Tuesday, October 15, 2019

McDonald’s Chain Restaurants Must Evolve

Global chain restaurant powerhouse McDonald’s back in the day became a major investor in Boston Market, Chipotle, and Food.com all concepts focused on grocerant niche Ready-2-Eat and Heat-N-Eat fresh prepared food that was portable they understood consumers were evolving and wanted ‘better-4-you’ meals and meal components both fresh and fast.  
Steven Johnson, Grocerant Guru® for Tacoma, WA based Foodservice Solutions® was on the team and drafted the ‘position’ paper for the undercurrents of change driving these major investments.  There was one problem; McDonald’s wanted to run them like a fast food restaurant. It worked for them so why not these new consumer driven concepts.  Well the answer is simple the attributes of customer relevant meal components changed, evolved with the consumer and new concepts and those customers have moved forward.   
Now McDonald’s U.S. division is changing the company it uses to license and distribute its McCafé coffee in retail outlets, announcing a long-term agreement with Keurig Dr. Pepper on Thursday. The licensing and distribution agreement will end the Chicago-based fast-food giant’s deal with Kraft Heinz, an agreement that launched McCafé products in U.S. retail shops beginning in 2014. So, here is our question.  Why?

Battle for Share of Stomach

NRN’s Johnathan Maze says “Kraft Heinz is backed by 3G Capital, which financed the creation of Restaurant Brands International, owner of rival Burger King—though a McDonald’s representative said that was not the reason behind the change.”
Maze continued “Under its new agreement, Keurig Dr. Pepper (KDP) will continue to be the exclusive manufacturer of McCafé K-Cup pods in the U.S. But it will also take on responsibility for coffee sourcing, distribution and marketing of the McCafé brand in K-Cup pods and bagged and canned coffee formats in retail and e-commerce channels beginning in the second half of next year.”
“Linda Van Gosen, McDonald’s vice president of menu innovation stated, “We are prioritizing McCafé as a go-to coffee brand for our customers, and we are confident this move with strengthen the impact of the McCafé brand in retail,”.  Ok, that sound good but lacking consumer facing innovation once again this looks more like operational efficiencies a tactic and retreat rather than a strategic path forward.
Consumers are dynamic not static brands focusing more on operational efficiencies a tactic than innovation will not fare well moving forward.  Its simple consumers are dynamic not static food retailers must evolve their business model for consumer relevance or risk capitulation a large base of existing customers.
Foodservice Solutions® team is here to help you drive top line sales and bottom-line profits. Are you looking a customer ahead? Visit www.FoodserviceSolutions.us for more information or contact: Steve@FoodserviceSolutions.us Remember success does leave clues and we just may the clue you need to propel your continued success.

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