KFC, a Yum! Brands chain and one of the first Western fast food restaurants to hit China in the 1980s, has long been recognized as a pioneer, with offerings like rice porridge with preserved egg along with fried chicken… But many Western companies resisted going local when they first came to China, in part because they mistakenly believed their well-known international brands would automatically succeed there.
Story length: 664 words; Access the full story here.
Disraelly Cruz (University of West Florida) suggests some key “Takeaways” on the story:
Several years ago I was briefly shocked by the launch of children’s beer. My initial reaction was largely based on the fact that I judged the merit of the product through my own cultural lens. Although the product itself was successful in Japan, the producers of the children’s brew received criticism as it attempted to enter Western markets. The nonalcoholic drink emulates the look of standard ale except the drink itself tastes like apple juice. Commercials for some of the brands even depict children toasting each other with a glass of beer. The issue was not the taste of the product, but Western norms that frowned upon the idea of promoting underage drinking. The developers of children’s brew failed to take into account cultural norms in marketing the product. As corporations continue to compete for a larger market share among consumers, they must constantly juggle the needs and desires of new consumers and stakeholders against a backdrop of differing cultural norms.
One key strategy international organizations are beginning to embrace is localization. Localization occurs when an organization develops new or alters existing products and services to meet the needs of a specific culture. For example, earlier this year Starbucks opened its first European concept store in Amsterdam. The goal of the European concept was to integrate local history with the products and services of a modern Starbucks. Other large international organizations are beginning to follow suit.
Although there are some successes and failures when developing new products, the localization process led to the birth of the Oreo wafer, which has had huge success in China. As consumers, we are often only privy to the final product. This article gives organizational communication scholars, students, and the general public an inside look at the process of localization and provides a several examples of corporations who have successfully altered their products to meet the needs and desires of the Chinese consumer. One of the key takeaways from the article isn’t necessarily the need to localize, but the need to empower employees to embrace the local culture and test new products.