Pizza Hut 2003 Annual Report Download - page 5

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We are the leader in the chicken, pizza, seafood &
Mexican quick service categories.
A new advertising campaign, “Gather ’Round the Good Stuff ™
,” was launched and is gaining
traction with customers. The new product pipeline has been rebuilt with a record number of
product and concept tests.
Pizza Hut is also steadily improving its operations and is the first one of our brands to achieve
team member turnover of less than 100% for the full year … 99.6% to be exact (the industry
average is nearly 200%).
While KFC is incredibly strong internationally, it is clearly our biggest challenge in the U.S. We
are, however, confident the new management team we put in place is taking the right actions
to turn the brand around.
We plan a major relaunch of KFC in the second half of 2004, featuring a new menu board that
features a roasted line of new products and everyday value meals. We are also emphasizing
the fact that our chicken is brought to our restaurants fresh, not frozen, every day.
Just as importantly for KFC, we are making steady progress in speed of service as we roll out
the same drive-thru program that worked so effectively for Taco Bell. One big advantage we
have is the ability to spread our best practices.
Key measures in the U.S.: At least 7% operating profit growth per year and at least 1–2%
same-store sales growth.
#2. Multibranding Great Brands
Our goal is to be the best in the world at providing branded restaurant choice.
We have category-leading brands that are highly successful on a stand-alone
basis. As a result, we are structured with fully staffed marketing and operating
teams who wake up every single day focused on driving each brand’s differen-
tiation, relevance and energy. Given the power of these individual brands, we
have the opportunity to literally change the quick service restaurant industry
as you know it today by offering
two of our great brands in the same restau-
rant
… we call this strategy multibranding.
Multibranding gives us the competitive advantage of branded variety. It is already a big business
for Yum!, accounting for 12% of our U.S. traditional restaurant base and generating almost
$185 million in U.S. company store profits and franchise fees. Our learnings this year make
Multibranding
gives us the competitive
advantage of
branded variety.
With the acquisition of A&W and
Long John Silver’s in 2002, we tripled
our multibrand potential in the U.S.
No one else has our brand portfolio
power.
3.