KFC HK: Innovation is the key to capturing diner hearts

Hongkongers are spoilt for choice when it comes to affordable food, with a host of international giants having maintained a regional presence in the region for decades. But there's also competition from local players, specifically from the city's  “Cha Chaan Teng” affordable cafes, whose cheap and cheerful aesthetic have gained them a loyal base.  So even as Hong Kong's fast food industry is dominated by big-name brands, innovation and down-to-earth approaches remain critical to success.

One such example of this mindset is KFC HK, who have showcased a fresh approach to meet diner needs while enhancing its service offerings.

As one of the heavy hitters in the market, KFC HK has been exploring ways to further engage its customers. In July, the fast-food chain store opened a concept store aimed at uplifting the traditional fast-food experience and creating a more relaxed environment in a cafe-style space.

“The retail sector had started declining three to four years ago, but we seized this opportunity to open a store at a prime location," said Janet Yuen, CEO of KFC-Birdland Hong Kong.

"We are facing fierce competition from other international big names and local flavours, but food delivery platforms are also strong opponents as well, making us explore innovative ways to engage customers.”

Located at the heart of Causeway Bay, the concept store can accommodate up to 150 customers at a time. Three-dimensional art installations have been positioned at each stairway, creating photogenic spots across the store.

"The concept store is to create a trendy socialising hub and recharge with friends that makes valuable moments," Yuen says.

The store is also acting as a hub for food innovation. Though it's common for chain restaurants to launch new and/or limited-run food items across all of a region's branches, KFC has chosen another approach launching all new items exclusively at the concept store first.

“It’s a place for innovations. Launching new products in just one store could help us minimise risks and mistakes. We can also know the difficulties in producing new products. After everything is smooth, we will expand the new products to other stores,” she said.

Examples of new items include a Grilled Chicken Combo,  a Chizza (a chicken pizza with a chicken fillet as the base with cheese and pineapple toppings), and an oven-glazed hot wing platter.

[caption id="attachment_273180" align="alignnone" width="700"] Chizza[/caption]

Furthermore, prior to the Mid-Autumn Festival, KFC HK launched two flavours of mooncake, namely the “spicy chicken and nuts mooncake”, and the “golden lava custard mooncake”,  bringing fun elements meant to engage young adults and millennials.

Yuen says this sort of beta testing will make it easier for the company to gather customer feedback and maintain the standards of new products.

Another reason for using a store as a testing ground for products is Hong Kong's highly competitive market. According to KFC HK, the number of transactions in stores here is notably higher than other cities in the world, meaning that kitchens across the city's stores need to expend extra effort to maintain those aforementioned standards.

Another element crucial to engaging customers is localisation. Previous examples from KFC HK  would be the launch of its Bucket Rice dish or the relaunch of its Bei Fung Tong Chicken. Currently, it is offering a twist on a Hong Kong afternoon staple with a Cheese Twisty Macaroni Tea Set. In October 2017, KFC HK went so far as to invite recognisable local actor Steve Lee (李家鼎) to create Bei Fung Tong-style dishes for the brand as well.

But sometimes it’s actually necessary to go the other way and avoid making any changes. While new products are launched across dozens of branches, it's common for stores in residential areas to not offer these promotions, because customers in these areas may not be open to these unfamiliar food items.

Looking forward, KFC HK tells Marketing it will strengthen its personalised marketing strategies and promotions. The kitchen team is testing more improvements including healthier options and a kid’s menu to cater to another segment of the fast-food market.

“Other than these, we all also looking for some accessible locations to open more stores across Hong Kong. Last but not least, we’ll stay distinctive yet relevant to our customers,” Yuen concludes.