Expanding into new markets is a crucial step for fast food companies that are willing to remain relevant. The specified solution allows organizations to attract the attention of new audiences and increase brand name recognition. Therefore, for the firms such as Wendy’s entering the Chinese market is one of the options that provide rather rich opportunities. At the same time, the firms must keep in mind the necessity to alter their brand products and marketing strategies slightly to meet the requirements of the new market and appeal to the new demographic.
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Because of the strong presence that KFC and McDonald’s already have in the Chinese market, firms such as Wendy’s have to design a unique product that would set it aside from a range of similar fast food chains will be required (Szulanski, Chen, & Lee, 2009). Particularly, the company could create the product that would appeal to the cultural specifics of the target population, such as its recent attempt at producing tofu McNuggets by McDonald’s (Kendall, 2014).
Among the key opportunities for operating in China, one must mention the mentality of Chinese people, who are willing to try new experiences. However, there is also an evident weakness of the specified project, which concerns high competition levels.
When considering the approaches that McDonald’s and KFC have used to enter the Chinese market, one has to admit that they are quite different, yet both are based on the same premise. McDonald’s focuses on creating the brand product that would incorporate both the characteristics of its trademark food and the elements of the local culture, such as the tofu McNuggets mentioned above. KFC, in its turn, has been promoting its western cuisine as an exotic concept in the Chinese environment from the start (Szulanski et al., 2009). Thus, McDonald’s is trying to marry the elements of its food and the local cuisine, whereas KFC positions itself as the firm delivering entirely Western food.
Although both models are admittedly efficient in the context of the Chinese market given the attention that both McDonald’s and KFC receive, they also have several problems. The approach used by McDonald’s, which allows it to appeal to the target demographic on a cultural level, somewhat devalues its product by stripping it of its initial uniqueness and adding the elements of the Chinese culture (Szulanski et al., 2009).
Local customers have been exposed to the Chinese food since they were born, which means that they hardly need another organization producing this type of food. KFC, however, also faces certain threats since presenting the food that is initially alien to the Chinese culture may lead to customers disliking it. In addition, it is worth noting that, despite the differences in their approaches, both companies focus on using the principles of quick service delivery as an innovative strategy in the Chinese food market (Szulanski et al., 2009).
The case shows quite clearly that the process of adapting toward the realities of a particular market requires a significant amount of flexibility and an in-depth analysis of local customers’ needs. Although the choices that McDonald’s and KFC have made when selecting their marketing strategies in China were flawed, the outcomes have been rather impressive. Therefore, an organization attempting at entering the realm of the Chinese economic environment should balance between offering a unique product and incorporating the elements of the Chinese culture into its food. As a result, a gradual rise in customers’ enthusiasm for trying the suggested product is to be expected.
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Kendall, P. (2014). McDonald’s Japan just released Tofu Nuggets, and they taste… SoraNews24. Web.
Szulanski, G., Chen, Y., & Lee, J. (2009). McDonald’s and KFC: Recipes for success in China. New York, NY: INSTEAD.