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McDonald's focusing on Vietnamese tastes

Released at: 19:09, 19/11/2018

McDonald's focusing on Vietnamese tastes

Photo: McDonald's

Vietnam's fast food market is predicted to become even more exciting as McDonald's Vietnam has recently decided to launch a new strategic item: crispy fried chicken.

by Hai Van

McDonald’s expects to trigger a new wave in Vietnam’s fast food sector by adding a dish familiar to the vast majority of the population, especially the younger generation: crispy fried chicken. There are still challenges the famous fast food chain must deal with, however, to successfully conquer the hearts of Vietnamese customers.

Great opportunities for fast food

More than 60 per cent of the population are under the age of 35 and seek rich experiences in the fastest-growing economy in the region and the country is becoming a magnet for fast food brands. “Vietnamese consumers are demanding a variety of modern dining styles, which open up opportunities for foreign brands to offer a wide range of options,” a representative from a business in the fast food field said.

Urbanization and household changes are affecting consumers’ buying decisions in the fast-paced consumer segment, according to market researchers Nielsen. This is also why figures from the Ministry of Industry and Trade (MoIT) show that more than 40 fast food brands in cakes, coffee, beverages, restaurants, and hot pots have been licensed in the last ten years.

As one of the giants, the McDonald’s chain in the country has been recording growth of nearly 40 per cent each year and now has 17 restaurants after only four years in Vietnam. The locations selected for its expansion are strategically located in the central business districts (CBDs) of Ho Chi Minh City and Hanoi, where there are a large number of potential customers.

The reality, however, is not all rosy. A developing market like Vietnam presents many challenges to fast food chains. Brands such as KFC and Lotteria have seen slower growth, making increasing their market share and opening new outlets anything but straightforward.

“In order to open a new store, McDonald’s has to fully prepare for a year, from choosing the right location to training staff and preparing logistics to meet standards,” a company representative said. “And McDonald’s is still eager to expand its coverage to many other locations, not only Hanoi and Ho Chi Minh City.”

In addition, the localization of supply and menus to provide dishes with appropriate taste and quality is also a challenge. The process of expanding chains to other areas besides large cities such as Ho Chi Minh City and Hanoi requires fast food chains strictly control the quality of products, services and staff training, which is a major challenge for any fast food chain.

Giant’s new strategies

Market challenges have not dampened the plans of fast food brands to penetrate further and expand their market share in Vietnam. In order to conquer the market, a fast food brand needs to understand the needs of customers and, especially, the country’s culinary culture. They need to strike a balance between serving traditional items and modifying and offering the right menu for local tastes.

For example, McDonald’s fast food restaurants have recently come up with a great selection of Vietnamese fries alongside the famous Big Mac and Cheeseburger. Its new crispy fried chicken has been well received by customers and is considered by many to be one of the best types of fried chicken available.

Creation is a must for fast food chains to reach the top of a fast-moving market like Vietnam. Young consumers in the country, including Generation Z, are willing to try new and exciting things even when they are familiar with a brand, according to Nielsen. Loyalty towards a brand among this young generation is quite low, however, due to their curiosity and improvisation. But this also presents a great opportunity for brands to offer exciting, innovative and unique experiences, products and services.

It is still too early to confirm the success of McDonald’s in Vietnam, but it can be seen that the fast food chain still has strong belief in the prospects of the market with 95 million people. “We will continue to expand the system and develop our restaurant network on the general principle of taking prudent steps, with quality products and services placed at the top,” the company representative said. “We are always listening to the needs of customers, to offer products with the right taste and price as well as to always improve the quality of service, apply new technology, and provide the best experience possible to customers.”

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