What historic event occurred 65 years ago this month? Why, the famous chicken connoisseur himself, Col. Harland Sanders, engineered one of the best culinary concoctions ever to have graced this fine planet: the KFC Original Recipe. Yum! Brands
I got a huge kick out of this release. The company cleverly linked the revelation of a political secret that has bugged this country for many years -- the identity of the mysterious Deep Throat -- with the intense protection afforded to the Colonel's classified algorithm for mixing 11 herbs and spices to produce an addictive form of cooked poultry. Even Bob Woodward and Carl Bernstein are mentioned, which really juiced up the humor quotient. Apparently, only a few select people are privy to the recipe; even the suppliers who work with KFC only know half the picture.
Having top-secret recipes is a nice marketing asset. Coca-Cola is an example of another company that has used such a tactic to good measure. The allure that is added to the product can only increase the intrinsic brand equity. It makes you feel like you're eating something special when you think that there is a sense of tradition and history behind the food. And if it's special, then a premium price can be more easily justified.
KFC has been good to Yum! Brands lately in that company's quest to effectively compete against quick-serve powerhouses like McDonald's
The three Yum! Brands are a fixture of Americana at this point and should remain so long into the future, making this a company on its way to blue-chip status along the lines of the aforementioned McDonald's. The company initiated a dividend last year and has strong prospects in China. Investment manager Bill Nygren told Fool contributor Matt Logan that he'd consider holding Yum! Brands for a decade.
If you're looking to add a fast-food restaurant chain to your portfolio, definitely take the time to take a closer look at Yum! Brands. Just don't expect to find that secret recipe.
For more juicy Takes on Yum! Brands, check out:
Let us know what you think of the secret recipe at the Yum! Brands discussion board.
Fool contributor Steven Mallas owns shares of Coca-Cola. He thinks it would be hilarious if KFC did an advertising campaign tied to its secret recipe that spoofed the whole Watergate/Deep Throat thing. The Fool has an ironclad disclosure policy.