Industrial Marketing Strategy

7/31/2019 Industrial Marketing Strategy

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EXECUTIVE DIPLOMA IN

INDUSTRIAL BUSINESS

MANAGEMENT

ASSIGNMENTMODULE :INDUSTRIAL MARKETING STRATEGYSUBMITTED BY : 15CLASS :EDIBM 11LECTURER :ENCIK HASNUDEN HASHIMSUBMISSION DATE : 27 APRIL 2012

MARK :


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TABLE OF CONTENT

CHAPTER DETAILSPAGE

NO.

CONTENT 2

1.0 INTRODUCTION 3-8

2.0

DEFINITION OF STRATEGIC MARKETING AND

SUMMARIZATION OF THE RELEVANT THEORIES

DISCUSSED

9-10

3.0

EXTERNAL AND INTERNAL ANALYSIS CONDUCTED,

FACTORS BEING LOOKED AT : PRODUCT, PRICE,

PLACE AND PROMOTION

12-18

4.0 OTHER CONSIDERATIONS (SEGMENTATION ETC.) 19-20

5.0 SUMMARY & CONCLUSION 21

6.0 REFERENCE 22


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CHAPTER 1 : INTRODUCTION

COMPANY PROFILE

KFC Corporation, or KFC, founded and also known as Kentucky Fried Chicken, is a chain of

fast food restaurants based in Louisville, Kentucky. KFC is a brand and operating segment,

called a "concept" of Yum! Brands since 1997 when that company was spun off from PepsiCo.

KFC primarily sells chicken in form of pieces, wraps, salads and sandwiches. While its primary

focus is fried chicken, KFC also offers a line of roasted chicken products, side dishes and

desserts.

KFC VISION STATEMENT

Food, Fun & Festival, this is what KFC is all about. Leading the market since its inception, KFC

provides the ultimate chicken meals for a Chicken Loving Nation. Be it Colonel Sanders secret

original Recipe Chicken or the Hot & Spicy Version, every bite brings a YUM on our face. At

KFC we can proudly say, We DoChicken right .


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KFC MISSION STATEMENT

(i) We are committed to customer satisfaction through offering high quality with excellentservices and good value.

(ii) We take great pride in serving each other, our customer and our communities.(iii) We seek continuous improvement in all that we do.

MARKETING ENVIRONMENT

There are certain forces, inside and outside an organization that affect marketing managements

ability to build and maintain successful relationships with target customers. Like all other

companies, KFC also has such forces around it; marketing environment is made up of Micro

environment and Macro environment.

(i) The Micro environmental Forces

This environment includes the factors that are close to the company and are contollable

by the organization. These factors are:-

- CompanyKFC is the multinational company that has chain of fast food restaurants all over

the world. In Pakistan it has 40 outlets out of which, 22 are based in Lahore, 19


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are in Karachi and the remaining 8 are located in the other cities of Pakistan. KFC

is growing rapidly, by having their strong relationship with their customers and

the trust , which they have developed, in the past years, employees are the main

assets of the company, and so they are very much concerned. The company has

very organized check and balance system, which is used for the evaluation of the

employee and the individual outlet as well.

- Suppliers

As KFC cannot compromise on the quality of food they provide, so reliable

suppliers are very much important to them. There are two categories of supplies.

The Dry food supply and the Frozen food supply. For the dry food , like a

burger buns- they have established their own warehouses and dry-stores for the

South region. Where as for the North region, they get dry material from the

vendors like Dawn Bread . For the Frozen food chicken they have agreement

with the K&N Chicken , for supplying chicken and fish is supplied by Thiland

and spices are supplied by Dubai to all over restaurants in Pakistan.

- ConsumersIt includes five categories as follows:-

a. Consumer MarketsKFC has large chain of consumers. According to KFC, We are growing

only with our customer. KFC has great environment for their consumers


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and families. They are concerned about the comfort and satisfaction of

their customers. That is why 40 million on a single outlet.

Midnight deals are there for the consumers with 50 % discount, which is

being appreciated by the individuals.

b. Business MarketBusiness markets buy good and services for further processing or for use

in their production process. In case of KFC there is no such business

market.

c. ResellersKFC is dealing in fast food, and so they dont have any resellers as such.

d. Government CustomersAs such no govt. customer exist so far. KFC is not expecting any govt.

customer as such.

e. International CustomersKFC is multinational company. They have outlets, almost in every

country. So they have international customers all over the world.


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- CompetitorsThey are classified into direct and indirect competitors.

a. Direct Competitors (McDonald, Subway)b. Indirect Competitors (Like Salt & Pepper, Kabana, Village, Bundu)

(ii) The Macro Environmental Forces

These are not controlled by the company and are environmental forces. It includes

Demographic Factor.

KFC has designed its menu according to taste of population. People of each age like to

visit KFC. It has deals for families as well as deals for the children. They also visit their

competitors to have better idea about changing trends and taste of people as well as their

competitors. KFC reconsider its menu and taste after every three months. KFC always

encourages feedback and suggestions from its customers.

Natural Factors

KFC always produces fresh food. The supply houses are well prepared and well

maintained for changing factors of weather. So it is not affected by natural factors.


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Technological Factor

Their machines and boilers are according to latest technology and standards. After every

six months, technical checkup is conducted and that equipment is replaced which

becomes useless. Efficient billing system is implemented, to eliminate the redundancy

and maintain the daily ledger account.

Political Factors

It consists of laws, govt. agencies and pressure groups that influence or limit various

organizations and individuals in a given society. But KFC has its own strong links and

politics, it is not been influenced by any external factors. No pressure groups are there

inside and outside organization to pressurize in any aspect.

Ethically there might be certain forces that have been impact on the overall sale of KFC,

for that; it has also made certain strategies and road-maps to overcome them.

Cultural Factors

KFC is always concerned about the culture and ethical values of the community. As, the

customer are from the same community that they are serving in, KFC takes care of ethical

and moral values of the society. As Pakistan is an Islam based country, so KFC serves

Halaal food here.


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CHAPTER 2 : DEFINITION OF STRATEGIC MARKETING AND

SUMMARIZATION OF THE RELEVANT THEORIES

DISCUSSED

There are five alternatives concept under which organizations design and carry out their marketing

strategies which are:-

Production concept Product concept Selling concept Marketing concept Societal concept

Production concept:

"The idea that consumers will favor the product that are available and highly affordable"

As for as KFC is concerned it is not following the production concept as the outlets of KFC

are in posh areas only, they are targeting the upper class and hence their prices are also high.

Product concept:

"The idea that consumers will favor products that offers most in quality, performance, and

features" KFC is following product concept as it is making improvements in products

Features.


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Selling Concept:

"The idea that consumers will not buy enough of the firm's products unless it undertakes a large

scale selling and promotion effort".

Mostly the firms practice the selling concept when they face overcapacity. As KFC provides fresh

foods according to the needs of customers and earn profit through customer satisfaction, so it does

not follow selling concept.

Marketing Concept:

"The marketing management philosophy that holds that achieving organizational goals depends

on knowing the needs and wants of target markets and delivering the desired satisfactions better

than the competitors".

KFC is following market concept as it is focusing on the customer and making improvements in

the menus according to the need and wants of the customer. It has added in its menus as fish

zinger, salad, Arabian rice etc according to the demands of the customer.

Societal Marketing Concept:

"A principle of enlightened marketing that holds that a company should make good marketing

decisions by considering consumers wants the company's requirements, consumer's long-run

interest, and society long-run interest".

Like KFC Mall Road Branch is giving employment to disables only, so its based on societal

marketing concept.


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CHAPTER 3 : EXTERNAL AND INTERNAL ANALYSIS

CONDUCTED, FACTORS BEING LOOKED AT :

PRODUCT, PRICE, PLACE AND PROMOTION

KFC is market leader in providing Fried Chicken. As KFC is addressing Fast Food, so it is competing

with the prominent market signs, like Pizza Hut and McDonalds.

Product ofKFC is doing well so far. It needs improvement in their Hot-Menu. They should make

their menu dynamic, by introducing new meals after certain period of time. New items should be

introduced, by varying the taste. Like, pizza hut has come up with "Chapli Kabab Pizza"addressing

the local taste; KFC should go for such innovation, in order to increase their market share.

Price of KFC is reasonable, if compared with other fast food restaurants. But as, price is always the

primary concern for consumers; so KFC should adopt certain strategy to attract the consumers. Its not

only by lowering their prices. It could be by, introducing discount packages, for families, employees,

students and regular customers. The membership cards can be used to, provide certain extra value to

the consumers.

Placement is very important factor, for a company to increase its market share, by targeting the right

consumers. KFC need to have more outlets, at commercial areas. It will help in targeting the actual

customers and potential customers as well. Mobile outlets can be effective addition as well.


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Promotion of KFC has a large customer equity, but being a market symbol, a company should strive

for having more actual customers. KFC should work for, having a solid marketing department. They

should organize and run advertisement campaigns. It would certainly be, incremental factor for their

sale. Different modes of advertisements can be used for, triggering the community. KFC could use

brand promoters. KFC can setup, promotional campaigns. All what is needed is a well established

marketing department, in order to facilitate effective, promotions.

The marketing mix is generally accepted as the use and specification of the 'four Ps' (4P)

describing the strategic position of a product in the marketplace.

3.1 Product3.2 Price3.3 Place3.4 Promotion


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3.1 Product

Anything that can be offered to a market to satisfy a want or need.

KFC's specialty is fried chicken served in various forms. KFC's primary product is

pressure-fried pieces of chicken made with the original recipe. The other chicken

offering, extra crispy, is made using a garlic marinade and double dipping the chicken in

flour before deep frying in a standard industrial kitchen type machine.

The menu of KFC provide as follows:-


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3.2 Price

Price is the any amount of money that customers have to pay while purchasing the

product. More broadly, price is the sum of all the values that consumers exchange

for benefits of having or using the product or services.

The factors below also include in the Price factor:-

(a) Demographic factors:-(i)

Age: Generally there is no age limit focus by the KFC. The target and

focus is on each and every individual in a society. KFC finds its largest

demographic in the young of any society.

(ii) Gender: Both male and females are focused by KFC, gender does notplay any role here.

(iii) Household Size: This plays a vital role in the demographic factor of theKFC. Generally they target whole families rather than single persons. This

being the reason for their Family Meals which are basically bundled items

served at a nominally cheaper rate.

(b) Economic factors:-(i) Income: Income is an important key factor for KFC. This factor decides

which class is to be targeted. In the early rise of KFC they focused on the

upper class but slowly are introducing economy meals that attract the

lower to middle classes.


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(ii) Consumption Behavior: It estimates the behavior of people, their liking

and disliking towards the pricing of the products.

3.3 Place

TARGET AREAS

Free home Delivery strategy They 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 lifestyleDue to the hectic lifestyle of office goings individuals the fastfood concept saves time of preparing food and gives the customer a full meal

quickly.

Economically convenientThe pricing appeals to the many classes of a society.

3.4 Promotion

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:

3.4.1 Advertising3.4.2 Sales Promotion3.4.3 Public Relations3.4.4 Events and Experiences


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3.4.5 Coupons, Discounts and Bundled packages

3.4.6 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.

3.4.1 Advertising

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 good is a 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.

Using Reminder advertisements KFC stimulates repeat purchases of its products. The

company anthem finger licking good is just a wake up call to the consumer to remind

them how good they felt the last time they ate KFC chicken.


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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.

3.4.2 Sales Promotion

KFC uses the following tools to further enhance its sales.

Premiums

Exhibits

Coupons Entertainment

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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CHAPTER 4 : OTHER CONSIDERATIONS (SEGMENTATION

ETC.)

4.1 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. In north India Chicken is the main selling product, while in the south the Veg.

items sell more than the chicken.

4.2 Demographic SegmentationIn 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:-

(i) Age is between 6-65.(ii) Gender is both males and females.(iii) Family size is 1-2, 3-4, 5+(iv) Income is Rs 10,000 n above.(v) Family lifestyle is almost all.

4.3 Psychographic segmentationDividing a market into different groups based on social class, lifestyle, or personality

characteristics is called psychographic segmentation.


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KFC divides market on the basis of psychographic variables like

(i) Social class- Upper and Middle class.(ii) Lifestyle is not specific.(iii) Personality is ambitious and authoritarian


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CHAPTER 5 : THE NEEDS OF MONITORING AND REVIEW,

SUMMARY & CONCLUSION

KFC is providing employment to 1200 Pakistanis which adds up to 6000 Pakistanis directly

dependant on KFC. KFC paying Rs.10 million to Govt. of Pakistan as direct taxes. 95% of its

food and packing material is used in KFC Pakistan is produced locally which sums up to

purchase of 35 million per month. Each new outlet developed by KFC Pakistan spends 40

million rupees thats a massive amount for this industry. From above analysis, its clear that

KFC and Pakistan are growing together. So KFC is doing well at Pakistan. KFC is also

following marketing strategies, segmenting the market to segmentation variables and increasing

their market share. KFC is leading in Fried Chicken. It gives quality, variety and fresh meal as

of its competitors.


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CHAPTER 6 : REFERENCE

Google Search:-

(i) WWW.KFC.COM(ii) WWW.KFCPAKISTAN.COM(iii) NAVEED IQBAL, BUSINESS UNIT MANAGER, KFC, MALL ROAD, LAHORE.(iv) PRINCIPLES OF MARKETING by PHILIP KOTTLER & GREY ARMSTRONG
http://www.kfc.com/http://www.kfc.com/http://www.kfcpakistan.com/http://www.kfcpakistan.com/http://www.kfcpakistan.com/http://www.kfc.com/

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