Giant fast-food corporations are waging a chicken war to win over Generation Z, a key consumer base. That is because fast-food corporations' sales rankings are being reshuffled depending on whether their chicken products become hits.
According to the U.S. Department of Agriculture (USDA) on the 9th (local time), annual chicken consumption has more than doubled since 1985, surpassing 100 pounds (about 45 kg) per person. In particular, consumption of boneless chicken and chicken sandwiches has jumped among low-income groups. By contrast, beef consumption has trended down over the same period and remains at about 60 pounds (about 27 kg) per person.
The Financial Times (FT) reported, "The more consumers try to save on dining-out expense, the stronger the tendency to choose boneless tenders and crispy chicken sandwiches over drumsticks or thighs," adding, "This shift is shaking up the hierarchy of the fast-food industry."
KFC, long called the "byword" for fried chicken, focused on "bone-in chicken" sales for years and lost favor with Generation Z, and U.S. same-store sales have been flat or falling for eight consecutive quarters. According to consumer data firm Numerator, as of July this year, Generation Z made up only 6% of KFC's customers.
By contrast, other fast-food corporations that have aggressively rolled out boneless chicken products preferred by Generation Z are growing rapidly. Chick-fil-A, led by boneless chicken sandwiches and milkshakes, saw last year's revenue rise 5.4% from a year earlier and has established itself as the third-largest food-and-beverage chain in the United States after McDonald's and Starbucks.
Chicken finger specialist Raising Cane's posted $5.1 billion (about 7 trillion won) in revenue last year, overtaking KFC to rank third in the chicken industry by annual revenue. Revenue, which was only $2.4 billion (about 3 trillion won) in 2021, has been growing more than 30% annually as it captured Generation Z through viral exposure on TikTok and other social media (SNS).
McDonald's, the "big elder" of the fast-food industry, also saw U.S. same-store sales rise 2.4% in the third quarter on the back of growing sales of the $2.99 Snack Wrap, which puts chicken tenders in a tortilla. McDonald's said chicken sales have increased nearly as much as beef and noted that it is "targeting a bigger chicken market opportunity."
Other fast-food corporations, having watched the success of Chick-fil-A and others, are rolling out new products and jumping into the chicken war. Wendy's, a burger chain whose share price has plunged by more than half over the past year, launched "Tendies" chicken tenders last month in a bid to revive sales. KFC also unveiled a $5 (about 7,000 won) chicken tender box and a $3.99 (about 6,000 won) chicken sandwich after a change in chief executive officer (CEO).
Some caution that the indiscriminate flood of chicken products to capture Generation Z is not entirely positive. The FT said, "A strategy tailored to Generation Z's tastes is not always a safe choice," adding, "In a situation where low-income consumers continue to face economic pressure, fast-food corporations' share prices are also unlikely to rise easily."