MARKETING STRATEGIESOF

MCDONALD’S VS

KFC

PRESENTED BY:-

• CHANDAN SINHA- BBA 4598/08• KUMAR RAVI- BBA 45103/08• ROHIT SINGH- BBA 45108/08• ANIL KR AGARWAL- BBA 4543/08

McDonald’s INDIA

Mc Donald's in India.

• McDonald’s entered India in 1996.• McDonald’s India has a joint venture with

Connaught Plaza Restaurants and Hard Castle Restaurants.

• Connaught Plaza Restaurants manages operations in North India whereas Hard Castle Restaurants operates restaurants in Western India.

• Today it has 169 Restaurants across India.

MARKET PERFORMANCE

• Estimated CAGR of 40%.

• Market share of 18% in north India.

• Total revenue of 2007-08 was 740.2 million $ in India.

BUSINESS MODELCONTD.

• Franchise Model – Only 15% of the total number of restaurants are owned by the Company. The remaining 85% is operated by franchises.

• Product Consistency – By developing a sophisticated supplier networked operation and distribution system, the company has been able to achieve consistent product taste and quality across geographies

BUSINESS MODELCONTD.

• Act like a retailer and think like a brand – McDonald’s focuses not only on delivering sales for the immediate present, but also protecting its long term brand reputation.

McDonalds Marketing Mix

(4 P’S).

PRODUCT.• The strategy for product is to provide entry

level product so that the customer can try new items and graduate to higher rungs.

• McDonalds has intentionally kept its product depth and product width limited.

• Designed the product after deeply studying the Indian customers.

• For Indian menu ham, beef and mutton burgers were removed.

• McDonalds continuously innovates its products according to the changing preferences and tastes of its customers.

PRICE.• This is the most important part of the marketing mix for

McDonald’s as this is the only part which generates revenue. All the other three are expenses incurred.

• McDonald’s came up with a very catchy punch line “Aap ke zamane mein ,baap ke zamane ke daam”. This was to attract the middle and lower class consumers and the effect can clearly be seen in the consumer base McDonalds has now.

• McDonalds has certain value pricing and bundling strategies such as happy meal, combo meal, family meal etc to increase overall sales volumes.

• Competitive pricing.

Pricing Strategy

• Value Ladder Strategy.• In March 2004 introduced “AAP KE ZAMANE

ME BAAP KE ZAMANE KE DAAM”. In this section prices ranged from 20 to 80, which resulted high increase in sales volume.

• Started product bundling.• Prices are stable because of well established

low cost chain.

PLACE.• The place mainly consists of the

distribution channels. It is important so that the product is available to the customer at the right place, at the right time and in the right quantity.

• The structure is simple for McDonald's. In India the outlets in north and east India are run by Connaught Plaza rest pvt ltd and outlets in west and south India are run by Hard Castle Rest. Pvt ltd.

• 169 outlets all over India.• Localized the supply channels.

McDonald’s a Locally Owned Company.

PROMOTION.

• The idea of their promotion is to promote McDonald’s as a global image.

• “Brand globally, advertise locally” is the McDonald’s promotional strategy.

• McDonald’s does its promotion through television, hoardings and bus shelters. They use print ads and the television programmes are also an important marketing medium for promotion.

• Intensive advertising aimed at children.

Some of the most famous marketing campaigns of McDonald’s are:

1. “You Deserve a break today, so get up and get away- To McDonald’s”

2. “Aap ke zamane mein ,baap ke zamane ke daam”.

3. “Food, Folks, and Fun”

4. “I’m loving it”. It is one of the most successful ad campaigns launched in 2003.

CO -BRANDING

• McDonald's has major tie up’s with various companies as their co- branding strategy.

• Coca cola-

• Brabie-

• Hot wheels-

• Disney-pixar-

SWOT ANALYSIS.

STERNGTHS.• Strong brand.• Customer intimacy.• Product innovation.• Supplier Integration.

SWOT ANALYSISCONTD.

WEAKNESS.

• Low width and depth of the product.

SWOT ANALYSISCONTD.

OPPORTUNITY.• Expand into Tier-2 and Tier-3 cities.• Entry into breakfast categories.

THE ROAD AHEAD.

• Entry to Tier 2 and Tier 3 cities – The main target customer for McDonald’s is the new urban Indian family. With the customer demographics constantly changing and tectonic social and cultural shifts being observed in Tier 2 and Tier 3 cities due to globalization, the company is now expanding to Tier 2 cities like Pune and Jaipur.

• Rolling out McBreakfast across all outlets – In India, the

company has recently launched its entry into the breakfast food category. This is now launched on a pilot basis on select stores. In Mumbai, it available at the Vile Parle outlet. The company views this category as a key growth driver in future.

SWOT ANALYSISCONTD.

THREATS.• Changing customer lifestyle and taste.

• Increased competition from local fast food outlets.

KENTUCKY FRIED CHICKENKFC

ABOUT KFC

• 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 IN INDIA.

• KFC(KENTUCKY FRIED CHICKEN) entered India in 1995.• Because of KFC not adhering with the Prevention of Food

Adulteration Act, 1954 and certain other mistakes it had to leave India.

• In 2003 it again came back with revised strategies and willingness to improve its earlier mistakes.

• Since then KFC has a strong presence in 11 cities of India with around 50 stores.

KFCMARKETING MIX

4 P’s

PRODUCT.

• 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.

• Products are generated based on the geographical locations.

• In KFC feedback is taken from the customer in order to know the customer demands and then improvements are made in products.

• KFC focuses on pure and fresh food in order to create a distinct and clear position in the minds of customers KFC has a strong brand name and they are leading the market in fried chicken.

PRICE.

• They adopt the cost base price strategy. Pricing of the product includes the govt. tax and excise duty and then comes the final stage of determine the price of their product.

• KFC globally enters the market using market skimming. Their products are priced high and 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.

Demographic factors

• 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.

• Gender: Both male and females are focused by KFC, gender does not play any role here.

• Household Size: This plays a vital role in the demographic factor of the KFC. 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.

Economic Factors

• 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.

• Consumption Behavior: It estimates the behavior of people, their liking and disliking towards the pricing of the products.

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 lifestyle – Due to the hectic lifestyle of office goings individuals the fast food concept saves time of preparing food and gives the customer a full meal quickly.

• Economically convenient – The pricing appeals to the many classes of a society.

• CHANNELS-1st level channel ie ; Manufacturer---Retailer---Consumer.

PLACECONTD

Location– Hectic lifestyle of individuals – giving them more time at work

and less stress about waiting for food.– Commercialization of urban and sub-urban markets leading to

more mid-sector people that find high-end eating joints very to expensive.

– Mid-sector people are always looking for change which KFC provides in their range of fast food.

– Quality conscious – people in urban areas are more conscious about the quality of food than rural areas.

– Urban areas are more populated therefore they help with attracting higher revenues.

PLACECONTD

Placement of outletsDue to KFC placing itself close to schools, colleges, cinemas and markets which are mostly populated by the young and those who are in a hurry, KFC enjoys a large number of footfalls everyday. In addition, they also have outlets close to non-vegetarians (mostly Muslim populated areas).

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.

• KFC and its new company jingle, “finger lickin good” is a frequent announcement on televisions, billboards, flyers and radio.

• The company anthem “finger linkin good” is just a wake up call to the consumer to remind them how good they felt the last time they ate KFC chicken.

• Sponsorship is another tool to strengthen an organizations image. KFC is currently the sponsor of the West Indies Cricket Team.

• All KFC outlets offer its customers with various forms of incentives to buy its Chicken.

SWOT ANALYSIS.

STRENGTHS.• Strong presence over competitors with its

primary product fried chicken.• High global brand image.

SWOT ANALYSISCONTD.

WEAKNESS.• Lesser number of outlets.• Little or no coverage in Tier-II cities.

SWOT ANALYSISCONTD.

OPPORTUNITY.• Opening more outlets in the four metros to

increase their presence.• Venturing in potential Tier-II cities.

SWOT ANALYSISCONTD.

THREATS.• McDonald’s is the biggest threat for KFC, because of its

continuous growth in Indian market.• Tough competition from the local non-vegetarians dishes

prepared by the local restaurants.• KFC’c previous brand image.

CONCLUSION

In India fast food market is strongly dominated by these 2 brands. But when it comes to comparing these two brands the following study brings us to a conclusion that as far as market presence and brand value is concerned McDonald's has definitely proved a point for themselves. But KFC who re entered in 2003 has shown a rapid progress and no wonder if in the coming years KFC overtakes McDonald’s in the Indian market share. Time will be the evidence for this, but for now it’s Ronald McDonald who is sitting high atop compared to the Colonel.