mcdonalds

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The Burger King Whopper is a great product. Many people, myself included, feel it is far superior to McDonald’s Big Mac.  The problem with BK has always been product consistency. One day a Whopper can be sublime – the perfect fast food burger.  Fresh, crunchy, a perfect combination of backyard BBQ, veg. and condiments (the tomatoes are always an issue in the winter), the next day it can be cold, greasy and sporting an almost fruit cocktail-like mush of ingredients.    

As a student of Burger King, I thought their investment in new broiler technology a year or so ago was going to change the fast food world. It did not. McDonald’s is still kicking their butt in consistency. Broiling is BK’s point of difference, but it won’t hold up to poor in-store execution.

Today a Brazilian consortium of investors by the name of 3G is likely to make a move on Burger King.  In my view they are buying a business and a brand with so much upside it’s scary. The new owners need to establish almost NASA-like precision, though, with regard to product quality, especially in franchise stores. Forget the advertising for the moment. Forget the children’s playrooms and store color palette.  Get the core product right, make it consistent and the category will turn in your favor. Especially as you roll out internationally. Peace!

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McDonald’s just reported sales and they are up 2.2% worldwide, missing analysts’ targets. Sales in the US were expected to be up 2.8% and came in at 1.7%. Value meal wars were partly to blame, but if you ask me the whole McCafe product extension is the cause. The New York Times reported the story – not a big one I might add – and nowhere is there a mention of the McCafe coffee line. I didn’t like the gourmet coffee move when I first read about it, and I don’t like it now. It’s not core.

Burger King, on the other hand, which for all its strategic and tactical ups and sideways owns the idea of “flame broiled,” decided not long ago it wanted to upgrade stores with state-of-the-art broilers. If memory serves, they’re supposed to be installed pretty soon. (I’ll have my fact checker get on it.) This is Russ Klein’s major stroke of genius. Crispin Porter, his agency, does great work and the King is the King, but flame broiling is what sets BK apart — and what should help them take a big chunk out of McDonald’s market share. Peace!

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The new Intel campaign by Venables Bell and Partners sounds a bit unfocused. The idea behind the campaign “Sponsors of Tomorrow” sounds good enough, though a couple of years ago the Magazine Publishers of America (MPA) did something similar through Toy-NY which was a bit trite. Intel’s campaign, according to reports, has three different executional ideas which makes it messy:  Portraying Intel R&D people as rock stars, comparing the Intel culture to popular culture ("our clean room isn’t like your clean room"), and showing what the future will be like thanks to Intel (a digital campaign). That’s three ideas, one tagline.  

 

The new McDonald’s McCafé advertising from DDB, Chicago, on the other hand, is based on a very tight idea. And a powerful idea. When you buy a McCafé beverage, it transforms wherever you are into a café, highlighted by a visual accent popping up on the “e” of the location name. (A commute turns into a commuté, for instance.) Pairing this graphic idea with amazingly lush film of the coffee takes the viewer out of greasy burger heaven and into – in the mind at least — an aromatic French café. Simple. Focused. Evocative. About the product. Peace.   

 

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I love Starbucks. I go there every morning for my grande non-fat latte. Howard Schultz is putting himself back in charge of Starbucks because the business has started to show signs of underperformance. It is seeing its first “dings” after many years of astonishing – Harvard business case — growth. The slowing of sales is generally attributed to overbuilding of stores and McDonalds coffee product (new and planned.)  
 
Starbucks store build out has probably been too fast, (remember Krispy Kreme?) so Mr. Shultz plan to slow store growth is a good one. And cutting underperforming stores is also a smart move. Either the demographics and geographics support the Starbuck’s experience or not. But McDonalds? And its new espresso bar? I think not. The Starbuck’s core customer doesn’t want to smell Egg McMuffins and canola oil potatoes thingies while waiting for their Ethiopian blends. Not a competitor. Please.
 
Starbucks might consider offering a “value” coffee-of-the-day to staunch the migration of people on a weekly budget, but please don’t be worried about Mickey Dees.
 
Mr. Schultz will do just fine. Welcome back.
 

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