:

• Focus of all resources to their restaurants operation because that is where they serve their customers.
• Giving respect and value to their customers making them loyal.
• Expanded and updated training with time and be the best they can be.
• Introduction of new and innovative ideas because these are the key to competitive growth.
• Diversified menu that now captures the health conscious customers too.
• Ensuring the customers that their meals are healthy and fat controlled.

Situation Analysis:

SWOT analysis:

Strengths:

1. Strong global presence with more than 15000 restaurants.
2. Strong financial performance- KFC generated 16 billion dollars in system sale in 2015.
3. Significant lead over competing brands
4. Variety in menu-Apart from the non-veg items it has also included vegetarian items in its menu to lure more customers.
5. KFC is the third fast food brand of UK with the provision of list of calorie contends in food.
6. KFC has introduced its 11 herbs recipe, which has made their trademark strong.
7. KFC is considered the highest fried chicken restaurants, which has the original recipe.

Weaknesses:

1. Food quality issues-significant criticism over its use of trans fats in the cooking of non-veg items.
2. Franchisee operations related issues-Disputes related to the Menu and operational issues
3. The brand has to face the lack of building of relationships with employees, who are unskilled and young
4. KFC only deals in fried chicken.
5. There is lack of strong marketing efforts in the brand.
6. The brand faces the high employee turnover, which affects its business.
7. Negative publicity about brand affects their provision of fried chicken.

Opportunities:

1. The brand should focus on healthier food to get more demand.
2. The brand should start home meal delivery to its clients.
3. The online services should be introduced to get orders.
4. The provision of HALAL chicken, which can increase the number of customers in Muslim communities.
5. The brand needs to maintain the standard of cleanliness and service.
6. The brand introduces more varieties in its menu to ensure healthier choices. The brand can also start the burger business along with its traditional business.

Threats:

1. Competition from other fast food brands globally
2. Limited market share
3. Rising operational, labor and raw material costs
4. Food quality challenge
5. The risk of bird flu can affect the sale of this business

Porter’s five forces:

Threat of new entrants:

Although the fast food chain market is difficult to penetrate due to many competitors, KFC’s services and products are receiving stiff competition from Radix Fried Chicken which is a new restaurant that was launched in 2008. Radix Fried Chicken has become popular because of it offers a fresh menu and this has appealed to many clients. However, KFC has the advantage of being a well-established household name and this has made it very popular in its abroad ventures. It is easier for clients to choose KFC as compared to other new fast food restaurants unless the new entrants actually offer different menus as compared to the more established restaurants.

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