Kentucky Fried Chicken And The Global Fast Food Industry
- What do you believe are KFC’s sustainable competitive advantages in its’ international markets? How does KFC sustain these advantages?
“The theory of flows and systems states that advanced marketing structures between distinct markets incorporates the series, parallel, reciprocal, and duplicating frameworks. There is no fixed formula when it comes to dealing with international brands. Therefore, the competitive strategies of different firms cannot be universal.”[1] KFC implements various mergers with other fast food companies, and this enables the company to flourish among international competitors. The company fused its operations with Taco Bell, A&W, and Long John Silvers. “The implementation of a franchise system facilitates diversification and the company gains a competitive edge in the market.”[2] KFC’s products are available to many consumers across diverse regions. Moreover, the natives in respective areas are responsible for managing the franchise systems. “Thus, the locals feel involved in KFC’s operations, and the company gains a competitive edge in the market.”[3]
“Advertising and quality control enhance the competitive advantage of a specific venture in the international scene.”[4] KFC directs reasonable resources to quality assurance and marketing communications. For example, the company launched a television campaign that incorporates a cartoon displaying Colonel Sanders’ image. KFC has a competitive advantage because of its’ extreme levels of cleanliness and product consistency.
How KFC Sustains The Competitive Advantages. “The prevalent cultures and marketing characteristics are of utmost vitality in all international operations.”[5] KFC sustains its competitive advantages by ensuring that it involves the natives in a particular area in management. Secondly, KFC engages in activities that aim to upgrade on its existing restaurants and eliminate the operating problems. The levels of quality are not compromised and the company manages to retain its’ market position. In addition, KFC ascertains the best operating practices across diverse regions and this ensures that it retains the loyalty of the customers in a specific locale.
- Do you think KFC and other fast food companies should focus on temporary advantage as “sustainable” competitive advantages are becoming very difficult to sustain?
“The theory of behavior constraints states that the political, economic, and social constraints affect marketing procedures. Sustainability entails ascertaining the features of the business that will ensure that the enterprise is successful in the long-term period. Temporary advantage is of significance in the short-term period, and the sustainability of the business cannot be a guarantee based on the aspects of temporary advantage.”[6] KFC and other fast food companies should formulate strategies that will facilitate the activities of the business in future. In addition, the market trends are dynamic, and KFC and other fast food restaurants should be on top of the game. Thus, they should always formulate strategies that are appropriate to all the stakeholders and more specifically the consumers.
“Sustainability incorporates formulating strategies that are complex to replicate. KFC and other fast food restaurants should ensure that their respective strategies are difficult to replicate.”[7] Temporary competitive advantage does not enhance marketing strategies that are unique. Thus, it is necessary for KFC and other fast food companies to refrain from formulating a market strategy based on temporary advantage. Moreover, sustainability entails formulation of a strong organizational culture. Temporary competitive advantage does not provide for a strong organizational culture and it is crucial for KFC and other fast food companies to nurture a strong organizational culture. Furthermore, KFC and other firms should formulate methods of sustaining competitive advantage. The key aspects in launching investments pertain to a sustainable competitive environment, and it is necessary for KFC and other fast food companies to guarantee a sustainable competitive environment.
- What is the extent of KFC’s competition in the Australian market? How does KFC respond to competitor actions?
“The resource based theory of competitive advantage states that it is necessary to identify the available resources in a business. Second, the firm has to assess the viability of the resources and finally the business has to formulate an appropriate strategy.”[8] KFC launched its operations in Australia in the 1960s and the company has experienced subsequent improvements since then. “Currently, KFC has over one million customers and about 602 retail stores in Australia. KFC avails a variety of products in Australia including popcorn chicken and Kentucky grilled chicken.”[9] However, KFC faces stiff competition from other Australian restaurants. The companies include Burger King, McDonalds, Domino’s Pizza, Hungry Jacks, and so forth. “KFC performs better in the preparation of chicken products across various restaurants in Australia. However, McDonalds and Burger King dominate the production of burgers in Australia.”[10] “ KFC has made significant steps in establishing a market base in Australia by being unique and establishing a strong corporate culture.”[11]
KFC’s Response to Competitor Actions. “The forces driving the competition in a particular segment incorporate the supplier power, buyer power, and degree of rivalry.”[12]Moreover, the substitutes and the new entrants are crucial. KFC evaluates the resources that are available in the business. After resource evaluation, the company launches several projects that pertain to franchising and diversification of products. Thus, KFC exhibits an effective response to the actions of its various competitors. “Second, KFC revamps its’ menus and it ensures that it avails wide variety of products to consumers as opposed to some of its major competitors who produce a single commodity.”[13]Third, KFC embraces joint ventures and mergers. The joint ventures and mergers enable KFC to have an advantage because there will be an exchange program between the various firms in the merger.
- Critically evaluate KFC’s global strategy from a “standardization” versus “adaptation” marketing strategy perspective. How does KFC’s approach affect its marketing in the Australia?
“The theory of social change and marketing evolution states that competitive advantage depends on adaptation to a specific region. The formulation of a marketing strategy from a standardization perspective incorporates designing a universal strategy that is applicable internationally. However, strategies whose focus is on the adaptation perspective aim to adjust to the current market dynamics in a specific locale. In addition, an adaptive perspective provides for the aspects of culture and enhancements of various food products.”[14] KFC implements both strategies in its global operations. The adaptation marketing strategy is applicable in instances whereby KFC appoints the locals to manage the franchise systems in various regions. As a result, the locals become responsive to KFC’s products. The standardization market strategy is applicable by KFC in nurturing its’ organizational culture across various nations. KFC engages in activities that ensure the sustainability of its organizational practices in all locales.
KFC’s market approach affects the Australian market in various ways. The Australian market is more receptive to KFC’s methodologies as a variety of food products are available at once. “KFC aims to embrace its’ organizational culture, and its’ restaurant décor displays Colonel Sanders’ images.” [15]As a result, the Australian market becomes enthusiastic about KFC’s products.
In conclusion, KFC respects its own foundations, and this makes it unique among many competitors. Moreover, KFC is receptive to diverse cultures and this is a critical element of international branding. Such procedures guarantee the sustainability of KFC in many countries worldwide.
Bibliography
Allen, Gary, and Ken Albala. 2007. The business of food: encyclopedia of the food and drink industries. Westport, Conn: Greenwood Press.
Bradley, Frank. 2005. International marketing strategy. New York: FT/Prentice Hall.
Chaffey, Dave. 2009. Internet marketing: strategy, implementation and practice. Harlow: Financial Times Prentice Hall.
Cravens, David W., and Nigel Piercy. 2012. Strategic marketing. New York: McGraw-Hill Higher Education.
Hunt, Shelby D. 2010. Marketing theory: foundations, controversy, strategy, resource-advantage theory. Armonk, N.Y.: M.E. Sharpe.
Jakle, John A., and Keith A. Sculle. 2002. Fast food: roadside restaurants in the automobile age. Baltimore, Md: Johns Hopkins University Press.
Kumar, Nirmalya. 2004. Marketing as strategy: understanding the CEO’s agenda for driving growth and innovation. London: McGraw-Hill Higher Education
Locker, Kitty O., and Donna S. Kienzler. 2013. Business and administrative communication. New York: McGraw-Hill/Irwin.
Nash, Edward L. 2000. Direct marketing: strategy, planning, execution. New York: McGraw Hill.
Ottman, Jacquelyn A. 2011. The new rules of green marketing strategies, tools, and inspiration for sustainable branding. Sheffield [England].
Paley, Norton. 2007. The marketing strategy desktop guide. London: Thorogood.
Rentz, Kathryn. 2014. M: business communication. [S.l.]: Irwin Mcgraw-Hill.
Schmid, Volker. 2011. The Impact of Technology on Marketing Strategy. München: GRIN Verlag GmbH.
Smith, Andrew F. 2007. The Oxford companion to American food and drink. New York: Oxford University Press.
Smith, Brian D. 2005. Making marketing happen: how great companies make strategic planning work for them. Amsterdam [u.a.]: Butterworth-Heinemann.
[1] Allen, Gary, and Ken Albala. 2007. The business of food: encyclopedia of the food and drink industries. (Westport, Conn: Greenwood Press), 39.
[2] Bradley, Frank. 2005. International marketing strategy. (New York: FT/Prentice Hall), 45.
[3] Chaffey, Dave. 2009. Internet marketing: strategy, implementation and practice. (Harlow: Financial Times Prentice Hall), 89.
[4] Cravens, David W., and Nigel Piercy. 2012. Strategic marketing. (New York: McGraw-Hill Higher Education), 94.
[5] Hunt, Shelby D. 2010. Marketing theory: foundations, controversy, strategy, resource-advantage theory. (Armonk, N.Y.: M.E. Sharpe), 69.
[6] Jakle, John A., and Keith A. Sculle. 2002. Fast food: roadside restaurants in the automobile age. (Baltimore, Md: Johns Hopkins University Press), 91.
[7] Kumar, Nirmalya. 2004. Marketing as strategy: understanding the CEO’s agenda for driving growth and innovation. (London: McGraw-Hill Higher Education), 125.
[8] Rentz, Kathryn. 2014. M: business communication. ([S.l.]: Irwin Mcgraw-Hill), 98.
[9] Locker, Kitty O., and Donna S. Kienzler. 2013. Business and administrative communication. (New York: McGraw-Hill/Irwin), 205.
[10] Nash, Edward L. 2000. Direct marketing: strategy, planning, execution. (New York: McGraw Hill), 304.
[11] Ottman, Jacquelyn A. 2011. The new rules of green marketing strategies, tools, and inspiration for sustainable branding. (Sheffield [England]), 106.
[12] Paley, Norton. 2007. The marketing strategy desktop guide. (London: Thorogood), 86.
[13] Schmid, Volker. 2011. The Impact of Technology on Marketing Strategy. (München: GRIN Verlag GmbH), 79.
[14] Smith, Andrew F. 2007. The Oxford companion to American food and drink. (New York: Oxford University Press), 304.
[15] Smith, Brian D. 2005. Making marketing happen: how great companies make strategic planning work for them. (Amsterdam [u.a.]: Butterworth-Heinemann), 97.