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January 19, 2022, 9:26 pm

McDonald’s tries to conquer Vietnam with skimming strategy

(13:55:42 PM 21/01/2014)
( - McDonald’s is wise enough to separate itself from the crowd by deciding not to set up its first shop in the downtown like other fast food brands.


To many people’s surprise, the fast food giant from the US has not chosen a place in the central area of HCM City for its first shop.


Analysts have commented that McDonald’s wants to be separated from other fast food brands, following the “skimming policy”, i.e. focusing on high income earners who have cars.


This has been hailed as a “creative strategy” of McDonald’s, like Starbucks does when setting up its shops in the downtown to attract foreign clients.


A report showed that Vietnam had 1.3 million cars nationwide by 2011. Supposed that 40 percent of the figure were civil cars, and the number of cars in the north and the south is equal, the number of cars in the south was 250,000.


The analysts said McDonald’s has chosen a place on the strategic road which leads to northern provinces and links to the other southern localities – the important economic and tourism centers – such as Dong Nai, Binh Duong and Ba Ria – Vung Tau.


The customers who possess cars will surely want to try McDonald’s products and services, including the drive-thru service. As such, by setting up a shop on the position, McDonald’s would be at the “center” of the car flow from the south to the north.


The first shop of McDonald’s in Vietnam would cover a very large area of 1,300 square meters. Designed in accordance with McDonald’s standards, the shop would have a playing field for children, serve clients 24/24 and comprises a parking lot.


Especially, with drive-thru, clients still can buy products while sitting in cars.


By choosing a position convenient for the traffic and attractive to car drivers, providing drive-thru service, McDonald’s has clearly shown its business strategy on targeting the middle class clients in the society.


If so, McDonald’s would not compete with other rivals in pricing. It would maintain the high prices of products in order to maintain its high end class and protect the brand positioning strategy.


McDonald’s has every reason to set up its first shop at the traffic gateway of HCM City, a dynamic economic center. Experts have commented that McDonald’s has taken a “bold, but feasible step” in its way to conquer the Vietnamese market, when the downtown has become too crowded with hundreds of shops bearing other fast food brands.


While other fast food brands have to struggle hard to scramble for the clients driving motorbikes in the inner city, McDonald’s target the clients who possess cars.


When there are too many players in the playing field, only the creativeness can help new comers win the competitions. They would fail if they follow the same way others went before.


Experts have predicted that the second shop of McDonald’s would be located at the traffic gateway on the other side of the city which leads to the provinces in the west of the southern region. The third and the fourth shops would be situated on the positions with similar conditions in Hanoi.


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