KFC SWOT Analysis - Research Paper Example

 (a) Strengths KFC is recognized as the second best global fast food brand. The value of the company is almost $ 6 billion (Jurevicius, . Prompt services and hygienic foods are the significant strengths of the company. Trademarked recipes like “Hot ‘N’ Crispy” chicken, “Fiery Grilled” chicken etc. are the major strengths in terms of competitive advantage (Jurevicius, 2013). KFC has a rich history as a recognized brand in fried chicken. The Kentucky Fried Chicken restaurant is a renowned chicken restaurant with an outstanding image across the world and has been globally placed for almost 50 years from its inception. KFC runs almost 5200 fast-food outlets in United States and almost 15, 000 outlets in other parts of the world (ET Bureau, 2014). This makes KFC the biggest chicken restaurant in the world. KFC has a market share of 50% and is estimated that this may increase in the near future. KFC serves a customer base of more than 13 million customers in more than 110 countries (KFC, 2014). KFC offers an original recipe with extra crispy grilled chicken that is served with home-style sides. KFC has a secret recipe that is served with 11 spices and herbs (Abbiewhouse, 2014). (b) Weaknesses The organization has a significant weakness of high employee turnover. The company has less global presence than McDonald’s. It also has weakness regarding global franchise management. KFC has serious weaknesses in terms of marketing exchange with PepsiCo. Soft drinks of only PepsiCo are available in KFC stores. This is a strategic weakness of this global food chain (Jurevicius, 2013). Additionally, KFC primarily offers chicken products to its patrons. This implies that it does not offer novel or differentiated products. KFC faces dilemmas in sustaining high standards of hygienic foods (Abbiewhouse, 2013). The company faces different charges in distinct nations because of poor standards of hygiene. For instance, in 2007 a KFC restaurant in New York was criticized for being rat infected (Woollaston, 2013). (c) Opportunities The organization has significant opportunity and can take substantial advantages of the North American Free Trade Agreement. The company has enough opportunities in vegetarian food items. The company has substantial opportunities to become responsible towards the environment. It can help them to remove all the negative publicities (Jurevicius, 2013). The shifting demographic trends offer an opportunity to KFC to diversify into new products and regions. For instance, there is a new trend where patrons are becoming health-conscious, and KFC can target such customers with new healthy products such as the corn on the cob, cornbread muffin and macaroni salad (Bhushan, 2014). Additionally, the increased number of single mothers and take-out foods offers an increased demand for KFC’s products (Brand Republic, 2013). The contemporary business environment requires an organization that is environmentally conscious and accountable (ET Bureau, 2014), as a result, KFC’s move to be environmentally responsible will heighten its reputation and image and increase its revenue and profits. Another opportunity available for KFC is the expanding Latin American Market. This market presents an opportunity to grow and expand to the region through offering a blend of KFC’s cuisine and local cuisines. (d) Threats Competitions from other fast food giants like McDonald’s and Subway are increasing day by day and it is an alarming threat for the company. Fast food markets are getting saturated in the developed economies and the business of the organization is significantly dependent on the developed economies only (Jurevicius, 2013). Because of its wide expansion, KFC faces the problem of sustaining similar standards in their outlets across countries. Additionally, the increasing number of health conscious customers poses a threat to KFC since most of its diet consist of chicken products (Bhushan, 2014). (e) Matching Strengths to Opportunities/Converting Weaknesses and Threats With the help of a strong financial situation the organization can mitigate the threat of market saturation by opening new stores in the developing economies. Prompt services i.e. short “Turnaround Time (TAT)” of KFC can reduce the weakness of high employee turnover. With the strength of hygienic and fresh food items the organization can improve its position as far as their environmental stewardship is concerned (Jurevicius, 2013). IV. MARKETING OBJECTIVES According to the annual report of KFC, revenue of the organization in 2013 was US$23 billion. One of the most important marketing objectives of the organization is to increase its market share in the industry of the fast food. Global business expansion is also an important marketing objective for the company. The organization has a clear cut objective to improve its profit margin to push their growth. The company has designed its marketing strategies according to their marketing objectives. Increasing customer loyalty is also an important marketing objective of the company. The organization always encourages and seeks for their satisfied customers to be repeat customers. As far as KFC is concerned providing dynamic and positive customer experiences are the integral parts of the marketing objectives of the company. The fast food industry has cut throat competitions. Being a player in the industry, the organization has significant challenges from different competitors like McDonald’s and Subway. KFC has a clear cut marketing objective to gain competitive advantages in the market. Due to that, the organization uses marketing as an effective weapon. Competitive supremacy with the help of attractive and effective marketing strategy is an inseparable part of their marketing objectives. The organization has stakeholders like investors and franchises and marketing objectives of the company are also being decided to attract the investors and franchisees. The organization is trying to diversify its portfolio of food items to target more customers. KFC has a prominent marketing objective to introduce the newly added food items into the market (Jurevicius, 2013). V. MARKETING STRATEGIES Target market(s) Target markets of the organization are the individuals who have busy and hectic lifestyles. People who want or need to devote more time to work rather than spend their time preparing food, the organization targets those customers. These kinds of customers are very busy in their life styles and are typically seeking a wholesome good meal at an affordable price. The company also targets middle and high income people. Due to the nature of their business KFC intentionally targets urban and suburban areas. Population of the urban areas is generally higher than the population of the rural areas. People of the urban areas have much more disposable incomes as compared to the people of the rural areas. These areas generate significant revenues for the company. That is why KFC has chosen these kinds of markets (Miah, 2014). Marketing Mix 1. Product Products of the organization are predominantly fried chicken related. All the products of the company are original in nature and give significant importance towards the quality and hygiene of the products (Miah, 2014). 2. Price KFC follows market skimming pricing strategy. The organization enters into the global market with this kind of pricing strategy and targets upper and middle class people of the society (Miah, 2014). 3. Place Urban and semi urban areas are typically the selected areas for the organization. The organization usually set up their stores into the commercial and more highly populated areas of the city where lifestyles of the people are significantly more busy and modern (Miah, 2014). 4. Promotion KFC manages its promotions with the help of sales promotion, public relationship, advertising, events, and social media marketing by offering attractive discounts to their customers (Miah, 2014). References Abbiewhouse, A. (2013, January 23). Poor food hygiene discovered at Yeovil's KFC weeks after opening. Retrieved October 27, 2014, from www.westerndailypress.co.uk/Poor-food-hygiene-discovered-Yeovil-s-KFC-weeks/story-17939224-detail/story.html Bhushan, R. (2014, September 27). Restaurant chains increasing vegetarian menu rapidly in the country - Economic Times. Retrieved October 27, 2014, from http://articles.economictimes.indiatimes.com/2014-09-27/news/54377122_1_vegetarian-yum-restaurants-kfc Brand Republic. (2013, June 16). KFC targets women customers - Economic Times. Retrieved October 27, 2014, from http://articles.economictimes.indiatimes.com/2003-07-16/news/27531245_1_kfc-soul-food-chicken ET Bureau. (2014, October 1). Fast & Furious: KFC gets meatier, eyes No. 3 slot after Domino's and McD's - Economic Times. Retrieved October 27, 2014, from http://articles.economictimes.indiatimes.com/2014-10-01/news/54516800_1_mobile-ordering-app-kfc-niren-chaudhary Jurevicius, O. (2013). SWOT analysis of KFC. Retrieved from: http://www.strategicmanagementinsight.com/swot-analyses/kfc-swot-analysis.html. KFC. (2014, January). About KFC. Retrieved October 27, 2014, from http://www.kfc.com/about/ Miah, R. (2014). Marketing mix-KFC. Retrieved from: http://www.academia.edu/7566841/Marketing_mix-KFC. Woollaston, V. (2013, September 3). From mouse droppings in Domino's Pizza to rodents in Burger King: The UK's 'most disgusting' food chains revealed | Daily Mail Online. Retrieved October 27, 2014, from http://www.dailymail.co.uk/health/article-2409772/From-mouse-droppings-Dominos-Pizza-rodents-Burger-King-The-UKs-disgusting-food-chains-revealed.html . Read More