Wednesday, July 13, 2011

One, two, three, how dumb is YUM brands.

No legacy food company is a better example of what happens at the confluence of Brand Protectionism and inflated C-level ego’s than Yum brands. Yum brands at one time was at the center of retail foodservice growth in the US retail food marketplace. Now caught up in a quagmire of their own making in part because it was easy to cherry pick profits from a fast growing Chinese middle class all the while spending 5 million plus franchise dollars per year too promote a single horse race? That’s not chicken; it’s a lot of tacos.

Capitulating market share is nothing new for YUM brands, they have been doing it in the US market for years in each of the three key sectors Pizza, Mexican, and Chicken. (Regular readers of this blog I assure you can name to competitors in each sector that have garnered share from Yum.) While hand held food for immediate consumption continues to garner market share Yum brands continues to capitulate share in each sector they still compete.

Legacy companies that practice brand protectionism simply do not understand or forgot that the consumer is dynamic not static. All food brands must maintain a relevant relationship with the consumer or give ground to competitors. Success in retail food service today can be found in Foodservice Solutions® 5 P’s of food marketing: Product, Packaging, Placement, Portability and Price.

Today retail food is a mix and match meal component opportunity that is very empowering for the consumer. Consumer’s select by meal occasion what “better for you” flavor or attribute they want. It can be fresh hamburger, low salt, cooked to order, or green packaging. Don’t discount the value of consumer choice or limit the world of “better for you”. Mix and match of small portion, fresh products, green packaging is making meal time a time of convenient meal participation, differentiation and individualization and consumers are responding. Yum must remember its about bundling product not price points. The consumer has moved and Yum must move with them or risk losing additional market share.

Since 1991 retail food consultancy Foodservice Solutions® of Tacoma, WA has been the global leader in the Grocerant niche for more on Foodservice Solutions® Bing or Google Grocerants or visit, or Facebook Steven Johnson

No comments:

Post a Comment