kfc vietnam- international marketing
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International Marketing
PROJECT REPORT
KFC Vietnam
Instructor : Dr. VU THE DUNG
RESEARCH QUESTIONS
1. What makes KFC Vietnam successful in International marketing perspectives?
2. Why did KFC not leave after seven years of loss?3. Are strategies of KFC Vietnam similar to those of KFC India?
KFC Corporation
• Based in Louisville, Kentucky
• Founded by Harland Sanders in mid 1950s
• Secret recipe of chicken with eleven herbs and spices.
• His growing age prompted Colonel Sanders to sell off the business for $2 million in 1964 to Jack Massey and John Brown Jr- two Louisville businessmen.
• In 1970 KFC merged with Heublein Inc, a producer of alcoholic beverages with little restaurant experience.
• In 1986 KFC was sold to Pepsico.
• There are over 15,000 KFC outlets in 105 countries and territories around the world.
Overview
17,000 KFC outlets in 109 countries and territories around the world
KFC Financial Highlights
International sales in $billion
Year end 2011 2010 2009 2008 2007 5-year growth
KFC 8,920 8,554 8,230 7,830 7,394 5%
Source: www.yum.com/annualreport/
Fast food market in Vietnam
KFC60%
Lotteria30%
Jollibee & others10%
Total sales in 2011: VND810 bn. Growth rate: 26%
KFC Vietnam
• Found by Tony Chew in 1997• Opened first restaurant in Saigon Super Bowl, Dec. 2007.• No profit during the first seven years. • 100 restaurants and outlets in 18 provinces and cities with
3000 jobs so far• 60% of fast food market share• Planning to reach 200 restaurants in 2015 with 7000 jobs.• Competitors: Lotteria, JollieBee…
KFC Vietnam
• Time lines of first restaurants:
12/1997 – Ho Chi Minh City 06/2006 – Ha Noi 08/2006 – Hai Phong & Can Tho 07/2007 – Bien Hoa – Dong Nai 01/2008 – Vung Tau 05/2008 - Hue 12/2008 – Buon Ma Thuot 11/2009 – Đa Nang 04/2010 – Binh Duong 11/2010 – Vinh, Nghe An 05/ 2011 – Nha Trang – Khanh Hoa 06/2011 - Long Xuyen – An Giang 08/2011 - Quy Nhon & Rach Gia 09/2011 - Phan Thiet 12/2011 – Hai Duong
PRODUCT
• Traditional fried chicken with original secret recipe: 11 herbs and spices
• Newly developed products to satisfy Vietnamese tastes– Diversify menu : fillet fried chicken, sandwich,
gravy chicken rice, mixed cabbage and jumbo, shrimp, fish, rice with chicken
– Classify products in categories : combo for kids, for family, snack, salad,…
KFC Products
Delivery menu – 13 options
Delivery menu
Original Fried Chicken
Combo
Combo
Combo
Menu for Kids
Light meals
Light meals
Light meals
Side orders
Side orders
Desserts & Beverages
Desserts & Beverages
Desserts & Beverages
Price
• Low price strategy from the beginning Retain the number of loyal customersAttract new customersMaximize the market share• Increase price when customers increase in
number• Combine 2 portions into 1 with lower price• “Ăn Thật No, Chẳng Lo Về giá!”
Place
• Funny and modern designs• In store and delivery sale• Big cities• Supermarkets, shopping centers• Business districts
Promotion
• Advertising• Sales Promotions• Public Relations• Events and Experiences• Coupons, Discounts and Bundled packages
Advertising
Sales promotion
Sales promotion
Sales promotion
Public relations
KFC Vietnam 100th store celebration
Sales promotion
with Euro Cup
Fan page
On sales
Problems
– Vietnamese people were not used to Western fast-food and greasy food.
– Financial crises in 2008 and 2009 reduced the turnover of KFC.
– Bird flu in 2005 => people did not believe in quality of products made from chicken.
Solutions
–Added rice to the menu–EZ menu during economy crisis–Only imported chicken from North America
and diversified the menu with beef and fish
Potential problems
– Competition from other fast-food brand names: Lotteria, Jollibee …
– Taste of Vietnamese people: prefer tough than friable chicken.
– People are more afraid of implicit disease from fast food such as obesity, heart attack,…
Future
• 200 restaurants and outlets by 2015• Expanding to other provinces and cities
The story of 7even
• 7 years of loss and loss:Vietnamese tastes to Western fast foodUrbanizationHigh rental outlets
The story of 7even
• Why did KFC Vietnam not leave this market?Long-term strategyStable politicsPotential market
Emerging market Young population Customer concern to hygiene and safety
Lessons learned from KFC Vietnam
• To be successful in Vietnam, fast food businesses need
Strong brandLong-term strategyCombination of standardization and localizationGood locationsEffective marketing campaignsWell-designed serviceContinuous improvement
KFC INDIA
• The first outlet opened in 1995 in Bangalore• Issues:– Protests from farmers and PETA– Targeted to high class income group– Menu without flavors and spices which Indian like.
Left Indian Market after one year
KFC INDIA
• KFC decided to re-entry to India in 2003 with new strategies.
• Now KFC has opened >100 outlets and will expand to 500 in 2015
• Competitors:– McDonalds– Pizza Hut– Domino Pizza– Café Coffee Day– Barista.– ….
KFC INDIA 4P’s
• Products: not only traditional KFC menu, but also more meals with Indian culture:– Fried Chicken– For vegetarian: Veg snacker, veg strips with salsa…– Rizo Rice: made from vegetable and fine Indian
herbs– Drinks: Pepsi and others
KFC INDIA 4P’s
• Price:– Target to high income group and to middle class of
customers also.– Give lower price for the same products from
competitors
• Place:– Expand network cross the country but more in big
cities: Dehli, Kolkata…– Location with large number of young people
KFC INDIA 4P’s
• Promotions:– Reminder ads: “Finger lickin’ good”– Sales promotions, coupons…– Events
KFC Vietnam versus KFC IndiaKFC Vietnam KFC India
Population 85 m. 1 bn.
Market share 60% 10%
Competitors Less More
Consumer acceptance More positive More negative
Localization More from beginning Less from beginning
Price strategy Low price Low price
Lessons learned from KFC Vietnam
• To be successful in Vietnam, fast food businesses need
Strong brandLong-term strategyCombination of standardization and localizationGood locationsEffective marketing campaignsWell-designed serviceContinuous improvement
GROUP 1 MEMBER
1. Nguyễn Thành Được2. Nguyễn Đăng Hạt3. Nguyễn Thị Minh4. Phạm Thị Hồng Phượng5. Lê Thị Thúy Linh6. Lữ Vân Phan Nhớ7. Đoàn Giang Sơn8. Trần Thị Ngọc Quyên
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