The fast food industry in Malaysia is saturated with players such as McDonalds, KFC, Wendy’s, Chili’s, Nandos and the like. The industry is relatively large in terms of the participating brands in fast food business. Fast food business is categorised according to the food served as well as their facilities and locations. There are restaurants selling specifically burgers, pizzas or only chicken, Mexican cuisine and many others. According the location, some restaurants are drive-ins whereas others provide in house catering as well as off premises catering.
The market of the fast food business is stratified, but all in all inclusive of all groups of the society.
As observed in many restaurants, they provide meals even for children, hence allowing all ages to enjoy their meals from the restaurants. Fast food business enjoys a high level of prominence in Malaysia as the trend of home cooking is currently on the fade, and the intertwinement of a busy life, promotes the fast foods as the reliable and available sources of food during breakfast, lunch and dinners.
Moreover, the eating habits of Malaysians give a good breeding ground for the fast food industry to flourish as people are fond of food and eateries have become places where business deals are concluded as well as assignments completed, for instance Starbucks. As per this year, it is projected that the sales of this industry will jump up according with the increase of tourism as it is the proclaimed year of tourism; this will eventually see, the increment in revenues collected by the fast food restaurants as the tourists will add up to the current population in Malaysia. 1.2COMPANY OVERVIEW
This study focuses on the brand of KFC or otherwise as known as Kentucky Fried Chicken. This is an international brand that hosts a large number of franchisees all over the world. KFC started in USA, and slowly infiltrated the rest of the world with its premier tasting chicken. In Malaysia, this brand started its operations in 1973; it has sustained a healthy growth over the years with many outlets being opened all around.
With the introduction of ‘Meals on Wheels’, customers are able to be delivered food upon orders made through the internet or by the phone. The fast food business is very competitive as there is a stiff competition in securing market. The plenty number of fast food makes the competition even higher and harder, moreover, it is not easy for newer businesses to penetrate especially if such a business does not do so with innovation. KFC has enjoyed recognition and surely it is a major brand. However with all the fame, KFC struggles with loyalty from customers. Customer loyalty is the tendency of customers having a strong purchase relationship with the business. Loyal customers are those who maintain purchases with the particular brand regardless of any changes.
Customer loyalty can be expresses in two ways; either as a behaviour or the number of times that a customer comes back to purchase from the same brand. The increase of competition may be attributed as one of the causes that lead the decrease of loyalty. This is because the market is flooded with any options which a customer may be able to choose from. Moreover, innovative strategies and more value added service to purchases tend to decrease loyalty. The perception of service value is an important factor that builds or destroys loyalty. It has been an area where many brands have been concentrating on in order to keep in phase with the on-going competition. KFC has attempted to revise its menu and incorporate new stuff that will make its brand more adorable to customers. Initially, KFC has been centred on its 11 spiced recipe of chicken. The core product I KFC is its fried chicken; over time, the brand has added burgers, pokkits, rice and potatoes to its menu so as to improve the menu by diversifying what they offer. 1.3BRAND
A brand is termed as an identification of a particular product or service that is specifically different from other product. The study of brand equity and its management produces loyalty from customers that is highly associated with satisfaction. Brand equity that takes a customer centered approach enables the easy creation and maintenance of loyalty. Brand equity, as explained by Keller consists of brand salience, performance, imagery, judgement, feeling and brand resonance. Keller portrayed the composition of brand equity in a form of a pyramid where brand salience forms the base and brand resonance is at the apex of the pyramid. 1.4SALIENCE
This is at the base of the pyramid, and in fact it is the foundation of a brand. This depicts the extent that a customer considers your brand during purchase. It deals with the situation whether your brand is recognisable or even well thought of by customers. for the success of any brand, there is a need of having a strong salience amongst customers, as this wil affect the chances of your brand being sold or even adored by customers. KFC fares reasonably well with salience, as its products carry much recognition as well as they is generally accepted by the market. This is evident by the fact the chicken meals served there as it is distinguished for only selling amazingly tasting chicken. Brand salience consists of brand awareness and brand associations. Brand awareness is defined as the extent to which a product is recognised and recalled. Brand associations are the connotations that surround the product. As explained above, salience forms the base of brand management that eventually leads to loyalty and satisfaction. If at all a company lacks or has minimal salience, it is highly likely that it shall face much challenges to sustain its existence. 1.5PERFORMANCE
Performance is on the second tier of the brand equity pyramid. After the establishment of the brand identity in the salient base of the pyramid, next is the performance and imagery. To further mark a distinction of a product from another, there is a need to highlight or show how the product performs, albeit its functions or in what way does it satisfy the need and desires of customers. Brand performance highlights its relevancy, value and service of the product. In terms of KFC, the performance is at the capacity of a meals restaurant where each meal is value added to allow the customers to enjoy partaking their meals. However, in the performance of the service, many flaws are identified in KFC that may amount to the decline in loyalty. Apart from the rich flavours of the food as expected, the service given is usually below expectation. There are usually long queues in the outlets as well as the level of tideness and cleanliness is a debatable issue. These factors give a low perception of the service given, hence a potential obstacle to customer loyalty. 1.6IMAGERY
This term encompasses the image and personality of a brand. The image of the brand is what the brand projects or portrays to the customers whereas brand personality reflect on the values and visions that a product embraces. Actually, brand imagery is all about the definition of a brand. This is important as it describes the features and peculiarities tat are unique to the brand alone. KFC attempts to project itself as a restaurant where a family can always have reliable means. On top of that, it has identified itself to be selling halal food; of which it is an added advantage with regards with the high number of population in the country consuming only halal foods. More so, it has identified itself as children-friendly by providing kiddies meal as well as areas where kids can host their birthday parties. In general, I has established itself to be a casual dining area where individuals can enjoy their meals in a relaxed manner. 1.7JUDGEMENTS
These refer to the some of the responses from customers towards the products. This covers judgements in terms of action as well as spoken word on the product. Furtherly, judgements of the brand acts as a feedback mechanism to the brand by showing whether the customers as the sole market for the product are by any chance impressed with the products. KFC has been able to gather positive comments over te quality of service and the items on the menu, but there has been a slump in the feedback that has been received. Customers judge it as being an innovative compared to the other restaurants. This has pushed KFC to revise its menu items and introduce some tangible changes to the products, for instance the introduction of Zinger burger Reloaded, and in a bid to diversify their menu items, the introduction of more fish based meals in the menu. 1.8FEELINGS
Feelings towards the brand work hand in hand with the judgements over the brand. This is more likely the satisfaction meter of a product amidst its customers. It addresses the potential feelings that are harboured by the customers to the product and the service altogether. The issue is whether it makes the customers feel all the positive feelings and emotions towards it. KFC is positively thought of by many customers as the meal is quite special in a way. Together with the corporate social responsibility program it has embarked on; the one of building homes for the homeless, the society does not repel it as it is a positive act. In addition to that, the number of employment it creates, alone, allows people to develop a positive outlook to it. 1.9RESONANCE
Brand resonance is at the topmost part of the pyramid. It reflects the relationship between the product and the customer. It expresses the level of attachment that a customer has to the product. More so, it points out the level of engagement the product yields on a customer. Brand resonance is measured in terms of its activity and intensity. The depth and extent of this engagement between the product and the customer result as the product of the salience, performance as well as the judgement and feelings bore by the customers to the brand. KFC seeks to maintain a high level of attachment of customers. However, it should be noted that, loyalty has a foundation in keeping the customers satisfied. The approval of the customer, in terms of the feedback from the customers help in the building of better channels where loyalty is groomed.
IMPROVEMENTS IN THE QUALITY OF SERVICE OFFERED.
There is always room for improvement in terms of the services rendered by the company. The reluctance to improvements is costly. This is evident from the fact that retaining a customer is less costly compared to the conversion and recruiting new customers. With such knowledge, it is essential that operational activities are constantly under review as well as scrutinised for their performance. The review of feedback is necessary as it generally maps out the perception of the service by customers. Such improvements can be in the form of fast service provision as well as more levels of hygiene in the outlets.
TRAINING OF STAFF
in order to increase the responsive nature of the brand, there is a need to continuously train the staff of the company so that the product and services offered are distinguished from their high levels of credibility and performance; this is interpreted as good perception of the brand by the customers. KFC should implement the time to time checks and training to the employees to make sure the customers are attended to with utmost importance. BRAND MARKETING
To improve on the loyalty of customers, it is suggested to reinforce the marketing strategies undertaken by the company. Market strategies are based on the 4 Ps are Product, Price, Product and Promotion. An effective marketing mix will enable the brand to be positioned in an advantageous place. For the case of KFC, the brand manager may opt on placing more promotions and refining the product in order to better suit the wants of the customers. the marketing of the brand should aim at establishing satisfaction on the side of the customers so that loyalty can be promoted. INTRODUCTION OF DISCOUNT CARDS
This suggestion directs to the introduction of cards or coupons that will offer discount upon purchase of the products. It may be a way of marketing, but it actually serves both purposes; marketing and loyalty in customers. These cards or coupon act like a link between the customers and the brand since the customers may view it as more economical sound to utilise the coupons or cards to purchase the same brand. In other sense, these cards give a sense of relation, making it fussy for customers to switch brands as they will consider this as the switching cost. FOCUS ON A REPEAT BUSINESS
With the market competition set so high, it is crucial for a brand that seeks to maintain customer loyalty to gear the operational philosophy towards generating an atmosphere that encourage repeated purchases. The brand manager should focus every aspect of the brand to achieve this goal. This will help to maintain loyalty in customers as repeated transactions are highly encouraged. This can be in the form of giveaways, or free products when a certain number of purchases re made. For instance, KFC may offer free meal on the fifth visit to the restaurant. This helps in locking the customers in the restaurant. PERFORMANCE MANAGEMENT
There is a need of assessment of the performance of the outlets in order to be able to raise the bar of standards higher, keeping in mind that satisfaction is key to customer loyalty. This assessment can be carried out by considering the comments of the customers s well as by assessing whether the key performance indicators are achieved in due time and thoroughly. In the scene of KFC, this is possible through the crosscheck and assessment of the outlets by putting a comments box where customers are free to leave
comments with regards to the service they got. TEAMING UP WITH TRENDS
The society at present is flooded with trends. This can be in the form of personalities, games or even movies. The teaming up with whatever is trending in the society puts the brand in a position where it hammers a competitive advantage over the market. For instance, McDonald’s is assured with loyalty from customers by the contract it as with te upcoming FIFA World Cup. KFC should follow suit with the sponsoring of a great event, and thus, it will also secure a great deal of allegiance from customers.
Customer loyalty is an advantage for a business because of two main things. First, loyalty asures increased revenues and sales and secondly, loyalty gives a prestigious feeling. Any flourishing business desires to be known by the population as well as attaining profits from the service rendered. KFC is a brand that is mature in the market hence, it has experienced times and times of revenues, however loyalty is slumping. The time is right for KFC to re-invent itself, not only on what meals they sell, but a wole change that will rejuvenate the business. This sort of changes aims to be innovative and strategic, and will target the operations of KFC as a brand. KFC should strive to have the competitiveness that is market wothy.
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