Because they bring the customer what the customer wants:
Bloomberg: "“KFC is certainly doing better than McDonald’s at becoming more Chinese,” says Su Yi, 28, a lawyer, as he pauses between spoonfuls of mushroom, bacon and rice one recent lunchtime in a packed KFC opposite Beijing’s Jishuitan subway station. “I have lunch at KFC twice a week because there’s always one close by. And when I’m out on a date and want to impress a girl, I take her to Pizza Hut.”"
From earlier in the article:
"While McDonald’s restaurants in China mostly sell the same U.S.-style burgers, KFC’s menu features dishes that would be un- recognizable to its patrons in the U.S. Alongside the Colonel’s ”secret recipe” fried chicken, Chinese KFCs also offer options such as the Dragon Twister, a chicken wrap in a Peking duck-type sauce, and spicy tofu chicken rice based on the cuisine of Sichuan province, home of China’s hottest dishes.
Pizza Huts in China bear even less resemblance to their Western counterparts. While a KFC in the People’s Republic still looks like a Western-style fast-food restaurant, Chinese Pizza Huts are marketed as sophisticated venues for the legion of increasingly affluent and status-conscious Chinese. Seated in comfortably cushioned booths, customers can choose from a 106- item menu that includes wine and Chinese-influenced dishes such as scallop croquettes with crushed seaweed and even French- inspired escargot."
What really struck me, in the midst of all this China Envy on display by my president on Tuesday, was the fact that YUM!'s restaurants in China (3,700) accounted for a larger portion of its profits then did all of its US establishments (19,000+).
In case Hans Rosling hasn't convinced you the world has changed, this should.