McDonald’s seeks ‘best burger,’ better coffee

NEW YORK — Beef, chicken and coffee are core menu items McDonald’s Corp. will continue to explore ways to improve in an effort to grow sales, said Ian F. Borden, executive vice president and global chief financial officer of the Chicago-based company.

In a March 13 presentation at the UBS Global Consumer and Retail Conference in New York, Borden described different levels of success and opportunity in each platform.

In beef, McDonald’s is in the early innings of its “best burger” initiative, which Borden described as a series of “small changes in how we cook and prepare our core beef products.” He said the program is focused on driving “significant improvements in taste and quality” and has been rolled out to about 70 markets. Plans call for the program to be in place in the rest of McDonald’s system by the end of 2026, he said.

“Taste and quality are the two biggest drivers of consumer visits to our restaurants, so that’s impactful,” he said.

Another opportunity in beef involves size. Borden said McDonald’s has not been successful in developing a premium burger that resonates with consumers, so the company has shifted focus to developing a “large, more satiating-type burger.”

“That opportunity is significant,” he said. “It’s consistent across many of our large markets.”

Borden said McDonald’s has several other beef products it is in the process of piloting.

“We’re going to pilot those products in two or three, what we call ‘market zeroes,’” he said. “We’re then going to — if those products work, we’re then going to scale one solution to that opportunity globally, where in the past, you would have seen us probably try and get after that opportunity in 20 different markets in 20 different ways, and then you don’t have the ability to build a global equity that you can drive at scale.”

The chicken category, meanwhile, is much larger and growing faster than beef, Borden said, adding that McDonald’s is under-indexed in its share of the chicken market. He said the company put a plan in place several years ago to grow its chicken business, and while McDonald’s has grown its presence in the category the opportunity to be an even bigger player remains in sight.

Borden said McDonald’s is in the process of scaling two of its newer chicken platforms: McCrispy and McSpicy.

 While upbeat about the company’s beef and chicken menu platforms, Borden offered a different take on McDonald’s coffee platform.

“I would say we’re not happy with our progress in coffee,” he said. “I mean we are the No. 2 coffee player globally. So, we have a significant share in coffee, but we haven’t made the progress as consistently as we believe we can. And we believe the biggest opportunity is we’re not delivering consistent taste and quality execution. Again, taste and quality are those top two drivers of customer visits.

“Maybe a micro example of why, we have 100 different coffee machines across our business today. So how can you possibly deliver a consistent experience if you aren’t even putting the product together in a consistent way? So, we’re going to just get a lot more focus. We’re going to bring that consistency to life at scale. And we believe by doing that, we can deliver a significant impact on taste and quality for customers and deliver a better experience.”

link