Environmental Factors That Affect Global and Domestic Essay

environmental factors that affect global and domestic marketing decisions for KFC. The paper will focus primarily on KFC's presence in China, comparing some of the differences in the decisions that were made for KFC in the marketing sector in the U.S. As compared to the Chinese market. With this in mind, it will look at the way the environmental factors have played an essential role in shaping these differences.

It is difficult to start by classifying which of the factors is most important in shaping this decision, so the first factor that can be analyzed is the demographics, mainly because it primarily affects the market segmentation strategy that KFC uses. The urban population in China is better educated and has a higher income than the rural population. At the same time, it is more cosmopolitan and it looks to the West to adopt new traditions and norms.

This, combined with other socio-economic and psychological factors (the openness of the urban population towards other cultures, the fact that the urban population travels more widely etc.) have led KFC to focus primarily on this segment of the population in China. Most of the KFC restaurants have been opened in urban regions, starting with the Eastern Coast and moving inland as this became saturated over time. In the U.S., there is no such distinction between urban and rural, except, perhaps, for the geographic factor that moves fast foods into larger malls and outlets outside the city.

An important environmental factor that affects marketing decisions that KFC makes in China is the political factor, particularly through its ramifications into areas such as legislation. As known, China is a one-party political system, where the Communist Party regulates everything. Marketing campaigns led by the government against foreign companies are not unusual and KFC was not an exception.For example, in the last years, governmental-led and dominated newspapers pressured KFC by supporting the idea that the company uses chicken with antibiotics and that its ice water does not respect the sanitary norms in China. As mentioned, this is usually a way in which the Chinese Communist Party aims to reassert itself in the face of foreign companies. One should remember (and this is discussed in more detail in the lines below) that China remains a culture where so much of the individual's actions and reactions are governed by the idea of "face." Losing and winning face is just as important as making a profit, so the government, the political party in power, wants to show, from time to time, to gain face, that it is the party that leads and has the power.

This is obviously not the case in the U.S., where a pluriparty democracy allows for all forces in society to be heard and where this type of pressures over companies are very uncommon, inexistent, and, usually, punishable by law.

Discussing the legislative factor, these play an important role in the marketing decision making process, because they create the regulatory basis that everything from advertising to promotional campaigns need to abide by. China is restrictive in some of the regulations that it imposes on advertisements, so KFC's marketing strategies are influenced by this environmental factor as well.

Probably, the most important of elements to discuss in this context is the issue of cultural differences. Cultural differences between China and the U.S. remain huge, despite the globalization process that went a long way….....