McDonald’s 2024

May 20, 2024 | Insights, Restaurant Research

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Executive Summary

McDonald’s enjoys substantial brand equity as the largest and possibly most influential restaurant chain, with an “I’m lovin’ it” positioning around: brand trust (built around billion-dollar iconic brands including the Big Mac, Quarter Pounder, chicken nuggets & fries); compelling price/value & convenience; and culturally relevant marketing. A focus on its core, iconic menu items (that resonate with 80% of consumers who prefer products they are familiar with) provides needed operational benefits. Recent menu upgrades include: “The best burger initiative” which renders hotter burgers with meltier cheese; success with its McCrispy chicken sandwich (with further opportunities identified to grow in the chicken category); and plans to merchandise Krispy Kreme’s donuts to boost breakfast & snack daypart sales. Notably, the chain offers an abundance of attractive value platforms that soothe significant core menu price increases over the last several years. The brand’s effective marketing taps into today’s youth & culture, with an emphasis on social media influencers, and a 40%+ digital mix stands to benefit from corporate plans to boost its martech investments (especially around its loyalty program which has 34MM active members). The chain’s strong domestic comp growth over the last 2 years is indicative of the system’s fundamental strength and reflects: strategic menu price increases; strong operations; effective marketing campaigns featuring the core menu; and continued digital & delivery growth. In conclusion, while McDonald’s is well positioned in QSR as the go-to brand, the chain may have to make more margin unfriendly price adjustments for its lower-income customers in the near term while it continues its very important work of improving its service speed.

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