Saturday, April 19, 2014

McDonald’s Quality Differentiation Will Win Breakfast Battle

The battle for consumers in 2014 is not a battle over breakfast but a battle over share of stomach. While breakfast is the current focal point. QSR leaders all must be mindful of the expanding success of fresh prepared food in both grocery stores and convenience store sectors. 

Taco Bells facile TV advertising can’t hide the fact that McDonald’s average sales volume per store is $1 million higher than the average for Taco Bell.  Simply put the reported $50 million dollar advertising campaign Taco Bell launched cannot be sustained. Then what?

The campaign may drive trial, for Taco Bell but will not diminish the brand value of the Egg McMuffin or McGriddle both unique category leaders copied by many, mastered by few. Taco Bell Franchisee's must be mindful trial is not adoption. For Taco Bell the cost of the big breakfast roll-out will come in months 4 through 12. 

McDonald’s is expected to have completed the roll-out of new “high density kitchen tables” increasing throughput by mid July 2014. Once the “high density kitchens tables” are in place look for McDonald’s to begin serving many breakfast items all day long.  Once again stifling Taco Bell and creating additional points of distribution for breakfast items that Grocery Deli’s and Convenience stores are not equipped to deal with in fresh prepared food. 

Remember breakfast is a hot category, Americans made 12.5 billion restaurant visits for breakfast last year, making the morning meal the only daypart showing traffic growth for the third consecutive year, according to NPD Group. In-addition with beef prices on the rise, breakfast offered all day long creates a platform for increased consumer choice creating both calorie and pricing flexibility.  specializes in outsourced business development. We can help you identify, quantify and qualify additional food retail segment opportunities or a brand leveraging integration strategy.  Foodservice Solutions of Tacoma WA is the global leader in the Grocerant niche since 1991

1 comment:

  1. Solid post. Interesting closing point. Will higher beef prices or our 24/7 lifestyles drive breakfast sales around the clock?