Burger King: Selling Whoppers in Japan Essay

1419 Words Nov 19th, 2013 6 Pages
Burger King: Selling Whoppers in Japan
“International is where it’s at,” said Ron Paul, a Technomic consultant. “The fast-food burger category is going to find its better growth opportunity overseas. We’re close to saturation in the United States. That’s why McDonald’s has been so aggressive in overseas markets.”
That’s also why Burger King has to be so aggressive in Japan. McDonald’s entered the Japanese market 25 years ago and now has 2,000 outlets there generating $2.5 billion in sales – that’s half of the entire fast-food burger market in Japan. In addition, McDonald’s generates 4.7 percent of its corporate profits from its 7,000 units overseas; whereas Burger King generates only 19% of company sales from its 1,600 units overseas.
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In addition, the Japanese government has relaxed restrictions on how gasoline is sold, and Burger King hopes to place stores in gas-and-burger outlets. Such an arrangement has advantages for both parties. Gas companies get a new competitive weapon with which to attract customers, and Burger King avoids the high cost of developing standalone sites. Furthermore, Burger King already operates gas and burger stations in New Zealand and Australia, so it has experience with this kind of operation, and Burger King is talking to Shell Sekiyu K.K., a unit of Royal Dutch/Shell Group.
Although some observers think that Burger King’s lack of name recognition in Japan is a disadvantage, Burger King thinks it can capitalize on this void to create an upscale image. It believes that a high-class image will help to set it apart fro McDonald’s.
To appeal to affluent Japanese teenagers, nearly all Burger King restaurants will have a “retro look” of 1950s and 1960s pop culture. In some stores, Hollywood will set the tone with Marilyn Monroe, Marlon Brando, and James Dean staring at diners from the walls. Other store decors will center around rock-n-roll, with original albums by stars such as Elvis Presley lining the walls. All stores will have jukeboxes, checkered tile floors, and 1950s-style red dining seats. “I just love these chairs,” says Shinoba Fukushima of the red dining seats at a Tokyo outlet. Sales for Burger King have jumped 40

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