Detailed Strategic Marketing Analysis Report: KFC's Strategies

This report provides a comprehensive strategic marketing analysis of KFC, encompassing its historical background, market size, and competitive landscape. The analysis delves into KFC's micro and macro environments, utilizing SWOT and PESTLE frameworks to assess its strengths, weaknesses, opportunities, threats, political, economic, social, technological, legal, and environmental factors. Furthermore, the report examines customer behavior, stakeholder relationships, and strategic planning initiatives, including KFC's approach to introducing new product ranges, particularly for vegetarians. The study includes detailed competitor analysis against McDonald's and Subway, exploring their service standards, pricing strategies, and market positioning. The conclusion summarizes KFC's efforts in maintaining its brand value and unique position in the fast-food industry, supported by a list of relevant references.

Strategic Marketing

TABLE OF CONTENTS
 HISTORY OF KFC
 MARKET SIZE
 COMPETTITOR ANALYSIS
 MICRO AND MACRO ANALYSIS
 SWOT ANALYSIS
 PESTLE ANALYSIS
 CUSTOMER ANALYSIS
 STAKEHOLDER MATRIX
 STRATEGIC PLANNING
 CONCLUSION
 REFERENCES

HISTORY OF KFC
 KFC is the fast food restaurant which has specialization
in chicken.
 It was founded in 1930 by Colonel Harland Sanders in
Salt Lake City.
 He started selling fried chicken from a roadside
restaurant at the time of great depression.
 Later he identified the potential of franchising which lead
to the first ‘Kentucky Fried Chicken’ franchise which
was opened in Utah in the year 1952.
 KFC is the one who popularized chicken in fast food
industry which has diversified its market by challenging
the already established dominance of hamburger.

Cont..
 He has branded himself as ‘Colonel Sanders’ and Harland became the
prominent figure of American culture.
 Also, his image was used in the KFC advertisement.
 By 1964, Colonel had around 600 franchise of its outlets across US and
Canada.
 It was the first American fast food chain which expanded globally by mid
1960s.
 The original product of KFC was pressure fried chicken pieces which
was seasoned with 11 herbs and spices a part of Sander’s recipe which is
represented as trade secret.

MARKET SIZE
 It has been seen that KFC UK sales has increased up 19% in Q2
of 2019.
 The UK’s market performance has accounted for approximately
6% KFC system sales worldwide.
 KFC has the brand value of $17.205 million in the year 2019
which was below McDonalds and Starbucks.
 In the year 2017, KFC has the total number of outlets as 847 with
the revenue of £791 million in the year 2017.

COMPETITOR ANALYSIS
Difference between the competitive factors of KFC
and its competitors
Basis of
comparison
KFC McDonalds Subway
Product  Major food offered
is chicken.
 Focusses on the
age and also the
occupational
background of the
customers.
 It involves
hamburger and
beef products in
its food
categories.
 It follows product
standardization in
all its outlets.
 It only offers
submarines and
sandwiches.
 The organization
also follows
standardization
strategy in its
outlets.
Market
positioning
 KFC is mostly
focussing on
attracting families.
 Working class
people and have
created dinning
environment for its
customers.
 McDonalds
mainly attracts
young people.
 Also, its products
are focussed
towards children.
 It has aimed at
attracting busy
professional
people along with
health-conscious
customers.
 It also offers
working
atmosphere to its
customers.

Cont..
Service
standards
 KFC follows
certain parameters
with respect to
hygiene in its
outlets.
 However, there
were few
complaints about
sanitation in the
washrooms in few
of its outlets.
 McDonald
follows strict
service standards
in all its outlets
across the world.
 The hygiene and
cleanliness
maintained by
restaurant is
appreciated by
customers.
 At subway, its
products and
ambience is
widely
appreciated
because of the
obedience shown
towards
maintaining
cleanliness and
also the usage of
healthy products.
Pricing
strategy
 KFC mostly
introduces its new
products at the
higher price using
price skimming
strategy with the
objective to earn
maximum profits.
 McDonald’s
mostly offers its
products at a
reasonable price in
order to attract
their target
customer
segments.
 Subway mostly
uses value based
pricing strategy
for pricing its
products with the
objective that
customers are
paying with
respect to the
product and
quality of service.

MICRO AND MACRO ANALYSIS
 Business environment is the surrounding within which business organization
operates.
 There are different factors that closely surrounds the business.
 It is divided into two types-micro environment and macro environment.
MICRO ANALYSIS:-
 It refers to the environmental factors within which business operates and has
a direct control over it.
 It includes competitors, suppliers, customers, employees, intermediaries and
other stakeholders.
 It has the tendency to influence the daily business operations and is mainly
for the short term only.

Cont..
How it helps analysing the organization?
 The analysis of environmental factors has a
significant role in achieving the success of the
organization.
 It helps the organization in identifying the factors
that has potential to affect the business functioning
which can be used while preparing the strategic
marketing plan.
 As a result, it will help in reducing the negative
impact of these factors over the business operation.

SWOT ANALYSIS
Strengths
 Strong brand equity.
 Strong and widespread global presence.
 Excellent customer service.
 Innovative in terms of menu.
Weaknesses
 High fat and calorie food menu.
 Supply chain and logistics issues.
 Poor franchise management system

Cont..
Opportunities
 Using latest technology for logistic management.
 Focusing into veg menu.
 Introducing healthy food stuffs.
Threats
 Increasing competition along with operational costs
 Changing habits of consumers.
 Closure of franchise affecting the brand image.

PESTLE ANALYSIS
Political factors Economic factors Social factors
 Criticized all over
the world for
selling unhealthy
food.
 Government
control over the
marketing of fast
food restaurants.
 Control over the
license for
opening fast food
restaurant.
 Fast food
restaurants not able
to generate
sustainable profits.
 Paying its
employees, a
minimum wage.
 Increasing demand
of healthy and
hygienic food
products.
 Using lucrative
advertisement to
lure children and
others.
 Mistreat of animals
and packing them in
unhygienic facilities.

Cont..
Technological factors Legal factors Environmental
factors
 Upgradation in
technology.
 Implementation
of automation.
 Increasing the
digital presence.
 Complying with
health and safety
standards.
 Cases against its
paper supplier.
 Employment of
underage children.

CUSTOMER ANALYSIS
 Customers of KFC are the people from different segments and age
groups.
 These are those who wants to taste buds with the delicious chicken
menu.
 Most of the customers are the youngsters or the young adults who
can afford to take out minimum amount of money in order to have a
delicious finger licking meals.
 The perception of the customers is that only KFC is highlighting
and attracting the all age group of customers including families to
dine out.
 It has also set standards based on which different hygiene and health
and safety of the customers and employees are taken care.
 Also, based on the sayings of KFC that ‘nobody cooks chicken like
it and they are the chicken experts which differentiates it from
others.

STAKEHOLDER MATRIX
 Stakeholder analysis is a process that evaluates and
analysis stakeholders such as consumers, employer,
and director’s interest, level of participation and
importance in decision making of company.
 Stakeholder analysis of KFC helps in identify people
that have high interest and power so that it can
formulate strategies in order to meet needs and
requirements of such stakeholders.
 Stakeholder analysis of KFC is classified into four
bases as per their power, level of participation in the
level of functioning.

Cont..
Meet their needs:
 Directors and top management have power and interest in functioning
of KFC so all activities and function are performed as per needs and
demand of such stakeholders.
 Thereby company satisfied need of such stakeholder on priorities basis
so that it can enhance its market share.
Least important:
 Such as distributors are least important as they have low power and
power interest in performance and operation of business.
 Thus, KFC play less attention in meeting needs and demand of such
people.

STRATEGIC PLANNING
Strategic planning
 Strategic planning includes setting goals, objectives, analysing and
evaluating environmental factors affecting the business, planning,
implementation and measuring and monitoring the progress.
 Strategic planning provides a direction through which business cam
achieve desired goals.
Strategic planning KFC is pursuing
Based on the marketing audit, the KFC’s marketing plan is to introduce
new product range exclusively for vegetarians.

CONCLUSION
 It can be summarized that KFC has made continuous efforts in order to
attain this success.
 It has been in top three in terms of brand value.
 Also, the competitor analysis has been drawn with McDonalds and
Subway, which has helped in identifying the operational practices used
by them such as pricing, promotional activities, supply chain etc.
 This has helped in identifying the unique position in the industry.

REFERENCES
 Adom, A., Nyarko, I. and Som, G. N., 2016. Competitor analysis in
strategic management: Is it a worthwhile managerial practice in
contemporary times. Journal of Resources Development and
Management. 24.
 Backhaus, K. and Awan, A., 2019. The Paradigm Shift in Customer
Analysis: Marketing or IT-Driven?. In The Art of Structuring (pp. 337-349).
Springer, Cham.
 Cuppen, E., 2016. 15 Stakeholder Analysis. Foresight in Organizations:
Methods and Tools. p.208.
 Griffiths, M., Fenton, A. and Fletcher, G., 2019. 4.1 Competitor
analysis. Strategic Digital Transformation: A Results-Driven Approach.