Kentucky Fried Chicken, popularly known as KFC, opened its first outlet in Bangalore in June 1995. But due to a lot of socio-economic, cultural and religious reasons, KFC had to leave India and again returned in 2004. From 30 outlets, the number has grown to 310 today. KFC was the first foreign fast-food restaurant chain to enter India after the Indian government implemented the economic liberalisation policy.
KFC finds huge potential in the Indian market as it believes that the country is very young and vibrant. The food chain heavily relies on digital advertising and innovation. With most of the demand coming from the Tier 1 cities, the Quick Service Restaurants (QSR) chain intends to expand its footprint further in the Tier 2 cities as well.
BestMediaInfo.com met Lluis Ruiz Ribot, CMO, KFC India, to understand his plans for the Indian market.
Ribot came to India in 2015 to head marketing for the brand. Before coming to India, he was heading the marketing functions of the brand in the UK. Ribot has also worked with Mondelez and Kraft Foods in various brand managerial roles prior to KFC. Excerpts:
How different is the market in India? Is the level of competition among the QSRs the same everywhere?
Every country is different. The room for QSRs to grow in India is enormous. The number of restaurants per person is much lower than what you have in the developed countries. India is a market that is less saturated and is developing than the developed markets such as the UK and US. The room for growth is much bigger here. Also, the population is very different. The average age in the UK is in the 40s and in India it is less than 30 years. Therefore, the consumer is much younger. Like this, our brand and target audience is much more vibrant. The thing that is common is the love for the brand and we as a company is the same everywhere.
Do you have to implement different marketing techniques in India or the consumer behaviour is the same everywhere in the world?
Our target audience is different compared to what we have in the UK. We tend to believe that the consumers are different in every country. But as human beings what I have observed is that the fundamental theme that is important to us in life is our aspiration and the triggered points that we have are the same across countries. I have worked in Spain, Switzerland, UK and here. There are some basic things that work the same across different countries. Yet what is different is some of the ways you execute as that is where the cultural nuances come into life. Then there is a stage of development of the society that could be more or less accelerated. What I find fascinating about India is that it is a very young country which is vibrant, the youth is aspirational and they want to progress. The other thing that is great about India is the way digitisation is moving fast. If you look at the rate of adoption of smartphones, access to data, Aadhaar card and Reliance Jio, there is a sudden big move into digital. It is where the whole world is moving, marketing is moving. It is interesting from a professional work point to work in a country which is developing. It’s a big opportunity to leverage from a brand’s standpoint.
Why is there a declining trend in the growth of QSRs in India and how are you preparing to deal with it?
We are our own competition. If we do well, we grow and vice-versa. We have posted three consecutive quarters of positive self-growth. All these figures show we are in a good momentum in terms of business. If there is de-growth in the category, maybe it is because of short-term, particular issues of one player or the other. But if you look at the long term, the projections that are out there in terms of how QSR is going to be in terms of revenue by 2020 and 2022 are very good. Also, the pace of the new entrants that are coming into the market is a sign that it is a good industry to be in.
Do you think India still has scope for more QSR restaurants? Would it be a profitable idea even?
I think that would be for everyone’s assessment. I cannot talk about the other companies. But for us, we see it as a country with very good prospects of growth in the future.
What are the challenges in the QSR category in terms of marketing in India?
It is important to stay relevant all the time because consumers nowadays are well-travelled, informed and like to experiment. No player, whether big or small, can afford to stay still.
It is a well-established fact that KFC is a brand that stands for fried chicken. India is a country that has diverse culture and religions, which sometimes don’t permit non-veg at all. Does this come in the way of your market expansion?
No, it does not. In fact, we respect the different religious sentiments and the cultural reality of India and we embrace its diversity. We are one option more among all other options. We also have our vegetarian menu. 30 per cent of our menu items are vegetarian. We are welcomed and loved wherever we are opening stores across the country. We respect different beliefs and cultural sensitivity. Back of house, all our kitchens are fully segregated, so no vegetarian product touches any meat product.
What is the whole idea of launching ‘Hangout Stores’? How is it different from your normal stores?
One has to keep its brand current. We as a brand celebrate authenticity and people to be themselves. Therefore, we wanted to create an environment which is much more invited, casual and flexible. The elements of lighting and seating bring authenticity. It is a bit more café-type, but still keeping the convenience the QSRs have. The consumer research shows that they really love the new design.
Patanjali has now entered the restaurant chain category as well. Are they any kind of a threat to KFC? They say they might eat into KFC and McDonald’s business in India.
It wouldn’t be a complete interview if I did not say that we welcome competition and because of the competition one has to be on your toes. Their entry will make us come up with better plans and be more competitive. Therefore, it will result in better propositions for the consumers. To me, if the consumer is happy, I am happy. I welcome people entering the sector and increasing the organised sector.
We tend to see a lot more innovative and digital campaigns by KFC these days. Does that hint at a change in the target audience for KFC? How has the consumer evolved for KFC?
The target audience is evolving and is much more digital savvy. We have always been targeting young people. The matter of the fact is that no one can deny that digital is part of their everyday life. Therefore, digital is a much more focused area for us in terms of priority, resources. For me, digital is a mindset, it is not just the figures you put behind it. If you look at everything we do and the society that lives in the digital ecosystem, we do things much differently. In terms of delivery, a number of sales we do through delivery on e-commerce, mobiles, website or the app has grown in huge numbers in comparison to the rest of the business. This part of the business is much more digital and less through the call centre. On social media, we have a huge fan base. Digital also helps us to associate with social causes that we pioneer as a brand that can create positive societal changes. We also do a lot of innovation on products. Chizza itself has been a massive success.
Demographically, from where are the sales numbers coming from India the most? What are your future expansion plans?
We are currently present in 90 cities. Most of the sales come from the Tier 1 cities. I see the potential for growth across the country. We have good numbers coming from everywhere.
One thing you would like to change in consumer behaviour in India?
I would like them to come more often to KFC (laughs). Apart from that, I am not here to change people but to understand them and adapt to their requirements.
We don’t see aggressive advertising for the vegetarian KFC menu.
We are KFC and the chicken expert. There are many options in the market. We feel to be at our best when we focus on the core and that is chicken. That’s where our main focus has been. Obviously, we are inclusive and offer options for everyone and hence we have the vegetarian menu. One day you may fancy chicken and the other day you might fancy something vegetarian.