Fast food brands strive to net early birds

In an attempt to stage a mealtime coup, McDonald’s recently handed out five million free breakfast McMuffins in Asia, the Middle East and Africa. The burger brand’s ‘National breakfast day’ is a deadly earnest attempt to grow its share of the breakfast market in Asia beyond 20 per cent of its total sales. 

Ray Pak, managing director at IPG Mediabrands Singapore, notes that as lunch and dinner crowd sales have generally stabilised for established quick service restaurant (QSR) brands, breakfast, snacking and delivery are growth opportunities.

In Asia, competition is more intense in developed markets such as Singapore, Hong Kong, Korea, Japan and Taiwan. According to Pak, these brands face an uphill task as they are not only competing with peers, but against local Asian breakfast staples, which are often cheaper and more readily available. 

The QSR brands are also competing against fast-food bakeries such as Subway and Dunkin’ Donuts, as well as local bakery shops, which provide healthier choices such as oven-fresh bread.

According to Euromonitor, local brands dominate the bakery products fast food category (see table) with Oliver’s Super Sandwiches leading in Hong Kong, Jollibee’s Red Ribbon dominating in the Philippines, and Paris Baguette leading in South Korea. 

Thailand’s breakfast market is likewise cornered by S&P. In Korea, director of BR Korea Jung Chung-kyun notes that the breakfast market is worth about one trillion won (US$882.8 million). BR Korea operates Dunkin Donuts in the country. The concept of breakfast in Korea is changing, he says, as consumers now will only have a cup of juice or thick soup in the morning, as opposed to the traditional Korean breakfast that always includes a bowl of rice, side dishes and soup. “As the eating pattern becomes Westernised, a cup of coffee and a piece of bread is the usual breakfast now,” Jung adds. 

Tara Hirebet, head of Asia-Pacific at trendwatching.com, says international fast foods have since introduced locally-inspired menu options and are also pushing the price limit with promotions such as breakfast meal combos.

KFC Philippines, for example, has added two new options to its A.M. breakfast range in February, which incorporates its signature chicken into Filipino breakfast to include garlic rice and scrambled eggs. “On weekends, they compete with increasingly popular lazy brunches,” Hirebet adds.

Burger King and KFC, she says, both introduced healthier lifestyle-skewed breakfast options in 2011 in Singapore to appeal to the younger, more health-conscious brunch-going group. KFC emphasises fresh ingredients, while Burger King introduced a breakfast platter and turkey ham Croissan’wich.

Local chains in Asia are feeling the heat, says Hirebet. Some have added Western-style interiors to appeal to consumers who prefer a more modern ambiance.  

Citing statistics from Mintel, she notes that McDonald’s breakfast makes up 25 per cent of total sales in the United States, but it is less than 10 per cent in China. Some 86 per cent of Chinese respondents said they have eaten at Chinese fast food restaurants, compared to 68 per cent at international fast food restaurants at breakfast time.

The prospect for international fast food breakfast seems to be brighter in emerging markets, says Hirebet. These massive markets, she notes, are full of new consumers with rising disposable incomes, who are eager to try the new products. 

“Breakfast sales as a whole will definitely rise in Asia and are a key opportunity,” she adds. “This is because people are becoming more time-poor and pressed, especially in the mornings, which tend to be rushed. Breakfast also tends to be cheaper than lunch and dinners, so it is a more ready-spend for consumers.”