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PROJECT RETURNED UNGRADED
Your project is being returned ungraded because you did not appropriately complete the assignment. The assignment was to first examine and evaluate the strategies used by KFC and McDonald’s when expanding into China. You were then to pick the strategy you would use to expand into India and justify your reasons for picking it. For example, one company tailored their experience to the culture of the country they were expanding to while another used its same business model to expand into a new country.
This is a “case study”.
Provide in-depth thought and analysis to the questions being asked.
Please rework and resubmit the paper for grading. Also, be sure to provide proper citation and references.
Penn Foster Instructor
Kentucky Fried Chicken and McDonald’s are the two main fast food global companies in the world. These two companies have used various marketing approaches to expand into China and other parts of the world. These strategies have led to the growth of both companies. McDonald’s was founded in the year 1995 in the United States, when it served its customers with French fries and hamburgers. KFC was founded in the year 1952 in the United States (which is one brand of Yum). It serves its customers with chicken that has a unique taste. McDonald’s made more sales than KFC at first. Later, both KFC and McDonald’s expanded to China, and the sales made by these two companies have been reversed. KFC has progressed more efficiently in China than McDonald’s. The difference that came in between these two companies was their marketing approaches in China. The differentiation and similarity between McDonald’s and KFC in China commenced a long time ago. KFC established its first branch in China in the year 1987. At that time, it was the only western fast food provider in the country (Hendrikse 78). Currently, it has four thousand five hundred and sixty-three branches hence considered the biggest food outlet in the country. The first McDonald’s branch in the country was opened in the year 1990, and it has two thousand and three branches in the country. KFC expanded to China earlier than McDonald’s and that was its first strategy.
The second difference in the strategies of the two companies was their products. KFC strategized in offering chicken products to its customers. Standard production levels were used by KFC and they sold cheap western products which favored the local people. Their menu changed every now and then to meet the customer’s needs (Kurtz, David and Louis 209). Some foods were offered permanently while others were temporary on the menu. KFC also had a secret recipe that it used to prepare its dishes. McDonald’s sells mainly beef and hamburgers. People of China prefer chicken over beef. Culturally, Chinese keep more chicken as compared to the number of cattle. This is because chicken consume less food and less space. Considering the price of raw materials, both companies altered their menus so adapt to the local needs. However, McDonald’s made few changes to their menu as compared to KFC
Another strategy difference was with the prices. Prices of goods and services vary from time to time depending on location and time. McDonald’s and Kentucky fried chicken use multiple pricing approaches. Both used price skimming strategies in China where they had to set high prices for their products and then decrease the prices steadily so as to get access to new markets. Another strategy difference between McDonald’s and Kentucky Fried Chicken is their promotion of products. Promotion is supposed to increase marketing of services as well as products of a company. Kentucky Fried chicken has made its logo of KFC together with colonel’s portrait in China. There is a new logo which puts emphasis on the taste of the food, and it is more welcoming and very friendly. Kentucky Fried chicken promotes its products by advertising on the Internet, television, and random distribution of coupons. KFC comes up with new menus yearly to access more markets and attract more customers (Hendrikse 45). They encourage their customers to buy chicken with a soft drink claiming that it would save them some money. The fast food company sends premiums as gifts to its customers, and it return it attracts new clients especially kids. People can also download their app on Appstore and will be offered some discount. The logo of McDonald’s has a motto “I am loving it”, and has a shield with a golden arch of letter M. They also promote their products by advertising on the Internet, television, and random distribution of coupons. The fast food company also sends premiums as gifts to its customers, and it return it attracts new clients especially kids (Kurtz, David and Louis 76).
In my opinion, the expansion strategy used by Kentucky Fried Chicken would be more effective. Expansion of markets into India should start as soon as possible. Franchising should be implemented in India early, just as KFC did in China. Products should be made to meet the needs of people of India. India has a high population of over one billion people, and most of them do not consume beef due to various cultural reasons (Hendrikse 43). Menus should be altered so as to accommodate the needs of all the Indians. New recipes should be introduced to attract more customers. Comparing the products of KFC with those of McDonald’s, localization strategy of KFC is better than the globalization strategy of McDonald’s into Chinese markets. Just like KFC, the skimming price should be used in India just the way KFC used in China.
Hendrikse, George. Strategy and Governance of Networks: Cooperatives, Franchising, and Strategic Alliances. Heidelberg: Physica-Verlag, 2008.
Kurtz, David L, and Louis E. Boone. Contemporary Business. Mason, OH: South-Western Cengage Learning, 2009.