Heft no object in McDonald’s new burgers for Japan

By Dow Jones Newswires-Wall Street Journal
Posted Jan. 11 at 1:31 p.m.

Even as its U.S. parent bows to consumer demand for healthier products, McDonald’s in Japan is ladling on the calories — an unusual strategy in a country known for its healthy diet and longevity.

Japan’s top restaurant chain by number of stores, McDonald’s Holdings Co. (Japan) Ltd. rolled out its Big America 2 campaign last week, featuring four burgers named for U.S. locales. The Idaho burger, which will make its debut by the end of this month, features a quarter-pound beef patty, melted cheese, a deep-fried hash brown, strips of bacon, onions and pepper-and-mustard sauce. The calorie count: 713.

The Texas 2 Burger — with chili, three buns, cheese and bacon — comes in at 645 calories. The 557-calorie Miami burger has tortilla chips nestled on top of the beef patty. By contrast, McDonald’s Japan’s Quarter Pounder and Big Mac mainstays come in at 556 calories each.

McDonald’s Japan expects to report a 41 percent drop in net income, to 7.6 billion yen ($91.4 million) for last year, largely because of the cost of closing 433 smaller and underperforming stores. But the outlook is less severe than the 55 percent drop the company had forecast earlier and accompanies an improved outlook for operating income and sales. McDonald’s Japan’s stock rose 14 percent last year, compared with a 3 percent drop in Japan’s Nikkei Stock Average.

Yasutsuru Mori, a svelte 74-year-old patron, wolfed down a Texas 2 Burger this weekend. “I love hamburgers. I eat every new hamburger that comes out in Japan, but I especially love McDonald’s burgers,” he said. “McDonald’s keeps to the fundamental American hamburger profile: ketchup, mustard and beef.”

The strategy in Japan seems diametrically opposed to McDonald’s U.S. strategy: a continued focus on healthier eating options. Though McDonald’s in the U.S. still offers hefty items, such as a Double Quarter Pounder with Cheese listed at 740 calories, nine meal-size salads and a fruit-and-walnut salad for snacking are on the menu as well. The U.S. website features a steaming bowl of oatmeal, studded with fruit. In Japan, there’s only one salad offering — a puny side salad — and no oatmeal.

McDonald’s Japan says its strategy here isn’t different from that of U.S.-based McDonald’s Corp., which owns 50 percent of the Japanese company. A McDonald’s Japan spokesman said it regularly is in touch with its U.S. parent to discuss strategy.

“I believe we are not going in a completely different direction to the U.S.,” a McDonald’s Japan spokesman said. “Consumers in Japan see beef as what McDonald’s can offer, and it tastes good. It’s our core competency.”

The big burger blitz comes as the Japanese, famed for their fish-and-rice diet and general slenderness, have been plumping up over the years. The proportion of Japanese adults considered overweight increased nearly four percentage points to 23.2 percent in 2004 from five years earlier, according to the World Health Organization.

While Japan is still several waist sizes away from the U.S. — the WHO said 66.9 percent of U.S. adults were overweight in 2004 — health concerns have prompted Tokyo to implement measures to help trim expanding waistlines. In 2008, the federal government passed a law that makes waistline measurements a compulsory part of annual check-ups for adults between 40 and 74 years old.

Unlike its U.S. parent, McDonald’s Japan hasn’t been vilified for the nation’s expanding girth. A spokesman said men around 18-30 years old typically make up the bulk of its “big sandwich” consumers, though other age groups consume them as well.

Part of the success in Japan is because of its marketing strategy. The company has homed in on a crucial element of the Japanese consumer psyche: a predilection for offerings that are available only during a short time span. For example, the Texas 2 Burger, introduced last Friday, will be replaced by the Idaho burger later this month. The company also has used Twitter and bloggers to spread the word.

“Japanese people have a weakness for products that are available for a limited time period,” 34-year-old Kazuyo Aoshima said outside a McDonald’s outlet in Tokyo’s posh Ginza district last Friday. The Tokyo resident said she plans to try all four burgers.

McDonald’s outlets in Japan also don’t evoke the image of a typical fast food joint. Workers greet customers with the type of enthusiastic attitude characteristic of Japan’s service industry and the restaurants are lit with a warm glow, unlike the fluorescent lighting found overseas.

“There are more service people and they come around 1 8 to clean 3 8 pretty frequently. The garbage cans are never full at McDonald’s,” Mr. Mori said. “The management is far better here than other places,” he said.

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