McDonald's balances core brands with new products
June 19, 2012
by Eric Schroeder
NANTUCKET, MASS. — McDonald’s Corp. has benefitted from a two-prong approach that balances the strengths of its global core brands with an effort to remain locally relevant, Pete Bensen, executive vice-president and chief financial officer of McDonald’s Corp., told participants at the Jefferies Group, Inc. Global Consumer Conference in Nantucket on June 19.
McDonald’s five core brands — Big Mac, french fries, hamburger, cheeseburger and Chicken McNuggets — account for more than 25% of total sales, Mr. Bensen said, and remain front and center in terms of promotion.
But Mr. Bensen said customers also have given the restaurant chain permission to stretch its brand to enter new categories with new products.
“Our growing line of McCafe hot and cold specialty drinks is a great example,” he said. “The McCafe beverage line that started in New Zealand is now a $1 billion business in the U.S., and there’s still plenty of opportunity for growth both in the U.S. and globally. Recently, markets like Canada and Australia have introduced blended ice beverages as part of their McCafe lineup, and we already have about 3,300 separate McCafe areas within our restaurants around the world and more under development.”
Mr. Bensen identified chicken as another product category with opportunity, specifically the introduction of large wraps in Europe and Chicken McBites, which McDonald’s recently debuted in the United States in a spicy version.
“(Chicken) drives good-for-you perceptions and enables us to create special tastes and new ways of eating that customers may not always expect,” he said.
McDonald’s also is highlighting fruits and grains on its menu, as is the case with the Wholesome Starts breakfast campaign in the United States.
“We bundled together products that are 300 or fewer calories like our oatmeal, the Egg McMuffin and the Fruit ‘n Yogurt Parfait so they are easier to find,” Mr. Bensen said. “We know that when customers feel good about eating at McDonald’s they will visit us more often.”