KFC's winning Strategy In India
|Regardless of the fact that McDonald’s is the first mover in the Indian Branded fast food market, the apparent success of the firm actually invited much competition. The competition was not only restricted to similar product category in the form of Pizza Hut, Dominos and US Pizzas (in Western India), but it became intense in the same product category as KFC and Subway came into the scenario. It was indeed hurting McDonald’s as these companies eventually followed the path which was discovered by the firm. McDonald’s might be the first to understand the uniqueness of the Indian consumer’s psyche, but there are others who have mastered the art of capturing the imagination Indian consumers.
Last year, Pizza Hut completely transformed its product offering, by not only offering more Indian flavored toppings to their pizzas, but at the same time introduced a large variety of salads and starters. US Pizza on their part understood the price sensitivity of the consumers and designed a unique buffet service where the customers can have as much as they want. On the other hand, Subway focused on the positioning themselves as a more green and fresh brand to stimulate the demand from the consumers of India, who are mostly vegetarian. But the brand which was hurting McDonald’s the most is KFC. The year 2011 witnessed a huge fight in this burger market as KFC launched its Streetwise range in order to make their market share better in India. But the time and space which KFC got was much limited as immediately after few months McDonald’s came up with the McSpicy range. The value segmentation strategy for McDonald’s was the key strength while on the other hand KFC’s previous campaigns were mostly depended on the premium products they served. But the year 2011 was different as evidently this year showed how these two brands envied each other as they particularly started targeting the same market. This actually called for some blood loss.
The crispy chicken offering in the McSpicy range introduced by McDonald’s is quite similar to that of the Zinger products as introduced by KFC earlier. McDonald’s realized that KFC has won the initial battle of understanding the taste preferences of the Indian consumes better. The war cannot just be restricted to only one component of the marketing mix in the form of “Product Design”, but eventually the battle became fierce as McDonald’s tried to play catch-up. As the Streetwise range of products of KFC started at INR 25, McDonald’s introduced the Happy Price Menu starting at INR 20. The pricing strategy of McDonald’s McSpicy and KFC’s Chicken Zinger was also similar as the former costs INR 111 while the later was priced at INR 101. The competition leading to the similar product positioning actually compelled McDonald’s to price a burger over INR 100 first time in India.
KFC tried to respond to this follow-up game by McDonald’s by introducing the Hot Chicken Zinger in April, 2011. Also at the same time the company who was only famous for chicken products focused on introducing vegetarian products specially designed for Indian consumers. The combo pack introductions also catered the tastes of the local consumers as the company management realized the inclination of the Indian consumes towards traditional Indian flavors in the form of Palaws & Chicken Curry. (Sweet flavored Rice with Chicken Gravy). In that regard, McDonald’s product offering became a bit predictable.
But what practically provided the desired level of recognition to KFC are not its food products rather it was the beverages. Krushers are big hit among the consumers of India and it provided a separate identity for KFC. It was something which was out of league for McDonald’s as even if they try to replicate it, the adaptation will be too obvious to give the brand a negative perceived image among the Indian consumers. Thus the ultimate strategy taken by KFC to beat the competition while making their brand more prominent in Indian market was simply to Krushhhhh McDonald’s.
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