Pestle Analysis of Chick-Fil-A

This report covers the Pestle Analysis of Chick-Fil-A, including the political, economic, social, technological, legal, and environmental factors affecting the company. It also includes a SWOT analysis, Porter's Five Forces analysis, and the 7 P's of Marketing.

MARKETING
MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................3
Pestle Analysis of Chick-Fil-A...............................................................................................3
Porter's Five force Analysis-..................................................................................................5
7 P'S of Marketing..................................................................................................................7
SMART Objectives. ..............................................................................................................8
STP of Chick-Fil-A...............................................................................................................9
CONCLUSION..............................................................................................................................10
.......................................................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Marketing management is planning, organizing, controlling and implementing of marketing
programmes, policies, strategies and tactics designed to create and satisfy the demand for the
firms' product offerings or services as a means of generating an acceptable profit. Chick-fil-A is
one of the largest American fast food restaurant chains and the largest whose specialty is chicken
sandwiches. Its headquarters are in College Park, Georgia. Chick-fil-A was originally founded as
the Dwarf Grill in 1946, changing the name to 'Dwarf House' until re branding as Chick-fil-A in
1967. This report covers issues such as SWOT analysis and PESTLE analysis of the company,
Segmentation targeting and positioning of the company, 7 P's of Marketing, objectives of the
company and Porter's five force analysis of the company.
Pestle Analysis of Chick-Fil-A
Political-
This environment is concerned with the issue and intervention of the government in
business. They set barriers, laws and regulations for the business which is compulsory for every
organization to follow so they are allowed to serve in the country. The company is serving
quality food and following all the protocols according to standard of the country. (Chonko and
Hunt, 2018.)
Economic-
This factor is concerned with the rate of interest, rate of inflation and the condition of the
economy. The sales of the business is growing in US and that is why they are taking the step of
expanding into UK. The reason is that the economy of both the countries is in good condition.
The company is going to launch new varieties which are demanded in UK. (Moutinho and
Vargas-Sanchez, 2018. )
Social-
This environment is related with the culture and trends of the society. It keeps on
changing. That is why the company is serving healthy as well as unhealthy food so that they can
meet up with the current trends in the market.
Technological-
Company needs to use new technology which reduces the time for preparation of the food
as they serve a large no. of people on a daily basis which will reduce the time that the consumers

spend in the waiting list of the customers. Company needs to look up the technology that they are
currently using and check if it has any kind of room for improvement so that changes can be
taken in order to cope up with the environment. (Pasquier and Villeneuve, 2017.)
Legal-
The company follows all the guidelines, laws and regulations which are set by the
government so they are allowed to expand their operations in to different countries in order to
increase the sales and generate more revenues.
Environmental-
The company needs to use those methods which are concerned with safeguarding the
interest of the environment. The company offers and produces food for the people in large
quantity on daily basis so they need to take the raw materials which are recyclable for the
industry.
SWOT Analysis
Strength-
Resources of the company are considered their strength as they have sales stronger than
their competitors such as McDonald’s. The reason behind that their quality and activities are
better than McDonald’s. The company has their unique selling preposition which differs them
from their competitors. Apart from that they offer their customers food at low and affordable
prices. The service they provide to their customers is considered to be as one of the reasons for
the success of the company. The food chain offers chicken sandwiches instead of burgers so that
they can change the way and differ from other restaurants as other restaurants only offer beef
burgers.
Weakness-
Chick-Fil-A needs to bring or add new things in their menu and change the strategies
they use for marketing and the method of supply chain. The company is not a global brand that is
why it is difficult for them to increase these measures. The company don't have the coverage
outer than USA that is the reason that they can fight the competition with the giants such as
McDonald’s on a limited area. They don't have gained the popularity in the market as compared
to other fast food chains who operate on a big level.
Opportunities-

To increase the customer base the company has the opportunity to offer the variety of
healthy food as people are more concerned for their health these days. With this option company
has the chance to change their image into something new and open new segment in this industry.
Fast food joints are not able to give appropriate services to their consumers which is why the
company has the scope to serve more customers in the market. The company can capitalize on
this measure.
Threats-
The company has to face many challenges such as threat from the giants such as
McDonald’s and KFC. Apart from that there are issues such as using chicken in everything and
to match with the quantity they serve they don't serve quality ingredients to their customers.
People who are concerned for the environment keep protesting on saving the animals and start
eating vegan food which affects the thought process and mindset of many people. (Baker, 2016.)
Porter's Five force Analysis-
Threat of New Entrants-
The industry in which the company is serving has high amount of profit margin but the
level of new entrants is a lot higher as compared to other industries. This impacts on the level of
profitability of the companies such as Chick-Fil-A. In order to survive in this industry company
need to take some essential measures so that they can stop the new entrants for making an
attempt into this industry because if they don't then the whole industry will suffer losses. Barriers
in this industry includes the legal aspects of environment which requires patents and copyrights.
To operate in this industry high level of capital is needed. Switching cost to other brands is
medium that is why company has to face high level of competition. Some policies are restricted
by the government and connection with suppliers and distributors must be strong so that they can
get the materials in time and at affordable prices. To establish the joint as a brand company
needs customer who are loyal to them. (Wagner and Eggert, 2016.)
Threat of Substitutes-
The company faces a lot of threat from their competitors so they need to serve quality
food and products to their consumers so that they can retain them and they do not switch to any
other brand. For instance people who don't like Pepsi will shift to Coke or the people who don't
like mineral water will prefer RO as they don't have to think about it. It is all based on their
preference. Only thing which will hit the customers is the pricing of their substitutes available in

the market. If the quality of the restaurant is reducing than the customer will shift to another
brand irrespective of price. (Kerin and Hartley, 2015)
Competitive Rivalry-
Less amount of capital is needed to enter in this industry. There is high amount of
competition in this industry that is why the company needs to use strategies that are effective
such as advertising to promote their brand, innovate new measures so that they can sustain the
position of competitive advantage and if they don't follow up these measures then they will loose
the current position in the market.
Bargaining Power of Buyers-
This aspect is concerned with the power that the consumer has with them which affect the
pricing strategy of the company. This factor is dependent on the industry and the importance they
give to their customers. The power of the consumers is high in this industry because they have
many substitutes available in the market which also makes the cost of switching lower. Chick-
Fil-A needs to take some measures so that they can make the consumers loyal and they won't
have the leverage of bargaining. If they manage the control of substitute brands then they will be
able to manage the power of the consumers and the cost of switching won't be a threat to them.
(Olson and et.al., 2018)
Bargaining Power of Suppliers-
This factor is concerned with the aspects of the prices set by the suppliers of the company
and issues such as increasing and decreasing of the prices. It affects the profitability of the
company and it is a threat to them. Chick-Fil-A needs to maintain a connection and reputation in
their eyes so that they suppliers have respect for them and charge them fair prices for the raw
materials. One advantage that the company has that they have lot of options available in the
market which states that if one supplier is charging high prices then the company can shift to
other one as the cost of switching is low and this way company don't have to buy the products on
the terms of the suppliers. The bargaining power of the supplier totally depends on the
availability of materials they have and in how much time they can deliver it to the company.
7 P'S of Marketing
Product-

The company is a leading brand in the sector of fast food joints in USA. The company
has the varieties to offer for breakfast, lunch and dinner to people. There product portfolio is
considered to be the strategy for the marketing mix. The company offers variety of food such as
bagel, sausage, eggs, biscuits with nutrition and much more for the breakfast. Also they have
various types of sauces and dressings available for the convenience of the customers. In the
beverages the company offers soft drinks, coffee, iced tea, juices and milkshakes. For kids they
have made a specific meal which includes nuggets of different varieties and other items which
are appealing to them. The company has also thought of the people who are health conscious and
for them they have made salads available in their menu with good and different varieties of them.
Considering all this the company is still known for their chicken sandwiches and the nutritious
food which they provide to the people. (Wierenga and Van der Lans, 2017.)
Price-
The annual revenue of the company is around a whopping of $ 8 Billion. People believe
that the prices of the items they offer is a little bit more than what is sold by their competitors.
The reason behind this is that the company targets those people on the basis of higher level of
income who can pay for their food easily. The company sets up a decent package of salary for
their employees as compared to their competitors.
Place-
Chick-Fil-A has opened up their restaurants in countries such as USA, Canada and South
Africa and now they are planning to open and expand their operations in UK. They have made
wide presence in the areas where they have opened their restaurants and because of the pricing
strategy the company follows it has benefited them to made their reputation in the market as a
premium brand. The franchises of the company go on to different places where they hire people
by training them and it is done on the condition of sharing of profits on a specific percentage. It
has helped them to gain the loyalty of customers and they attract them with a purpose that is to
glorify God. The company keeps them close at the time of holidays and sundays which is a part
of marketing.
Promotion-
Chick-Fil-A advertise their products in an effective manner with the help of online
platforms. They use medium of email, public relations, Radio and TV and many more in order to
increase their reach and spread the awareness among consumers. On the appreciation day for

Cows every July they encourage their customers and people to visit their restaurant. They
advertise themselves at the time of professional sports which has helped them to successfully
position their brand.
People-
Chick-Fil-A targets their customers on the basis of their potential which states that they
target their group on the basis of their level of income. Every company who serves in this
industry targets those who are working individuals and don't have time to cook by themselves.
Their employees are hired on a greater pay scale than those of their competitors. (Chernev, 2018.
)
Process-
The company has set up a process of buying up its franchise. Initial investment of around
$ 10,000 is needed to buy the franchise of the company. Then the programs for training and
programs for interviews are held which takes some time. They have mentioned the terms in their
closure for the people who will be suitable and who will not be suitable for buying out the
franchise. The company selects each of their restaurant and put efforts to build it.
Physical Evidence-
The outlets that the company has in the form of the restaurant are their physical evidence.
Things such as their ambience and the service they provide to their customers differs them from
other brands. This creates the evidence for the place as it tells how the restaurant treats their
employees. The overall satisfaction they give to their customers and the staff is evident enough.
It does not matter where the restaurant is located as all of them maintain the level of uniformity
as they are all running by the same people. (Haider and et.al., 2019)
SMART Objectives.
To increase profitability by 10% till the end of year.
To increase market share by 20% in upcoming 6 months.
To increase customer experience by 5% till the end of 2021. (Deepak and Jeyakumar, 2019)

STP of Chick-Fil-A
Segmentation-
The company has segmented their market on the basis of demographic that is the kind of
population the company targets and serves the most. They divide the people on the basis of age,
gender and race as it helps them to focus on making products for other people as well. Apart
from that they also segment their market on the level of income and the potential of the
customers. (Keegan, 2017.)
Targeting-
Currently the company has a 20 per cent share in the market in the industry. The females
which the company targets are in the age group of between 18 to 44 years and most of them are
from Asian or African American females. According to a survey most of the prefer who have
kids prefer this restaurant more. The males which are targeted by the company is between the
age of 22 to 54 years as most of them are working individuals and they don't have the time to
prepare or cook the food by themselves. The company is also targeting the families with the help
of advertisements in sports and couple with kids prefer more to eat here because they know the
nutritional fact about the food they serve in the restaurant and the families feel that it is healthy
for their kids to eat here. Company also targets the people on the basis of level of income as they
are a premium brand and charge a slight higher prices as compared to their competitors. (Shaw,
2016. )
Positioning-
The purpose of the company is to glorify God which helps in taking the decisions of the
business to show them the right path. The company has tried to put up the dining experience on a
customer centric approach and a alternative to the people which is healthier for them. The
company serves food and ingredients which are of high quality and for that they charge a
premium price as compared to their competitors. To reinforce the positioning of the brand
company has taken events for the appreciation of regular customers, there services are attentive
which has helped them to position well in the market. They influence the minds of the consumers
with the help of their Eat more Chikin. It has helped the company to differ themselves from other
companies in the eyes of target audience. The quality food they serve to people and the
experience that the customers are getting from the restaurant has helped the company to gain a
competitive advantage over others. The positioning of the company is viewed as a advantage for

customers as it helps the company to get repeated sales to the same consumer which leads to
high profits for the company. The company has tapped the response of the customers in an
emotional way. Many marketers of the company believe that the positioning strategy of the
company must appeal to head and the heart both. The positioning has helped the company to
create and maintain a mutually beneficial relationship with their customers. (Kotler and et.al.,
2018.)
CONCLUSION
From the above studies it has been concluded that Chick-Fil-A is one of the leading brands to
serve their customers in the fast food industry. Their sales are bigger than McDonald’s though
they need to reach their geographical presence if they want to make the company global. The
service that the company gives to their customers and the ambiance that the restaurant have
satisfies the consumers. The company segments and targets their audience on the basis of their
age, gender and race and the income level of the customer as it is a premium brand not everyone
can afford it. The company is known for their chicken sandwiches in the market. They have
positioned their brand as glorify the God and their advertisements with cow saying that eat more
Chickin has helped them to increase their sales and revenues. The company uses high quality
ingredients while preparing the food that is why they charge higher prices for their items. Initial
investment of $ 10,000 is required in order to buy the franchise and then to go under the process
of training and interviews which will take some time.

REFERENCES
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