Answer ALL questions from this part. All questions carry equal
Case Study: KFC China: Targeting Through Localization:
Read the following case study carefully and answer all the
questions given at the end of the case.
When KFC first entered Hong Kong in 1973, it quickly grew to 11
restaurants by the following year. However, the business seriously
misjudged the local market and failed to develop a business model
that could be sustained. Consequently, by 1975, all 11 of the
outlets had been forced to close.
Ten years later, KFC was back. It franchised its operations to
Birdland, a company with the backing of local investors. KFCs
difficult times in Hong Kong provided the business with vital
knowledge when it came to entering China in 1987. At the time,
China required overseas businesses to enter into joint ventures
with Chinese businesses. KFC China carefully selected local
partners with strong government connections.
Localization was also an important aspect of KFC China’s approach.
The Business introduced more new products more frequently than its
competitors in China. KFCs core product is chicken, second only in
popularity in China to pork. Chicken is also far more popular than
beef, giving the business a huge advantage over rival Mc Donald’s.
KFC China has worked tirelessly to ensure that it continues to come
up with and launch new products that are a better fit for the
Chinese consumer. As a result, it is twice as big in China than
McDonalds, elsewhere in the world it is the other way around.
The highly localized menu, which includes Chinese style porridge,
Beijing Chicken Roll, Spicy Dried Chicken has kept KFC China ahead
of McDonalds and Burger King, but other restaurant are formidable
competitors. KFC China also runs Pizza Hut and Pizza Hut Express
and are currently developing a new brand called East Dawning’s in
an attempt to fend off local fast food rivals which is both
offensive and defensive move to ensure that it maintains market
leader position. KFC has been positioned in Mainland China as a
Western brand with Chinese characteristics modified through product
localization and differentiated marketing practices.
The KFC has repositioned itself and expand its target markets to
include all ages, family and friends. Answer All the questions
below in Part A
1. What key elements of its Chinese fast food retail marketing
strategy do you think make KFC success story? (10 marks)
2. In China, KFC succeeded in changing the eating habit of its
Chinese consumers. Evaluate the relevance and the implications of
adopting a similar policy in other countries. (10 marks)
3. After reading the case study, you might wonder whether a
common global retail marketing policy could be adopted in every
national market. On the other hand, the case study emphasizes
variations in retail marketing policy and the need for
international retailers to consider aspects of religion, social
customs and cultural values in their retail marketing operation in
the context of standardization and adaptation. Discuss what you
think differentiates KFC fast food retail marketing operations,
marketing concept and strategies in China from the USA. (20