McDonald's Toy Giveaway Backfires

by Kalinga Seneviratne

In this case, McDonald's marketing strategy did not work the way it they had planned.

Its 40-day promotion for "Hello Kitty" dolls was meant to be a new millennium "thank you" to its loyal customers in this tiny Southeast Asian republic well known for its consumerism.

But its early runaway success, running on the popular appeal of the Japanese character collectibles in many Asian countries, soon backfired.

Since the promotion started on New Year's day, there have been reports of fist fights, traffic jams, broken glass walls and people fainting from sheer fatigue in queues that start forming early evening on Wednesdays for the Thursday morning release of a new set of dolls.

On Jan. 27, even before the outlets opened for business in the morning, more than 250,000 people waited outside to get their hands on the "Hello Kitty Romantic Couple" dolls dressed in Western wedding garb.

The chaos erupted every Thursday for the last three weeks, since the fast food chain introduced a new pair of the "Hello Kitty" and "Dear Daniel" dolls in a different wedding costume. The McDonald's company had to engage more than 130 security personnel to control the crowds.

Soon the marketing success -- customers who buy certain meal packages get a doll of their choice -- turned sour and led to soul-searching by residents of this affluent city state.

"What is it about these cheap-looking, characterless toys that has made otherwise sensible adults take time out to join endless queues for the privilege of buying them?" asked Bob Ng, associate editor of the Straits Times.

He argues that one reason is greed and the other is to have something which everyone else is having, regardless of whether it is of any use. "Truly, there is no accounting for the idiosyncrasies of the gullible," he noted.

Similar views were expressed in the media from social critics who raised questions about the marketing strategies of McDonald's in the light of the fact that people have been openly throwing away their hamburgers, after getting their hands on the Kitty couple.

"It is shocking to observe the mass hysteria over a toy," complained Ramesh Kudva in a letter to the Straits Times. "On one hand, it (McDonald's) appears as a concerned corporate citizen. But the cold-blooded hand of commercialism opportunism is evident."

Singapore has been a dream market for McDonald's. It began operations here in 1979 and currently has 113 outlets spread across this tiny island of 4 million people.

Sensing that its corporate image is taking a beating, McDonald's decided to suspend its Hello Kitty promotion last week. It announced that order forms for the new set of dolls will be available at all the outlets in the coming two weeks. All orders will be honored by July this year.

McDonald's may have saved Singaporeans another day of Thursday morning chaos in this smoothly functioning metropolis. But many questions about marketing gimmickry and Singaporean social values remained unanswered.

Put on the defensive, McDonald's marketing director Fanny Lai told the media that the company had no idea that the situation continue to escalate and get out of hand. "The overwhelming response is unprecedented in McDonald's history worldwide," she said.

The "Hello Kitty" chaos has also drawn attention to McDonald's business strategy here.

The Federation of Merchants' Association (FMA) while complaining about the disruption caused to small businesses around the fast food chain's outlets on Thursdays, raised questions regarding what it called possible breach of Singapore's trading laws.

FMA's president Tang Chong Meng called a press conference last week and asked McDonald's to stop selling soft toys and stick to selling hamburgers. He argued that McDonald's should not market the soft toys to promote its burger sales, because it is in the business of selling food and not toys.

Tang's deputy, Soo Yap Chai, added that bakeries which wanted to sell fruits were threatened by the Environment Ministry with fines. "Then how could McDonald's sell toys in its outlets?" he asked, pointing out that advertisements in the newspapers promoted the toys and not the food.

"The toys are sold at cost price and they are seen as a way of giving back to our customers for all the support and patronage they have given to McDonald's," argues Lai.

Not many are willing to take that line anymore. Social critic Irene Ng argues that while technology and wily marketing cannot be dismissed, Singaporean society's prospects for social progress are at stake its people did not know how to defend themselves against mindless consumerism.

"It makes me sick to see Singaporeans queue like Pavlovian dogs, tongues hanging out, for hour and hours, for a silly soft toy without a mouth," she pointed out.

"So we go after Ronald McDonald: The charges against him include being the wily mastermind out to exploit the 'I-also-want' syndrome and the 'Hello Kitty' craze of weak-willed consumers," says Ng.

She argues that relatively rich and unerringly brand-conscious, Singaporeans form a ready market where latest innovations are consumed eagerly and upgraded constantly.

Psychiatrist Dr Tan Chue Tin argues that the 'Hello Kitty' promotion has shown how good the McDonald's marketing people are in understanding human behavior in the Singapore context.

"It is the compulsive-acquisition syndrome. The queue becomes more than just a queue," he argues. "McDonald's makes it the only way to achieve the status of owning a Kitty collection. Its platform is one where even if people have the money, they cannot buy."

Indeed, reports said some people spent long hours in the queues with the intention of making a fast buck in the collectibles open market. But the highest price reportedly offered for the 'Hello Kitty' pair in the open market so far has been between 50 to 60 Singapore dollars ($29-35 U.S.).

Recent news that McDonald's plans to flood the Taiwan market with 4.8 million of the same dolls have further dampened the hopes of these speculators.

Indeed, associate professor Leong Siew Meng of the National University of Singapore's business administrative faculty likens the 'Hello Kitty' craze to the short-term speculation initial public offering mania of prime stocks. "The whole thing is a fad itself, so people have to sell it off fast, before the fad dies."

Toy-collectible dealers here say that currently there are more sellers than buyers for the 'Hello Kitty' dolls.