KFC entered the Brazilian market in 2007 through a partnership with Brazil Fast Food Corporation (BFFC). There are currently 18 KFC locations in Brazil, focusing on Rio de Janeiro and Sao Paulo. While facing competition from other fast food chains like McDonald's, KFC sees opportunities to expand in Brazil given the country's large population and growing middle class. KFC tailors its menu and promotions to Brazilian tastes but maintains its well-known chicken products and brand image internationally.

1. Kentucky Fried Chicken in Brazil
Anna Brewer, Gabe Hyde, Emily Mallory

2. KFC Company information
 Based in Louisville, KY
 Parent company: YUM! Brands
 Ranked #239 on Fortune 500 List
 Each day, 12 million customers are served
 36,000 locations worldwide
 World’s most popular chicken restaurant chain
 World famous for Original Recipe fried chicken

3. KFC Internationally

4. KFC Internationally
 In 109 countries
 5,200 in the U.S.
 15,000 globally
 Globally there are 300 products served
 Grilled chicken in the U.S. to salmon sandwich in
Japan

5. Financial History
 Own 39% market share of the chicken-on-the-
bone segment as of 2011
 Video: http://bcove.me/oih2ju8r

6. Financials

7. Target Market: Brazil
 Languages:
 Portuguese (official)
 less common: Spanish, German, Italian, Japanese,
English, and a large number of minor Amerindian
languages
 87% urban population
 55% of Latin American economy
 Over 50% of population is under the age of 30
 Hits the key demographic for KFC

8. The Target Market
 Large gap between the rich and poor
 26% population live below the poverty line (CIA
World Fact Book)
 Literacy Rate: 88% male and female
 Obesity Rate: 11%
 52nd out of 70 ranked nations in the world
 Generally a healthy nation
 Consumer expenditure on food in millions
 2011: $ 190,598.8
 Expected for 2012: $ 199,582.2

9. The Target Market
 Consumer behavior
 Brazilians have good culinary sense
 Strong food and drink traditions
 Crucial for KFC to align with natives (BFFC)
 Growth in Brazilian economy
 emergence of a larger middle class with higher
income per person
 consumers to spend more on indulging themselves,
rather than restricting their spends to basic
necessities
 Brazilians are spending more on eating out
 Seeking convenience

10. Industry Analysis

11. Industry Analysis
 4 segments of market
 Quick service
 Take-aways
 Mobile and street vendors
 Leisure locations

12. Foreign Market Entry Method
 100% franchised in Brazil
 Aligned with BFFC (Brazil Fast Food Corporation)
 Strategy
 Joined a strong franchise within the market
 They already know the Brazilian culture and marketplace
 BFFC knows the tastes and culture of the food industry
 Entered in the first quarter of 2007 with 4 restaurants
in Rio De Janeiro
 Currently there are 18 locations
 5 in Sao Paulo
 13 in Rio De Janeiro

13.  Wagner Rodrigues
 Executive Officer of YUM! Restaurants International
in Brazil
 “With Brazil Fast Food’s extensive knowledge of
the Brazilian fast food market, we believe that it is
the perfect company to entrust with the continued
growth, development, and consolidation of the
KFC brand in Brazil.” -QSR

14. Competitive Analysis
 Within Brazil
 McDonalds
 Burger King
 Subway
 Local Chain Competitors
 Bob’s
 Giraffa’s
 Habib’s
 Potential: Any fast food company could come into
Brazil in the future and become a direct competitor
 Wendy’s
 Dairy Queen
 Krystal’s

15. SWOT analysis: internal aspects
 Strengths
 BFFC alliance
 Brand Equity is #2 in the world
 Strong markets internationally already in place
 The top international country-style chicken fast food
company in the world
 Weaknesses
 Fairly new in the marketplace (2007)
 The risk that comes with franchising (i.e. loss of control,
consistency and quality)
 Do not have a lot of healthy food options

16. SWOT analysis: external aspects
 Opportunities
 18 KFC locations
 Absolute room for expansion long-term
 Blue Chip for growth opportunity behind China, India and
African nations
 5th largest country with over 170,000,000 people
 Growing fast food market
 Media availability in Brazil is the largest in South America
 Threats
 Future competitors entering the market
 McDonald’s is the market share leader
 CPI is 3.8

17. The Marketing Mix
Product
Promotion
Price
Place

18. Product Strategy
 Description
 Global leader in chicken fast food
 Quality: focus on improvements
 Health aspects
 KFC has re-launched its grilled chicken menu in the US, which is aimed at
satisfying consumers' needs for health and convenience. In doing so, it is
addressing consumer trends and countering concerns regarding fatty
offerings in the fast food sector.
 Brand Name: Internationally known Kentucky Fried Chicken
 Branding
 Colors: red and white
 Coronel Sanders
 Image: Adaption verses Standardization
 Doesn’t want to lose brand image, but mix “balance aggregation with
adaptation”
 Standardizing of some products, but also tailoring to customer’s needs

19. KFC Products: menu in Brazil
 Core products same as the U.S. (original, extra
crispy)
 Unique dipping sauces to adapt to local taste
 Culturally unique products
 Farofa, black beans, parmiggano sandwich, I-Twist

20. Price Strategy
 Standard of living
 Optimism: Majority of citizens believe it is improving
 Exchange rate: 0.52 Real = $1.00
 Competitive pricing
 Value pricing strategy: provide the best value per
competition
 Par Value Pricing: pricing is based on the
competition
 U.S. pricing vs. Brazil pricing
 Brazil: 20 Reals, For 6 pieces of chicken 2 sides
 U.S. $12.99, For 6 pieces of chicken, 1 large side, 3
biscuits
 20 Brazilian reals = $10.4058 US dollars

21. Place/Distribution
 Distribution
 Goods direct to consumer
 In store
 Drive through
 Delivery
 Franchisees place food orders through BFFC’s
procurement department
 Suppliers
 Pilgrim’s Pride, Perdue Farms, Tyson Foods
 Prefer to supply from within the country but use
contingency plans to ensure quality
 Currently, 18 locations in Brazil

22. Promotion
 Media availability
 Largest and most developed of South America
 Of 170 million people, only 2.3 million have cable
and 1.3 have satellite
 71 million listen to the radio
 75 million have computers but ONLY 5 million have
the internet
 Media power: radio and television
 Freedom of speech in the press

23. Promotion
 Advertising Strategy
 Brazil advertising is
known for creativity and
innovativeness (AEF)
 Brazilians desire
entertaining advertising
 Most desired
advertising is during
soccer games
 Emphasize physical
beauty
 Billboards, signs in the
streets also utilized
 Emphasize price and
convenience
 Combining meals and
discounts

24. Promotion
 Corporate social responsibility initiatives
 Coronel’s Scholars
 Social Diversity
 Supplier Code of Conduct
 Packaging and the Environment
 Animal Welfare Program

25. Animal Welfare Program
 YUM! Brands does not own, raise, or transport
animals
 Influence the way the supplied animals are
treated
 Monitor suppliers
 Council with highly respected experts in the
animal welfare field to advise KFC
 Develops guidelines and audit programs for
suppliers in the broiler industry
 Industry leading in poultry care and handling audit
program