MKT303 - KFC's International Marketing Strategy & Challenges in China

This presentation delves into KFC's market entry and subsequent challenges in China, primarily focusing on the infamous 'finger-licking good' translation error. It explores the initial reasons for KFC's expansion into the Chinese market, including the promising fast-food landscape and the desire to bridge the gap between Western and Eastern cuisine. The presentation then discusses the missteps taken by KFC before entering the market, such as inadequate market research and choosing the wrong local partners. It proposes solutions to rectify the translation error, including engaging local translators and cultural experts. Furthermore, it recommends strategies for KFC to maintain customer loyalty and ensure future success, such as franchising, direct exporting, and understanding the complex legal environment. The presentation concludes by highlighting the importance of cultural sensitivity and thorough market research for successful international expansion, providing valuable lessons for KFC and other multinational corporations. Desklib offers similar solved assignments and past papers.

Individual Poster Presentation
KFC in China
Introduction
KFC is a fast food chain that operates in
various countries across the world. It
identifies countries whose markets seem
promising and venture in them with the
sole aim of becoming the market leader.
The chain has been operational in China
for more than 30 years and it holds about
40% of the fast food market share in
China. However, there have been many
challenges that it has faced in China such
as the problem of translation of its
tagline.
Need for KFC to launch in the
Chinese Market
In China, various reasons gave KFC a
reason to invest here. Firstly, the Chinese
fast food market was one of the most
promising markets in the world. The
Chinese consumer has been known over
the years as being curious and
experimental, and this gave KFC as an
upper hand as it opened its first restaurant
in Qianmen in 1987, Liu (2008, P. 12).
Evidence points out that thousands of
Chinese were eager to have a bite of the
western food, and KFC rode on this
whirlwind advantage to become
successful.
Another need for KFC to venture into the
Chinese fast food market was to bridge the
gap that existed in the industry. There
were not many Western fast food
restaurants in China at the time, and
therefore, there was the need to ensure that
the West was well represented in the East.
Many consumers in China always wanted
to taste Western food, but they had little or
no exposure to them.
Therefore, in line with their objective of
venturing to all corners of the world, KFC
had to consider this issue.
Finally, KFC’s strategies and policies
urged them to expand o china. The local
partner’s strategy allowed it to partner and
collaborated with local brands. They went
ahead and created a local team internally,
whereby the leadership team was drawn
from Taiwan. KFC had the confidence of
venturing into this market because their
team knew the industry in China, the
culture as well as the global standards that
. What could KFC do to ensure
customers still visit KFC after
the ‘translation error’?
One of the most important decisions
would change the slogan that resulted in
the translation error. The translation
error offended the Chinese consumer
because it was understood as being rude
and uncivilized according to the Chinese
Culture (Bell & Shelman 2011, P. 22).
Therefore, KF would attract more
customers to their restaurants if they
changed the slogan to a more civilized
one and one that is clear tot eh Chinese
consumer. Additionally, customers
would still visit KFC because KFC
would have shown the Chinese
customers that they cared about what
they felt and that making the customer
happy was one of their first priorities.
KFC would have ensured that customers
still frequented their restaurants by
employing more Chinese attendants Liu
(2008, P. 12). This strategy would work
wonderfully through showing the
Chinese consumers that it meant well
even though the translation had
offended them. The consumers would be
confident that just as the attendants were
one of their own, they had nothing to
worry about buying from KFC. Many
consumers feel secure and an urge to be
loyal to a brand whenever they are
served with people who they can
identify with concerning their
background and social standings (Bell &
Shelman 2011, P. 22).
Recommendations
When KFC plans to enter into another
foreign market in the future, some
recommendations should be taken into
consideration. Franchising is one of the
steps that should be considered. As a
brand, KFC should license some other
businesses to open branches of the
restaurant. The franchises, on the other
hand, are going to pay a certain fee in
accordance o their agreement with KFC.
This strategy is cheap and would enhance
the brand name of KFC such that it shall
be able to penetrate more regions that
could be possible if KFC did it alone (Liu
2008, P. 12). Additionally, there will be
no maintenance costs that will accrue to
KFC because the franchises are going to
foot their bills and cost of running.
KFC should incorporate direct exporting
before it has entered into a new market.
In this case, there would be direct selling
to the market that the chain is trying to
break into. The aim of direct exporting is
to see how well a brand does in the target
market and what needs to be improved to
make it more viable. Once KFC has
obtained data regarding sales in this
respect, they shall be able to determine
whether they should venture into the
market
er

What KFC should have done
before entering the Chinese
Market to ensure brand success
According to Thangavel (2018), One of the
first steps that KFC should have taken was
to ensure that they had a comprehensive
study of the Chinese market before their
entry. It is evident that they carried out
some, but it was not done exhaustively. For
instance, there was the need to ensure that
they took into consideration the issues of
language. The Chinese translated the
tagline “finger licking good” to mean “eat
your fingers off.” Though KFC did not
intend to communicate such a message, it
was important for them to ensure that
whatever they used as a tagline would be
suitable for the Chinese translation to avoid
the apprehension that came as a
consequence.
The brand would have been successful if
KFC chose the right local partner to
collaborate with. Collaboration with local
partners who are reputable in a certain
market enhances the chances of brand
success. Therefore, KFC made the mistake
of not choosing the right partner who
would have ensured that the brand became
successful and accepted by the locals.
Instead, KFC only involved locals through
establishing a management team from
Taiwan that they thought would capture the
innocent.
The other step that needed to be taken was
to ensure the complex legal environment in
China was well understood. As a brand,
KFC needed to take into consideration the
fact that business law was something new
in the Chinese market and was constantly
evolving. Therefore, it was important to
ensure that the brand was knowledgeable
regarding the heavy regulation of foreign
investment from the state. KFC just
assumed that the Chinese market was just
like the American market regarding
business law and consequently, they
usually found themselves at loggerheads
with the state, thus lowering the brand
reputation.
Solution to the problem
The KFC translation error in the Chinese
market was costly. However, there is the
need to ensure that such an issue does not
happen in any other market to avoid
losses and lower brand reputation
Blablurn (2017). The most viable
solution to such a problem would be to
ensure that the locals have been engaged
in the process of slogan and taglines
translation in case the market does not
use English as their primary way of
communication. For instance, whenever
KFC comes with a slogan, it should not
be translated KFC itself but by native
speakers of the language used in the
target market. In the Chinese market, for
example, they should have collaborated
with employees who formed the
management team from Taiwan and
come up with a tagline that would not
offend anybody. Besides, the problem
would be solved by ensuring that KFC
understood that the unofficial phrases
coined from the English language are
different from what is coined from the
Chinese language. The level of
understanding between the people from
these two different markets is different.
Therefore, the use of the local
community would be very instrumental
to avoid a repeat of such a mistake.
Another recommendation related to the
above mentioned is piggyback. In this case,
KFC would start selling products directly
to domestic companies in the country
where they aim to start operating. Such
companies have international presence, and
this would be important in assisting KFC to
make decisions on which market to
penetrate. The process of allowing the
companies to present KFC products to
international agencies would provide the
chain with an overview of what happens in
different international markets.
Conclusion
KFC is an international chain that has been
successful in the various international
markets that it has entered in the past. The
Chinese translation blunder was a fail that
threatened to derail its operation in China,
though it recovered after a while. However,
the chain came to understand that their
market entry strategy concerning
differences in language and understanding
was the key point that resulted to this.
Therefore, the recommendations that have
been provided are going to be an important
tool for KFC in future as they plan to
expand into foreign countries.
References
Liu, W.K., 2008. KFC in China: Secret
recipe for success. John Wiley & Sons
(Asia).
Bell, D.E. and Shelman, M.L.,2011. KFC's
radical approach to China.
Blablurn. (2017). KFC China Introduces:
CHIZZA.https://www.neogaf.com/threads/
kfc-china-introduces-chizza.1387511/
Thangavel. (2018). Piggyback Marketing.
Avaiable at
https://www.slideshare.net/kavipriyaThang
avel/piggybank-marketing
Borad B. Sanjay. (2009). Franchising.
Available at
https://efinancemanagement.com/corporate
-restructuring/franchising
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