Digital, Drive-Through, Delivery Powering McDonald’s

McDonald's President says that the Travis Scott Meal is helping but their latest earnings results are actually powered by improvements in digital, drive-through, and delivery....
Digital, Drive-Through, Delivery Powering McDonald’s
Written by Rich Ord
  • “I know everyone wants to focus on the Travis Scott Meal and Spicy Chicken McNuggets which definitely contributed to the fantastic September that we had,” says McDonald’s USA President Joe Erlinger. “But the setup for this great quarter actually started much earlier in the year. Our drive-throughs have been getting faster at McDonald’s. We’ve made a lot of investments in digital and drive-through and delivery as well.”

    https://youtu.be/8K0lnarZ0oQ

    Joe Erlinger, President of McDonald’s USA, says that the Travis Scott Meal promotion is helping but their latest earnings results are actually powered by improvements in digital, drive-through, and delivery:

    Digital, Drive-Through and Delivery Powering McDonald’s

    I know everyone wants to focus on the Travis Scott Meal and Spicy Chicken McNuggets which definitely contributed to the fantastic September that we had. But the setup for this great quarter actually started much earlier in the year. Our drive-throughs have been getting faster at McDonald’s. We’ve made a lot of investments in digital and drive-through and delivery as well.

    Then really we made a lot of changes to our business model as the pandemic set upon us including over 50 changes in operations. We limited our menu and we’ve made our restaurants easier to run. At the same time, we conserved some of our marketing funds. We began to unleash those marketing funds in the third quarter. That’s what set up this great result of 4.6% double-digit comps in September.

    Breakfast Is BACK At McDonalds

    When we entered the pandemic we had reversed what was a long-term trend of negative guest counts. It’s been lost in the results of what happened in the epidemic. But in January and February, we actually had positive comps at breakfast and positive guest counts. It goes without saying that we don’t sell the Spicy McNuggets or the Travis Scott orders at breakfast and we’ve obviously seen positive comps across all dayparts.

    So we are actually very optimistic about the daypart. We’re excited about the bakery launch that’ll take place later this month. We’ve got a real built-in advantage on this because of our drive-throughs and just because of our overall convenience factor. I like the characterization that yes, breakfast is back at McDonald’s.

    Mood Amongst Franchisees Is Strong

    Franchisees did come into this in a position of absolute strength. In fact, 2019 was the highest cash flow year ever for our franchisees. Some of the steps that we took through the pandemic both to support them in terms of their liquidity but also to make the operations of the restaurant easier (helped significantly). We actually improved margins at the restaurant level as well.

    They’re actually coming out of the worst of the pandemic in a very good position and in a very strong financial position. The mood amongst our franchisees is strong. I was in restaurants uh in Washington state a few weeks ago. Last week I was actually in Washington DC. There’s a lot of optimism confidence as we enter the fourth quarter.

    Digital, Drive-Through, Delivery Powering McDonald’s

    Get the WebProNews newsletter delivered to your inbox

    Get the free daily newsletter read by decision makers

    Subscribe
    Advertise with Us

    Ready to get started?

    Get our media kit