“Must Succeed Customer”: Pizza Hut’s Rebranding in China

Pizza Hut and Kentucky Fried Chicken (KFC), the U.S. fast food restaurant chains under Yum! Brands, have enjoyed phenomenal success in China. In the past five years, Yum! China has on average opened more than one new restaurant a day. Now, it has over 3,700 KFCs and more than 760 Pizza Huts across China.

According to analysts, Yum! China’s business, driven by a rapidly growing middle class, will be twice as large as its U.S. business within five years. Already, China accounts for more than 40 percent of Yum! Brands’ global revenue.  As Yum! Brands CEO David Novak said, China is the best restaurant growth opportunity of the 21st century.

How did the Kentucky-based restaurant conglomerate succeed in a country that has thousands of years of its own culinary history? One word that summarizes Yum! China’s success is: rebranding.

Rebranding

When they first entered China in the late 1980s, Yum! China management made a conscious decision that it did not want to be seen as a foreign presence in China, but as part of the fabric of the local community. As Sam Su, CEO of Yum! Brands China Division, pointed out, they wanted to take the best ideas from the U.S. fast-food model and adapt them to serve the needs of Chinese consumers.

They re-branded fast food in China as “delicious and safe, high quality and fast, nutritious and balanced, healthy living, and rooted in China.”

For example, Pizza Hut’s Chinese name, “Bi Sheng Ke,” means “Must Succeed Customer” in Chinese. It gives no hint that the restaurant is about pizza. The name resonates well with Chinese, as it implies success and good fortune.

Pizza Hut is positioned totally differently in China than in the U.S. Continue reading

How Asia Can Shape The World – Poorly Made in China or The Chinese Dream

I was very honored to be on a panel in a webnar hosted by Yinglan Tan, author of Chinnovation, with a group of distinguished China experts to discuss business trends in China and how companies can get China right.

Here is a description of the topics and discussions:

Asia will redraw the map of economic progress over the next twenty-five years. Growth is necessary to solve economic and social problems, but harder to achieve as the age of plenty gives way to the age of scarcities. China is obviously a key player.

  • What is the Chinese dream? How do the driven middle class and shows how the not-so-private sector operates
  • What is the possibility of democracy in China’s future
  • How can the idea of unity in diversity could help solve China and America’s growing energy, health, and environmental problems
  • However, what are the industry secrets, including the dangerous practice of quality fade—the deliberate and secret habit of Chinese manufacturers to widen profit margins through the reduction of quality inputs.

How can organizations that want to build effective strategies for China address each of these realities head on, just as GE, Yum Brands, Adidas, Nokia, IBM, Accenture, Microsoft, Cisco, and many other pioneering companies the authors describe have done. Shedding light on the brutal competition for today’s markets and resources in China?

About 120 CEOs and executives attended the webnar. Other people on the panel include Dr. Anil Gupta, Chair in Strategy and Entrepreneurship at Robert H. Smith School of Business of University of Maryland, Paul Midler, author of Poorly Made in China, Joergen Oerstroem Moeller, visiting research fellow at Institute of Southeast Asian Studies in Singapore. Host Yinglan Tan is a member of World Economic Forum’s Global Agenda Council for Fostering Entrepreneurship and has impressive backgrounds in business and academics.

It was a very stimulus and informative panel discussion.

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