“Kentucky
Fried Chicken “
Case Study
Presented by: Debashis Sen Namrata Prakash Ritwik Ghosh Sumanta Guha
•Founded by Harland Sanders in mid 1950s when fast food franchising was still in its infancy. Colonel Sanders was able to tap a latent market.
•Secret recipe of chicken with eleven herbs and spices.
•His foreseeing seemed to be true when in less than 13 years the chain had crossed the 300 mark.
•His growing age prompted Colonel Sanders to sell off the business for $2 million in 1964 to Jack Massey and John Brown Jr- two Louisville businessmen. •In 1970 KFC merged with Heublein Inc, a producer of alcoholic beverages with little restaurant experience. •However soon enough conflicts arose regarding quality control issues and restaurant cleanliness.
•In 1986 KFC was sold to Pepsico.
•Next KFC turned their attention towards tapping into international markets and by around 1980s it had entered Japan, Australia, Mexico and places in the Carribean and UK. •In the 1990s it could foresee the virgin markets of India and China.
KFC`s success story:
•Colonel Sanders` commitment to quality and hygeine.
•PepsiCo taking over KFC proved to be a turning point in its life cycle.
•Being a leader in its field Pepsico provided that extra edge to KFC whereby the soft drinks were made available at KFC outlets along with their menu.
•Coordinated through national advertising. •Consumers were able to relate the soft drinks with the snack foods. •Was able to foresee a huge untapped market in the Asian countries. •“Think like a local…not like an American company”. KFC gelled with the people as the operations were in their hands.
•Mellowed down their Fried Chicken image by changing their name to KFC in 1991. •Were able to provide a wider variety to the customers to choose from, thus strengthening their market positions.
•Customisation in different countries. Different cultural and customer preferences were taken into account to attain GCTC [Getting Close To The Customers].
•KCF is also quite aware of its “CSR”. Different relief programmes and other social undertakings have been
well executed by them
Cultural factors contributing to KFC`s “success” in INDIA and CHINA:
•Reducing the “Psychic Distance” by handing over of operations to local people so that customers could relate to them more easily.
•Able to adapt to cultural differences, tastes and preferences. For example keeping in mind the Indian taste buds KFC launched a fierier “Zinger Burger”. In China different flavours of chinese tea is made available in the KFC outlets.
•Got an edge since chicken is a staple dish and is taken more frequently in Asian Countries. •More accustomed to take out food over the counter. •The target consumers of KFC [ upper middle and above] are health conscious and hence to cater to their interests Kentucky Fried Chicken changed its name to KFC
•Price sensitivity of the two economies drove KFC to introduce menus that were easy on the consumer`s pocket.
Cultural factors in India that go against KFC`s original recipe:
•KFC is perceived as a restaurant serving only chicken— Indian families obviously wanted more variety. •Believed to be expensive….no value for money. •Wanted to position itself as a “Family Restaurant”, not as a “Teenage Hangout”. •Ambience was missing. •Perceived difference in eating habits. •Tried to target the vegetarian segment. However this backfired as in India having veg food cooked in a non veg kitchen doesn’t come out well with the vegeterian segment.
•Ethical factors: The regulatory authorities found that KFC's chickens did not adhere to the Prevention of Food Adulteration Act, 1954. Chickens contained nearly three times more monosodium glutamate (popularly known as MSG, a flavor enhancing ingredient) as allowed by the Act. Since the late 1990s, KFC faced severe protests by People for Ethical Treatment of Animals (PETA), an animal rights protection organization. PETA accused KFC of cruelty towards chickens and released a video tape showing the ill-treatment of birds in KFC's poultry farms.
Kentucky Fried Chicken >>>>>>> “KFC” :
•With the advent of time the consumer has become more aware of what he is consuming and whether it is worth the consumption. Hence more and more people are health conscious and the name “fried chicken” itself might be ringing quite a few bells in their minds. Needles to say Kentucky Fried Chicken had to mellow down this effect and so were prompted to change over to KFC.
The MSG crisis:
The regulatory authorities found that the amount of MSG, a flavour enhancing ingredient, in KFC is three times more than the allowed amount.The marketing strategy to handle this would be: •To make widespread promotions stating that the amount of MSG in KFC is within the permissible limit.
•Lay stress upon the fact that hygeine and customer satisfaction have been always been given prime importance in KFC
•Rope in well known celebrities and personalities to support KFC and stress upon their hygeine conditions. •Bring out commercials where the production process is made transparent so that the consumers can decide for themselves.
•Promotions should be done through all possible channels to reach out to the masses and do as much damage control as possible. •Can also state the ingredients with each bucket of fried chicken sold. This would allow the consumers to quickly eye through the points and effect sales. •The most important thing is to act at the right time. Silence or delay in reaction can spell doom for the company.
Political Upheavals in INDIA:
KFC has been facing protests and demonstrations by a lot of political parties who tried to stop their operations. Any demonstration does quite a damage to a company`s image. Reasons for the protests ?? • Cruel handling of the birds and the tortures inflicted on them. The masses were being appealed to boycott KFC. PETA had a huge role to play in this. •The MSG issue. Use of Mono Sodium Glutomate in more than permissible limits caused a lot of protests. •Farmers rallied againsts globalisation and corporatisation of agriculture and other sectors of the state's economy.
Possible solutions:
•To tackle the points raised by PETA, KFC could raise awareness by showing that they follow healthy practices.
•Try to convince the customers that the amounts of MSG used are within the permissible limits.
•Having their products tested at different laboratories and getting their approval to back their statements. •Make the government understand that even if KFC enters the Indian market, they would be not following unfair means. They would support healthy competition so that everyone has a chance to capture their market at the end of the day.
THANK YOU
doc_175797654.ppt
Fried Chicken “
Case Study
Presented by: Debashis Sen Namrata Prakash Ritwik Ghosh Sumanta Guha
•Founded by Harland Sanders in mid 1950s when fast food franchising was still in its infancy. Colonel Sanders was able to tap a latent market.
•Secret recipe of chicken with eleven herbs and spices.
•His foreseeing seemed to be true when in less than 13 years the chain had crossed the 300 mark.
•His growing age prompted Colonel Sanders to sell off the business for $2 million in 1964 to Jack Massey and John Brown Jr- two Louisville businessmen. •In 1970 KFC merged with Heublein Inc, a producer of alcoholic beverages with little restaurant experience. •However soon enough conflicts arose regarding quality control issues and restaurant cleanliness.
•In 1986 KFC was sold to Pepsico.
•Next KFC turned their attention towards tapping into international markets and by around 1980s it had entered Japan, Australia, Mexico and places in the Carribean and UK. •In the 1990s it could foresee the virgin markets of India and China.
KFC`s success story:
•Colonel Sanders` commitment to quality and hygeine.
•PepsiCo taking over KFC proved to be a turning point in its life cycle.
•Being a leader in its field Pepsico provided that extra edge to KFC whereby the soft drinks were made available at KFC outlets along with their menu.
•Coordinated through national advertising. •Consumers were able to relate the soft drinks with the snack foods. •Was able to foresee a huge untapped market in the Asian countries. •“Think like a local…not like an American company”. KFC gelled with the people as the operations were in their hands.
•Mellowed down their Fried Chicken image by changing their name to KFC in 1991. •Were able to provide a wider variety to the customers to choose from, thus strengthening their market positions.
•Customisation in different countries. Different cultural and customer preferences were taken into account to attain GCTC [Getting Close To The Customers].
•KCF is also quite aware of its “CSR”. Different relief programmes and other social undertakings have been
well executed by them
Cultural factors contributing to KFC`s “success” in INDIA and CHINA:
•Reducing the “Psychic Distance” by handing over of operations to local people so that customers could relate to them more easily.
•Able to adapt to cultural differences, tastes and preferences. For example keeping in mind the Indian taste buds KFC launched a fierier “Zinger Burger”. In China different flavours of chinese tea is made available in the KFC outlets.
•Got an edge since chicken is a staple dish and is taken more frequently in Asian Countries. •More accustomed to take out food over the counter. •The target consumers of KFC [ upper middle and above] are health conscious and hence to cater to their interests Kentucky Fried Chicken changed its name to KFC
•Price sensitivity of the two economies drove KFC to introduce menus that were easy on the consumer`s pocket.
Cultural factors in India that go against KFC`s original recipe:
•KFC is perceived as a restaurant serving only chicken— Indian families obviously wanted more variety. •Believed to be expensive….no value for money. •Wanted to position itself as a “Family Restaurant”, not as a “Teenage Hangout”. •Ambience was missing. •Perceived difference in eating habits. •Tried to target the vegetarian segment. However this backfired as in India having veg food cooked in a non veg kitchen doesn’t come out well with the vegeterian segment.
•Ethical factors: The regulatory authorities found that KFC's chickens did not adhere to the Prevention of Food Adulteration Act, 1954. Chickens contained nearly three times more monosodium glutamate (popularly known as MSG, a flavor enhancing ingredient) as allowed by the Act. Since the late 1990s, KFC faced severe protests by People for Ethical Treatment of Animals (PETA), an animal rights protection organization. PETA accused KFC of cruelty towards chickens and released a video tape showing the ill-treatment of birds in KFC's poultry farms.
Kentucky Fried Chicken >>>>>>> “KFC” :
•With the advent of time the consumer has become more aware of what he is consuming and whether it is worth the consumption. Hence more and more people are health conscious and the name “fried chicken” itself might be ringing quite a few bells in their minds. Needles to say Kentucky Fried Chicken had to mellow down this effect and so were prompted to change over to KFC.
The MSG crisis:
The regulatory authorities found that the amount of MSG, a flavour enhancing ingredient, in KFC is three times more than the allowed amount.The marketing strategy to handle this would be: •To make widespread promotions stating that the amount of MSG in KFC is within the permissible limit.
•Lay stress upon the fact that hygeine and customer satisfaction have been always been given prime importance in KFC
•Rope in well known celebrities and personalities to support KFC and stress upon their hygeine conditions. •Bring out commercials where the production process is made transparent so that the consumers can decide for themselves.
•Promotions should be done through all possible channels to reach out to the masses and do as much damage control as possible. •Can also state the ingredients with each bucket of fried chicken sold. This would allow the consumers to quickly eye through the points and effect sales. •The most important thing is to act at the right time. Silence or delay in reaction can spell doom for the company.
Political Upheavals in INDIA:
KFC has been facing protests and demonstrations by a lot of political parties who tried to stop their operations. Any demonstration does quite a damage to a company`s image. Reasons for the protests ?? • Cruel handling of the birds and the tortures inflicted on them. The masses were being appealed to boycott KFC. PETA had a huge role to play in this. •The MSG issue. Use of Mono Sodium Glutomate in more than permissible limits caused a lot of protests. •Farmers rallied againsts globalisation and corporatisation of agriculture and other sectors of the state's economy.
Possible solutions:
•To tackle the points raised by PETA, KFC could raise awareness by showing that they follow healthy practices.
•Try to convince the customers that the amounts of MSG used are within the permissible limits.
•Having their products tested at different laboratories and getting their approval to back their statements. •Make the government understand that even if KFC enters the Indian market, they would be not following unfair means. They would support healthy competition so that everyone has a chance to capture their market at the end of the day.
THANK YOU
doc_175797654.ppt