Burger King Case Study Essay
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Burger King or McDonalds? In the United States, these two companies equally compete for consumers. Americans usually favor one company over the other or just choose to eat at whichever is more convenient to them. For the American people, Burger King is as common of a household name as McDonalds. However, in Japan, the Burger King brand is one that is not very well known. Burger King has been trying to tap into the Japanese market for some time now. McDonalds, KFC, and Pizza Hut are the leading fast food market chains as of today, but Burger King is trying to make it into this region of the world.
With U.S. markets saturated, and the mad cow disease scare slowing sales of Burger King in Europe, it is so important for Burger King to saturate another market, Japan. Much research has been done to think of new and effective ways to penetrate the Japanese market through marketing. Our group of researchers have put together an in depth report on the issues within the marketing of Burger King in Japan.
They have discovered the main cause for this need in marketing and what needs to be done to solve Burger King’s marketing issues. Situation Analysis
There are many differences between eastern and western culture regarding the restaurant industry. In Western Culture space is more easily attainable. It is easier for new companies to enter the market in the restaurant industry because it is more accepting of diversity. Food trends in this culture differ dramatically from eastern culture. In the western culture, significance of food is not greatly valued and is offered in access creating more waste. The western culture is vast and heterogeneous. Many cultures are accepted creating a vast variety of fusion food sold here in the west culture. In restaurants a bigger variety of different food can be found on the menu. In the Eastern culture, food defines the culture. Each country has it’s own unique and cultural dishes that signifies the past. The middle easts favorite top meat ingredient is lamb and it is substituted for beef. Also most of the Middle East is Islamic so that means that many of the of their dietary rules are observed because of religious factors. In Asia, food and culture is divided into three main regions: southwest (India), southeast (Vietnam) and northeast (Japan). India uses more vegetarian ingredients such as beans, rice, and spices.
Vietnam focuses on stir-frying, steaming, or boiling when preparing their food. In Japan, many use the spices they used for their for religious ceremonies. Also in Japan, space is very limited due to overpopulation of people. The Japanese market is maxed out making it very challenging for new companies such as restaurants to enter the restaurant industry. To the Japanese consumer, the significance of food is valued and they feel it is important to not waste it. The norm of their culture is to conserve and not let anything go to waste. Food is offered in small portions for this particular reason. Japan has a very homogeneous culture. They are set in the ways that they do things and don’t deviate from their way of life. In Japan’s restaurant industry, it is more common to see rice and vegetables on the menu. In the case study one of the reasons why Burger King is unsuccessful in Japan is because they are trying to push western culture in an eastern market. Burger King doesn’t understand that they have to tailor their menu to meet the needs of the eastern pallet. They are not offering the foods that appeal to the people of Japan. There are number of other reasons why BK has not become successful in Japan: Weak advertising.
Upon researching commercials for Burger King in Japan, it is apparent that their advertising doesn’t appeal to their consumer market. Forcing higher prices than their competitor (McDonalds).
McDonalds has been established for more than 25 years and is the most popular hamburger restaurant. Most consumers are price conscious
There is no market place for them because they haven’t completely established their brand. BK in Japan does not look like they have established any goals as to how they want to present their brand No differentiation among competitors
They haven’t fully achieved brand recognition
They’re trying to be an upscale restaurant which doesn’t fit the market. Targeted market is too narrow only catering to a younger crowd They need to reach out to the older population. The cost of having flame broil grills is not cost effective. BK is hiding the most unique characteristics because it’s too expensive to build it in front of the restaurant. The budget promotion costs are being overlooked while opening too many stores. BK is just wants to try to take over the competitor market when in reality they are failing.
The problem with Japan is brand image. Burger King wants to expand without building a brand that the Japanese consumers are willing to spend extra money for a burger. Analysis of Alternatives
Focus on “freshness”
Burger King has stated that its main focus is producing traditional burgers. Instead of the typical two pickles and some ketchup, focus on the nutritional value such as fresh lettuce, tomatoes, onions, and pickles. Fix branding image
Differentiate themselves as a more upscale restaurant A example, better training of the staff and cleaner facilities. This may avoid burger wars. Appeal to younger generation
Studies have shown that the younger generation is willing to spend more money on nice things. Burger King should try to target this market by becoming an upscale burger restaurant. Also, anime commercials may attract a younger crowd. Place flame broiled grills in front of store.
With the gas restrictions are becoming more lenient, having customers visibly see how burgers are made will attract more customers and provide free advertisement just by word of mouth. Attract customers by smell.
Venting the exhaust from the grill will release the smell of burgers cooking into the public. This could reach the customers 5 sense of smell, touch, see, taste, and hear. All of this elements could attract more customers to a delicious flame broiled Whopper. Continue integrating Burger King into existing stores
Building “stand-alone” restaurants is expensive. By adding small restaurants into high traffic areas (train/gas stations) it will be a great selling location because of the high volume of customers stopping and waiting. Also, land is so scarce in Japan, partnering will help minimize costs and provides a definite location for the restaurant. Adding Japanese influence into store.
May become more relatable to the culture so customers will be dining in a comfortable environment. Sponsor shows
Sponsor physical challenge show comparable to MXC (Most Extreme Elimination). Making the obstacle courses resemble Burger King. Example: have some customers jump on Whoppers or placing the Burger King Emblem to help positively advertise working out with burgers. Themes in restaurant
The rock and roll theme is creative but the drawbacks are that they’ll only be known as the rock and roll themed restaurant. A Burger King could be known as a themed restaurant by having different themes in each restaurant. One themed restaurant can have revolving carts where the consumers can sit down and just pick their order off a conveyor belt right by their table. Recommendation
Top Recommendation Ranking
1. Fixing brand image
2. Promote freshness of ingredients
3. Adding flame broil grills in front of restaurants
4. Integrate Burger King into existing stores such as gas station or train station 5. Focus on Millennial demographic
6. Promote Japanese culture in restaurants
7. Spend more on promotional advertising
8. Attract customers by smell
9. Sponsor Shows
10. Theme in different restaurants
During the research it can be said that Burger King in Japan is trying their best to become a real competitor in the fast food industry. I believe that Burger King has the ability to succeed if only better decisions are made. It is evident that many BK restaurants are being developed in a rapid amount of time. A Japanese proverb “wishing to eat the fugu, but wishing to live too” states that “Fugu is a delicious fish which has a poison in it which leads to death if eaten, so in order to eat it has to be prepared by a skillful cook who knows how to properly get rid of the poison. This proverb illustrates situation when there is a bit of risk in taking the action and expresses concern about the outcome”. In all seriousness, it is a risk to rapidly open BK restaurants without the concern of not reaching its potential goal of succeeding. Burger King Japan needs to sit down and focus on how they want to show the consumer what the BK industry is about. Next, corporate should consider thinking outside of the box and adding more cultural options instead of buns and beef. I have discovered that a black bun burger “Kuno Burger” has made it’s way to Japan. Further research on the success needs to be analyzed. Did the consumers like it? Did they know it existed? How did you advertise the sandwich? What will happen if you add rice dishes on the menu? Or fish sandwiches?
Also, I believe a way to help Burger King find its target market is by asking individuals what they would like to see, taste, hear, smell, and touch. Maybe have more events and a taste testing between two competing burger restaurants. One target market can be tourists visiting Japan. Some tourists are thrilled to see that their comfort zone is all of a sudden changed because of cultural influences. McDonalds has successfully changed its menu to fit more of the consumer needs which has proved to be the top restaurant to beat. Burger King needs to be more aware of their tactics and build a better team to figure out how to attend to all customers from all around the world (whether the want something familiar or something new).
In conclusion, Burger King has to reconsider its standpoint in Japan. It has proved to establish itself successfully in other countries. In the maxed out market economy of Japan, Burger King can has potential to grow. Corporate needs to band together to better figure out the brand image before expanding itself too thin.