Social Media & Quick Service Restaurants in India

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Quick Service Restaurants (QSRs) have started offering discounts and combination meals to raise revenue from all directions. And since there is no switching cost for customers, it is essential that QSR invest in brand building to gain loyal customers and attract new customers

This presentation shows how quick service restaurants can leverage the power of social media to grow its business

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Social Media & Quick Service Restaurants in India

  1. 1. FAST FOOD INDUSTRY IN INDIA HOW QUICK SERVICE RESTAURANTS CAN LEVERAGE SOCIAL MEDIA TO GROW ITS BUSINESS (c) InRev Systems
  2. 2. 8560.9 25INDUSTRY OVERVIEW (1/3) 60000 20 9000 52047.5 18 7472.8 17.5 47099.5 8000 50000 16 6741.1 20 42171.1 7000 19.3 37203.4 14 5836.8 40000 13.4 6000 31656.8 12 4891.7 15.5 14.615 11.7 Million 5000 30000 10.5 10 Transactions 4000 $ million 10.9 10 8 % Growth 20000 % Growth 3000 6 4 2000 5 10000 2 1000 0 0 0 0 2005 2006 2007 2008 2009 2005 2006 2007 2008 2009 The Indian fast food market grew by 10.5% in 2009 The Indian fast food market grew by 14.6% in to reach a volume of 52,047.5 million transactions 2009 to reach a value of $8,560.9 million Indian Fast Food Market Segmentation by Value, 2009 Leading Companies The company recorded revenues of Mobile & Street $1,404 million in the fiscal year 0.10% ending December 2009, a decrease vendors 44.70% of 1.5% compared to fiscal 2008 55.10% Takeaways 0.10% The company recorded revenues of Quick Service $22,745 million in the fiscal year Restaurants ending December 2009, a decrease Leisure Locations of 3.3% compared to fiscal 2008 Source: Data Monitor (c) InRev Systems
  3. 3. The industry is fairly fragmented. Industry Price war is commonly seen in this Industry RivalryINDUSTRY OVERVIEW (2/3) Rivalry industry. Exit cost is low. 5 Overall, the attractiveness of the 4 industry due to industry rivalry is 3 MEDIUMnot capital intensive and Industry Threat of 2 Threat of New Threat of anyone can start their own Substitute 1 Entrants New business. However brand plays a Entrants 0 very important role in this industry and a new player might find it difficult to survive. But the industry has been growing. Overall, the attractiveness of the Buyer Power Supplier Power industry due to threat of new entrants is LOW Overall, the attractiveness of the industry is MEDIUM Suppliers include ingredient suppliers. Forward integration of the supplier is possible. Supplier Suppliers are important for a QSR as the quality of food served depends on them. Power Overall, the attractiveness of the industry due to supplier power is MEDIUM Large no of buyers. Switching cost is very less - within a given price range, a consumers choice Buyer of fast food provider is purely a matter of personal taste, and can vary from one day to the next . Power Price elasticity is very high. Overall attractiveness of the industry due to buyer power is MEDIUM Threat of There are huge no of substitutes available in the market such as frozen foods and ready to eat Substitute foods. However the convenience as well as location of fast food outlets makes it attractive over its counterparts. Overall, the attractiveness of the industry due to threat of substitute is medium (c) InRev Systems
  4. 4. Indias working-age population pool is the largest in the world, and is expected to increaseINDUSTRY OVERVIEW (3/3) significantly over the next four decades 1200 400 A study by McKinsey Global 324 1000 300 Institute estimates that growth in food and beverages 800 200 consumption will accelerate to 600 100 2007(millions) 4.5% annually by 2025, from 3% 34 2050(millions) witnessed over the past 20 years 400 -14 0 -2 0 -31 Growth 200 -100 -140 0 -200 1000 932.2 Source: UN 900 800 669.6 700 600 500 2005 Agg Disposable In 2005, people with a disposable 356.7 Income income of $10,940 or more 400 300 2025 Agg Disposable contributed just $79 billion in 200 367.6 Income aggregate disposable income. This 100 78.8 67.8 is expected to increase 0 exponentially by 2025 to $932 More than $4380 to Less than billion Source: McKinsey Global Institute $10940 $10940 $4380 (c) InRev Systems
  5. 5. LinkedIn has over 100 million users and adds about 1 million newWHY SOCIAL MEDIA (1/3) users to its service every week. The median age of LinkedIn users is 39, and the average user has 60 connections. 20 per cent of its members are in the service industry Twitter has more than 145 million users and adds about 6 million new users a month. On average 140 million tweets are sent a day. More than 460,000 new account have been added every day . The median age of a Twitter user is 31 years old and the average user has 70 followers. Majority (33%) are between the ages of 18-29 Facebook currently has over 500 million active users around the globe and 50% of these active users log on to Facebook in any given day. Facebooks median age is 33 and its average user has 130 friends and is connected to 80 community pages, groups or events while average user creates 90 pieces of content each month YouTube has 2 billion views per day, and 24 hours of video is uploaded every minute. YouTube achieved for the first time the milestone of 100 videos watched per user last year (c) InRev Systems
  6. 6. Quick Service Restaurants (QSRs) have started offering Majority of fastWHY SOCIAL MEDIA (2/3) discounts and combination meals to raise revenue from all food outlets directions. And since there is no switching cost for patronage are customers, it is essential that QSR invest in brand building youngster and it to gain loyal customers and attract new customers make sense for QSRs to leverage Social Media or Consumer-Generated Media can help QSRs social networking understand consumers’ need and attitude and then sites to promote proactively engage with customer needs and query their brand Brand Health CRM Tracking Access Engagement sentiments of with customers customers Consumer Reaching out Insights to customers (c) InRev Systems
  7. 7. Has your QSR got new product or service whichWHY SOCIAL MEDIA (3/3) you want to be make aware among your customer base? Social media is the best and easiest place to drive awareness of your product/service Hasten Awareness Foster Innovation & Idea Develops & Deepens Customer Relationship It is essential for your fast-food outlet to provide Social media is the right place to collect the best service and solution to your customers. information about the company. Social media is By leveraging social media, QSRs can develop filled with suggestions for improvements and and increase their relationship with customers ideas and these can be used to foster innovation (c) InRev Systems
  8. 8. Dominos Pizza India has been one of the most successful QSR in India using socialSOCIAL MEDIA INDEX (1/4) media as a way of engaging and connecting with its customers Facebook Page Blog Twitter Profile Engagement in Facebook (c) InRev Systems
  9. 9. McDonald India has a long way to go as compared to its International counterpart.SOCIAL MEDIA INDEX (2/4) No of Likes in McDonald India Facebook: 19173 versus McDonald International: 8,804,138 McDonald India Facebook Page McDonald International Facebook Page McDonald International has more than 136846 followers in Twitter while McDonald India doesn’t have a twitter page (c) InRev Systems
  10. 10. SOCIAL MEDIA INDEX (3/4) SOCIAL MEDIA GRADES is calculated based on the interactivity level of the mixed retailers in Facebook, Twitter, LinkedIn, YouTube and Blogs. It shows how active the Quick Service Restaurants are in the social media space No of Channels represents the number of social networking sites a Quick Service Restaurant is present in QUICK SERVICE RESTAURANTS* No of Channels Social Grades DOMINOS PIZZA 5 3.07 KFC 4 2.79 PIZZA HUT 3 2.75 MCDONALD 4 2.0.8 TACO BELL 4 1.36 * Indian Branch (c) InRev Systems
  11. 11. SOCIAL MEDIA INDEX (4/4) 4 3.5 3 Interactivity Level 2.5 2 1.5 1 0.5 0 0 1 2 3 4 5 No of Channels Interaction Plot of the Quick Service Restaurants in the Social Media Space (c) InRev Systems
  12. 12. BRAND AWARENESS: Number of conversations across webRESEARCH FINDINGS (1/6) Dominos Pizza has the highest number of mentions in the social media amongst all the players – Dominos: 145631, Pizza Hut: 145272, McDonald: 132173, KFC: 139676, Taco Bell: 105713 while Taco Bell has the least (c) InRev Systems
  13. 13. BRAND HEALTH: SENTIMENTS across web for different QSRsRESEARCH FINDINGS (2/6) Taco Bell is the brand which is most dislike in the social media Dominos Pizza and Pizza Hut are the most loved brand (c) InRev Systems
  14. 14. COMPARE the demographics – age groupRESEARCH FINDINGS (3/6) of your brand talkers with competitors Young Teens in their 13-17 are the people talking about these QSRs the most online followed by people in the age group of 18-25 (c) InRev Systems
  15. 15. COMPARE the demographics – location of your brand talkers with competitorsRESEARCH FINDINGS (4/6) Taco Bell and KFC has less buzz in the country as compared to the other QSRs (c) InRev Systems
  16. 16. COMPARE the source of messagesRESEARCH FINDINGS (5/6) All the QSRs have a strong presence in Twitter. There is a lot of scope for getting into Facebook, Blogs and Videos (c) InRev Systems
  17. 17. INDUSTRY INTELLIGENCERESEARCH FINDINGS (6/6) Tracking the keyword “FAST-FOOD” in Simplify360 There are 19318 mention of the keyword “FAST-FOOD” in the social media within a period of 2 weeks alone 17.78% of the talks about FAST-FOOD is related to negative sentiment about the topic Young Teens in the age range of 13-17 are the people talking most about FAST-FOOD FAST-FOOD is popularly talked about in Mumbai and Chennai (c) InRev Systems
  18. 18. Start Using Simplify360 TodayFor Details, Visit - Or Send a Mail to -http://simplify360.com/ david@in-rev.comhttp://simplify360.com/blog/ VP - Sales, http://www.facebook.com/simplify360 InRev Systems @simplify360 © InRev Systems 2011 18

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