Having it Their Way

October 31st, 2008 | Sources: Economist

Subjects: ,

For 20 years Burger King left China’s exploding fast food market to McDonald’s and Yum! Brands, which operates Pizza Hut and KFC. Burger King joined its rivals on the mainland in 2005, but as recently as this April, it had only 12 storefronts in China.

Now, the King wants in on China’s $29 billion fast-food market and who can blame them?

This summer Burger King announced plans to open 300 outlets in China over the next 5 years. That still places it a distant third behind KFC, with 2,200 outlets and McDonald’s with 1,000.

And there’s a lot of work to do. For example, Burger King must get up to speed on Chinese food preferences. Chinese consumers it turns out, prefer chicken over beef-which is more or less what’s inside its trademark Whopper (known locally as huangbao, or Emperor Burger).

Burger King can thank its larger rival for some pioneering work in this regard. McDonald’s spent a ton of Yuan over the last decade convincing Chinese consumers that there are health benefits associated with eating beef (we promise to reveal these benefits once we learn what they are).

Even after tweaking its menu, the King knows it needs a killer strategy to make up for lost time. Right now its plan is to target younger, independent-minded consumers that want to distinguish themselves from older family members who prefer the “traditional offerings” served at Micky-D’s and KFC.

Hmmm…that might work, but a Cantonese version of “hold the pickles hold the lettuce, we don’t let special orders upset us,” wouldn’t be a bad backup.


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