“We have a great opportunity to create more modern relevance and more modern engagement with modern families and young modern singles,” Chevez said. “This is the next great opportunity for growth.”
Lessons from Nintendo
Chavez’s background as a marketer with Nintendo of America—where he was senior VP of sales, marketing and communication before departing for KFC—informs his focus on younger consumers and the ways KFC will go about attracting them. At Nintendo, Chavez led marketing of its revolutionary Nintendo Switch console, whose appeal was in its versatility with various gamers, he said.
“What we did at Nintendo over the last seven to 10 years was unlock demand for modern video games for modern families; it wasn’t about going toe-to-toe with Microsoft and Sony,” Chavez said. “And over time, we built relationships with those families via digital accounts and loyalty. We know KFC has a big opportunity there to unlock relationships with families who love KFC through digital media and loyalty.”
Although KFC over the last year unveiled a new app and website allowing for new conveniences like easier online ordering, it is still in the process of developing a formal loyalty program. Chavez said more detail on that program is still to come.
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KFC’s global same-store sales grew by 11% in fiscal 2021 and by 7% in the U.S. In the most recently reported fourth quarter, U.S. same-store sales increased by 4% and by 12% on a two-year basis. The U.S. is KFC’s second-largest market, accounting for 17% of its total sales. Its U.S. fourth-quarter performance was sparked by increased sales of its chicken sandwich, which now accounts for 9% of its sales mix, up from 1% in 2020’s fourth quarter.
About one-third of KFC’s new ads will feature the chicken sandwich.
KFC is a division of Yum brands, which also controls the Taco Bell, Pizza Hut and Habit Burger brands.
Chavez declined to specify what KFC was spending behind the new campaign but said the outlay would be “significantly higher” on a quarter-to-quarter basis than it was a year ago. The campaign is designed to reach target customers “in the places and spaces that are most relevant to them,” he said, so that means more premium digital video like Hulu and Peacock and what Chavez called “top-tier” programming including the NBA playoffs, "American Idol" and in “hyper-targeted” programmatic digital media led by Spark Foundry.
“What we want people to think and feel after seeing this campaign is that 'KFC is for me, It’s for us. Let’s get KFC tonight,'” he said. “We’ll be tracking brand relevance across multiple demographics. Secondarily, we’ll be looking all of the typical measures—breakthrough, likeability, persuasion, attention—but the big one is, is the brand increasingly relevant for me and my family?”
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