chew on this
Posted by Dale Buss on August 20, 2014 04:41 PM
Everything seems to be sticking to McDonald's these days. There was the food-safety scandal in China last month, and now the chain's very ubiquity has hurt it as the local, franchisee-owned McDonald's at the epicenter of the racial strife in Ferguson, Mo., has become unwitting headquarters for much of the back-and-forth in the building drama there.
Maybe that particular problem for McDonald's will pass quickly, but the beleaguered chain is continuing to battle its long-term challenges, ranging from the junk-food image of its menus to flagging sales growth to still-growing competition.
At least McDonald's is trying some new tactics as CEO Don Thompson tries to pull the world's iconic fast-food chain out of its deepening slump, with moves involving digital leadership, new forms of influencing thought leaders, new menu items and new attempts to leverage the strengths that it does have.Continue reading...
chew on this
Posted by Dale Buss on March 11, 2014 12:58 PM
McDonald's just introduced a Bacon Clubhouse Sandwich and is testing new McCafe Petite Pastries for breakfast. But will either product save the chain's dough?
That's not likely after McDonald's posted the fourth consecutive month of declines in US same-store sales, a 1.4-percent drop in the market that the brand blamed on "challenging industry dynamics" as well as the severe winter weather that has slowed much of the American economy.
Neither is McDonald's offsetting its sluggish US performance with strong overseas sales as it once was capable of doing. Globally, sales declined 0.3 percent at locations open at least 13 months in February. In a region encompassing the Middle East, Africa and Asia, sales declined by 2.6 percent; there also was weakness in Japan and Australia. McDonald's said a change in the timing of the Chinese New Year also was a problem.Continue reading...
Posted by Dale Buss on March 6, 2014 03:38 PM
If you can't get to one of Taco Bell's 5,500 locations during any of the four "day parts" the chain has recognized, now including breakfast, then there's another way for you to solve your craving for all things Bell: stop at your local supermarket.
Kraft has been partnering with Taco Bell since 1996 to offer Taco Bell-branded products in the grocery aisles, now totaling 28 different items ranging from sauces to "dessert kits" that require only the addition of ice cream, according to Advertising Age.
Now Kraft and the chain are turning up the heat on their collaboration this week by launching four new products: two dinner kits and two seasonings. The Taco Bell Ultimate Taco Night Kit, for example, comes in two varieties—Cheesy Taco Grande and Steak & Cheese Soft Taco Kit, both featuring Kraft's Velveeta cheese (which isn't offered in Taco Bell products in restaurants).Continue reading...
chew on this
Posted by Dale Buss on February 11, 2014 03:51 PM
It's not easy being a global brand, even if you're McDonald's, as you still have to succeed locally. It's possible that its continuing domestic US sales woes are mostly due to treacherous winter weather and a bad new product bet or two. But it's also possible that the chain and the brand are reaching the end of once-outsized relevance to the American consumer as it continues to face food health and labor critics.
Until it becomes evident which scenario is true, McDonald's CEO Don Thompson is relying on improved performance in key international markets to offset the brand's frustrations in the United States. He will rely on incoming US CMO Deborah Wahl to help him tackle the larger issue of McDonald's actual place in its home market. The auto industry marketing veteran is still transitioning into her new role, which she formally assumes on March 3.
The chain reported that US same-restaurant sales fell by more than 3 percent in the first quarter, or about double the percentage decline expected by analysts. Thompson blamed the snow and cold but analysts cited the continued sluggishness of the US economy. But of course, it could be the third factor: American consumers have gotten used to bypassing McDonald's more and more.Continue reading...
Posted by Mark J. Miller on January 30, 2014 06:47 PM
Get ready for some digital experimentation from Starbucks. CEO Howard Schultz has shaken up the upper ranks of his company and also announced that he’ll be working more closely with Chief Digital Officer Adam Brotman and Chief Strategy Officer Matt Ryan on "next generation retailing and payments initiatives," according to the Wall Street Journal.
"They will partner with me as I focus on Starbucks mission, growth initiatives and the convergence and integration of our retail and e-commerce, digital, card and mobile assets around the world," Schultz said in a statement Wednesday.
Schultz handed over some of the day-to-day responsibilities to other executives so he could focus more on digital. After all, Starbucks, an investor in mobile payments provider Square, is processing five million mobile payments each week and that number is expected to grow, the Journal notes. The chain currently allows consumers to pay with a mobile app and loyalty cards.Continue reading...
Posted by Dale Buss on November 15, 2013 06:02 PM
McDonald's retains its long-term growth goals despite its troubles in 2013. But the chain certainly is tweaking how it plans to reach them, with new efforts ranging from selling McCafe coffees in supermarkets with Kraft to its first Happy Meal tie-in with the National Football League. And along the way, McDonald's is trying to figure out how it lost the "quick" in its quick-serve.
CEO Don Thompson said at the company's investor conference this week that McDonald's has suffered from an iffy consumer economy, and labor- and commodity-cost pressures. The company also has been hamstrung by its own poor execution in areas that have included the less-than-stellar sales performance of its steady menu of new Limited Time items, such as Mighty Wings chicken wings.
But the most problematic area for McDonald's may be that its US customer service has suffered recently, in part because it has introduced too many of those new menu items, too quickly, for its operations to adjust efficiently.Continue reading...
see you in court
Posted by Dale Buss on November 13, 2013 01:29 PM
It may be difficult to argue with both Starbucks and Kraft packaged coffee businesses at the moment: Starbucks' brand is busting out beyond the brand's own coffee houses, while Kraft is on the cusp of a potentially exciting new CPG opportunity with McDonald's McCafe brand.
The only thing is, it just cost Starbucks $2.7 billion to get to this point. That's how much an arbitrator has ordered Starbucks to pay Kraft's corporate sibling, Mondelez International, as a result of their failed CPG-coffee partnership that ended in a dispute. It'll take all of Starbucks' cash on hand plus more to make the payment to Mondelez.
Kraft first did the deal to distribute Starbucks-brand packs of coffee in 1998, and by 2010 it had grown to a $500 million-a-year business, the Wall Street Journal reported. But Starbucks accused Kraft of not doing a very good job of displaying Starbucks coffee inside stores and of otherwise doing a poor job of marketing the Starbucks brand. That critique came in spite of the sales growth and after giving Kraft credit for its "world-class" capabilities. Continue reading...
Posted by Dale Buss on November 1, 2013 06:11 PM
Well, it works for Starbucks. So why can't McDonald's also sell packaged versions of its McCafe coffee line in US supermarkets?
The struggling fast-food giant will begin testing just that idea next year in a deal with Kraft. The tests will include packages of whole bean and ground coffee as well as "single-cup" options, which typically include K-cups for Green Mountain Coffee Roasters' popular Keurig brewer. Test markets and pricing were not disclosed, Crain's Chicago Business noted.
"We want to work with McDonald's to help consumers enjoy McCafe premium coffee in the comfort and convenience of their own homes," Kraft Foods CEO Tony Vernon told analysts on a conference call, disclosing the test for the first time. Kraft will handle the marketing and distribution of the McDonald's brand coffee. McDonald's said in a statement it was "building on the momentum of our McCafe beverages in our restaurants by expanding these options," according to the publication.Continue reading...