KFC Business Management Assignment

Introduction: KFC Business Management Assignment

Business Management Assignment
KFC

Fast food market is going to stay strong in UK. More than 45% of the people feel that they like the taste of fast food that they are not ready to leave it. People in UK and Europe are the largest consumers of the fast food, with burgers topping the list. Research shows that average English spends about £82 for fast food.the tread has been on a rise and it has resulted in massive proliferation of fast food/take away food counters in UK (Joe Bramhall, 2009). People even though are getting more concerned about their health these days are not ready to leave apart these fast food habits as many of them has commented in an interview that they are ready to do an extar work out just to have these food out everyday. So from all these factors it is quite clear that these fast food chains are here to stay. Another trend that is seen in the market is the rise of many fast food chains concentrating on healthy food options and customers moving towards them. Many of these food chains are communicating their offerings and the benefits to the customers in an attempt to earn brownie points as the first movers in the market (Schreiner, Bruce, 2009).

KFC Business Management Assignment: Gaining From the British Take Away Culture

In 2006, KFC was on a downhill.Being treated as a just another take away chain, it was struggling to find its way out of an already saturated market.But after a BSE crisis and change in the customer tastes, KFC is back on the radar again. They are expanding fast over many locations in UK. By announcing that they would create more than 10,000 more jobs in the next five years they have made their intention pretty much clear. In fact the market analysists predict that the fast food market of UK is going to grow by 6% in the coming year to become a £11.4 bn industry (Joe Bramhall, 2009). With the rise in disposable income and scarcity of time, these fast food chains have become an important part in the life of an average British. By communicating the convenience factor and smart marketing objectives and tactics KFC has managed to sell at the rate of almost 10 pieces of fried chicken every minute. With growing health concerns in the industry they have tried to project the use of white meat which is considered to be healthier than others.

Market Positioning

KFC has to position them so that they match the culture or atleast not in direct contrast with the culture of the society. In a time starved UK society it has positioned itself as a convenient and healthy option for the working middle class and the upper class. Keeping in mind with the health concerns of the public, they have started projecting themselves as a substitute for hamburgers. In almost all the messages that the communicate to the public they maintain a high quality image and this High Quality check positioning has resulted in the acceptance of KFC as a healthy and convenient alternative by the people. KFC uses their strong brand name in all their communications and is positioned in the market as one of the leaders in the Fried chicken segment.

Target Market

From the fact that most of the KFC outlets are located at posh locations and they are highly priced as compared to many other take way stores. They target the upper middle class, the working population and the upper class. Behavior wise they target the ambitious, gregarious and the authoritarians.

PEST Analysis KFC

The PEST Analysis  factors that affect the fast food industry in UK are as follows:

Political

  • Strict health and safety guidelines that regulate the growth of fast food chains
  • Animal activists campaigning against non vegetarian outlets; E.g. Stop KFC campaign
  • UK Epidemic of BSE in 1998 and hence a sudden shift of customers towards Healthier food and associated regulations from the government.

Environmental

  • Very low set up costs due to the stripped down versions of the restaurants.
  • High Perceived value foe money as they provide a healthy convenient option for the public.
  • Growing market and high disposable income in the middle class.

Social

  • Time starved lifestyle, in search of convienience.
  • Healthy Lifestyle and increased concerns on obesity
  • Activists against a non vegetarian fast food culture

Technological

  • Online ordering system
  • Computerized Supply chain to increase the efficiency of the supply chain.
  • Technological innovations to come up with new product innovations like low fat food

Recommendations and Future Communication Plan

Being in a service industry it is essential for the brand to make every customer encounter a “moment of truth”. All the customer touch points should be effectively utilized and made use of while communicating to the customers. Rather than massively depending on the ATL communication out of the belief that advertising would do the trick for you would be the one of the biggest mistakes that they can ever commit. Customers these days look for a whole experience when they go to eat out. So the entire package that they offer should be communicated. Even though cliched, a 3600 approach is needed in this case to get the attention of the customers. Various recommendations and suggestions as far as different media channels are concerned are given below:

Advertising: Print and Television

Colonel Sanders is now known to be almost synonymous with KFC (Doug Bennett, Jr., 1997). By using him the brand gains more eyeballs and gets easily recognized among the public. Even those who are not regular customers associate Sanders with KFC. So make sure that all the communications have him in them whether its print or in TV. They have been extensively focusing on the product based advertisements in which they have been showing people enjoying their food without any fear. Agreed that they have a superior product and it needs to be advertised as a USP. But somewhere the whole experience of other service offerings that they have does not get reflected in their ads. More emphasis should be given on this front even if it’s in a subtle manner.

Merchandising

Merchandising does a two way trick for you.It increases your revenue at the same time it increases the loyalty and visibility of your brand.they may start merchandising even though still they are doing it at a very small scale. Merchandises targeting various age segments like watches, toys, mugs etc may be promoted in store as well as during external promotions like events and sponsorship. Having an exclusive KFC club and giving them offers is also an excellent option as far as increasing awareness and loyalty is concerned.

Promotions

Sales promotions these days have been promoted only in store. There are ample avenues to reach to your customer and make him buy your product. New offers and additions to the menu should be intimated to the customers by means of mails and messages. Having sales promotion along with other products is an excellent way of introducing your product to the customers. Since they have a tie up with Pepsi, they can distribute coupons along with a large purchase of Pepsi. By entering into strategic deals with other companies they can increase their sales. Whatever they do they should ensure that they have to make sure that most of the target market should be aware of such programs. Unless your sales promotions get maximum exposure, it is not going to serve the purpose of driving up the short term sales.

PR AND CSR

They are always under the scrutiny of their critics who wait for a chance to devalue the brand. In order to counter attack any such measures, they should continue with the Corporate Social Responsibility Projects like Remove Hunger Project and Reduce litter Campaign. By having associations with large NGOs, which is possible given their strong brand name. They should try to humanize the brand in the eyes of public. One major advantage that they have by this exercise is that even though they are not promoting any of their product they are trying to build the brand which is very essential in a saturated market like UK.

Sponsorship and Out of the Home Advertising

They are very active in this field by sponsoring many events such as Race for Life, 4 music-shows etc. They should continue spending on this front. Only thing that they should be careful about is the kind of events that they are promoting or sponsoring. They have to make sure that they have a sizable number of their target group available for the program that they are sponsoring. This is one of the most conducive environments that one will get to communicate with their customers. Customers are more receptive to your messages as they find you as partners to the program and are more likely to listen to the communication that you make. Trial of new products and getting customer feed backs would be high in such cases. By taking the customers opinion into consideration and trying to incorporate their views into your business plans can have a positive effect on the customer psyche.

Health Conscious Drives

As more and more people are getting concerned about obesity and other health effects they can start a parallel website giving health tips to the customers or can spread the word among the community that they build. They should include more healthy options and should emphasis the health benefits in all the communications that they make. In addition to this they should make sure PR should back it with some major exercises like health initiatives undertaken in different parts of the country.

Bibliography

  • Joe Bramhall, “KFC”, (online), available at: “hoovers.com”, Retrieved on 2010-10-18
  • Peter O. Keegan (1991-02-21), “KFC shuns ‘fried’ image with new name – Kentucky Fried Chicken has changed its name to KFC”, Nation’s Restaurant News
  • “KFC Resurrecting Old Kentucky Fried Chicken Name, With New Image”, (online), available at: “com”, 2005-05-01, Retrieved 2010-10-18
  • Anne DiNardo, 2005, “Kentucky Fried Chicken: Fast Food Makeover”, (online), available at: “VMSD.com date=2005-08-29”, Retrieved 2010-10-18\