2.0 min read
Back in the summer, KFC announced it would be revamping its brand, its stores and its menu. At that time,m it unveiled its new restaurant decor plans and promised even bigger changes in other facets of its business. Now, KFC’s first menu change has bubbled up…
The KFC of the Future: New store features a seating area, longer hours and a Breakfast Menu…
After 40 years of partnership, KFC has dropped Pepsi as its fountain drinks supplier. And the chicken behemoth is already phasing in Coke products at all of its 4,000 US stores…
The past is preface…
You’ll recall that, this past summer, both Pepsi and Coke announced new approaches to expanding fans’ access to custom blends and a broader range of products via their resto dispenser systems.
That was just the most visible of a cavalcade of changes both beverage giants have been rolling out, reflecting forays into the ‘healthier for you’ drinks space, and marketing gimmicks designed to pry prec-ious market share out of each others’ desperate hands. The snacks and soda market spaces are supersaturated with hundreds of different brands vying for specialized slices of the action.
Soda and snack sales plateaued, then started to decline over the past year as younger generations came into their own and started demanding healthier indulgences.
Pepsi, which was number two in the US soda rankings just two years ago, has now slumped to numb-er three, behind Coke and Dr Pepper. And the loss of KFC as a restaurant partner isn’t a good look for the brand, as other partnerships come up for renewal…
Why?
KFC US President Catherine Tan-Gillespie said the switch to Coke, “[marked] another step in our work to evolve KFC, strengthen our restaurants, menu offerings and create a more relevant experience for today’s customers. Coca-Cola shares our ambition for the future of this brand.”
KFC is also testing new ways to expand its business opportunities. “The premise commercially behind this restaurant is called ‘AUV-maxxing,’” Tan-Gillespie said. “We want to open up as much as we can in terms of driving new channels, driving new day parts, driving new menu options, driving new ex-periences, [and] new occasions.”
‘AUV’ stands for ‘Average Unit Volume’. In its simplest form, ‘AUV maxxing’ means getting the most revenue possible out of a fast food restaurant by using its resources to maximum benefit.
For KFC, that will include adding in-store seating and offering a breakfast menu, to access that here-to-fore unexploited day-part. And franch9ise hours will be expanded, opening at 6 am and closing at midnight.
My take
I think… Coke’s new fountain dispensing system just resonated more strongly with KFC’s new goals than Pepsi’s. I’ve also hard that the Pepsi system costs more to install and more to run. And cost is the first concern for any Fast Food operator.
We’ll see how KFC’s new regime works our as it’s rolled out over the coming year or so. And we’ll also see how the elbows-up war between Coke and Pepsi turns out. I expect to see even more-dramatic moves by both players over the next few months!
~ Maggie J.