KFC eyes ‘Grilled’ rebranding of ‘Fried’ legacy

KFC eyes ‘Grilled’ rebranding of ‘Fried’ legacy

LOUISVILLE KY. KFC Corp. [3] will give franchisees the option of rebranding their stores “Kentucky Fried & Grilled Chicken” as part of a scheduled chainwide rollout of a nonfried product undergoing trials nationwide. —Representing a potential sea change in its 60-year-old image,

The revised moniker already is being used on KFC store facades during test marketing of “Kentucky Grilled Chicken” in at least six cities where the product is offered as a no-extra-cost alternative on all meal combos and variety buckets. —Representing a potential sea change in its 60-year-old image,

Some 45 corporate KFC branches in San Diego alone feature the new chicken. That city and Colorado Springs, Colo., were the initial test markets, starting 30 months ago. Branches in Indianapolis; Oklahoma City; Jacksonville, Fla.; and Austin, Texas, also are selling the new chicken. —Representing a potential sea change in its 60-year-old image,

In addition to a standard flavor, varieties such as rosemary-citrus, orange-chipotle and honey-barbecue are in the testing pipeline, as are snack products that would use the new chicken. —Representing a potential sea change in its 60-year-old image,

KFC has failed repeatedly for more than a decade to find a following for nonfried chicken offerings, but the struggling division of Yum! Brands Inc. [4] is pinning its hopes this time on what it says is improved cooking gear that would be deployed chainwide domestically by next spring. —Representing a potential sea change in its 60-year-old image,

KFC president Gregg Dedrick said the grilled product would “contemporize” the brand and mark a defining shift in its marketplace identity. —Representing a potential sea change in its 60-year-old image,

Exhibition cooking will not be part of the change, however, though window signs reading “Now Grilling” will be part of non-mandatory store upgrade packages the franchisor expects operators will make as part of regular remodels. Food containers also have been redesigned to carry the new product’s name. —Representing a potential sea change in its 60-year-old image,

Kentucky Grilled Chicken uses the same marinated, bone-in chicken as KFC’s Original Recipe and Extra Crispy items, but it gets a sprinkling of spices before cooking in a fully automated, high-temperature convection-steam oven. —Representing a potential sea change in its 60-year-old image,

Technically, the chicken is roasted, although the oven, estimated to cost $10,000 to $15,000, uses a patented nonstick “grill plate” to stripe the chicken. —Representing a potential sea change in its 60-year-old image,

Doug Hasselo, KFC’s chief food innovation officer, said the oven would get a lot of use as the grilled line is broadened over time. Including work in KFC’s corporate kitchens in Louisville, the new product has been in development for four years. —Representing a potential sea change in its 60-year-old image,

The boxy roasting device and the grill striping yield a chicken that’s said to be tastier and juicier than KFC’s previous nonfried offerings. Taste would be the focal point of the chain’s so-far-unspecified national marketing plan, officials have indicated. —Representing a potential sea change in its 60-year-old image,

About twice the size of an institutional microwave, the new roaster cooks 80 pieces of chicken at a time in roughly 22 minutes. Without breading, operators say, the production process is simple, and the oven is self-cleaning. —Representing a potential sea change in its 60-year-old image,

Sales results at test locations were not divulged, nor were implementation costs or the chain’s planned rollout-marketing budget. However, per-store costs would not be out of line with comparable upgrades, KFC indicated. —Representing a potential sea change in its 60-year-old image,

Dedrick acknowledged that Kentucky Grilled Chicken would not overshadow fried offerings, but would show “customers they have more options.” He said the new product “appeals to people who eat fried chicken and people who don’t eat fried chicken.” —Representing a potential sea change in its 60-year-old image,

Kentucky Grilled Chicken would meet the nutritional needs of an increasingly health-conscious public and attract lapsed customers who had given up eating the chain’s fried offerings, he added. —Representing a potential sea change in its 60-year-old image,

The Kentucky Grilled Chicken product, depending on the part, has as much as 50 percent fewer calories and half the sodium, and up to two-thirds less fat than KFC’s other chicken, officials indicated. —Representing a potential sea change in its 60-year-old image,

KFC has been unable to shake the sales downturn that has stung many quick-service chains in recent months, including its closest but still distant rival in the fried-chicken category, Popeyes [5] Chicken & Biscuits. —Representing a potential sea change in its 60-year-old image,

Yum chairman David Novak told analysts recently that KFC’s performance last year “underscored the need for dramatic change” that its new grilled chicken would represent as the “centerpiece of an overall brand transformation.” —Representing a potential sea change in its 60-year-old image,

However, some franchisees are known to be unconvinced about the grilled chicken’s ability to reinvigorate the brand and have cited consumers’ consistent preference over the years for KFC’s fried signatures. —Representing a potential sea change in its 60-year-old image,

That factor, and inconsistent cooking equipment and production forecasting, led to the Colonel’s Rotissserie Gold line being plucked by the chain in 1996, three years after $100 million was spent on introductory promotions. The Rotisserie Gold products, which one former KFC franchisee called “a nightmare to execute,” were replaced by Tender Roast items that survive today on the chain’s menu only in a sandwich, a Twister wrap and a salad topping. —Representing a potential sea change in its 60-year-old image,

But franchisees involved in field-testing are enthusiastic about Kentucky Grilled Chicken and its automated cooking process. “The night crews love being able to push a button on the cleaning mode and not have to do anything else with it,” said Lyndon Poindexter, a four-unit franchisee in the Indianapolis market. —Representing a potential sea change in its 60-year-old image,

When his morning shift comes in, they merely “wipe the oven down and clean the racks, and that only takes about 10 to 15 minutes.” Poindexter’s new gear was provided for testing at no cost by the franchisor, the 27-year KFC veteran said. —Representing a potential sea change in its 60-year-old image,

With its new nonfried chicken, Poindexter believes KFC has eliminated the store-level stumbling blocks of the past. “Operationally this is a much better product for us to handle, and I think the taste is better,” he said. “In my opinion, this is one of the best products KFC ever came out with.” —Representing a potential sea change in its 60-year-old image,

Consumers in Colorado Springs like the product, said Brian Shinn, regional operations director for KFC’s oldest franchisee, Harman Management of Los Altos, Calif. —Representing a potential sea change in its 60-year-old image,

“[Customers] know we cook it in an oven, but they say they really like the smoked flavor,” Shinn said. “They tell us it tastes a lot more moist than if it was cooked on a grill.” —Representing a potential sea change in its 60-year-old image,

When two TV commercials for the new chicken aired in his market area, sales were strong, but they weakened after the spots ended, Shinn said. “It would have been nice to have had more support from KFC to keep it going,” he said, “but it’s got a good-enough loyal following that managers don’t want to take it out.” —Representing a potential sea change in its 60-year-old image,

At KFC headquarters, there’s no shortage of enthusiasm for the new product, which is being heralded by staffers as “just like chicken off a backyard barbecue,” and even “addicting.” —Representing a potential sea change in its 60-year-old image,

Still, some analysts contend that the variability of consumer demand for another type of chicken poses potentially insurmountable production-forecasting problems that could vex operators over time and put store margins at risk. —Representing a potential sea change in its 60-year-old image,

But Dedrick insists that no product during his tenure has been torture-tested or scrutinized as much as this one. Customers love it, not just like it, and Kentucky Grilled Chicken has proved itself operationally sustainable, he said. Current phases of test marketing aren’t for product improvement, but rather are helping KFC tweak its forthcoming national marketing strategy, he said. —Representing a potential sea change in its 60-year-old image,

KFC this time “had to get it right,” Dedrick said, adding that the new chicken “had to be worthy of the KFC name.” —Representing a potential sea change in its 60-year-old image,

“We had to have an operational procedure where our operators weren’t put at a disadvantage,” Dedrick added, “and we needed to have equipment that would, over the long run—kind of forever—be able to cook this product.” —Representing a potential sea change in its 60-year-old image,