Company Case chick-FiI-A: Getting Better before Getting Bigger

Chick-fiI-A is dominating the U.S. fast-food market. Whereas mantra. As a family-owned operation, the company has never
McDonald's, Subway, Burger King, and Taco Bell trudge along at deviated from its core value to “focus on getting better before
the top of the heap, Chick-fil-A has quietly risen mom a South- east getting bigger.” The slow-growth strategy has facilitated that
regional favorite to become the largest chicken chain and the ability to “get better."
eighth-largest quick-service food purveyor in the country. The As another way to perfect its business, the company has also
chain sells significantly more food per restaurant than any of its stuck to a limited menu. The original breaded chicken sandwich
competitors—twice that ofTaco Bell or Wendy’s and more than remains at the core of Chick-fil-A’s menu today—“a bone- less
three times what the KFC Golonel fries up. And it does this breast of chicken seasoned to perfection, hand-breaded, pressure
without even opening its doors on Sundays. With annual cooked in 100% refined peanut oil and served on a toasted,
revenues of more than $6 billion and annUal average growth of buttered bun with dill pickle chips.” In fact, the com- pany’s
12.7 percent, the chicken champ from Atlanta shows no signs of trademarked slogan —“We didn’t invent the chicken, just the
slowing down. chicken sandwich”—has kept the company on track for decades.
How does Ghick-fi1-A do it? By focusing on customers. Since the Although it has carefully and strategically added other items to the
first Chick-fil-A restaurant opened for business in the late 1960s, menu, it’s the iconic chicken sandwich in all its vari- eties that
the chain’s founders have held tenaciously to the philoso- phy that primarily drives the brand’s image and the company’s revenues.
the most sustainable way to do business is to provide the best This focus has helped the company give customers what they want
possible experience for customers. year after year without being tempted to develop a new flavor of the
month,
Applying Some Pressure
Chick-fiI-A founder S. Truett Cathy was no stranger to the res- Getting It Right
taurant business. Owning and operating restaurants in Georgia in the Also central to Chick-fiI-A’s mission is to ”have a positive influ-
1940s, ’50s, and '6ds, his experience led him to investigate a better ence on all who come in contact with Chick-fiI-A.“ Although
(and faster) way to cook chicken. He discovered a pressure fryer that seemingly a tall order to fill, this sentiment permeates every as- pect
could cook a chicken breast in the same amount of time it took to cook of its business. Not long ago, current Chick-fiI-A CEO Dan Cathy
a fast-food burger. Developing the chicken sand- which as a burger was deeply affected by a note that his wife taped to their
alternative, he registered the name "Chick-fiI-A, Inc." and opened refrigerator. In a recent visit to a local Chick-fiI-A store, she had not
the first Chick-fil-A restaurant in 1967. only received the wrong order, she had been overcharged. She
The company began expanding immediately, although at a circled the amount on her receipt, wrote "I’ll be back when you get
substantially slower pace than the market leaders. Even today, it right" next to it, and posted it on the fridge for her hus- band to
Chick-fiI-A adds only about 100 new stores each year. Although it see.
now has more than 2,000 stores throughout the United States, That note prompted Dan Cathy to double-down on customer
that number is relatively small compared to KFC’s 4,100, service. He initiated a program by which all Chick-fil-A employ- ees
McDonald’s 13,000, and Subway’s 27,000. Chick-fil- A’s were retrained to go the "second mile" in providing service to
controlled level of growth ties directly to its “customer first" everyone. That “second mile" meant not only meeting basic
standards of cleanliness and politeness but going above and meal. Last year, the 10th anniversary of this annual event, about a
beyond by delivering each order to the customer’s table with million cow-clad customers cashed in on the offer.
unexpected touches such as a fresh-Cut flower or ground pep- per Another tradition for brand loyalists is to camp out prior to the
for salads. opening of a new restaurant. Chick-fiI-A encourages this ardent
The experience of a recent patron illustrates the level of ser- vice activity with its “First 100” promotion—an officially sanctioned
Chick-fiI-A’s customers have come to expect as well as the event in which the company present the first 100 people in line for
innovative spirit that makes such service possible: each new restaurant opening vouchers for a full year’s worth of
Chick-fiI-A meals. Dan Cathy himself has been known to camp
My daughter and I stopped at Chick-fil-A on our way horns, out with customers, signing T-shirts, posing for pictures, and
The parking lot was full, the drive-thru was packed.. . but the personally handing coupons to the winners. And whereas some
love we have for the chicken sandwiches and waffle potato customer-centric giveaways are regular events, others pop up
fries! So we decided it was worth the wait. As we walked up the randomly. Take the most recent “family challenge,” which awards a
sidewalk, there were two staff members greeting every car in free ice cream cone to any dine-in customers who relinquish their
the drive-thru and taking orders on little tablets. A manager smartphones to a “cell phone coop” for the duration of their meals.
was making his rounds around the building outside smiling and To keep customers engaged when they aren’t in the stores,
waving at cars as they were leaving.
Chick-fil-A has become an expert in social and digital media. Its
When we came inside, the place was packed We were greeted
newest app, Chick-fil-A One, jumped to the number-one spot
immediately by the cashiers. Seth happened to take our order. He
on iTunes only hours after being announced. Nine days later,
had a big smile, wonderful manners, spoke clearly and had
more than a million customers had downloaded the app, giving
great energy as a teenager He gave us a number and said
them the ability to place and customize their orders, pay in
he’d be right out with our drinks. We were able to sit at a
table as the other guests were leaving and before we could even get advance, and skip the lines at the register. And in a recent survey
settled our drinks were on the table! While Seth started to walk away, by social media tracker Engagement Labs, Chick-fil-A was
our food was delivered by another very friendly person. Both ranked number one and crowned the favorite American brand on
myself and my 15-year-old daughter commented on how fast it all major social media platforms, including Facebook, Twitter, and
all happened. We were so shocked that we started Instagram.
commenting on the large groups arriving behind us, and Every year, as the accolades roll in, it is apparent that Chick- fiI-
began watching in amazement, not only inside but outside! A's customer-centric culture is more than just talk. Among the
Everyone behind the counter worked together, used many competitors, Chick-fiI-A was rated number one in
manners, and smiled. The teamwork was amazing. Then Ron, a gray customer service in the most recent Consumer Reports survey of
headed friendly man, made his way from table to table, checking fast-food chains. In the latest annual Customer Service Hall of Fame
on guests, giving refills, and trading coloring books for small ice survey, Chick-fiI-A ranked second out of 151 of the best- known
cream cones with sprinkles for little kids. He checked on us companies across 15 industries, trailing only Amazon. A whopping
twice and filled our 47 percent of customers rated the company’s service as
drinks once. “excellent,” and Chick-fiI-A was the only fast-food chain to make
the list for the second year in a row.
Recently, the company instituted the “parent’s valet service,” After decades of phenomenal growth and success, Chick- fiI-
inviting parents juggling small children to go through the drive- A is celebrating by firing the Richards Group, its long- standing
through, place their order, park, and make their way inside the agency of record. Additionally, the beloved cows that are so
store. By the time the family gets inside, its meal is waiting on widely recognized as symbols of the brand will ease into the
placemats at a table with high chairs in place. But beyond the background of promotional materials. “The cows are an integral
tactics that are taught as a matter of standard policy, Chick-fiI-A also part of the brand. “they're our mascot, if you will,” says Jon
trains employees to look for special ways to serve—such as Bridges, chief marketing officer for Chick-fil-A. “But they aren't
retrieving dental appliances from dumpsters or delivering smart- the brand. The brand is bigger than that.” For now, Bridges only
phones and wallets that customers have left behind, says that the cows won’t disappear. But a new “Cow-plus” is in
the works, and the brand’s promotional messages will expand
beyond the bovines to tell engaging stories about the food,
Give Them Something To Do people, and service that make the brand so special. It’s a risky
Beyond high levels of in-store service, Chick-fiI-A has focused move. With Chick-fiI-A growing faster than any other major fast-
on other brand-building elements that enhance the customer ex- food chain, it begs the question as to whether such a drastic
perience. The brand got a big boost when the Chick-fil-A cows change in the brand’s symbolism will sustain its current growth
made their promotional debut as three-dimensional characters on for years to come, or send some customers out to pasture.
billboards with the now famous slogan, “EAT MORE CHIKIIJ.” The Prior to this recent announcement, one estimate has Chick- fiI-
beloved bovines and their self-preservation message have been a A on track to add between $6 billion and $9 billion in revenues within
constant across all Chick-fil-A promotional materials for the past 20 the next decade. In that same period, giant McDonald’s may add
years, They’ve also been the linchpin for another Chick-fil-A as much as $10 billion in U.S. sales but as little as only
customer experience-enhancing strategy—engage customers by $1 billion. Clearly, all this growth is not an accident. As one food
giving them something to do. industry analyst states, “It’s about trying to maintain high levels of
Displaying any of the cow-themed mugs, T-shirts, stuffed service, high quality, not deviating dramatically, and giving
£tnimals, refrigerator ma9• e ts, laptop cases, and dozens of other customers an idea of what to expect,” As long as Chick-fiI-A
items the company sells on its website certainly qualifies as
“something to do.” But Chick-fil-A marketers go far beyond pro-
motional items to engage customers. For starters, there’s “Cow
Appreciation Day"—a day set aside every July when customers who
go to any Chick-fiI-A store dressed as a cow get a free
continues to make customers the number-one priority, we can
expect to find more and more access to those scrumptious
chicken sandwiches.

Questions
1. Give examples of needs, wants, and demands of
Chick- fiI-A customers, differentiating these three
concepts.
2. Describe Chick-fil-A in terms of the value it
provides customers. How does Chick-fiI-A engage
customers?
3. Evaluate Chick-fiI-A’s performance relative to
customer expectations.
4. Which of the five marketing management
orientations best applies to Chick-fil-A'?