Post on 05-Apr-2018
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COMPETITOR ANALYSIS
The company we have selected for competitor analysis is KFC. The competitiveanalysis will give a snapshot of competitor position in the market. After
competitor analysis a company can evaluate itself among the competitors andthen make a strategy to compete.
KFC Profile
KFC, also known as Kentucky Fried Chicken, KFC Corporation, basedin Louisville, Kentucky, is the world's most popular chicken restaurant chain,specializing in Original Recipe, Extra Crispy, and Colonel's Crispy Strips chickenwith home style sides.
KFC is part of Yum! Brands, Inc., which is the world's largest restaurant system
with over 32,500 KFC, A&W All-American Food ,Taco Bell, Long John Silver'sand Pizza Hut restaurants in more than 100 countries and territories.
KFC has more than 11,000 restaurants in more than 80 countries and territoriesaround the world. And in quite a few U.S. cities, KFC is teaming up with sisterrestaurants, A&W, All-American Food, Long John Silver's, Taco Bell and PizzaHut, selling products from the popular chains in one convenient location.
KFC Strength and Weakness Analysis:
Strength:
Good reputation in market
Strong brand name
Having Maximum outlets in the market
Strong financial position
Joint venture with the international firms like Pepsi cola and Yem
international
Using modern technology to interlink their resources
Having strong distribution channel
Weakness:
Company did not come up with new products as compared to McDonald.
Limited menu and sticked with their original recipe.
Having less sales as compared to McDonald
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KFCs Customers
KFCs customers generally choose the restaurant they will eat at based onquality, rapidity, and variety of items. KFCs customers are also really pricesensitive and will go elsewhere if they find that the value is not worth the price.
They can also be characterized by being people that want to be served fast andbe out of the restaurant in no time.
Competitors of KFC
In the fast food industry there are three major competitor of KFC. McDonald isone of the biggest competitors that has capture maximum market share. The
AFC is one of the major competitors of KFC and now a new and potentialcompetitor is Subway, no doubt it is new entrant but due to its world wide
renowned brand name having potential to capture huge market share. KFC is themarket leader in the fast food industry and majority of the customer prefer to dineout at KFC that represents not only their brand loyalty but also availability of KFCoutlet at convenient location as compared to rest of fast food restaurants.
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Number of Outlets
KFC
McDonald
AFC
Subway
Comparison of KFC & its competitor outlets:
Number of Outlets
KFC 34McDonald 20
AFC 21
Subway 12
Competitors Sales data:
Average Daily Sales by oneoutlet
Daily Sales by the alloutlets
Sales PerMonth
Rs. Rs. Rs.
KFC 125000 4,250,000 127,500,000
McDonald 145000 2,900,000 87,000,000
AFC 80000 1,680,000 50,400,000
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Average Daily Sales Comparison
0
50000
100000
150000
200000
250000
300000
KFC McDonald AFC
Rupees
Sales Per Month comparison
0
50,000,000
100,000,000
150,000,000
200,000,000
250,000,000
KFC McDonald AFC
Ru
pees
Competitor Analysis Work Sheet
In the chicken Burger chain segment, the main competitors of KFC are McDonald
and AFC. In Pakistan KFC is the market leader because it is the first international
chain that opened its out let in country and also having huge number of outlet as
compared to rest of the competitors.
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KFC Mc Donald AFC
Market
Market dimensionSingle market (junk food) (junk food) (junk food)Multi market
Total Market
Regional Market
National Market
International market
Market Entry
First in Strategy
Follow the leader strategy Last in Strategy
Market Commitment
Major commitment
Average commitment
Limited commitment
Market Demand
Prune market whendemand slackens
Concentrate on keymarkets when demand
increases
Harvest profits when sales
plateau
Market Diversification
Added new businesses or
added another stage of
production or distribution.
Diversified into unrelatedbusiness.
KFC Mc Donald AFC
Product
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Positioning
Positioning a single brand Positioning a multiple brand
Repositioning older products
Product Life CyclePromoting more frequent usage Finding new users Finding more uses for product
Finding new uses for productsbasic materials
Product Competition
Competing Brand Private label
Generic Product
Product Mix
Single product
Multiple Products Product Systems
Product design
Standard Products
Customized products Standard product, modified
New Products
Innovation Modification Line extension Diversification
Remerchandising existing
products
Extending Market for existing
products
KFC Mc Donald AFC
Pricing
New Products
Skim (high) Pricing Penetration (low) pricing Psychological (odd/even) pricing
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Follow the leader pricing Cost plus pricing
Established Products
Slide down (gradual reduction) pricing
Segment pricing Flexible pricing
Preemptive pricing Loss leader pricing
Promotion
Advertising
Support personal selling
Inform target audience about
availability of product
Persuade prospects to by directly
from advertising
KFC McDonald AFC
Distribution
Channel StructureDirect distribution to enduser
Indirect distributionthrough intermediaries(Distributors, dealers)
Multiple ChannelComplementaryChannels
Competitive Channels
Channel control
Adding a wholesalingfunction.
Adding a retailingfunction.
Controlling more of themanufacturing process
Adding franchises
Combining with other
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Competitor 2
AFC
The time was mid 90's. Fast food companies were booming in
Pakistan. Quality fast food in Pakistan was outrageously
expensive and on a handful of families could afford to go there.
No middle class family could think of taking their children to such big food chains.
This was the time when AFC (Al-Najam Fried Chicken) opened its first restaurant
at Saman Abad, Main Market in Lahore. AFC make the quality fast food available
to all those people who liked the fast food but couldn't dare to afford.
At present time, AFC has more then twenty branches Nationwide including MallRoad, Railway Station, Allama Iqbal Town, Twonship, Mughalpura, Defence,
Thokar Niaz Baig, G.T. Road and Wapda Town. It has also opened in Faisalabad
and Gujrat, Abbotabad, SGD, Gujranwala, Rawalpindi and Karachi.
Segmentation: As compared to McDonald the AFC segmenting the price
sensitive customers so majority of their customer belong to the middle class.
Price Strategy: The products of the AFC are less costly as compared to KFC,McDonald and Subway and acceptable to their segmenting customers.
Product Strategy: AFC provides quality food in reasonable price to the middle
class segment and they follow the competitor strategy by keeping in mind their
target segment. They follow the strategy to extend the market for the existing
products.
Promotion Strategy: AFC extensively use the outdoor media i.e. billboards and
banners and they are not investing in indoor media for their promotion and
advertisement.
Place: AFC is operating in eight major cities of Pakistan with the network of 21
outlets. Only in Lahore there are 13 outlets of AFC are operating. Direct
distribution strategy is being focused by the company.
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Summary of competitor analysis
In Pakistan, KFC have an advantage of its high number of outlets all over the
country in spite of that McDonald have high daily sales. Both companies are
multinational and operating in international market. KFC and McDonald both
follow the leader strategy. The both are attracting the customer due to their
internally renowned brand name and as well as their quality of product and
services. AFC is targeting low price income segment and also follow the leader
strategies.
All of the competitors providing standard products to their customers and
attempt to get large market share they often gives different packages to their
customers. KFC and McDonald Inform target audience about availability of
product through different media. AFC tend to use follow-the-leader pricing
strategy when launching new products and to use preemptive pricing.
Sales force of all the competitors are very efficient and also
facilitate their customers by giving home free delivery with in no time. KFC did
not come up with new products as compared to McDonald. They have a limited
menu and have sticked to their original recipe chicken that made their success
since the beginning.
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Zinger Burger
TWISTER
CORN ON CUB
FAMILY FEAST
http://images.google.com.pk/imgres?imgurl=http://pakistangiftsemporium.com/bmz_cache/e/e8dd9fdd1f91f0a21257678ee9a7a4bf.image.150x112.jpg&imgrefurl=http://pakistangiftsemporium.com/index.php%3Fmain_page%3Dproduct_info%26products_id%3D60&h=112&w=150&sz=5&hl=en&start=15&tbnid=tDmUWPNSeyCpEM:&tbnh=72&tbnw=96&prev=/images%3Fq%3Dzinger%2Bburger%26gbv%3D2%26hl%3Denhttp://images.google.com.pk/imgres?imgurl=http://pakistangiftsemporium.com/bmz_cache/e/e8dd9fdd1f91f0a21257678ee9a7a4bf.image.150x112.jpg&imgrefurl=http://pakistangiftsemporium.com/index.php%3Fmain_page%3Dproduct_info%26products_id%3D60&h=112&w=150&sz=5&hl=en&start=15&tbnid=tDmUWPNSeyCpEM:&tbnh=72&tbnw=96&prev=/images%3Fq%3Dzinger%2Bburger%26gbv%3D2%26hl%3Den7/31/2019 KFC (Final Project)
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STRENGTHS &WEAKNESSES ANALYSIS OF SPA
It is used to evaluate how SPA measures up to a competitors organization. The
strength & weakness evaluation is intended to determine where SPA is weak or
where it is strong as compared with the competition.
SWOT Analysis
Strengths: (Internal)
Good reputation in market
Strong brand name
Strong financial position
Joint venture and collaboration with international and forighen
universities.
Using modern technology to interlink their resources
Weaknesses: (Internal)
Poor coordination amongst departments
Politics faced by the organization
Having less sales as compared to McDonald.
Opportunities: (External)
Increasing demand for professional degrees
An unfulfilled customer needs.
Growing Market
Potential to capture additional market share
Threats: (External)
High inflation rate.
New HEC regulations
Political & social instability.
Internal Factor Analysis IFE
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FACTOR WEIGHT RATE (1-4) TOTAL
(How important it isfor my product)
(Company Rates itsability)
STRENGTHS
Strong Financialposition
0.1 4 0.4
Strong brand name. 0.2 3 0.6
Good reputation amongcustomer.
0.1 2 0.2
Maximum number ofoutlets in the market
0.07 2 0.14
Favorable access todistribution networks.
0.1 4 0.4
Firm using modern
technology
0.03 2 0.06
Joint ventures with bigfirms of the world(Pepsi, YemInternational)
0.1 2 0.2
WEAKNESS
Sticked with the originalrecipe
0.2 3 0.6
Employee satisfaction is
low.
0.1 4 0.4
TOTAL 1 3
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External Factor Analysis EFE
FACTOR WEIGHT RATE (1-4) TOTAL
(How important it is for my
product)
(Company Rates
its ability)
Opportunities
An unfulfilledcustomer needs.
0.1 4 0.4
Arrival of newtechnology
0.05 2 0.1
Growing market 0.1 3 0.3
Potential to captureadditional market
share
0.1 2 0.2
Very few brands inFast Food industry(Brand building)
0.2 4 0.8
Threats
Shift in consumertastes, away from thefirm product.
0.05 3 0.15
Emergence ofsubstitute product.
0.12 4 0.48
New governmentregulations
0.03 1 0.03
high infation rate 0.05 3 0.15
political and socialinstability
0.2 3 0.6
TOTAL 1 3.21
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GE Matrix
4
3
Market
Attractiveness
(EFE) 2
1
4 3 2 1
Business Strength (IFE)
Market attractiveness is shown on the vertical axis and Business strength is
shown on the horizontal axis, we have examined the companies SWOT
(strengths, weaknesses, opportunities and threat) and plotting the external and
internal factors on the GE matrix. KFC falls on the 1st and 2nd
quadrant that
shows there is excellent market environment and KFC is in good position. And
Investtogrowstrategymust be followed by the company.
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TOWS Matrix
Strength
1. Good reputation in market2. Strong brand name
3. Having Maximum outlets inthe market4. Strong financial position5. Joint venture with theinternational firms.6. Using modern technology tointerlink their resources7. Having strong distributionchannel
Weakness
1. Company did not comeup with new products as
compared to McDonald.2. Limited menu andsticked with their originalrecipe.3. Having less sales ascompared to McDonald4. employees areunsatisfied
Opportunity
1. An unfulfilled
customer needs.2. Growing Market3. Arrival of new
technology (tomaintain the qualityand crispiness of thefried chicken product.)
4. Potential to captureadditional marketshare
5. Very few brands inFast Food Industry
(Brand building).
SO
1. S1, S2, S3,S4
2. S4,S5
3. S6
4. S7
5. S3
WO
1. W1, W2
4. W3
Threats
1. Shift in consumertastes, away fromthe firm product.
2. High inflation rate.3. Emergence of
substitute product.4. New government
regulations5. Political & social
instability.
ST
1. S1,S2
2. S6
WT
1. W1, W2
GAP
Segments of KFC
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In this portion of project we will discuss that how many segments KFC is serving
for its products and what strategy they are using for these segments.
Market segmentation
The commonly used basis for segmenting the consumer market may be grouped
in following categories, which are selected by the KFC for its products and
services.
1) Geographic Segmentation
KFC major target segment and consumption is associated with the geographic as
well as economic conditions of a place. As the target segment of the KFC is
upper5 and middle class so the main outlet are in the urban area specially in the
big cities like Lahore, Karachi, Faisalabad, Islamabad and Peshawar.
2) Demographic Segmentation
Age: People from all age groups (Focus Kids 6-12
years)
Sex: Both Male & Female
Occupation: People from all walks of life
Income: Rs. 15,000/- and above
Religion: Muslims & Non Muslims
3) Psychographics Segmentation
The social class, which is included in the target group of KFC, is consumer from
upper class and middle class. They enjoy getting the services of KFC due to the
status and time constraint. The consumer has wide range of personalities from
dynamic to interesting. From self confident to extra vested, from adventuresome
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to social able. The personality of a person makes a lot of difference in buying
power.
The lifestyle of consumer varies from flashy, liberal modern to dull conservative
and backward. It is a very important factor which very much influences the buyingpattern of the consumer. People will be mostly influenced by high quality,
healthful richness and branding of product.
4) Behavioral Segmentation
The customer expects high quality in product and services offered. KFC is known
for its brand name and quality which creates loyalty and consumers normally
dont want to shift from this outlet to other. Due to internationally brand
recognition and the quality of service offered, consumer expectation is high and
KFC also wants to provide high level of services to their customers. KFC provide
different type of packages and deals to sort down the consumer wants.
5) Benefit Segmentation
Specially the businessman, students and those person how have not much time
to dine out with their family in traditional restaurants due to time constraint. So
this segment prefer to fast food restaurants for dine out alone or with family to
enjoy quality food with minimum time wastage.
6) Target Market
A target market is defined as a group of customers (people or organization) at
whom seller specifically intends to aim its marketing efforts. For this purpose
company must analyze three components:
Consumer
Buying Power Social and psychological factors influencing buying patterns
With the increase in literacy rate and high disposable income people awareness
about health and expectation about services increased. This means Fast Food
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Industry has market in each age group of society. Due to increased
industrialization the income and the life standards are improving. But the new
generation is becoming modern and their life style is totally changed and they like
Fast food rather than traditional food items.
Marketing Plan --- Xtreme Value Meal
The segment which KFC targeted for their new product
Xtreme Value Meal is upper and middle class, People
from all age groups belong to all walks of life. Due to
internationally brand recognition and the quality of
service offered, consumer expectation is high and KFC
also wants to provide high level of services with huge
assortments to their customers. The target segment for
this product is same that the KFC was earlier targeted. The main purpose of
launching this product is to increase product line and to capture more potential
customers.
Marketing Mix
Product:
Name
KFC is launching its new product named as Xtreme Value Meal which is Pizza
based deals.
Product line
Meal for 1 ( one 7 pizza + 1 Regular Drink)
Meal for 2 ( one 10 pizza + 2 RegularDrink+ Salad)
Meal for 4 ( Two 10 pizza + 4 Regular Drink + two salad)
Price Strategy:
The pricing strategy is to be set by keeping in mind our target audience ,
competitors price and the total cost during the manufacturing of product.
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Below table shows the approximate or average total cost and price
Xtreme ValuePizzaItems 7" 10" 13"
Flour 1.80 3.60 5.99
Egg 0.23 0.47 0.78
Chicken 20.00 35.00 60.00
Spices 3.00 5.00 7.00
Onion 2.00 3.50 6.00
Pizza Sause 4.14 8.29 11.05
Tomato 4.00 6.50 9.00
Cheese 28.00 52.50 77.00
Oil 1.90 5.70 12.67
Packing 7.00 10.00 12.00
Total 72.08 130.56 201.49
Proposed Price To be charged 130 250 310
Chicken Tikka Pizza has chicken tikka cubes, green chilies, spicies, onions,
cheese. Cost all these and other ingredient in it are been covered and the total
cost for 7 is Rs. 72.08, 10 is Rs. 130.56 and for 13 is Rs. 201.49.
Xtreme Value Meal Price:
Meal for 1 ( one 7 pizza + 1 Regular Drink)
Meal for 2 ( one 10 pizza + 2 Regular Drink+ Salad)
Meal for 4 ( Two 10 pizza + 4 Regular Drink + two salad)
Xtreme Value Meal Deal Price (Rs.)
Meal for 1 160
Meal for 2 320
Meal for 4 650
Promotion:
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Print Media:
Advertisement in newspaper and Magazine specially in leading news
paper Dawn, The News, Jang and Nawaiwaqt.
X stand flex sign on the entrance gate
Front lit flex sign on the billboard on different lactations.
Broachers and pamphlets to introduce their new product to their
customers.
Electronic media:
TV Channels: Before launching the productXtreme Value Meal will be
displayed TVC teasers on different Television channels. Some of the famous
television channels are
GEO
Star Plus
AAG
ARY
HUM
Radio: there is huge trend of youngsters to dine out in fast food restaurants and
a huge number of youngsters listen music on radio especially FM channels are
too popular in the youngsters so FM and AM radio channels can be a effective
medium to permute our new product.
Promotion on the point of purchase:
When a customer will buy Xtreme Value Meal KFC we will give him or her
discounted coupon. And the benefit of this coupon to the customer will be that
whenever the customer will come to buy Xtreme Value Meal he or she will
get discount. This coupon will be for some specific period of time, like this
coupon will be valid for one week or 10 days.
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Placement Strategy:
As KFC have 34 outlet in allover the Pakistan and majority of their outlet are in
Lahore. In the Beginning, our new product Xtreme Value Mealintroduced in the
KFC outlet of Lahore to certain period of time. But after some time this product
introduced at every outlets all over the Pakistan.
KFC is charging ten rupees for home delivery of their products
but in the case of new product Xtreame Value Meal totally free home delivery
provided to the customers to encourage the usage and for the promotion of the
Product.
Packaging Strategy:
To give value addition to the customers
KFC offers packing of Pizza according to
the horoscopes star (like LEO, Libra,
Aquarius) of a customer has. Also offer
packing of different shapes on different
cultural and religious occasions like in
valentine day the packing shape is like
heart. This packing strategy not only
gives pleasant effect to the product but
also give a attractiveness to the product.
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Market Plan for Three Year
This product of KFC Xtreame Value Meal expected to launch in December
2008. The campaign stars before two month of launching the product in the form
of teasers in print media and in electronic media. In first year, the main objectiveto create awareness about this new product among the potential customers and
attain maximum sales of the product.
In second year spread this product all over the Pakistan KFC
outlets. To sustain and get the competitive advantage we increase the product
line in the Xtreame value meal.
In third year the main objective of KFC is to create maximum
awareness about the product and increase the sales and revenue. Secondly find
out the new segment and usages for their product to increase the profitability of
the company.
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References
Mr. Kashif Imran 0334-9705010
Assistant Business ManagerKFC Joher town Branch
Mr. Umar Saleemi 0322-4689639
Account officer
AFC Wapda Town/ PIA Branch
www.kfc.com
www.statpak.gov.pk
www.afc.com.pk
www.mcdonald.com
www.commerce.gov.pk
www.epb.com.pk
http://lahoremall.com/kfc.php
Pakistan economic survey
http://www.kfc.com/http://www.kfc.com/http://www.statpak.gov.pk/http://www.statpak.gov.pk/http://www.afc.com.pk/http://www.afc.com.pk/http://www.mcdonald.com/http://www.mcdonald.com/http://www.commerce.gov.pk/http://www.commerce.gov.pk/http://www.epb.com.pk/http://www.epb.com.pk/http://lahoremall.com/kfc.phphttp://lahoremall.com/kfc.phphttp://lahoremall.com/kfc.phphttp://www.epb.com.pk/http://www.commerce.gov.pk/http://www.mcdonald.com/http://www.afc.com.pk/http://www.statpak.gov.pk/http://www.kfc.com/