Dec 3, 2019 After missing the first memo, McDonald's finally jumps into Fried Chicken Sandwich Wars Read More McLate... A full 3 months after Popeye's faced a crispy chicken sandwich shortage (good problem to have), McDonald's wants in. Yesterday, the fast food chain started testing its own caloric version in its Houston and Knoxville restaurants. We know what you're thinking: Didn't fry-master McDonald's already do fried chicken?
McNuggets and the McChicken Sandwich don't count — they're not "Southern" style.
McD's has tried multiple other chicken sandwich options, but none came close to Big Mac fame.
Solution: Steal Chick-Fil-A and Popeye's Southern-style crispy chicken concept, with butter and pickles.
The other other white meat... is worshipped nationwide right now. Southern-style fried chicken sandwiches became profit puppies for a pair of McD's rivals during last summer's Chicken Sandwich Wars:
Popeye’s: Feasted on its best quarterly sales growth in nearly 20 years as its brioche bun-nestled fried chicken sandwich grew sales by 10%.
Chick-Fil-A: Now America's 3rd largest restaurant chain by sales — Chick-Fil-A has about double the sales per restaurant as other fast food joints.The Takeaway:McDonald’s franchisees are its secret sauce... 9 of 10 McD's restaurants worldwide aren't owned by Ronald, they're actually owned by a franchisee — an entrepreneur who McDonald's licenses its logo/recipes/supplies to in exchange for fees and a portion of their location's sales. Back in July, franchisees wrote a joint letter to McD's asking for a chicken sandwich ASAP... before the Chicken Sandwich Wars. They were right. McDonald's finally admitted it. Oct 23, 2019 McDonald's did more with less last quarter, boosting sales despite fewer diners Read More We're concerned. But we're impressed... The number of people who went to McDonald's in the US last quarter — aka "foot traffic" — fell. Somehow McDonald's sales still rose 4.8%. Ronald squeezed more money out of each customer, ketchup-pouch style, and here's how:
Higher prices: You dropped 3% more for a McSomething because McD's upped the menu prices (partly to cover higher paychecks because of city/state minimum wage increases).
Tech: McD's acquired 3 tech companies in the past year, including one that adjusts the drive-thru menu based on weather. Hot day = McFlurries on 6 of the value meals.
Promos: 2 for $5 Mix & Match. Buy 1 Big Mac, Get 1 Big Mac for $1. Bargains get your eyes ordering more than your stomach planned.The Takeaway:"Lower foot traffic" isn't part of McD's plan... The chain's huge $2.4B store renovation plan focuses on self-order kiosks and table service. That's meant to boost store traffic — but the opposite happened last quarter, so investors dropped shares 5% Tuesday. Our guess: Viral Popeyes vs. Chick-fil-A chicken sandwich wars temporarily attracted the Big Mac (un)faithfuls. Jun 25, 2019 McDonald's burger market share rises for 1st time in 5 years Read More Extra fries... Pairs with the 40M more "fresh beef" Quarter Pounder burgers that McDonald's pumped out last quarter compared to a year before. McD's revealed that sales of Big Mac's new anti-frozen cousin are up 30% since it introduced the option in 2018 — And for the 1st time in 5 years, it gained market share in the obscurely delicious "informal burger category."
Ronald deserves a Masters Degree... in smiles and supply chain management. The creation of a "fresh beef" option was a major investment by the McDonald's team — It took 4 years to install a new process to go from cow-to-mouth faster and never frozen. Here's what that "massive transformation" included:
Designing new fridges to handle fresh beef at the right temperature.
Distributing new kitchen utensils (aka spatulas) to every participating franchise about to flip the softer burgers.
Training 3,000 restaurant operators to prepare the actual patties.The Takeaway:This is why you invest in your growth... Just as McD's is spending on its supply chain to accommodate the new patties, it's pursuing another major overhaul: The $6B nationwide renovation of the majority of its 14K US stores by 2020. Fresh beef is a case study on how investing big into your infrastructure can cook up major payoffs. May 1, 2019 Bacon and Donut Sticks power McDonald's to a record high Read More Pop the top-shelf McFlurry... McDonald's just notched its 15th-straight quarter of sales growth, jumping 5.4% globally. But McD's suffered two menu casualties: Its fancy burgers (the "Signature Crafted Recipes" lineup) is 86'd and its late-night menu is getting trimmed.
Ronald has settled into a 2-carb diet... And it's working. McDonald's credited a pair of promotional foods for the strong 2019 start:
Donut Sticks: Added to the menu in February, the 280-calorie balanced breakfast headlined McD's new 2-for-$5 "Mix and Match" deal.
Bacon Day: The one-day event in January let you toss bacon on the side of any order. That delivered a single-day sales pop and an opportunity for diners to experience new menu options.The Takeaway:The Breakfast Wars just got kicked up a notch... Fast food sales were flat last year overall, but breakfast sales rose 1%. Breakfast is now the last quick-serve food frontier because it's the meal you most likely prepare at home. Donut Sticks were McD's latest Breakfast War attack — Here are the other recent battle moves:
Burger King introduced a $5-a-month coffee subscription in March.
Panera redesigned its morning menu in April.
Dunkin' launched two new sausage & egg-white breakfast bowls this week. Apr 25, 2019 Domino's jumps 5% as CEO defends in-house delivery Read More Extra cheese... Despite vicious competition, Domino's quarterly sales still rose 4%. But the highlight was new CEO Ritch Allison defending the chain's contrarian delivery strategy: Domino's handles its own deliveries instead of using those flashy new apps. And it's proud of it.
Dough-to-door delivery happens under the Domino's brand... Meanwhile, McDonald's, Starbucks, and Chipotle use third-party delivery apps DoorDash, Uber Eats, or Postmates, with aggressive discounts to lure new eaters. That delivery outsourcing can cut costs and boost sales. But Ritch has problems with it:
Quality: DoorDash's gig workers won't treat the pizza with the same love and care as Domino's faithful deliverers would.
Fees: Uber Eats would snag 15%-30% of each order, and that adds up.
Data: Postmates won't share key info about the orderer with Domino's. So Ritch won't give up data to "some third party who will ultimately use it against us."The Takeaway:Domino's has an obsession for the customer (data)... Acting like a tech company, Domino's has converted tons of phone call deliveries into app-ordered ones. Not only does Domino's keep the entire pizza bill by delivering on its own — It also understands eaters' eating habits. Knowing your Saturday late-night order helps it better sell you pizza midweek. Mar 26, 2019 McDonald's reinvents drive-thru with 1st acquisition in 20 years Read More Treat yo' self... McDonald's just dropped over $300M to buy Israel's Dynamic Yield. Great technology, brutal name. It's McD's biggest acquisition in two decades (it splurged $174M on chicken chain Boston Market in '99), but this one's got one focus: Make drive-thrus freakishly personal.
This Happy Meal feels like my soulmate... That's the vibe McD's wants you feeling as you coast away from the drive-thru. Dynamic's technology unleashes some serious customization to the menu.
Temp hit 92-degrees? Dynamic Yield pushes up M&M McFlurries on the drive-thru menu.
Already ordered Egg McMuffin? Dynamic Yield suggests hashbrowns to round out that breakfast of champions.
Kitchen low on chicken? The Dynamic Yield menu highlights the 6-pack of McNuggets over the 20-pack binge option.
The Takeaway:Ronald's New Year's resolution was a new look... 2018 was all about upping McDonald's digital game (including order kiosks and a new app), but 2019's focused on physical transformation — McD's is dropping almost $1B to upgrade 2,000 locations. The drive-thru just wants to get to know you.