Fast Food MNCs Getting Clobbered by China Daily Today

December 20, 2012

It’s not exactly breaking news to say that multinationals/foreign companies have it tough in China. Seems like every other day I’m writing something about a new investigation, enforcement campaign, or dispute involving a foreign firm here. Some times the criticism turns out to be fair, and other times the rumors are unfounded.

Occasionally there are witch hunts, where the media (often, but not always State media) piles on with inflammatory rhetoric, assuming the worst of multinationals and their business practices. Recently we saw a series of reports about Nike and its “double standard” with respect to product quality, and the retailer Carrefour has had its share of problems as well.

The latest fun and games is courtesy of China Central Television, which this week did an investigative piece on chicken farmers:

China Central Television reported earlier this week that some chicken farmers in east China’s Shandong province have given their chicken with excessive amounts of antibiotics, including amantadine and ribavirin, to make them survive in overcrowded chicken houses.

The topic is certainly fair game and quite relevant to most folks here who worry about food safety. KFC and McDonald’s, which haven’t purchased chicken from these guys for months, promptly issued the usual statements about food safety and promised full cooperation with the authorities. The Shanghai authorities are now conducting an investigation. However, in the two days following that CCTV report, some follow-up pieces in China’s print media seem to be focused not on the farmers or their customers as a whole, but rather on KFC and McDonald’s.

I suppose that one could justify this attention in light of the sheer size of these two fast food franchises. KFC and McDonald’s do a huge business in China and may totally overshadow other customers of these Shandong farmers.

It’s much more difficult to explain why China Daily just hours ago sent out one of their usual RSS feed dumps that included the following articles:

Some foreign fast food is harder to swallow (2011-08-15)
Tests find oil used by KFC not harmful (2011-08-11)
KFC denies excessive brightener in containers (2011-04-27)
McDonald’s apologizes for wrongdoings (2012-03-16)
Prices up 1 yuan at McDonald’s (2012-05-16)

That’s a partial list. Apparently some editor over at China Daily thinks that folks interested in the current Shandong farmer story also need to be reminded about McDonald’s pricing changes from earlier this year and old allegations about KFC’s packaging practices.

Nice, huh? My favorite one is from August of last year and is entitled “Multinational firms’ tricks.” The content is pretty much what you’d expect: a consumer protection story that devotes itself exclusively to the ways that MNCs screw over Chinese shoppers.

Why is all this worth mentioning? It all comes down to branding, PR, social media and reputation. It doesn’t take much media attention to tarnish the image of a brand these days, particularly when it comes to food. This news item from the Financial Times on this latest food scare is in no way surprising:

Chinese consumers, spooked by a seemingly unending series of food quality scares, responded vociferously on Sina Weibo, the popular microblogging site, with a handful calling for a boycott of KFC or even of western fast food in general.

I suppose the lesson here for MNCs is not merely to maintain high quality standards in China but to keep an eye on media management. These guys have extensive story archives, which can be dredged up and sent off through the Intertubes on a whim. Scary stuff.