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Posted by Dale Buss on October 21, 2014 05:38 PM
In its earnings report on Tuesday, McDonald's turned in its biggest drop in quarterly profits in seven years, and CEO Don Thompson acknowledged the calamity and the dire need for change.
Arguably, McDonald's faced some significant short-term and extraneous factors in posting a worse-than-expected 30 percent drop in quarterly profit and 5-percent decline in revenues. In China, a meat-supplier scandal still ripples; in Europe, the economy is tanking again, and Russian authorities meddled with McDonald's operations there in the last quarter.
But McDonald's biggest problem is that many American and global consumers no longer perceive clear reasons for favoring McDonald's over any other place to eat. They don't believe the food provides a satisfactory combination of good enough, fast enough, inexpensive enough and nutritious enough for them to go to McDonald's anymore. The golden arches may have reached a seminal negative moment in its history.Continue reading...
chew on this
Posted by Dale Buss on February 18, 2014 03:50 PM
Burger King may have come up with a great way to kick rival McDonald's when it's down: Go after the Golden Arches' signature product.
That's what Burger King is doing with new improvements to its three-month-old Big King sandwich, which now will have 0.8 ounces more beef than the Big Mac. The chain has been testing the beefier new Big King at 200 locations in South Florida and experiencing a 10 percent jump in guest-satisfaction scores, said the Motley Fool.
And this week, Burger King began bragging about its newly improved burger in advertising, saying that "size matters. That's why the Big King just got bigger. Now with a quarter pound of beef" vs. McDonald's 3.2 ounces in the Big Mac, "freshly fire grilled."Continue reading...
Posted by Dale Buss on November 21, 2013 09:21 AM
Chrysler eyes December IPO.
LG investigates "unauthorized spying" claims.
Microsoft builds line of products, apparel around "Scroogled" marketing campaign.
Abercrombie & Fitch reports loss on weak sales.
British Airways fields billboard ads that interact with planes overhead.
CCTV grapples with ad slowdown in China.
Foursquare opens up home screen to big brands.
IKEA is investigated in France for labor issue.
McDonald's plans no national launch for McRib this year.
Mondelez invests $100 million in Czech biscuit plant and expands presence in Pakistan.Continue reading...
Posted by Dale Buss on May 15, 2013 09:20 AM
Google CEO Larry Page discloses vocal-cord condition as company plans music-streaming service.
Apple is being investigated for its role in e-book pricing.
Burger King rolls out BK Rib to bust McRib by McDonald's.
ABC tests expanding Nielsen ratings to mobile and plans to consolidate Dancing with the Stars to Monday evenings.
Amy's Baking Company goes rogue after Kitchen Nightmares rejection, shows what brands shouldn't do on social.
Bloomberg terminal-use issue highlights stress in corporate culture as Wall Street firms begin to regard it as competitor.
Dell will miss profit estimates.
Dollar General looks to hire 10,000 new employees this month.Continue reading...
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Posted by Dale Buss on December 10, 2012 02:19 PM
Take that, Hamburglar and all your little mischief-making fiends: McDonald's may already be back in the U.S. just one month after poor sales brought about the departure of the head of its U.S. operations.
McDonald's surprised the restaurant world by announcing a 2.5-percent jump in comparable-store sales in the United States, after analysts had expected a U.S. drop in sales of as much as 1 percent for the month.
The chain attributed the unexpected rise to the "ongoing popularity" of its breakfast in the U.S. along with "balance across everyday value offerings, premium menu options including the limited-time Cheddar Bacon Onion sandwiches, and the beverage lineup," according to McDonald's press release. Holiday cheer, despite stepping up around Thanksgiving, didn't really move the needle on sales.Continue reading...
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Posted by Shirley Brady on December 4, 2012 02:25 PM
It was leaked that it's coming this month, and now it's been confirmed: The McRib sandwich is returning to McDonald's American restaurants on Dec. 17 in a year-end boost for the chain and its new US head, Jeff Stratton. Let the line-ups begin and the McRib Locator get started.
Posted by Dale Buss on November 27, 2012 05:16 PM
Whatever McDonald's next US CEO, Jeff Stratton, does after he takes over from ousted McD's veteran Jan Fields on Dec. 1st, outsiders agree that it'll probably involve significant new menu launches and refreshing old favorites. As in most businesses, it's product innovation that provides the most effective promotional opportunities and does the most to drive sales and pique consumer interest.
Especially in an increasingly competitive environment where Americans seem to have grown inured to a simple value pitch, expect the icon of fast food to turn more, and more often, to variations of its signature products, and other new items, to reverse the October U.S. same-store sales slide that cost Fields her job.
Some analysts are suggesting that Stratton, a four-decade veteran of McDonald's who championed sustainability in his role as Chief Restaurant Officer, will rely on his expertise in operations to shore up the bottom line and that he'll turn to improved marketing to boost the top line. But in picking apart the reasons for this year's slide and putting together ways to reverse it, Stratton also must balance menu expansion with the traditional simplicity at the heart of McDonald's business model.
In 2012, the chain relied more on "limited-time" menu additions in the US such as Chicken McBites and a Cheddar Bacon Onion burger that was introduced in October. The pandemonium-causing McRib sandwich, meanwhile, is rumored to return in December — and not a moment too soon. As Peter McGuinness at DDB Chicago, McDonald's agency, commented about the pre-Christmas McRib timing in a reference to Coca-Cola's classic holiday theme, "We don't really do polar bears."Continue reading...
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Posted by Dale Buss on October 22, 2012 02:23 PM
As global economic bellwethers go, McDonald's sales results probably rank right up there with oil prices and consumer-confidence measures. So its shareholders, analysts and executives aren't exactly lovin' it when the company reports lackluster results, as it did for the third quarter.
The fast-food leader reported weaker-than-expected earnings for the period as it battled a weak global economy and accommodated more budget-minded consumers from Europe to China. Both sales and profits fell during the quarter, a rarity for McDonald's.
Of course, McDonald's results aren't directly synonymous with the status of the world's appetite for quick fare. The stronger dollar hurt international sales too. Also, competitors in many markets have been upping their game lately, including both Burger King and Wendy's in the United States, and the new strains from rivals also are reflected in McDonald's results.Continue reading...