McDonald's Boosts Sales With Faster Drive-Throughs and Travis Scott
October 08 2020 - 8:29AM
Dow Jones News
By Heather Haddon and Micah Maidenberg
McDonald's Corp. said its U.S. sales have bounced back from the
initial shock of the coronavirus pandemic, thanks to sped-up
drive-throughs and a meal promotion with musician Travis Scott.
The burger giant said Thursday that comparable sales at U.S.
restaurants rose 4.6% in the three months ending in September
compared with the same period last year. In the preceding quarter,
U.S. sales by that metric were down 8.7% from a year earlier, as
the chain shut dining rooms and people stayed home.
It remains to be seen whether the sales growth will translate
into more profit. McDonald's didn't release profit figures for the
quarter. The company is expected to release full results for the
period Nov. 9.
McDonald's has struggled in recent years to boost sales in its
home market. The chain has experienced rising competition,
particularly at breakfast. Efforts including all-day breakfast and
burgers with customizable toppings boosted U.S. sales, but they
later fell again.
Operational changes and new marketing in recent months have
given the chain momentum, McDonald's said. The company attributed
the third-quarter sales growth to the partnership with Mr. Scott
and a reduction in average wait times at drive-throughs, which it
has long sought to improve. McDonald's said a simpler menu during
the pandemic and the closure of most dining rooms increased labor
efficiency and helped drive-throughs operate faster.
In recent weeks, McDonald's has mixed up its menu and marketing
as it seeks to regain ground in particular with younger
customers.
The chain said Wednesday that it was adding sweet breakfast
pastries such as blueberry muffins and apple fritters to stores on
Oct. 28, the first bakery additions to its standard menu in eight
years. Last month, it introduced spicy McNuggets, the first flavor
for that item since they were introduced to U.S. menus in 1983, the
chain said.
On Monday, McDonald's added a marketing deal with reggaeton
artist J Balvin, with a meal of a Big Mac, fries and an Oreo
McFlurry bearing the musician's name on sale through Nov. 1. It
didn't set a standard price for that celebrity meal, saying it
would vary.
Mr. Scott was the first celebrity to be featured on the menu
since basketball icon Michael Jordan, who lent his name to a
McJordan meal in 1992.
"We've been pushing ourselves recently to go beyond our
traditional comfort zone," said Morgan Flatley, McDonald's U.S.
chief marketing officer, in response to questions about the
campaign.
The individual items in the Travis Scott meal--a Quarter Pounder
with cheese, lettuce and bacon, fries with barbecue sauce and a
Sprite--was on sale for about a month ending Oct. 4.
Mr. Travis--a hip-hop artist with a knack for partnering with
big consumer companies, including General Mills Inc., Nike Inc. and
Epic Games' "Fortnite"--released a new single, "Franchise," and
video featuring a man wearing a McDonald's hat and T-shirt. The
song made its debut on the top of Billboard magazine's Hot 100 this
week.
"Billions and billions served," Mr. Scott wrote on a recent
Instagram post that included a photo of him eating a McDonald's
sandwich next to a worker at a fry station.
One Ohio restaurant manager said the restaurant's kitchen was
overwhelmed at times by demand for the Travis Scott meal. Some
customers played Mr. Scott's music at the drive-up speaker or asked
for a "Fortnite burger."
"I was thinking of it as a Happy Meal for grown-ups," said Adam
Yescas, a 33-year-old in Fresno, Calif. who ordered the meal and
got a branded Travis Scott doll from the chain
Downloads of the McDonald's app increased 20% from Sept. 15 to
Sept. 30--part of which the meal was only available at a discount
through digital purchases--compared with two weeks earlier,
according to App Annie, a third-party analytics firm.
"I like the dark tones of his music and the energy he brings to
the stage," Christianson Daniels, a 20-year-old in Wilkes-Barre,
Pa., who ordered the meal last month, said of Mr. Scott. "That was
enough to bring me into the door. But the meal itself? Eh."
Write to Heather Haddon at heather.haddon@wsj.com and Micah
Maidenberg at micah.maidenberg@wsj.com
(END) Dow Jones Newswires
October 08, 2020 08:14 ET (12:14 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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