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McDonald’s Taking McBite Out of Chicken Market

A year ago, BurgerBusiness.com tipped off that McDonald’s had introduced all-breast-meat Chicken McBites in Australia as a new-era McNugget. In Sept. 2011, we reported that McBites were testing in Detroit, and in a post last month, we called chicken snack foods like McBites “the next battleground” for QSRs. 

Now, connecting those dots, is Maureen Morrison of Ad Age, who reported that McDonald’s intends to roll out Chicken McBites nationwide in January 2012 as a 90-day offer. Ad Age reprints an internal memo on the introduction, which McDonald’s calls “phase 2 of the chicken strategy toward becoming a credible destination for chicken.” The chain tells operators there is an opportunity to “mitigate the switching behavior consumers are displaying within the category.” McNuggets apparently were phase 1. McBites are smaller and crispier and are unprocessed chicken.

Checkers/Rally's has introduced Chicken Bites for just $1.

As argued in the “battlefield” post, chains are jockeying for chicken leadership with new introductions as Checkers/Rally’s rolls out Chicken Bites, KFC puts heavy ad support behind its Popcorn Chicken, Burger King reformulates its Chicken Tenders, Hardee’s/Carl’s Jr. add Hand-Breaded Chicken Fillets and so on. McDonald’s wants all that business. 

In Australia, McBites were sold at $2.95 for 10. In the Detroit test, however, pricing was based on weight: $1.99 for a 4-oz. bag; $2.99 for 6 ozs.; $4.99 for 12 ozs.

A 90-day LTO is an unusually long window. But the internal memo tells operators that the average check in Detroit and Phoenix during McBite test marketing was $7.22, a $1.80 “trade-up” from the norm. Good deal. Ad support runs for four weeks from the January introduction into February (and likely through the Feb. 5, 2012 Super Bowl weekend).

So what happens to Chicken Selects, McDonald’s pricier whole-breast chicken tenders when McBites come ashore? The chain’s memo to operators says data indicates Chicken McBites do better with Selects absent. McBites are scheduled for a four-week test ending in February 2012, so expect Tenders to take a menu vacation then. 

When McDonald’s originally introduced Chicken McBites in Australia, they were described as having “a crispy, Southern-style coating.” Crispy is still the operative term, but don’t look for a Southern tie-in here. The memo obtained by Ad Age as describes them as having a marinade with a “crave-able[sic] homestyle flavor profile (buttermilk, onion, garlic, sugar, salt).” The coating is described as having a “light/delicate crispiness” without regional style. 

Wendy’s, which has done well in the chicken category, was already planning on a huge year-end chicken push, so it’s in good position. Next month the chain switches marketing focus from burgers to its reformulated “Gold Chicken” product line, including the Chicken Bruschetta sandwich. But given the leak on McDonald’s McBites plan, Wendy’s can be expected to ramp up promotional support for its successful Chicken Nuggets (especially the spicy version) as well. 

Expect Jack in the Box to whip together a chicken snack product of its own to get into this battle. It has done chicken sandwiches occasionally, but needs hand-held chicken items to compete in this market. Sonic has Popcorn Chicken on its menu but rarely promotes it. It may do so now.

In August, McDonald’s Corp. President-COO Don Thompson said the chain was seeing the most innovation in burgers comings from Europe (such as the 1955 Burger) and the best chicken ideas coming from Asia. McBites are one of the items he likely had in mind.

What other chicken items might McDonald’s import from its Asian operations? The Chicken Muffin breakfast sandwich that it has offered in Japan and Malaysia would get chicken on the breakfast menu here, something the chain no doubt would love to do given rising beef costs. McDonald’s has a variety of items under the Chicken McGrill name in Singapore. I wouldn’t expect those foods to come here, but that name is too hip not to leverage it. And the McBites were introduced in Australia as a side-kick to a new chicken sandwich, the Legend Chicken (spicy sauce, sourdough bun, bacon, lettuce, tomato and cheese). That product has fared well in Europe, too, and could make the jump to the U.S. some day.

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