MARKETING STRATEGIES OF MCDONALDS VS KFC
DISSERTATION AMITY SCHOOL OF BUSINESS NOIDA UP
SUBMITTED TO
SUBMITTED BY
PRIYANKA. A. SING H
ADITYA DHEER
LECTURER,ASB
BBA (M&S)-2
AMITY UNIVERSITY,NOIDA.
A3914708029
ACKNOWLEDGEMENT
I would like to express my gratitude to my institution AMITY SCHOOL
OF BUSINESS (ASB) for giving me the permission to choose my topic for the dissertation in MARKETING STRATEGIES OF MCDONALDS VS
KFC.
I express my thanks & gratitude to my faculty guide who has managed to get some time out of her busy schedule & helped me with my dissertation report.I firmly believe that without her commitment & support this report would not have been completed.In this regard I am extremely grateful to my faculty guide
PRIYANKA .A.SINGH (LECTURER) AMITY NOIDA.
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ABSTRACT
This dissertation report entitled MARKETING STRATEGIES OF
MCDONALDS VS KFC is undertaken as a partial completion for my BBA(MKT & SALES) course in AMITY SCHOOL OF BUSINESS (ASB) in NOIDA UP. Mcdonalds is the worlds largest chain of hamburger fast food restaurants,serving more than 58 million customers daily.Mcdonalds primarily sells hamburgers,cheeseburgers,chicken products,French fries,breakfast items,soft drinks,shakes & desserts.The business began in 1940 with a restaurant opened by brothers Richard & Maurice Mcdonald in san Bernardino,California.The first Mcdonalds restaurants were opened in United states,Canada,Costa rica,Japan,Netherlands,Germany,Australia,France & Sweden.
Kfc is a chain of fast food restaurants based in Louisville,Kentucky in the United states.Kfc primarily sells chicken pieces,wraps,salads & sandwiches,while its primary focus is fried chicken.Kfc also offers a line grilled & roasted chicken products & desserts.Outside north America,kfc offers beef based products such as hamburgers or kebabs,pork based products such as ribs & other regional fare.Kfc was founded by colonel Harland sanders in 1952.
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OBJECTIVE
The main objective of Mcdonalds are as follows:-
y
To serve good food in a friendly & fun environment.
y
To be a socially responsible company.
y
To provide good returns to its share holders.
y
To provide its customers with food of high standard,quick service & value for money.
y
The company vision is to be the uks best quick service restaurants experience.
y
The company is committed to maintaining & developing the best food products in the quick service restaurants market.
y
Committment to food safety & nutrition.
y
To have biggest market share.
y
To expand its business & be more popular worldwide.
y
To increase variety on their menu list.
y
To make its customers happy
y
To have polite employees
y
To beat its rivals such as KFC,Pizza hut,Subway.
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The main objectives of KFC are as follows:-
y
To sell chicken & other products to its customers.
y
To gain money so that they could buy food.
y
To be more popular than other fast food chains.
y
To expand its business & be more popular worldwide.
y
To make more profit.
y
To have polite employees.
y
To make their customers happy.
y
To increase variety on their menu list.
y
To make their service faster & friendlier.
y
To sell high quality products.
y
To have biggest market share.
y
To beat its competitors like Mcdonalds,Pizza hut,Subway.
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CONTENTS
OBJECTIVE.........................................................................(4) INTRODUCTION.................................................................(7) y
BRIEF ABOUT MCDONALDS & KFC...................(8)
y
PRODUCTS OF MCDONALDS & KFC.................(10) KFC.......... .......(10)
y
MARKETING MIX OF MCDONALDS & KFC.........(12)
y
CO-BRANDINGS OF MCDONALDS.....................(16)
SWOT ANALYSIS..............................................................(17) RECOMMENDATIONS......................................................(25) BIBLOGRAPHY..................................................................
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INTRODUCTION
Mcdonalds is the worlds largest chain of hamburger fast food restaurants,serving more than 58 million customers daily.In addition to its signature restaurant chain,Mcdonalds corporation held a minority interest in prêt a manager until 2008 & was a major investor in the chipotle Mexican grill until 2006 & owned the restaurant chain boston market until 2007. A Mcdonalds restaurant is operated by either a franchisee,an affiliate,or the corporation itself.The corporation revenues come from the rent,royalties & fees paid by the franchisees as well as sales in company operated restaurants.Mcdonalds revenues grew 27% over the three years ending in 2007 to $22.8 billion & 9% growth in operating income to $3.9 billion. Mcdonalds primarily sells hamburgers,cheeseburgers,chicken products,French fries,breakfast items,soft drinks,shakes & desserts.In response to obesity trends in western nations & in the face of criticism over the healthiness of its products,the company has modified its menu to include alternatives considered healthier such as salads,wraps & fruits. th
It was founded on may 15 1940 in san Bernardino,California by Richard & Maurice Mcdonald.Its headquarter is in oak brook,Illinois,us & is situated worldwide.Mcdonalds restaurants are found in 119 countries & territories around the world & serve 58 million customers each day.Mcdonalds operates over 31000 restaurants worldwide,employing more than 1.5 million people.The company also operates other brands,such as piles cafe.
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KFC was founded by colonel Harland sanders in 1952 & is widely known as the world famous fast food restaurant based in Louisville,Kentucky us.KFC has been a brand & operating segment.KFC primarily sells chicken pieces,wraps,salads & sandwiches,while its primary focus is fried chicken.It also offers a line of grilled & roasted chicken products,side dishes & desserts.outside north America KFC offers beef based products such as ribs & other regional fare.In april 2007 the company began using its original name,KFC for its signage,packaging & advertising in us as a part of a new corporate rebranding program. KFC speciality is fried chicken served in various forms.Its primary product is pressure fried pieces of chicken made with original recipe,the other chicken offering extra crispy is made using a garlic marinade & double dipping the chicken in flour before deep frying in a standard industrial kitchen type machine. Kentucky grilled chicken is targeted towards health conscious sutomers.It features marinated breasts,thighs,drumsticks & wings that are coated with seasonings before being grilled.It has less fat,calories & sodium than the original recipe fried chicken. KFC has two lines of sandwiches its regular chicken sandwiches & its snackers line.The regular sandwiches are served on either a sesame seed or corn dusted roll & are made from either whole breast fillets,chopped chicken in a sauce or fried chicken strips.The snakers line are value priced items that consists of chicken strips & various toppings.In uk,Australia & newzealand,sandwiches are reffered to as burgers,there is chicken fillet burger(a chicken breast fillet coated in an original recipe coating with salad garnish & mayonnaise) & a zinger burger as former but with a spicier coating & salsa. 8
The kfc twister is a wrap that consists of either chicken strips or roasted chicken,tomato,lettuce & pepper mayonnaise wrapped in a tortilla.In Europe the twister is sold in two varities:Grilled twister(chicken strips) & grilled Mexican twister. KFC fillers are a 9 in 23cm sub,available in four varieties over the summer period in Australia.shish kebabs are also being sold by kfc. Wrapstar is a variant of the kfc twister,consisting of chicken strips with salsa,cheese,salad,pepper mayonnaise & other ingredients,contained in a compressed tortilla. In some international locations,kfc may sell hamburgers,porks ribs or fish.In us KFC began offering fish snacker sandwich during lent in 2006.The fish snacker consists of a rectangular patty of Alaskan Pollock on a small bun & is the fifth KFC menu item. Some of other products sold by KFC in other countries include zinger burger,chilli cheese fries,parfait desserts,sara lee desserts,krushers available in Australia,South Africa,India & Newzealand are drinks containing real bits.They include classic krushers,smoothie krushers & fruit krushers. Other than fried chicken many KFC restaurants serve side dishes like coleslaw,various potato based items including potato wedges,French fries & mashed potatoes with gravy,biscuits,baked beans,macaroni & cheese,macaroni salad,rice,steamed vegetables & corn on the cob.
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PRODUCTS
y
Bahrain:-Mcdonalds restaurants in Bahrain,began in march 2008,sell Mccrisy, a meal consisting of 1,2 or
3
chicken stris
served in a wraer for a single stri or in a box for 2 or
3,with
a
choice of barbecue,sweet & sour,or garlic sauce.like all Mcdonalds restaurants all food served in Bahraini outlets is halal.
y
China:-Mcdonalds Chinese new year meal,grilled chicken sandwich & twisted French fries.In china chicken Mcnuggets come with the traditional bbq,sweet & sour & honey mustard sauces,but there also a chilli garlic sauce.In china there are specific Mcdonalds restaurants & counters for 10
icecream,beverages & desserts.They also include crisy chicken wings on their menu which comes in 2,4 &
y
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icces.
India:-The Mccurry pan is a very popular dish across India.It is an original creation of Mcdonalds India.Beef & pork products are not served to cater to Indian religious sensitivities.chicken along with fish are the only meat products used.Other items on Indian menu includes chicken products such as Mcchicken burger & chicken Mcgrill.The vegetarian burger menu consists of Mcaloo tikki burger ,Mcveggie & Mc surprise.
y
Indonesia:-Mcdonalds sells fried chicken,which is by far more popular than the hamburgers.Mcrice is also offered a small amount of steamed rice.Mcsou is a chicken flavoured sou with bits of reconstituted croutons & vegetables.
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MARKETING MIX
MCDONALDS:y
Product:-The strategy for product is to provide entry level product so that the customers can try new items & graduate to higher rungs.Mcdonalds has intentionally kept its product depth & product width limited.For Indian menu ham,beef & mutton burgers have been removed.The company tries to innovates its products according to the changing preferences & tastes of its customers. The product mix includes veg menu,non veg menu,beverages & frozen deserts. Veg menu includes Mcveggie,Mcaloo tikki,paneer salsa wrap,crispy Chinese,veg Mccurry pan & pizza Mcpuff. Nonveg menu includes chicken maharaja,mac Mcchicken,chicken Mexican wrap & chicken Mcgrill. Beverages includes cold coffee,ice tea,soft drinks,Mcshakes,hot serves. Frozen deserts includes soft serve cone,Mcswirl,soft serve,flavour burst & floats.
y
Price:-This is the most important part of the marketing mix for Mcdonalds as this is the only part which generates revenue for the company. Mcdonalds came up with a very catchy punchline aap ke zamane mein ,baap ke zamaane ke daam.This was to attract the middle & lower class consumers & effect can clearly be seen in the consumer base Mcdonald has. 12
Mcdonalds has certain value pricing & bundling strategies such as happy meal,combo meal,family meal to increase overall sales volume.
y
Place:-The place mainly consists of the distribution channels.It is important so that the product is available to the customer at right place,at right time & in right quantity. The structure is simple for Mcdonalds in India the outlets in north & east India are run by Connaught plaza restaurant pvt ltd & outlets in west & south India are run by hard castle restaurant pvt ltd.There are 1 69 outlets all over India.
y
Promotion:-The idea of company promotion is to promote Mcdonalds as a global image.Brand globally & advertise locally is the Mcdonalds promotional strategy. Mcdonalds does it promotion through television,hoardings & bus shelters.They use print ads & the television programmes are also an important marketing medium for promotion. Some of the most famous marketing campaigns of Mcdonalds are:You deserve a break today,so get up & get away to Mcdonalds. Aap ke zamaane mein,baap ke zamaane ke daam. Food ,folks & fun. I am loving it is one of the most successful ad campaigns launched in 200 3.
13
KFC:y
Product:-Kfc speciality is fried chicken served in various forms.Kfc primary product is pressure fried pieces of chicken made with original recipe.Products are generated based on the geographical locations. In Kfc feedback is taken from customers in order to know the customers demands so that improvements can be made by the company.Kfc focuses on pure & fresh food in order to create a distinct & clear position in the minds of customers kfc has a strong brand name & they are leading the market in fried chicken.
y
Price:-Kfc adopts cost base price strategy,pricing of the product includes govt tax & excise duty & then comes the final stage of determining the price of the product. Kfc globally enters the market using market skimming.Their products are priced high & target the middle to upper class people. Compared to its competitors kfc has a monopoly in fried chickens,thus kfc has an upper hand in pricing their fried chickens.
y
Place:-Kfc have their outlets close to colleges,schools,cinemas,malls & market which are mostly populated by young & those people who are in hurry.In addition they also have outlets close to muslim populated areas.
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They provide free home delivery to offices & homes,result in several outlets to cater to the needs of people in & around the city.Due to hectic lifestyle of the people the fast food concept saves time of preparing food & gives the customer a full meal quickly.
y
Promotion:-Promotion is the main tool to bring all the chicken lovers attention towards its delicious one of a kind product fried chicken.They try to promote their product through radio,television,billboards,flyers. Kfc try to sponsor events in order to strengthen their company image.
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CO-BRANDING Mcdonalds has major tieups with various companies as their co branding strategy:-
y
COCA COLA:-
y
BARBIE:-
y
HOTWHEELS:-
y
DISNEY PIXAR:-
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SWOT ANALYSIS MCDONALDS:STRENGTH:y
It has a strong global presence & is considered as a market leader in both domestic as well as international markets.
y
It is a global brand that owns 31000 restaurants serving in 120 countries.
y
It uses economies of scale for reducing the cost as its huge expansion diversifies the overall risk involved with the economic performance.
y
It earns revenue by fast food sales as well as a property investor & a franchiser of restaurants.
y
It has branded menu item i.e big mac,chicken mcnuggets,which further promote mcdonalds.
y
It is recognised as one of the worlds most recognized logos.
y
It is recognised as a socially responsible & community oriented firm.
y
It adapts to the cultural differences regarding the region where the restaurant is set up.
y
It has located itself in major airports,cities,highways,tourist locations,theme parks.
y
It has an efficient food preparation style that follows the process in a systematic way.
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WEAKNESSES:y
It uses advertising that mostly targets children.
y
Low width & depth of the product.
y
High employee turnover.
y
It has yet to accomplish going on the trend of organic food.
y
Price competition with the competitors resulting in low revenue.
y
Lack of innovative products.
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OPPORTUNITIES:y
It can adapt to the needs of the societies & undergo an innovative product line.
y
It can research ways to use green energy & packaging which will work as a part of their promotional effort as well as fulfil their social responsibility.
y
It can create new product offerings,use mobile text messaging to offer services that appeal to consumers.
y
It can upscale some of its restaurant settings at luxurious locations to attract more customers.
y
It can provide optional items that are regarded to be the basis of allergy for some.
y
It can slow down the level of expansion in order to increase the profitability of the organisation.
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THREATS:y
The recession negatively impacts the holding position of the firm regarding its revenue streams,even though they are quite diversified.
y
Foreign currency fluctuations are regarded to be a major problem as it uses standard pricing for its food item.
y
More restaurants that are increasing their food offerings & declining their price.
y
Health issues regarding the fast food chain.
y
Heavy investments on promotional campaigns which decrease the gaining of market share.
y
Sued various times for unhealthy food,usually with addictive additives.
y
Emergence of major fast food competitors like burger king,starbucks,subways,kfc,wendys.
y
Expansion has made the firm vulnerable to slow the economies of other countries.
20
KFC:-
STRENGTH:y
It is a very famous fast food chain outlet that started from Louisville Kentucky.
y
It has been known to be a leader in the chicken restaurant segment with annual sale of more than a billion dollars.
y
It has more than 50% of the market share in fast food industry & new entrants are finding it very difficult to capture its share.
y
It has gained enormous recognition as a reputable brand for fast food & has globally positioned itself well in industry.
y
It has a high global brand image compared to its other competitors.
y
It has a strong presence over its competitors with its primary product fried chicken.
y
It has strong location,store management,motivated work force & franchises.
y
It has a strong distribution network such as outlets in shopping malls,airports etc.
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WEAKNESSES:y
Kfc is not innovative because it serves only the chicken products to the customers.
y
It doesnt offer any new or differentiated products.
y
It felt after the market was offering new products because it was doubling other fast food chains to remain competitive.
y
Its merger with different corporations resulted in big cultural problem for kfc employees such as merger with pepsico.
y
The company is only focusing on few locations & is ignoring to check standards at franchises in different countries.
y
Kfc is facing problems to maintain the higher standards of hygienic food & is being charged in different countries due to poor standards of hygiene food.
y
Some of the examples are as follows:-
y
In 2007 a kfc outlet in newyork city was initiated to be rat infected.
y
In 2009 a kfc store in London was also charged with 1 3 food hygiene fines.
y
A court case in 2010 exposed poor hygiene at a kfc store in Sydney,Australia.
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OPPORTUNITIES:y
Changing demographics trends provides opportunity to diversify into new products & locations.
y
Increasing demand for foodstuff eaten outside the home.
y
Expand globally to capture the untapped markets & increase the revenue.
y
The company can take advantage of Nafta(North American free trade agreement).
y
Expansion for the latin American markets.
y
Consumers are becoming health conscious so they decided to introduce new products line for this segment.
y
To be environmently responsible because it will improve the public image of kfc & will help it to increase its revenue.
y
To diversify into other fast foods & meals.
y
To open more outlets in metro to increase their presence.
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THREATS:y
Kfc is facing strong competition from its competitors,such as Mcdonalds,yum,subway & pizza hut.
y
It is also facing competition from local restaurants in different countries of the world.
y
The company is facing problem in maintaining same standards at their international franchises.
y
To sustain a market leadership position in the global fast food industry.
y
Other players are turning to new menu offerings,locations & outlets.
y
Increase in number of health conscious consumers.
y
Saturated fast food industry in the us market.
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RECOMMENDATIONS
KFC:y
If kfc could increase company own restaurants,which restaurants,which enables it to control quality,services & restaurant cleanliness therefore more capital capit al is needed.
y
Kfc need to make sure that their restaurants offer a diversified menu.
y
To provide their customers with quality food,excellent service & restaurant cleanliness.
y
Kfc should always listen to their customers & try follow new trends on market in order to satisfy their customers.
y
The company should try to develope new products that customers want in order to increase their financial performance performance & value.
25
Mcdonalds:y
To provide their customers with quality food & excellent service.
y
They should expand their business by innovating new menu in their menu list.
y
The billing counters should be expanded more so that the rush in the restaurant is avoided.
y
The service given by the employees should be fast & quick so that the order can be reached at customers desk.
y
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BIBLOGRAPHY
www.google.com www.scribd.com www.wikipedia.com
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