DISSERTATION REPORT

ON

MARKETING & BRANDING

STRATEGIES OF KFCS
IN INDIA

Submitted in partial fulfillment for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION

JAMIA HAMDARD UNIVERSITY

HAMDARD NAGAR, NEW DELHI

Submitted By:-

MD SHADAB KHAN
ENROLLMENT NO 2015-502-062

Under The Guidance of :-

Dr. Nudrat Moini Rahman

( Associate Professor)

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 ACKNOWLEDGEMENT

It is a pleasure and my privilege to recognize the individuals who helped me in various phases of my project work.
Without their co-operation it would have been impossible to complete or even embark on this project. I express my
deep sense of gratitude JAMIA HAMDARD, NEW DELHI that provide me an opportunity in fulfilling my most
cherished desire of reaching my goal..I am thankful to Dr. Nudrat Moini Rahman(Associate Professor) for her
constant encouragement and evincing keen interest in my project and under her guidance this project seen the day of
light.I am also thankful to the staff members both teaching and non teaching of the department for their valuable
assistance throughout my entire project. Last but not the least my sincere thanks to my parents, family members and
friends for their continuous support, inspiration and encouragement, without whom this project would not have been
a success.

CONTENTS

Chapter Page No.

2
1. INTRODUCTION 7

1.1. Introduction of Company

1.2. Companys overview
1.3. KFC History
1.4. KFC in India
1.5. Values of KFC

2. SITUATION ANALYSIS 15

2.1. Company & Branches

2.2. KFC Original Recipe
2.3. KFCs outlets in India

3. KFCs MISSION and PHILOSOPHY 21

3.1. KFC The CHAMPS Program

3.2. Mission of Company
3.3. Goal of KFC

4. PRODUCT ISSUES 23

4.1Quality Control over Ingredients

a) Every Chicken Tasted
b) Every chicken Certified
c) Quality assurance Certificate

4.2) Packaging
a) Recycled Paper
b) Environment Concerns
c) Litter

4.3. Branding

4.4. Four Forces Analysis

a). Entry
b) Buys/Supply Bargaining Power
c) Substitute and Compliments
d) Rivalry
Chapter Page no.

5. CURRENT TARGET MARGET 27

5.1) Segmentations
a) Demographical Basis

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 b) Behavioral Basis
c) Geographical Basis
d) Psychographic Basis

5.2) Profile Criteria

5.3) Market coverage

5.4) Economic Analysis

a) Macro Environment
b) Micro Environment
c) Competition
d) Customer

5.5) CURRENT SALES ANALYSIS

5.6) ENVIRONMENTAL ANALYSIS

a) Political factors & opportunities
b) Economic
c) Socio- Cultural
d) Technological
e) Environmental
f) Legal Factors

6. SWOT ANALYSIS
34

7. MARKETING STRATEGIES 36

7.1) Marketing
7.2) 4 Ps of Marketing
7.3) Competitive Analysis

8 .BRANDING STRATEGIES 46

Chapter Page no.

9. CONCLUSION 53

10. BIBLIOGRAPHY 54

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 TABLE OF GRAPHS

1. MACRO ENVIRONMENT 24

2. COMPETITIVE ADVANTAGES 49

INTRODUCTION

1.1. Introduction

KFC was the first fast food multinational to enter India, after the economic liberalization policy of the Indian Govt.
in early 1990s.KFC received permission to open 30 new outlets across the country & Opened first food outlet in
Bangalore in June 1995 by targeting upper middle class population. Understanding the significance of cultural,
economic, regulatory and ecological issues while establishing business in India, understanding the importance of
ethics while doing business, appreciate the need for protecting animal rights in developing country like India,
examining the reasons for protests of PETA and identifying the solutions for KFCs problem in India etc were the
some of the major issues in front of KFC.

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At present KFC rank 3rd among the top ten fast food chain in India. The main purpose of this project is to identify
marketing and branding strategies adopted by KFC in India which made KFC to stand at 3rd position in India and
also to provide some recommendation for further improvement.

KFC Corporation, based in Louisville, Kentucky, is the worlds most popular chicken restaurant chain, specializing
in Original Recipe, Extra Crispy TM, and Colonels Crispy Strips chicken with home style sides and five new freshly
made sandwiches. Every day, nearly eight million customers are served around the world. KFCs menu everywhere
includes Original Recipe chickenmade 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 productsfrom a Chunky Chicken Pot
Pie in the United States to a salmon sandwich in Japan.KFC continue 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 Colonels spirit and heritage are reflected in KFCs brand
identity the logo features Colonel Harland Sanders, one of the best recognized icons in the world. KFC specialized
in chicken and they says, Nobodys cooking like KFC today and we are the chicken expertsThere is no
competitor for spicy chicken which is made by KFC.

1.2. Company Overview

K FC is an internationally renowned fast food industry in the world. They have the main ambition to increase &
maintain the best 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.

1.3. KFC in India

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 In December 2013, there are 361 KFC outlets in India. As well as the standard KFC offerings, the chain
sells a chickpea burger, a paneer burger, hot wings with chilly lemon sprinkles and other country-specified
products. A major franchise holder is QSR Brands (M) Holdings which operates 26 outlets as of 2012.
The first Indian KFC was two-storey outlets on the fashionable Brigade Road in Bangalore in June 1995.
According to journalist Michael White, the company could not have chosen a more difficult venue for its
maiden entry into country. Bangalore housed the headquarter of the Karnataka Rajya Raitha Sangha, one of
the most influential, vocal and anti-foreign investment farmers association in the country. The first outlet
suffered protest from leg-wing, anti-globalization and environmental campaigners, as well as local farmers,
who objected to the chain bypassing local producers. Many Indian were disruption of indigenous tradition. The
protest came to a head in August 1995, when the Bangalore outlet was repeatedly ransacked. The KFC outlet in
Bangalore demanded and received a police van permanently parked outside for a year. The outlet was closed on
13 September 1995 by local authorities, who claimed that company uses illegally high amount of monosodium
glutamate (MSG) in its food. However, the outlet reopened for business within six hours of its closure, after
the Karnataka High Court blocked local authorities order on an appeal by KFC. The company had argued
that it prepare food in India using same formula as in 77 other countries. Rural activist, M. D. Naryundaswamy
subsequently claimed KFC that would adversely affect the health of the improvised , by diverting grain from
poor people to make the more profitable animal feed. Former environment minister Meneka Gandhi joined the
anti KFC movement.
A second outlet opened in Delhi, but was closed by the authorities throughout November, purportedly for
health reasons, but more likely to avoid a repetition of the Bangalore incident, the Delhi outlet was soon closed
permanently.
KFC began to expand outside Bangalore in 2004, with a localized menu that was the most extensive meat
free menu across the chains worldwide operations. It introduced a wraps and side dishes and like Mc Donalds
served eggless mayonnaise and sauces. Unnat Verma, Marketing Director of KFC India states The vegetarian
offerings have made the brand more relevant to a larger section of consumers and that is necessary for KFCs
growth. KFC has also begun using Indian spices and cooking techniques to localize its chicken dishes. By

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 2008-09, KFC operated 34 outlets in India. In 2014, KFC launched So Veg, So Good menu as a part of an
India specific promotional strategy focused on enhancing their vegetarian range.

1.4. 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.

1.4. KFC History

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 colonels finger lickin good chicken dinners are served annually. And not just in
America, The colonels cooking is available in more than 82countries 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. A teage 10, his first job working on a nearby farm for $2 a month. When

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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-yearold 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 revelers who stopped at
his service station in Corbin, KY. He didnt 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.

K FC is the worlds 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 its 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 Sanders 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. KFC also has great tasting vegetarian offerings that
include the Veggie Burger, Veggie Snacker and Veg Rice meals and keeps the slogan So Veg So Good:. In India,
KFC is growing rapidly and by December 2013, there were 361.

The factors that enabled the brand to flourish from launch to the current period and build brand equity
The KFC brands most distinguishing characteristic is the taste the delicious, satisfying, and one-of-a-kind taste of
their chicken. Whether its Original Recipe or Hot & Spicy Fried Chicken, Zinger or Popcorn Chicken, it delights the
customers by their signature flavors and menu items that cannot be found anywhere else.
The heart of KFC is the great tasting unique products they offer to the consumer. KFC claims that their food excites
the senses with the golden glow of the breading, the appetizing aromas, and the flavors that make the taste buds
dance in anticipation of that first bite. Life just tastes better with KFC.
Menu Vision
Leverage heritage in taste
Strengthen ability to offer meals that satisfy both individuals and families

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 Spread the success of our branded value menus
Third-Ranked KFC is Winning the Fast Food Battle in India

India has been steadily claiming a larger share of the attention of leading operators looking to expand abroad, and
some have even gone as far as calling India, China 2.0. Within the past year, Yum! Brands, McDonalds and most
recently, Burger King, have all pledged to make India a central focus of their future expansion strategy, a testament
to the level of opportunity present in the sizable market. But while brands from all over the world have already
rushed to carve out a presence in India, the market is still years away from seeing anywhere close to the kind of
chained foodservice penetration already achieved in China. And as excitement about future potential in India has
grown, so too has the competition, taking with it any chance of finding any sort of first-mover advantage. This has
resulted in a market thats relatively underdeveloped in terms of outlets per-capita, and yet one that is already
crowded with competitors all vying for customers in the same concentrated areas.Within these conditions, many
chains are having trouble finding ways to stand out, and the window for establishing oneself as a leader in the
lucrative market may soon be closing. With the hopes of discovering whats actually working in India so farand
what isntEuromonitor took a look at three current winners and dove a little deeper into the localization strategy,
pricing structure, and youth appeal that are helping to drive their success. Well start with the third-ranked brand in
the market, Yum! Brands KFC.

A Slow Start, with Building Momentum

KFC was the fastest-growing major chain in India in 2012, recording 45% value growth year-over-year based on a
41% increase in outlets (a net addition of 62). This level of growth has helped KFC become the third-ranked brand in
India, a fact that is particularly notable considering they were a relatively late entrant in terms of widespread
expansion. In 2003, KFC had just 3 local outlets, putting them well behind Baskin-Robbins, Dominos, Pizza Hut,
and McDonalds, all of which had over 50 outlets already in operation, and were growing quickly.

KFCs success has come as a combination of clever localization, savvy pricing strategies, successful consumer
education, and a menu that appeals well to the changing preferences of sophisticated, urban Indian consumers.
KFCs entry into the market was slow, and despite opening three initial outlets as early as 1995, the chain had
reached just five units nearly a decade later. At that time, the market posed significant logistical issues, and sourcing
enough poultry, beef and other products continues to be a challenge even in 2012. Back in the 90s, local leader
McDonalds famously spent years building its own India supply chain from scratch, training local farmers and
designing a cold chain that would be robust enough to handle its needs, while Yum! Brands focus was firmly on
building its now-dominant presence in China. The chains investment in the latter market has paid off handsomely,
but it also left the brand with some catching up to do.

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Meanwhile, Indian consumer preferences were changing. Chicken consumption in India may be more common than
beef, but meals are typically carbohydrate-heavy, and many local consumers prefer a vegetarian diet. Further, the
chicken that is eaten is traditionally taken in the form of tandoori, a fiery-red, spicy grilled dish thats eaten alongside
rice and vegetables. When the time was finally right for expansion, and Indian consumers were broadening their
foodservice horizons through travel, the internet, and generally greater exposure to global cuisine, KFC began
expanding aggressively and adapting their menus to bridge the gap between familiar and innovative. By 2012, the
chain had reached 220 outlets and added spicier versions of their chicken, including a Fiery Grill flavor that mimics
the red hue and hot spice of traditional tandoori, and Curry Chicken, modeled after popular local curries.

In addition to promoting its chicken items, KFC also added plenty of vegetarian options. The chain now serves fried
vegetable strips and burger patties made of either potato or vegetables, and many new menu launches have been
accompanied by a similar vegetarian item, such as the Zing Kong beef burger meal combo and Veg Zing Kong
combo, both launched in mid-2012.

Finally, KFC has also achieved success through the use of its pricing strategy, which was designed to help turn what
appeared to many as a special-occasion novelty restaurant into an everyday option. In recent years, KFC has taken
steps to drastically reduce its prices, launching a Streetwise branded menu targeted to students who have very little
income but tend to be willing to spend on foodservice at the right price. The menu starts with items as low as Rs25
(US$0.40), and was marketed with a youthful campaign that promoted the range as a better alternative to the
university dining hall at similar prices. In 2013, KFC followed up with a Wow@25 marketing campaign and
augmented reality smart phone app. Cash-strapped students can scan any small bill with their phones, and the app
suggests low-priced items off of a new KFC Wow menu that fits within their budget.

The Road Ahead

This budding success in India couldnt come at a better time for Yum! Brands, which has been facing dire results
from China, usually its strongest market. The company has been battling concerns about its poultry quality, avian flu
scares, and various food safety scandals that have caused comparable-store sales to plummet as much as 11% in the
most recent quarter. In India, third-quarter results were better, with outlet sales surging 24% despite flat comparable-
store sales.

Some of this relative slowdown in India is due to rising competition, especially in fried chicken fast food. Now that
local consumers are more willing to see fried chicken as a meal, countless imitators have entered the market, many
of which are backed by deep-pocketed operators and, in some cases, possibly even better suited to Indian palates.
Thai street stall concept Five Star Fried Chicken, for example, launched in India in 2013, targeting young
professionals and college students by opening in malls and business parks. The chains very spicy Thai-style fried

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chicken appeals well to Indian preferences, and parent company Charoen Pokphands holdings in the local chicken
processing industry enables the chain to sell items at prices that start even lower than KFCs Streetwise menu.

To battle this competition, KFC is ramping up expansion even further, aiming to double its local outlet presence by
2015. The chain will also be moving into smaller cities and second-tier areas, gaining access to new customer groups
in areas less saturated with chained foodservice options. In an even more interesting move, KFCs parent company is
betting on Taco Bell for future growth in India, a concept that has so far remained mostly confined to the US. Despite
this, the concepts menu is easily translatable into vegetarian fare and has high potential appeal for young people, the
same group Yum! Brands has worked so hard to target with KFC.

Key Takeaways from KFC

Moving forward, there are a few key lessons other brands can take from KFCs success. First, the importance of
menu localization cannot be overstated, especially in a market with a well-developed dining culture of its own.
Indian consumers like very spicy food, and they are as diverse in their dietary preferencesmuch of which stems
from local religious and cultural traditionsas they are in terms of income stratification. Successful brands will need
to take significant steps to bridge the gap between offering a new, exciting dining experience and one that will be
familiar enough, and attainable enough, to entice consumers to dine outside of the home.

Second, operational challenges in India are just as important as customer acquisition, and operators who arent
proactive about building their supply chain will likely find success impossible. Finally, in a country with over a
billion people, targeting a concepts appeal to the right customer base is still important. KFC has had success using
pricing, product mix, and branding to target young people, a customer base that can expand with the chain in the
future as the demographic grows both in size and in purchasing power. By 2030, India is expected to surpass both the
US and China to become the home of the largest consuming population in the world, and while the right consumer
base will continue to grow larger, the importance of carefully targeting those consumers and fostering their future
brand loyalty will be no less paramount.

SITUATION ANALYSIS
2.1. Company & Branches

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This is a listing of countries with KFC franchises. As of yearend 2013, there are 18,875 KFC outlets in 118
countries and territories located across the world. The first KFC franchise opened in the United States in 1952 and in
Canada a year later. The first overseas franchise was established in the United Kingdom in 1964. A large number of
Caribbean and developed Western markets had been entered by the early 1970s. This was followed by expansion
throughout the Middle East and developed Asian markets from the mid-1970s and into the 1980s. China was entered
in 1987. Expansions were made into Eastern Europe and South America in the early 1990s. The most recent area of
expansion is Africa, where the company is targeting that continent's growing middle class.

The major markets for KFC include China (4,563 units), the United States (4,491 units), Japan (1,181 units), the
United Kingdom (784 units), South Africa (736 units), Canada (663 units), Australia (618 units), Malaysia (579
units), Thailand (492 units) and Indonesia (465 units).

The global operations are overseen by Yum! International, which is headquartered in Louisville, Kentucky. Yum!
Typically grant a master franchise to a local operator, or take a stake in a joint venture between such a company and
itself. In 11 locations, Yum! International manages KFC directly, including China, Russia and India. Worldwide,
major franchise holders range from large local conglomerates such as Jardine Matheson and Doosan Group, to
companies specifically established to run restaurants franchises, such as AmRest. In Japan, Malaysia and Indonesia,
the major franchise holders are publicly listed companies. On the other hand, in smaller markets such as some
Caribbean islands, the franchises may be operated by a single individual.

Current markets in Asia

Country Year Owner/major operator Notes

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 entered

Bangladesh 2006 Transcom Group The first KFC outlet was

opened at Gulshan and the
second one in Sylhet. 13
outlets.

Brune 1992 KFC (B) Sdn Bhd First outlet opened at Plaza
Athirah 14 outlets in
]
2012. KFC Brunei falls
under the global brand's
master franchise in
Malaysia

Cambodia 2008 It was the first international

fast food outlet in
The Royal Group Cambodia, and first opened
on Monivong Boulevard
in Phnom Penh. ] 10
outlets in 2013

People's 1987 KFC China The first Kentucky Fried

Republic of Chicken outlet opened on
China Qianmen Street in
downtown Beijing in 1987.
4563 outlets

Hong Kong 1985 Birdland Ltd KFC was the first American
fast food chain to enter
Hong Kong in 1973, with
an outlet in Mei Foo Sun
Chuen . There were 11
outlets by mid-1974, but by
September 1974 many
outlets had closed. The
remaining 4 outlets were
closed in February 1975.
KFC misjudged the local
market and failed to
develop a suitable business
model, with its takeout only
stores failing to catch on.

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 Chickens imported from
China were fed fishmeal,
which ruined the taste. The
chain was reintroduced by
Swire Group in September
1985, with an outlet opened
on Jordan Road, at a cost
of $3 million. A second
outlet was opened on
Causeway Bay in 1986.
By 1995 there were 17
outlets. Sold to Birdland in
1997. 164 outlets as of
2014.
KFC opened a two-storey
India 1995 outlet on Brigade Road in
KFC India
Bangalore in June. 299
outlets.
First outlet in Jalan
Indonesia 1979 Melawai, Jakarta. ] Listed
PT Fastfood Indonesia
on the Jakarta Stock
Exchange.
First outlet opened in
KFC Holdings Japan, Ltd
Japan 1970 Kobe. 1181 outlets.
Americana Group 15 outlets.
Kazakhstan
The first KFC outlet was
Malaysia 1973 opened in 1973 on Jalan
Tunku Abdul Rahman.
Today there are 579 outlets
Kentucky Nuggets was
conceived in Malaysia and
QSR Brands (M) Holdings
then found its way to KFC
Sdn Bhd
worldwide. Today,
Kentucky Nuggets is one of
KFC's successes. KFC led
the chained fast food
market in 2011, with 41
percent of value sales.
Tavan Bogd Group Two outlets.
Mongolia 2013
Nepal 2009 Devyani International Two outlets.

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 First entered Pakistan in the
late 60s to early 1970s but
subsequently closed down.
Pakistan 1997 Cupola Group
Started again in Gulshan-e-
Iqbal in Karachi in 1997.
58 outlets
237 outlets. On June 1994,
Manuel U. Agustines
obtained the sole franchise
over the sale and
Philippines 1967 Wholesome Foods Inc distribution of KFC
products in the Philippines,
under the corporate name of
Quick Service Restaurants
(QSR) Corporation.
First outlet opened on
Somerset Road in 1977. 40
stores by 1992, when it was
acquired by KFC
QSR Brands (M) Holdings
Singapore 1977 International. In 2002,
Sdn Bhd
KFC Singapore was
acquired by KFC
(Malaysia) Holdings Bhd.
80 outlets in 2012.
First KFC outlet in Jongno,
South Korea 1984 Doosan Group
Seoul. 165 outlets.
Sri Lanka 1995 Cargills Ceylon PLC 27 outlets.
Taiwans first KFC outlet
was opened in the
Ximending district of
Taipei. It was initially a
joint venture between
KFC and Uni-President
Enterprises Corporation,
Taiwan 1985 Jardine Matheson Taiwan's largest food
company, until President
sold its stake in 1997.
Jardine's acquired full
control of the poorly
performing KFC Taiwan
from Yum! in 2010. 135
outlets.
Thailand 1984 Yum Restaurants Originally opened in 1970

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 but closed down after the
end of the Vietnam War in
1975. KFC reopened in
Thailand at CentralPlaza
International (Thailand) and Lardprao in Bangkok. In
Central Restaurants Group 2013 there were 493
outlets, 60 percent were
company owned and 40
percent were owned by
CRG.
First outlet opened in Ho
Chi Minh City. Jardine
Matheson acquired a 25%
stake in the company in
2011. 137 outlets .
Vietnam 1997 KFC Vietnam
Euromonitor estimated
that KFC has 15% of the
fast food market by value in
2011, making it the leading
company.

2.2. KFC Original Recipe

6 cups Crisco Shortening1 eggs well beaten2 cups Milk2 cups Flour2 teaspoons ground pepper3 tablespoons salt1
teaspoon MSG1/8 teaspoon Garlic Powder1 dash paprika2 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 there maining 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.

2.3. KFCs outlets in India

17
Sl. Name of the City No. of Locations
no
1 Bangalore 41

2 Kolkata 10

3 Mumbai 6

4 Ludhiana 3

5 Ghaziabad 2

6 Amritsar

7 Jalandhar 1

8 Lucknow 1

9 Chennai 27

10 Gurgaon 9

11 Pune 5

13 Patna 2

14 Hyderabad 8

15 Chandigarh 3

16 Coimbatore 2

17 Ahmadabad 1

18 Faridabad 1

19 Noida 3

20 Goa 2

21 Cochin 1

18
22 Delhi 22

KFC Mission & Philosophy

3.1. 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:

19
 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.

3.2. Mission of the Statement

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

3.3. 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 Pakistan 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.

Current Products

Kentucky fried chicken

Zinger burger
Krushers
Game Box
Twister
Box master
Chicken Bucket
Hot wings
Fries
Corn on the cob

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 Zing Kong
Snacker (chicken & veggie)
Veggie Feast
Soft Drink
Coleslaw
Chicken Thali
Veg Finger
Snack Box
Sundae
Soft Twirl
Brownie Sundae

PRODUCT ISSUES

4.1) Quality Control over Ingredients

a) Every Chicken Tested

K & Ns 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.
b) Every Chicken Certified
HACCP K & Ns 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.
c) Quality Assurance Certificate
Director General (Research) has issued quality assurance certificate for the chicken used by KFC.
4.2. 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 maximize performance against these three criteria.
a) Recycled Paper

21
All our clamshells and chicken boxes contain as much recycled material as it is legally allowed. By law we are
required to have virgin fiber board in any part of the packaging that is in contact with food. Any virgin fiber 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.
b) 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.

c) 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.
4.3. 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.
2.4. Four Force Analysis
a) Entry
For the current Pakistan market for fast food, it is not difficult for a fast- f o o d r e s t a u r a n t t o e n t e r t h e
m a r k e t . H o w e v e r , i t w o u l d b e e x t r e m e l y 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 Pakistan for
any restaurant to s u r v i v e , K F C h o l d s t h e f i r s t - m o v e r a d v a n t a g e i n t o t h e ' n o n - v e g f o o d
s p e c i a l t y f o o d s e g m e n t ' t h a t g i v e s t h e m f r e e r e p u t a t i o n . C u s t o m e r s , especially children who are
used to going to KFC as a treat or reward f r o m t h e i r p a r e n t s o r g r a n d p a r e n t s , a r e n o t g o i n g t o w a n t
to go to other r e s t a u r a n t s theyve 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 McDonalds, Pizza Hut, D o m i n o ' s and
S u b w a y , a n d a n y n e w f a s t - f o o d e n t r a n t s w o u l d j u s t b e presenting something very similar to

22
whats 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.

b) 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 e a t a t K F C , t h e s t o r e i s n o t g o i n g t o l o w e r i t s p r i c e b e c a u s e
t h e c o s t o f l o s i n g o n e c u s t o m e r i s n o t v e r y g r e a t . T h e s u p p l i e r s , l i k e t h e b u ye r s , 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 l o c a l s u p p l i e r s b y g i v i n g t h e m t e c h n o l o g i c a l s u p p o r t t o
i m p r o v e t h e i r products. This is a brilliant strategy because the supplies that KFC would
o t h e r w i s e n e e d t o i m p o r t f r o m t h e U . S . c a n n o w b e
o b t a i n e d 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. W i t h t h i s s t r a t e g y , K F C c r e a t e d c o m p e t i t i o n
a m o n g i t s s u p p l i e r s , 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.

c) Substitutes and Complements

As mentioned above, there are a few major competitors in the fast-food industry in India for KFC, namely
McDonalds, Pizza Hut, Dominos 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 India 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, KFCs 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.

c) Rivalry

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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 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.

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 CURRENT TARGET MARKET

TAR GE T M ARKET
T h e p r o c e s s o f e v a l u a t i n g e a c h m a r k e t segments attractiveness and selecting two or more segments
As the outlets of KFC are in posh area and prices are too high (overhead expenses-rent, air-conditioning, employees), so KFC targets
upper and middle classes. Target market depends upon size and growth rate of population, Company resources and structural
attractiveness of market segment.

5.1. 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.
a) Demographic Segmentation
In demographic segmentation, the market is divided into groups based on an age, gender, family size, income, occupation,
religion, race and nationality.KFC divides the market on demographic basis in this way:
Age is between 6-65.
Gender is both males and females.
Family size is 1-2, 3-4, 5+
Income is Rs 10,000 n above.
Family lifestyle is almost all.
b) Geographic segmentation: KFC has outlets internationally and sells its products according to geographic needs
of the customer. In India KFC focuses how geographically its customers demand different products. I n north India
Chicken is the main selling product, while in the South the Veg. items sell more than the chicken.
c) Behavior segmentation
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

25
 Class conscious
Combination of price and quality

d) Psychographic segmentation
Dividing a market into different groups based on social class, life style, or personality characteristics is called
psychographic segmentation.KFC divides market on the basis of psychographic variables like

Social class- U p p e r a n d M i d d l e c l a s s .
Lifestyle is not specific.
Personality is ambitious and authoritarian
5.2. Profile Criteria ofile criteria:
1. Gender: KFC is for each gender both male and female.
2. Income: Everyone can use the KFC service 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.
11. Product positioning
Customer perceives this product as a unique product that other is not giving.
12. Attitudes
The attitudes of the public is very good people like our new product like others.
13. Purchasing process:
Many people come from home to eat this, and some make impulse decision as they saw it.

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5.3. MARKET COVERAGE STRATEGY
KFC will be using differentiated market coverage strategy. It means that different marketing mix will be used for different
age group.
Target Market for Fast Food
After evaluation of various segments, KFC has decided to target the market of Urban and Sub-urban Areas of India
Product usage
People are educated and they want variety in their diet.
Normally people of rural areas dont 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 is more in
Urban Areas.

5.4. 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 need to satisfy their needs through exchange. These needs make up the demand for particular products
and services. Several components must be considered, as all these components have a direct or indirect impact on
KFCs success. Changes in the below described components over the last couple of years have led to big changes in
peoples 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.
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
organizations on 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.

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 a) Micro environment
The microenvironment consists of all forces that are close to KFC, and on which KFC has an impact. They directly
affect KFCs ability to serve its customers. (Kotler et al 2003). Three major components influence KFCs
microenvironment:
b) Competitors
Because the fast food market in India is highly competitive, KFC faces wide number of direct and indirect
competitors. KFCs main competitors are fast food chains such as McDonalds and Dominos, which are already well
established throughout India .McDonaldss in particular is a direct competitor, as they have already successfully
introduced their Salads plus line , which directly targets healthy food conscious India. 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.

c) Customers
KFCs customer market consists solely of the consumer market (Kotler et al 2003).KFCs 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 segmentation of them are discussed later in this report.

5.5. Current Sales Analysis

Market Share

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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 Donalds, 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.
5.6. Environmental Factors & opportunities
a) 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.
b) Economic:
Though for last 1 year there was economic slowdown all across the globe but 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
at2.965 trillion U.S. dollars in the year 2010. The GDP- per Capita (PPP) was2700 U.S. dollars as estimated in 2008.
The GDP- real growth rate in 2007was 8.7%.. So taking into considerations the economic factors of India KFC is
safe.

a) Socio cultural:
Indias population is divided in the following age structure: 0-1 4 y e a r s 3 1 . 8 % , 1 5 - 6 4 y e a r s
6 3 . 1 % a n d 6 5 y e a r s a n d a b o v e 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

b) Technological:

The Indian fast food Industry is heating up with a lot of foreign players entering the India market. The
technological knowhow and expertise will also enter the Indian market with an increase in competition. With the

29
 lower rates and increase technology the fast food counters are attracting youth by giving them attractive deals.
For e.g. KFC and Dominos 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.

c) 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 cows ranch. Large-scale plantation has effect the environment and lots 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.
d) Legal factors:
As a certified fast food operator, there are many regulations and procedures that KFC should follow. For example is
the Halas certification that becomes a concern to Muslim consumers. KFC should protect its integrity and consumer
confidence by ensuring all material sand 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.

SWOT Analysis

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SWOT analysis mean strength, weakness, opportunities and threats and the SWOT analysis of KFC is:
i. 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 recognized in other markets outside India, where the company is among
the leading fast food giants. The brand is recognized 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 India 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.
ii. Weaknesses
i. KFC was losing market share as other Chicken chain increased sales at a faster rate.

KFC share of Chicken Segment sales fell from71 percent 1999, to less than 56 percent in 2009, a 10 -years drop of
15 percent.
Huge competition in this segment.
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.
iii. Opportunities
New Markets: Globalization has opened doors for new markets for the company. As the developed markets are
mostly saturated, the developing countries like China promises a good market and generation of demand in the
future. With more than70% of the markets in being unexplored and unorganized and India has largest young group in
the world 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

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India has a very large share of youth population as compared to other countries. More than 60%of the population is
under the age of 30yrs. As the young generation is more open to fast foods and demands it more, this is 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.
iv. Threats
Competition:
Competitor companies like McDonalds are fast catching up with the market. McDonalds with sales of more than19
billion in 1999, accounted for 15 percent of the sales of the nations top 100 restaurant chains.
Organizations 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 organizations,
questioning the way KFCs suppliers are threatening the chicken, before they got slaughtered. Anti-KFC campaigns,
such as the one from PETA are affecting KFCs 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

Market 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 offers free home delivery.

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KFC opens their outlets on reachable places.
KFC menu consists of more than 30 products.
KFC gives more priority to Family

7.1 Marketing

Since 1982, KFCs All-American salute to Mothers national card contest has been KFCs way
of honoring moms and their families for making mothers Day KFCs 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 Mothers
Day, were sent to thousands of schools nationwide
7.2. Marketing Mix (4Ps of Marketing)
Marketing Mix

T h e m a r k e t i n g m i x i s g e n e r a l l y a c c e p t e d as the use and specification of the 'four Ps' describing the

strategic position of a product in the marketplace.

Product
Price
Place
Promotion

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 Fig:-Marketing Mix
i) Product

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 all over the globe. KFC target the Asia and east side
because they observe that there people 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 Crispy TM chicken
Hot Wings TM pieces
Tender Roast chicken
Chunky Chicken pot pie
Kentucky Nuggets
Colonels 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:

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 1) Taco bell
2) Pizza Hut
3) Long john silvers

KFC creates a veg menu for India

For the country like India, KFC Kentucky-based fast-food chain known for its "finger-lick in' good" range of chicken
fillets and burgers, has also launched its wide variety of Veg Product with a slogan "So veg, so good" to show its
commitment towards the category. Paneer Zinger and Veg Twister, in addition to the hot-selling Potato Krisper
Burger, Veg Strips, Veg Rock in' Burger and Veg Rice Bowl is now attracting consumer mind space along with their
popular non-veg counterparts.

According to the Food and Agricultural Association of the United Nations, around 42% of Indian households are
vegetarian and 35% of weekdays are vegetarian for rest of the non-vegetarian population. The apparent split is
backed up by consumer choice at various fast food restaurants across the country. So it was Veg products were the
demand of mass. Keeping this in view KFC introduces its Veg product range along with Non- veg menu.

The KFC menu is increasingly throwing up a number of vegetarian items such as Veg Zinger, Veg Snacker and Veg
ZingKong. It would appear that KFC, synonymous with chicken across the world, is turning 'vegetarian' in India. In
recent months, the brand has followed the launch of a non-veg product with a veg equivalent (Example: Zingkong
boxes). KFC now plans to simultaneously unleash veg and non-veg items in the Indian eating-out marketplace,
according to Tarun Lal, general manager at KFC India.
Like so many other foreign brands, KFC has been tailoring its strategy to suit local preferences in India. Yet, few
rebranding efforts would surprise as the attempts of Kentucky Fried Chicken to walk the line between vegetarian and
non-vegetarian food in India. KFC is to fast-food chicken what Nike is to running shoes and Boeing is to planes.
Surely, Colonel Harland Sanders, the founder of the restaurant chain, would have been amused, even a tad mortified,
by KFC's approach in India.
Nevertheless, when the brand was relaunched in India in 2004, Yum! Restaurants, KFC's parent, hit on the strategy
of offering vegetarian food in the country almost immediately. Truth is KFC had little choice. Lal says in the Indian
context, the brand had to adapt the menu to ensure that it was delivering to the expectations of consumers. "That
realisation happened very early in our journey."
Other major fast-food companies in India have been attempting similar rebranding to accommodate vegetarian items
on their menu. KFC's bigger rival McDonald's is a notable example of this strategy. Just as it took to baguettes in

35
France, McDonald's has been offering vegetarian items such as McAloo Tikki Burger, McVeggie and Veg Pizza
McPuff in India. The company is stepping up its vegetarian strategy by opening its first full-scale vegetarian
restaurant near the Vaishno Devi shrine in Jammu & Kashmir and another one near the Golden Temple in Amritsar
next year.
Similarly, sandwich powerhouse Subway and pizza major Domino's too are opening vegetarian-only outlets in India.
WHAT'S COOKING?
KFC itself has a history of tweaking its strategy periodically in many markets. The brand added to the menu a
Snacker - as the name suggests, a quick and easy-to-eat patty - radically different from its core offering, the crispy
'bony' chicken. In the 1990s, it had withdrawn, much to the consternation of diehard fans and thankfully only briefly,
the cardboard chicken buckets. KFC had also retooled its brand image, reintroducing the whole Kentucky Fried
Chicken name and the images of Colonel Sanders at many restaurants.
In the backdrop of these changes, KFC's veg platter shouldn't be entirely surprising. Why should India, where more
and more consumers are dining out and have accepted different kinds of foods from the world, be any different? It
represents the company's attempt to reach out to a larger audience of Indian consumers who are predominantly
vegetarian. "Vegetarian [food] is very, very important to us," says Lal. "It will play a large role in our strategy in the
context of variety. We had to broaden the relevance of KFC across different consumer types in the country," he says.
KFC's ambitions in India are significant because in all other markets, vegetarian food plays a limited role.
Shushmul Maheshwari, CEO of research agency RNCOS, had told ET Magazine in an earlier interview that with the
increasing competition in the Indian fast food industry, it will become indispensable for companies to customise
products. "That will be one of the key strategies for the success of foreign fast-food chains in India."
In this respect, India has no parallel. This is after all a country of 'strict' vegetarians. Not surprisingly, many brands
have been taking aim at this section of customers. South-based chains such as Saravana Bhavan and Sagar Ratna
have been equally successful in the north. Luxury hospitality chain ITC Hotels is launching a vegetarian brand of
restaurants called Royal Vega.
Lal says vegetarian food plays a large role even among non-vegetarians in India. "A non-veg user at a KFC will
consume a veg item if there is a great offering in that category," he says.
GOURMET PRETENSION?
At present, one in every five products on the KFC menu is vegetarian. Yet, given that vegetarian food contributes
only 10% of overall revenues, how serious is KFC about its veg offerings?

ii) Price
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 standard of their products.

Pricing Strategy

36
 Market skimming: KFC globally enters the market using market skimming. Their products are priced high and
target the middle to upper class people. Gradually they trickle down the
prices focusing on the middle to lower class people to penetrate both sides of the market.
Competition
W e c a n c o m p a r e t h e p r i c e o f t h e i r products with Mc Donald, Dominos and Pizza Hut. If the competitor
provides the same product at a lower price then the organization usually lowers the price of its product too. In the case of KFC,
Fried Chicken is its main selling point and controls a monopoly over the Indian fast food market (only with fried chicken).It
prices its burgers, French fries and soft beverages with relation to its competitors .
Cost Based
K F C p r i c e t h e i r p r o d u c t k e e p i n g different points in view. They adopt the cost base price strategy. Pricing of
the product includes the govt. tax and excise duty and then comes the final stage of determine the price of their product. The
products are bit high priced according the market segment and it is also comparable to the standard of their product.
In the cost based method we include the variable and fixed cost.
Calculation of the price under Cost Based
Total Pounds of Chicken Served in KFC Restaurant Annually= 1.914Billion
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

iii) Place

TAR GE T AREAS
Free home Delivery s t r a t e g y : - T h e y provide free home delivery to offices & homes (select countries).
Accessibility: Resulting in several outlets to cater to the needs of people in & around the city.
Hectic lifestyle: Due to the hectic lifestyle of office a goings individual the fast food concept saves time of
preparing food and gives the customer a full meal quickly.
Economically convenient: T h e p r i c i n g appeals to the many classes of a society.

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TAR GE T M ARKET
1 ) L o c a t i o n : H e c t i c l i f e s t y l e o f i n d i v i d u a l s , g i v i n g t h e m m o r e t i m e at
work and less stress about waiting for food.
C o m m e r c i a l i z a t i o n o f u r b a n a n d s u b - u r b a n m a r k e t s leading to more mid-sector people that find
high-end eating joints very to expensive.
Mid-sector people are always looking for change which KFC provides in their range of fast food.
Q u a l i t y c o n s c i o u s : p e o p l e i n u r b a n a r e a s a r e m o r e conscious about the quality of food
than rural areas. U r b a n a r e a s a r e m o r e p o p u l a t e d t h e r e f o r e t h e y h e l p with attracting higher
revenues.
2) Placement of outlets
D u e t o K F C p l a c i n g i t s e l f c l o s e t o s c h o o l s , c o l l e g e s , cinemas and markets which are
mostly populated by the young and those who are in a hurry, KFC enjoys a large number of footfalls every day. In addition,
they also have outlets close to non-vegetarians (mostly Muslim populated areas).

iv) 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 know 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 like Print and Electronic media both 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.
Promotion is the method used to inform and educate the chosen target audience about the organization and its products. Using all the
resources of promotion:

Advertising
Sales Promotion
P u b l i c R e l a t i o n
Events and Experiences
Coupons, Discounts and Bundled packages
An organization finds most of its meanings and survival through promotion.

At KFC, Promotion is the main tool to bring all chicken lovers attention towards its delicious one-of-a-kind product, the
Fried Chicken.
Advertising

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The logo of the smiling Colonel is probably one of the most recognized faces in the world and instantly brings the image of fried
chicken to ones mind.
KFC and its new company jingle, finger licking food is frequent announcement on
televisions, billboards, flyers and radio. The concept of showing a normal customer deeply involved in devouring his piece of
chicken usually turns on the drool factory in everybodys mouth and makes them rush to the nearest KFC. In India where
chicken lovers are plenty abound these ads featuring normal people connect instantly and create a rush at their outlets. Using the
following methods KFC spreads its message of finger licking good chicken.

Advertising
Using Reminder advertisements
KFC stimulates repeat purchases of its products. The company anthem finger link in food is just a wakeup call to
the consumer to remind them how good they felt the last time they ate KFC chicken.
Sponsorship is another tool to strengthen an organizations image. KFC is currently the sponsor of the Australian Cricket
Team and the colonel logo can be seen on their uniforms throughout the matches.
Sales Promotion
K F C u s e s t h e f o l l o w i n g t o o l s t o f u r t h e r enhance its sales.
P r e m i u m s
E x h i b i t s
C o u p o n s
E n t e r t a i n m e n t
Sales Promotion
All KFC outlets offer its customers with various forms of incentives to buy its Chicken. Using coupons that one can
acquire after spending a particular amount over a period of fixed time, customers can enjoy the benefits of free meals or
free add-ons.
Additionally they provide meal vouchers and exciting offers in their print ads, which the customer must cut and bring
along.

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7.3. Competitive Analysis

Competitor
You cannot enjoy the business without competitors. No organization can afford to ignore their competitors. It is very
important for marketing managers to monitor the activities of their 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 Donalds.

Competitive Advantage

KFC MC Donalds
Spicy Product Big Mac
Indian People like spicy food rather than
boiled food
Chicken & Veg Rice Bowl and Zinger
Burger

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Free Delivery Chargers on Home Delivery
Local stuff and highly qualified because Its stuff is consists of simple graduates and give them
local stuff can better deal with customers training
KFC uses Top to Bottom and Bottom to Mc Donalds use Top to Bottom approach in their
Top approach in their Management Management
Chicken is eaten in very community Beef is banned is some community

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 BRANDING STRATEGIES of KFC

8.1) Brand Resonance Model

a) Brand Salience

KFC creates awareness by means of its brand logo. The logo of the smiling Colonel is one of the most recognized
faces in the world and instantly brings the image of fried chicken to ones mind. Reminder advertising by using the
Company jingle Finger Lickin Good helps in creating awareness that KFC chicken is so tasty that the customers
would even resort to licking their fingers.

b) Performance

KFC focus lies on the tasty food products they offer to their consumers. KFC products are whole muscle chicken,
have signature tastes and flavors. KFC service is attentive, prompt, depicts genuine friendliness and is dedicated to
quality. Since they are a customer-centric organization, they regularly come out with new Combo meals that match
the needs of the local customers.

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 c) Imagery
User groups have formed a image of the brand as customer friendly, made up of natural ingredients i.e. the 11
herbs and spices that they offer in their meals. KFC comes across as youthful and outgoing, high on Energy,
Innovative and creative. KFC is priced at a premium and the Bucket symbolizes a sumptuous meal.
d) Judgments and Feelings

Customers regard KFC as a trustworthy brand. Its credibility is well established since it has garnered respect since its
inception way back in 1950s. Customers regard KFC as being a market leader as far as Fried chicken is concerned.
The brand evokes feelings of being upbeat, fun loving and playful.

e) Brand Resonance

All chicken lovers are very loyal to KFC. They go for repeat purchases and dont switch frequently. They have a
sense of attachment with this brand since it has been providing them with quality products at great prices.

The target market for the brand & how is the brand differentiated in terms of brand positioning, brand
personality and brand identity?

KFC segments and targets the market on the basis of Geography, Demography and Psychographics. KFC has outlets
internationally and sells its products according to geographic needs of the customer. For example, in north India,
Chicken is the main selling product while in South India, Vegetarian items sell more than the chicken.

KFC targets people of age group of 15-45 yrs. It targets both males and females having an income of Rs. 10000 and
above. It targets individuals, couples as well as families. Most of its target customers include school and college
going people. On the basis of Psychographics, it targets Middle and Upper class people who have a busy lifestyle and
are great lovers of fast food that acts as a substitute for the home cooked meal.

Brand Personality

The Colonel is the personality of the KFC brand which signifies being ambitious and authoritarian. But KFC has
never fallen into the trap of thinking its brand to be of the same age as that of the founder. The personality of KFC
depicts the following:

Youthful and Spontaneous

High energy and Outgoing

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 Fun loving and Social

Humorous

Street Smart

Innovative and Creative

Real

Brand Identity

The Brand Identity of KFC can be divided into the following parts:

1. Brand as Product

Vow flavor that ignites the senses

Signature recipes

Freshly prepared chicken

Contrasting textural or flavor elements

Leadership quality

i) Brand as Place

Cooking and Fresh cues

Inviting, welcoming, informal

Energetic, contemporary, warm

ii) Brand as Symbol

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 The Colonel

The Bucket

Red and White

11 Herbs and Spices

Finger Lick in Good

iii) Brand as Service

Genuine Friendliness

Attentive and Prompt

Dedicated to quality

Brand Positioning

The Brand positioning statement of KFC goes like this Great tasting, Finger Lickin Good, Got to have it.

This clearly shows that customers perceive the KFC products as possessing a different taste. They also think that
KFC offers a sumptuous meal. KFC is perceived as being honest, down to earth, and easy to talk to. KFC focuses on
pure and fresh food in order to create a distinct and clear position in the minds of customers.

If re-launched what might be the positioning strategy

The current image of the brand is that of a Fried Chicken. KFC has also come under the hammer because several
groups have claimed that its products have fuelled the rise of Obesity in youngsters. With the consumer tastes
shifting towards more and more of health conscious foods, the Positioning strategy should change to Healthy fast
food chain. They should do aggressive advertising and change its product portfolio to suit the needs of health
conscious individuals. Advertising should focus on people adopting a healthy lifestyle. They should come out with a
new Fitness mantra which would show the Calorie content of the food and would try to do something different which
will enable them to reverse the negative perceptions that consumers have formed of fatty fast food.

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Moreover its name signifies that it has a Non-Vegetarian product portfolio. Therefore, by means of extensive ad-
campaigns, they should display a host of Vegetarian foods that they have on their menu cards so that people gain
awareness and Vegetarians may put KFC in their consideration set of fast food restaurants as well.

This would also help them in differentiating itself from its competitors and offer them a competitive advantage. KFC
will be able to stand out from the crowd so that fitness freak individuals on one hand and Vegetarians on the other
would also like to associate themselves with this brand name.

Brand extension strategies

When a company wants to extend its products or categories, it may go for line extension, multi brand, brand
extension and new brands.

Line Extension:

This is where the company adds new products of same category/variations to the existing products to expand the
breadth of the product line. This will expand the product line/category under the same brand name

Advantages of line extension are:

Ability to spread the total brand management cost across large product range,

New products can be introduced to the market confidently using the existing brand name

Life cycle of the brand is made longer as new products are added to the brand.

Disadvantage of line extension strategy is that:

It distracts the specific values and associations brand has already built due to large breadth of new products
i.e. excessive dilution of parent brand equity can occur.

KFC in for Line Extension:

Introduction of KFC submarines under the brand name of KFC can be seen a line extension as KFC Submarine is
new addition to existing category of KFC chicken burgers.

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In India KFC came up with the new Rice meals as an attractive proposition from its side to consumers who love to
have a whole some meal and is yet to adapt itself to have fast food for lunch and dinner.

The two variants in the category go down well with the consumer and also act as a profitable product variant for the
company.

KFC Zinger:

KFC Zinger has been a sub-brand of KFC fighting its way with all other fast food chains in the popular burger
segment. With the presence of prominent players like Burger King, McDonalds, etc. in the burger segment KFC
needed to create a sub brand for itself in the same. Zinger was a success in this respect. Burdened with the name of
which hints of Fried chicken and international legacy it is enough to drive away one third of Indian Consumers who
happens to be vegetarian. KFC is desperately trying to reposition itself as Irresistible food and not just Fried
Chicken. For this enticing consumer segment of India a Line Extension of the existing Zinger sub brand is recently
introduced by KFC Veg Zinger.

Brand Extension

This is where an existing brand introduces a new product category to the market under existing brand name.

Advantages of Brand extension are:

Acceptance of new product category by loyal customer of the brand,

Less promotion cost is incurred as the existing brand name will help to capture market share

Brand reputation/brand awareness can be increased.

Disadvantages of the brand extension are:

Failure in poor products can harm the reputation of entire brand,

Certain product can fail as not all products are suitable to be introduced under certain brand names

Brand dilution can occur. (over extension of brands can lead to loss of original values and association of
brands losing the identity of the brand)

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 Grilled Chicken

KFC used this strategy to launch Grilled Chicken. The introduction of grilled chicken was an unprecedented
sensation. KFC wants to use Grilled Chicken as an entirely new platform with potential for adding flavored variation
and other product innovation. One of such innovation is Fiery Grilled Wings, a hot wing version of KFC Hot wings
in fried category.

This has come as a result of changing orientation of customer towards health conscious food items. Over the last two
decades consumers have become more concerned with their health and more sensitive about the negative effects of
this type of fast food

To promote this KFC launched Unfry Day on 27th of April. This segment caters to those consumers who love chicken
but are anti towards the fried version of it. This diversification strategy gives KFC an opportunity to widen their
consumer base and create an entry barrier to any new firm looking to enter this new segment of Grilled Chicken and
create an anti Fried chicken promotion.

So this strategy can be seen as KFC looking ahead to tap new customers, and fend off any competitors that can harm
the parent brand.

But from consumer point of view it was bound to create complexity and confusion as KFC reminded them of juicy
fried chicken. Sudden venture of KFC to unthinking and present grilled chicken might have offset them.

The confusion is same with the distributors, or franchisee. Although advantage of brand extension was to increase
the probability of gaining distribution and trial but the confusion with the franchisee creates and obstacle for grilled
chicken to make its way to consumer. This can be a disaster for the brand.

So the awareness must be propagated by KFC to them as this strategy will not harm the parent brand but act as a
shield to substitution and attract new customer.

Retail:

KFC has an opportunity to hit the fast growing organized retail market in India by going for Brand Extension and
making a foray in the frozen food segment. It can go ahead and launch frozen chicken for burgers and etc. which
requires minimum cooking. This can be launched as Colonel in your kitchen to give you the irresistible delight of
KFC.

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Five most important priority initiatives I think are good to start tomorrow for the brand.

According to the present situation the KFC brand faces key challenges in global arena. If we concentrate at India
the challenges are different. The challenges should be the key priority areas and should be worked upon. We have
identified the following priority areas and the initiatives that should be taken.

a) 35% of India is vegetarian. This vegetarian segment can be further divided into sensitive and non-sensitive
vegetarian. Although core of the brand KFC speaks only about chicken but in case of India certain tweaking is
required. These tweaking should be in terms of menu or product line, communication and positioning.

The brand should be positioned in the mind of consumer as not only for great chicken but for irresistible and great
taste. Activities should be biased towards making KFC an inclusive brand, which means that it provides something
for everyone and at the end it stands for great irresistible taste.

Veg Zinger, Veg Rice meals are steps to building the same repute for the brand by doing certain tweaking in the
menu.

b) Communication of KFC should be directed towards great irresistible taste and promote along with it
Lickonomics or Finger licking is good. The content of the communication should not only be chicken but focus
should also be on the vegetarian dishes.

c) Certain Key Success factors for KFC should include number of outlets and design and ambience of outlets. As
the Brand wants to portray itself as contemporary and modern there should be focus on improving the design of
shops, introduce warm lighting and make it bit more comfortable with stylish design so that there is a buzz of energy
that lifts people up.

d) Indian customers favors extensive menu with variety and price options. So certain tweaking in menu should be
done. Old moving menu items should be given some push through specials of the week.

e) As KFC attracts lot of criticism from different NGO and other social organizations; there should be an
increased focus on the CSR activities carried out by KFC. Initiatives like Green Day; employing handicapped
persons; and other positives moves towards the locality of each and every shop will help create a positive image of
the brand and its increase its acceptance by the consumer and society. Another move can be mentioning calorie count
on its food items which will help projecting it as a health conscious brand.

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 CONCLUSION
KFC Corp, owned by YUM brands is one o the oldest (1952) and most popular chicken and food restaurant n the
world.KFC primarily sells chicken pieces, wraps, salads & sandwiches while its primary focus is fried chicken.

In India they opened in 1995 and after entering into the market like India it has extended its menu with Veg dishes
especially for their vegetarian customer. This has increased its customer range and thus helped in increasing its sale.
After doing the Strategic Group Data Analysis of competitors, the result clearly show that currently KFC is lying in
the 3rd position, being Mac Donald at the top follow by Dominos Pizza.

Since number of outlets and good customer service is a key factor to increase its reach and try to move rightward. To
grow in this competitive market, KFC has to improve its acceptability by customizing its menu to suit local taste and
price will become less important as almost all players in the industry will be similarly priced.

As it is clear that the strength of KFC is its taste, so it is recommended that KFC should try to differentiate on this
basis from its competitors.

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 BIBLIOGRAPHY

Sl. No Title Author/ Agency

1 Marketing Research-an applied orientation N.K.Malhotra

2 Market Potential of Consumer Products John.H.Parfitt

3 Consumer Behavior L.G.Schiffman

4 The great Indian Market Indian Mart

5 Atmospherics as a marketing tool - Journal of Kotler P. (1973)

Retailing, p. 49

6 Broad sensory branding, Journal of Product & Martin Lindstrom (2005)

Brand Management Vol. 14, No 2, pp 84-87

7 VSRD International Journal of Business and Prateekkhanna

Management Research, Vol. 2 No. 12 December
2012 Power of senses in branding and its impact
on consumer.

8 Scent marketing: an overview, In Krishna, Sensory Morin M. (2010)

Marketing, New York: Taylor and Francis
Group. (p. 78).

9 Sensory Marketing: research on the sensuality of Krishna, A. (2010).

products. New York: Taylor and Francis
Group.

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