• Post:By Admin
• January 11, 2024

Customer Management: KFC

Introduction 

KFC is one of the leading fast-food chains in the fast-food industry, which has been able to manage a great customer engagement strategy so far. While this report aims to provide a clear idea about how the organization has been performing, and what are the major things that could help the company to improve in terms of customer engagement and customer acquisition and marketing practices (Amoako et al., 2021). Hence, starting with an organization summary, the report would focus on the customer engagement strategies application of KANO models and a competitive analysis with McDonald’s in order to understand the current market KFC and the areas for improvement.

Organization Summary

1) Customer Acquisition, Retention, and Development Strategies

Customer Acquisition:

KFC employees a multifaceted approach to custom acquisition leveraging both online and offline channels. Online strategies include targeted digital marketing campaigns engaging social media content and mobile app promotions. For example, Facebook, Twitter and Instagram are the great platforms to engage with potential customers through interactive content promotions and advertisements (Lucas, 2023). On the other hand, this is not only increasing brand visibility, but also serves as a means of attracting new consumers.

 In the context of offline method KFC strategically locates its outlets in high traffic areas, capitalizing on footfall and impulse purchases. Anees et al., (2020), highlights the importance of physically accessible stores in terms of customer acquisition, while the role of trust is evident in KFC’s transparency regarding sourcing and preparation of its products along with fostering confidence and potential customers. Therefore, customer commitment plays a crucial role in KFC acquisition strategies, whereas the loyalty programs offering discounts and exclusive deals incentivizing first time customers to return all these contribute to the greater possibility of consumer acquisition. The acquisition process is enhanced to customer satisfaction achieved by maintaining high food quality and efficient services as suggested by (D et al., 2021).

Customer Retention:

In terms of customer retention, KFC places a significant emphasis on consumer retention aiming to transform loyal customers into brand advocates and re-engage dormant ones. Loyalty programs mentioned earlier contribute to customer attention by providing tangible benefits while influencing share of wallet. On the other hand, El Defrawy, (2022) supported the idea that increased share of wallet leads to stronger customer loyalty. In order to convert loyalty customers into advocates KFC encourages user generated content on social media platforms. This word-of-mouth marketing supported by social proof can be powerful retention strategy. Additionally, KFC invests in personalized communication leveraging customer data to tailor promotions and offers. Therefore, re-engaging dormant customers is facilitated through targeted marketing campaigns, offering exclusive promotions to reignite interests. Husna et al., (2020), highlights the importance of personalized reengagement strategies to revive dormant customer relationships.

Customer Development:

KFC’s customer development strategy focuses on turning low purchase customers into high purchase ones, emphasizing on customer value and relationship benefits. For example, the introduction of premium menu items and meal combos encourages customers to trade up. Husna et al., (2020), suppose the idea that perceived value influences purchasing decisions. Apart from this, to foster customer development KFC invests in customer education programs, communicating their nutritional benefit of its products and also manifesting a live demo of the food preparation processes in their kitchens to the consumers as well. Such approach aligns with the idea that informed consumers are more likely to become high value repeated purchasers than the others (Omwancha, 2020). Hence, KFC’s customer engagement and its management strategies demonstrates a compliance approach to acquisition, retention and development which eventually highlights KFC ability to be a formidable player in the fast-food industry.

2) Comparative Analysis

In the context of developing the competitive analysis, the comparison of KFC will be presented with McDonald’s, which is another key player of the fast-food industry.

Based on the above table, the comparative analysis could be presented in terms of KFC and McDonald’s, being the major players of the fast-food industry. Share certain similarities in their customer management strategies. Both companies delivered just strong online presence, actively engaging with customers on various social media platforms while its emphasis on physical accessibility strategically locating outlets in a common approach to attract and convert prospects (Srivastava et al., 2021). Additionally, both KFC and McDonalds have implemented loyalty programms to enhance customer retention, reflecting the industries recognition of the value of repeat business. On the other hand, a notable difference can be detected in terms of their strategy being concentrated on user generated content and personalized communication, particularly through high loyalty programs stand out in the competition. In contrast, McDonald’s places a significant emphasis on a broad range of loyalty programme and a proactive approach to re engaging dormant consumers. Yao, (2021), believes that the importance of social media engagement in the contemporary marketing have played a pivotal role in supporting both the companies’ strategies. On the other hand, Amoako et al., (2021) have also identified the role of a personalized communication in enhancing customer relationships, aligning with KFC’s approach.

In terms of customer development, both the competitors share common ground in introducing premium menu offerings. Both companies have recognized the importance of offering diverse options to cater to varying customer preferences, while Du, (2022) validated the strategic focus on perceived value supporting premium strategies of KFC and McDonald’s.

3) Customer Value Creation

In relation to discuss the customer value of creation the Kano model is applied in the context of KFC, which is explained in the following manner.

The Kano Model developed by Professor Noriaki Kano who provides a unique framework for understanding customer satisfaction by categorizing features into three main types, basic needs, performance needs and excitement needs. The model is particularly relevant for assessing customer value creation as it goes beyond merely meeting expectations and focuses on exceeding them (Husna et al., 2020). Therefore, applying the Kano model to KFC manifests the dynamics of customer satisfaction in the fast-food industry.

Basic Needs:

KFC excels in addressing basic needs, providing fundamental features that customers expect in a fast-food experience through taste and quality of their signature fried chicken, coupled with efficient services fulfilling essential requirements at the same time. According to Kano’s theory, the meeting basic need does not necessarily lead to high satisfaction, but failing to meet them results in dissatisfaction (El Defrawy, 2022). On the other hand, KFC is constant delivery on these fundamental aspects. Establishes the foundation for positive customer experience.

Performance Needs:

The performance needs are explained through KFC’s effort beyond basic needs by offering features that enhances the overall customer experiences Through customization options, diverse menu choices and the introduction of new and innovative items contribute to performance needs (Srivastava et al., 2021). The Kano models suggest that improving performance features can directly impact customer satisfaction. On the other hand, it will also enhance KFC’s ability to adapt its menu to cater to evolving tests align with the dynamic nature of performance needs. Ensuring continued satisfaction and engagement.

Excitement Needs:

KFC’s success is further propelled by addressing excitement needs those features that, when present, generates high satisfaction, but when absent do not necessarily causeway dissatisfaction. Limited time offers special promotions and unique flavor combinations fall into this category (Anees et al., 2020). These elements evoke positive emotions and contribute to the excitement factors, creating memorable experiences for customers. KFC’s strategic use of excitement features aligns with the Kano models emphasis on delighting customers.

In the context of applying the Kano model to KFC, it advocated the importance of balancing basic performance and excitement needs for effective customer value creation. By understanding the dynamic nature of customer preferences, KFC can continuously adopt its strategies to meet and exceed expectations. Anees et al., (2020), highlights the fact that the effectiveness of Kano model in guiding businesses towards enhancing the customer satisfaction and loyalty is quite definite.

4) Conclusion

In conclusion, KFC customer management strategies exhibit notable strengths, including a robust online and offline presence, effective loyalty programs and a focus on customer satisfaction. On the other hand, the company’s emphasis on user generated content and personalized communication contributes to customer retention. However, there are areas for improvements such as further exploring excitement needs to enhance customer experiences The comparative analysis has also manifested a clear idea with one of the major competitors like McDonald’s to highlight the similarities and differences in their customer acquisition strategies. Therefore, applying Kano model helps in identifying the success in meeting basic performance needs, but suggested potential for innovation in excitement features. Therefore, addressing all these aspects will effectively refining for KFC strategies and maintaining competitive age in dynamic fast-food landscape.

References

Amoako, G.K., Caesar, L.D., Dzogbenuku, R.K. and Bonsu, G.A. (2021). Service recovery performance and repurchase intentions: the mediation effect of service quality at KFC. Journal of Hospitality and Tourism Insights, ahead-of-print(ahead-of-print). doi:https://doi.org/10.1108/jhti-06-2021-0141.

Anees, R.T., Nordin, N.A., Anjum, T., Cavaliere, L.P.L. and Heidler, P. (2020). Evaluating the Impact of Customer Relationship Management (CRM) Strategies on Customer Retention (A Study of Fast Food Chains in Pakistan). Business Management and Strategy, 11(2), p.117. doi:https://doi.org/10.5296/bms.v11i2.17934.

D, D., Sinha, R., Wei, O.L., Kee, D.M.H., Leei, O.J., Shuang, P.K., En, T.J., Permatasari, V.N., Sin, L.G., Boadu, E. and Saifi, J. (2021). Effective/Differentiating Marketing Strategies of McDonald’s in Malaysia And Indonesia. Journal of the Community Development in Asia(JCDA), [online] 4(1), pp.16–33. doi:https://doi.org/10.32535/jcda.v4i1.995.

Du, Y. (2022). McDonald’s VS. KFC, Which is More Successful in Marketing in China? [online] www.atlantis-press.com. doi:https://doi.org/10.2991/978-94-6463-098-5_126.

El Defrawy, N.A.M. (2022). The role of Sociology in improving the education of food applications’ designers and developers to reduce food loss ‘Applied analytical study on some Arab Food delivery applications’.. Egyptian Journal of Educational Sciences, 2(2), pp.111–130. doi:https://doi.org/10.21608/ejes.2022.287632.

Husna, N., Kee, D.M.H., Amirah, N.W., Syazreeza, R., Fatihah, N.A., Pandey, S., Agnihotri, S. and Pandey, R. (2020). How Organizational Management Affect Employees’ Motivation and Service Quality: A Study of Kentucky Fried Chicken (KFC). International Journal of Applied Business and International Management, 5(2), pp.73–81. doi:https://doi.org/10.32535/ijabim.v5i2.860.

Lucas, A. (2023). Popeyes overtakes KFC as No. 2 chicken chain, but Chick-fil-A stays on top. [online] CNBC. Available at: https://www.cnbc.com/2023/10/04/popeyes-overtakes-kfc-as-no-2-chicken-chain-chick-fil-a-stays-on-top.html.

OMWANCHA, I.N. (2020). INFLUENCE OF SERVICE CONVENIENCE ON CUSTOMER SATISFACTION A CASE STUDY OF KENTUCKY FRIED CHICKEN (KFC) IN NAIROBI, KENYA BY IVY NYAKERARIO OMWANCHA HPM-G-4-0053-16 A RESEARCH PROJECT SUBMITTED TO THE SCHOOL OF HOSPITALITY AND TOURISM IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE AWARD OF THE DEGREE OF BACHELOR OF SCIENCE IN HOSPITALITY MANAGEMENT OF GRETSA UNIVERSITY. [online] Available at: https://ir.gretsauniversity.ac.ke/bitstream/handle/20.500.12736/1938/Ivy%20%20Final%20project%20H.pdf?sequence=1.

Srivastava, R.K., Manimoy, P. and Bhanot, S. (2021). Will perception of customers of McDonald’s fast food restaurant be different in India and USA - A comparative study between the two countries’ culture. International Journal of Export Marketing, 4(2), p.150. doi:https://doi.org/10.1504/ijexportm.2021.115289.

Yao, Y. (2021). Factors Positively Affecting Brand Loyalty of KFC Customers in Hengyang City in China. dspace.bu.ac.th. [online] Available at: http://dspace.bu.ac.th/handle/123456789/4750.