Western fast food chains try to woo Chinese consumers

A booming middle class and a nascent economy are fueling appetites for Western fast food chains in China, where the number of foreign outlets is set to break the 50,000 mark, according to a new industry insight report.

Over the past five years, the market for foreign fast food in China has seen steady growth, reports market research group Mintel, and is expected to increase 39 percent from 2012 to 2017 with a total of 71,964 units in the country.

In recent months, American fast food giants like McDonald's and Burger King announced major expansion plans in that country to rival the Yum! brand, whose bullish growth strategy has succeeded in making it the top foreign fast food chain in China.

Yum! owns KFC and Pizza Hut, and in 2011 opened a record 656 restaurants in China. Currently, the chain has 4,790 outlets across 800 cities.

But while 44 percent of Chinese consumers said they plan to spend more on fast food in the coming year, the Mintel report also found a preference for domestic brands which serve Chinese staples like rice, and noodles, seen as more economical, nutritious and flavorful than Western fast food fare.

In the survey, 86 percent of respondents said they ate at a local fast food restaurant in the past year, compared to 68 percent of respondents who said they ate at a Westernized fast food chain.

'Key to foreign fast food success'

The recipe for success among foreign brands? Considering the Chinese palate and incorporating local flavors into menu items, say both analysts and 76 percent of consumers respondents polled.

KFC's formula for winning over Chinese consumers, for instance, has been to cater its menu to local tastes, such as offering a breakfast chicken congee (savory rice porridge) or the Dragon Twister, KFC's version of Peking Duck in wrap sandwich form.

Similarly, in a country where matters of health are given priority, hamburgers and pizza are considered decadent, pricier indulgences rather than an everyday purchase, points out Mintel.

Meanwhile, a report by Euromonitor identified domestic Chinese fast food chicken chains CNHLS and Dico as some of the top 10 international foodservice chains to watch.