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| Kyochon F&B CEO and Chairman So Jin-se speaks during an online press conference held on Oct. 22, 2020. Courtesy of Kyochon F&B |
By Kim Jae-heun
Kyochon F&B, Korea's largest fried chicken franchise, has come under fire for its controversial sales policy after raising menu prices by 8.1 percent last November. Consumer advocates are complaining that the company has since been offering discounts frequently in a bid to appease consumers who are unhappy about the price hikes and making them accept that it is now more expensive to eat fried chicken.
Kyochon sold e-coupons on Kakao's live-commerce platform recently, offering a 4,000 won discount for four types of combination set menu items that come with fried chicken and cheeseballs. The company ran the same promotion with Baedal Minjok (Baemin) last month, but with 1,000 won cheaper e-coupons. Baemin is the country's leading food delivery service.
Kyochon has also been giving 2,000 won discounts for four of its fried chicken menu items to those adding Kyochon to their friends list on Kakao Talk, the most widely used messaging application in Korea.
"What is the point of raising prices if it was going to give out discounts? Kyochon is only trying to get its customers to naturally accept the new prices before actually raising them up," a customer surnamed Cho said.
"The company said the price hike was inevitable due to the increasing costs of ingredients and salaries. But they couldn't be giving out the discounts if the explained conditions were true."
Kyochon said the events are temporary and aimed to benefit as many customers as possible.
"It is part of our marketing strategy to attract young customers, especially Millennials, through various retail channels," a Kyochon official said.
The fried chicken franchise stepped up to become the first such firm to increase prices in seven years since 2014. The company said the decision had to be made to improve the profitability of its franchisees and it will reward customers with better-quality food and services.
Other fried chicken restaurants chains including BHC followed by increasing prices too, and consumers have been increasing their complaints.
Meanwhile, BBQ Genesis, the country's third-largest fried chicken restaurant franchise after Kyochon and BHC, decided to freeze its prices.
An industry official said customers tend to adapt to new prices well if they are given discounts for three to six months.
"It gives people the feeling that they are eating chicken at the previous price, which invites less resistance. I think Kyochon knows this and introduced such promotions," he said.
