McDonald’s just announced that they would be introducing a rice menu in Mainland China. Beginning Monday next week all 1700 locations will be introducing 4 rice items – chicken rice wrap, beef rice wrap, chicken rice bowl, beef rice bowl. Will it help to drive sales? Has McDonald’s tried this in other markets and if so were they successful?
McDonald’s has tried rice menus before in other Asian markets with mixed results. It all depends on how strong the local rice based QSR competitors are at the time of introduction. In Japan, McDonald’s tried many rice items to compete with MOS Burger, including a copy of their famous “rice burger.” Japanese consumers gave no credit to McDonald’s for these items and turned thumbs down. McDonald’s also tested bone in fried chicken and pizza but these were not very successful either. The McDonald’s business got back on track when the chain re-focused on their core competencies – burgers, fries, cokes, and QSCV (Quality, Service, Cleanliness, Value).
KFC today in China looks more like a Chinese QSR chain than a Western one. The breakfast rice items do well because there is limited competition and the price is very cheap! As Chinese QSR chains grow and get more sophisticated it is unlikely that KFC can keep their share and will begin to focus back on their core brand DNA.
McDonald’s shops are primarily in expensive rent areas in CBD’s so adding rice may be more of a financial decision than a customer centric one. Incremental sales help to pay for the high rent.
My personal feeling is that customers will give the rice menu a try and buy it occasionally if it is cheap enough but they would prefer to buy their rice based items from a Chinese QSR chain with greater Chinese food credibility such as Zheng Kung Fu or Yonghe. Time will tell but my bet is that this approach will not end well!