KFC Service Marketing Project Report

Chapter 1 Introduction KFC was introduced in Pakistan in 1999. After its introduction in Pakistan it gained rapid popularity in Pakistan. It surpassed McDonalds because of its foods products appealed to taste of local population. Due to its rapid popularity more people started to imitate the products of KFC and local fast food chains started to emerge in Pakistan. Popping up of these chains led to erosion of KFC’s brand image. New local chains were offering customers fast food at low prices with acceptable quality of food and in some case the food quality was comparable to KFC’s food products. Major competitor McDonalds initially was losing its share in Pakistani market. But it changed its food product line according to taste of Pakistani customers and provided better service than KFC. The focus of project is to identify weaknesses in the KFC’s services and devise strategies to overcome these weaknesses.

Target Market Although KFC and McDonalds target same type of customers the elite and upper middle class. The types of customers who are coming to KFC to consume eatables in KFC are middle class and upper middle class. On the other hand, elite and upper middle class are going to McDonalds. Because, people in elite class and upper middle class prefer that if they have to consume same type of product so why not enjoy their food in friendly environment and space in which they can consume eatables in a relaxed manner.

Chapter 2 Strengths and Weaknesses of customer experience at KFC Strengths KFC’s food products are very well suited to taste of Pakistani. Consumers like the food of KFC. The slight taste of spiciness and the crispiness is liked by Pakistani people. The food products of KFC are suited to not only the Pakistan but are also popular in Middle East and India. Because of KFC’s popularity in Pakistan, different entrepreneurs tried to copy the KFC’ food products. This imitation of KFC’s food products caused the KFC’s image to dilute rapidly. Weaknesses: The main weaknesses of the KFC’s are due to its service escape. KFC’s service escape has very limited space. Usually KFC service escape is made in Plot sizes of 5and10 Marlas (Marla (2.81 sq. meters)) or 1 Kanal (56.2 sq meters). These plot sizes fail to provide a friendly environment for consumers. It looks like that everything in KFC is crammed. Everything is very closely spaced that sometimes customers find hard to stand in queues. It becomes difficult for customer to sit in the seating area. However, McDonalds which is one of the major competitors of KFC has its service design conducive for families to consume food in friendly environment. It usually has huge space for customer seating, drive-thru, children’s play and a in some cases a park where people can enjoy quality time with their families while eating their food. Other weaknesses were 1. Only 2 counters 2. Less queue area 3. Small kitchen 4. Layout of seating area 5. Closely spaced seats 6. Small Kids play area 7. Small washroom 8. No specific parking space

Chapter 3 Service Blueprint Marketing Mix for Services Product KFC’s products are much better in quality and taste as compared to others fast food restaurants. Products of KFC have huge potential because KFC food products are suited to taste of Pakistani consumers who like to have spicy and crunchy chicken meals. Price KFC’s products are priced high as compared to local fast food chains but its prices are comparable to other major competitors. Placement KFC is usually located in the prime locations so as to increase customer’s convenience. Promotion It has been many years since KFC has given any significant amount of ads in Pakistan. This is also one of the reasons that KFC is losing market share in Pakistan. People KFC employees are well trained and follow the standards established by the KFC. However, they need to well informed so that they can serve customers in better way Process KFC has designed its cooking processes to provide quick delivery of orders. But still employees fail to deliver it in shortest time possible. Physical Evidence KFC’s Service escape is poorly designed and needs a lot of improvement to attract customers.

Chapter 4 Gaps Model Gap 1 (Listening or Knowledge Gap) This gap has aroused in KFC because of its franchises are taking matter into their own hands and the top management is not realizing that their service-escape design is not meeting expectation of customers. Other major competitors have raised the expectations of customers. These increased customer expectations are not being communicated from bottom (franchise) to top (top management). Gap 2 (Not selecting the right service design and standards) This can be seen in KFC in the form of poor design of physical evidence. Once, physical evidence has made a bad image in the mind of consumers it affects the moods of the customers and affects the consumer’s service experience. Gap 3 (Service Performance Gap) There was slight delay in the delivery of the food products. KFC’s standards are keeping their employees on their toes so that they work hard and try to deliver the products quickly. So, there is small gap between service customer driven standards and service delivery. Gap 4 (Communication Gap) KFC has not advertised for a long time and consumer who usually forget those products who are not communicated to them frequently. So, this communication gap has increased due to no frequent advertising to consumers. Also the service –escape provides some tangible cues to consumers and affects their mood. In this case the service-escape has failed to meet the demands of consumers.

Chapter 5 Customer Decision Making Process Need recognition: Usually, people decide to go to Fast food chains when they feel hungry or want to consume quality fast food products. Information Search: Ads Billboard signs Memory of customers Friend’s opinion (peer pressure) Brochures Evaluation of Alternatives: KFC McDonalds Hardees Pizza Hut Other local Fast Food chains RFC (Royal Fried Chicks) AFC (Al-Najam Fried Chicks) Purchase Selecting the KFC Consumer Experience Satisfactory or not good Post Consumer Evaluation Usually, the post experience evaluation is done when next time a consumer decides to consume fast food. In case of KFC, after consumer has consumed eatables of KFC and visits other fast food chain. Consumer’s opinion might get worse about KFC, especially after visiting McDonalds.

Research KFC can improve its service and recapture its market share if KFC implements a proper research program. This research program should include interviews, surveys, feed back from franchises, focus groups of franchise managers, etc. Carrying out an effective research program will help KFC to improve its service, reposition itself in the minds of consumers and strengthen relationship between KFC and its customers.

Chapter 6 Service Quality Dimensions Reliability KFC usually provides standardized products and there is less chance of products which have defects. However, when it comes to timely delivery of products KFC lacks to deliver it exactly on time. Assurance The Knowledge of employees about their products was low on the Phone so they need to improve their knowledge about available food products. However, employees of KFC were courteous. They greeted by saying Aslam-o Aliakum when we visited KFC and made a phone inquiry. Empathy KFC employees gave individualized attention to its customer. Responsiveness Employees of KFC were responsive to requests and demands of their customers. For instance, during visit of KFC we asked tissues from helper. He immediately provided tissues. Tangibles KFC seriously lacks in service-escape. How ever the employees are well dressed in uniforms.

Service Recovery If KFC fails to meet the need of its customers, customers usually do not complain in case of fast food restaurants. Because when they decide next time to purchase fast food, at that time they evaluate the overall service of fast food chain. The reasons behind switching from KFC to other brands are high prices, a competitor offering better service (better service in better environment), service encounter failures (knowledge of employees) and delays in service delivery.

Chapter 7 Service Escape Role of Service-Escape Package Service escape as a whole affects the moods and emotions of customer and influences the perception of the consumers about the firm. Facilitator Service-escape allows the flow of activities smoothly and provision of service quite easy. Socialize Service-escape allows the customer to socialize with other customers in a better way. Differentiator Service-escape can differentiate one service provider from another.

Chapter 8 Service-escape While investigating the service escape of KFC we kept in mind the dimensions described in the article of Mary Jo Bitner. Environmental Dimensions Ambient Conditions The temperature, air quality and odor were better. Instead of music and loud noise the news on the TV were capturing our attention. Space We took the pictures of service-escape including the queue area, seating area, play area, parking area, washroom and stairs area. There was no space specially allocated for KFC customers. There were only 2 queue counters. The chairs in the seating area were so closely spaced that we had to adjust them before sitting. Washroom was like a closet which was converted into washroom. We also noticed the kitchen area which was very small. The building was divided in several stories to accommodate the customers and their cooking operations.

Signs & Symbols We took pictures of Menu, oven and the overall décor of the lounge and KFC’s outer appearance. Perceived Service-escape The overall impression about KFC in our mind was that layout KFC’s service-escape of the KFC is crammed and not friendly environment. Response Moderators When customers came to KFC they expected a quick delivery of food products (impatient customers). When we visited KFC we were in hurry to rush back to our homes and do our work. In this case, KFC personnel forced us and other customer to wait for 5 minutes to get our desired products.

Customer Response The resulting response of customer was asking about how much more amount of time they have to wait for the food to be delivered. Employee Response In response to customer’s inquiry about how much they have to wait. The employee who was providing the service at the counter was worrying and yelled at supply people to quickly deliver the products. Employee Approach Employee and his supply people worked hard to deliver the products to consumers. Customer Approach Customer who had spent their money for buying the products had to wait for products to be delivered and consume them in crammed layout of seating area. Social Interaction between Employee and Customer The interaction between employee and customer was good. The employee at the counter greeted us with Aslam-o-Alaikum and asked us what we needed. When the he delivered the products he formally thanked us for consuming their products and service.

Chapter 10 Usefulness of Mystery Shopping Mystery shopping is much more important tool to evaluate the services of any organization. The main advantage of this research is that you don’t need to conduct lengthy surveys in which there is chance of non-responsive customers, biased opinions of customers and conduct your research without permission and criticism of managers about defects in questionnaire. Mystery shopping also allows you to engage in a service delivery process and find out what are gaps in service provision and where these lags are occurring.

Recommendations 1. KFC needs to improve its employee’s knowledge about its products availability. Simply provide the respondent with copy of brochure on which items which are not available are crossed. 2. KFC needs to improve communication between franchises and regional and global headquarters. 3. KFC needs to improve seating area and layout of seating plan 4. Improve parking area 5. Improve kids play area 6. Locate KFC franchises near public parks. From 3rd recommendation onwards, requires KFC to redesign its franchise physical environment layout. For this purpose, they may either suggest to their franchise owner to rebuild their service providing facilities or induct new design of physical environment in new opening franchises.

Reference to Articles The article “Evaluating Service-Escape: the effect of cognition and emotion” by Ingrid Y. Lin. In this article he has mention about the Gestalt study (page 164, Evaluating ServiceEscape by Ingrid Y. Lin) in which researchers have found that service-escape affects the mood and emotions of customers and their overall evaluation of service-escape.

Customers evaluate the service escape and form their judgment about the service-escape. Later in this study, he discusses about space of service-escape (page 168, Evaluating Service-Escape by Ingrid Y. Lin). He refers to study of (Ching 1996), in which he describes that high ceiling is associated to spaciousness while the low ceiling is associated with coziness. This article provides argument that low ceiling associated with coziness. In Pakistan where people like spaciousness in their service-escape, KFC’s service-escape is small. First of all customer face the problem of parking their vehicles which is like a first barrier to entry customers face for going to KFC. The article named as role of service-escape in service marketing by Meenakshi Ghanghas describes that layout of the service-escape can differentiate the type of customers who will be coming to that service-escape. Further, she says that a service-escape should facilitate the customer in service consumption in convenient and comfortable manner. Moreover in this article she says that firms adapt their service-escape to reposition their services and capture new market segments.

References 1. .2012. . [ONLINE] Available at:http://www.ida.liu.se/~steho/und/htdd01/9208310667.pdf. [Accessed 10 December 2012]. 2. . 2012. . [ONLINE] Available at: http://www.ba.aegean.gr/m.sigala/paperservicescape.pdf. [Accessed 10 December 2012]. 3. Role of ServiceScape In Marketing of Services - By Meenakshi Ghanghas, Lecturer. 2012. Role of ServiceScape In Marketing of Services - By Meenakshi Ghanghas, Lecturer. [ONLINE] Available at:http://www.123oye.com/job-articles/advertising-salesmanagement/servicescape.htm. [Accessed 10 December 2012].

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