McDonald’s claims to have the “Best Burger” to date, but it will take time to discover if customers are purchasing more of them. McDonald’s has improved its burgers, but it’s not obvious if Best Burger will lead to an increase in sales. In recent quarters, the fast-food giant McDonald’s sales growth has been strong enough to surpass that of its competitors.
McDonald’s Best Burger Drives More Customers and Increases Foot Traffic
At a Monday media briefing, McDonald’s U.S. Chief Restaurant Officer Mason Smoot stated, “Our goal was to enhance the quality, flavour, and overall eating experience of our core burgers, but we wanted to stay true to the tastes that everyone loves.”
Posted February 5th, 2024
McDonald’s claims to have the “Best Burger” to date, but it will take time to discover if customers are purchasing more of them. McDonald’s has improved its burgers, but it’s not obvious if Best Burger will lead to an increase in sales. In recent quarters, the fast-food giant McDonald’s sales growth has been strong enough to surpass that of its competitors.
Price increases throughout the menu and higher-class consumers switching to McDonald’s signature Big Macs and McNuggets contributed to the fast food chain’s sales rise. Nevertheless, fewer low-income diners visited McDonald’s in the United States in the third quarter of the year.
Growth in McDonald’s sales
Street Account estimates that analysts are predicting McDonald’s United States growth of just 4.4% when the firm reports its Q4 results on Monday. When compared to McDonald’s United States sales growth of 8.1% during the third quarter, there is a clear lag.
There will be pressure on McDonald’s and its rivals to increase traffic this year. The double-digit price increases that drove last year’s sales are too much for diners to bear. Rather, chains need to persuade patrons that their meals and beverages are worth their costs and demand more regular visits.
Here’s where McDonald’s “Best Burger” effort comes in: little adjustments made to the chain’s burgers result in a notably more tasty end product. At a Monday media briefing, McDonald’s U.S. Chief Restaurant Officer Mason Smoot stated, “Our goal was to enhance the quality, flavour, and overall eating experience of our core burgers, but we wanted to stay true to the tastes that everyone loves.”
McDonald’s approach
McDonald’s altered the cooking and assembling procedures rather than the beef patty itself. The patties have a little more space to breathe as they cook thanks to the grills. Six instead of eight are cooked at a time to enhance flavour.
For the onions to absorb the patty’s juices, they are also added before the patties are cooked. By maintaining a higher temperature for the cooked patties, the entire burger remains warm when it is served to the diner. Better cheese melting, improved buns, and extra McDonald’s signature sauce are all included in the renowned Big Mac burger.
Analyst Mark Kalinowski, CEO of Kalinowski Equity Research, stated, “This is a step in the right direction for improving some of their very core products, but staying very true to who they are as well.”
The best burger at McDonald’s
The improved burgers were first offered by McDonald’s about a year ago, but they have now been available at every outlet across the country. Australia and Canada, two of the company’s most significant outside markets, have already adopted “Best Burger.” It has seen better results in Australia and Canada than in some of its other major overseas countries, which Kalinowski said can be at least partially attributed to the burger upgrades.
CEO Chris Kempczinski stated during McDonald’s investor day in December that the “Best Burger” would reach 70 markets by the end of 2023. The company anticipates that almost all of its markets will offer the improved burgers by the end of 2026.
He informed investors, “With projects like Best Burger, we are making small changes that add up to big differences that our customers are noticing.”
MCDONALD’S PRACTICAL MANAGEMENT
McDonald’s is using a well-known rival, the Hamburglar, a McDonaldland figure that has appeared in advertisements since the 1970s, to promote the changes. In TV commercials featuring the “Better Burger,” the chain’s mascot praised the burgers’ enhanced flavour. An endorsement from Hamburglar is now prominently displayed on the homepage of McDonald’s website.
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For the first time in five years, McDonald’s increased its market share in the burger segment as a result of switching from frozen to fresh beef patties.
VIEWS FROM THE WALL STREET
On the question of whether the “Best Burger” can spur meaningful development, Wall Street is divided.
Zachary Fadem, an analyst at Wells Fargo, identified “Best Burger” as a potential “upside driver” for McDonald’s in 2024 in a research note published last month. How much of an improvement the corporation anticipates from the project is still unknown, though.
Nevertheless, there are some encouraging preliminary indications that patrons are eager to sample the enhanced burgers.
According to Loop Capital analyst Alton Stump, “Our contacts indicated Better Burger drove a 10% lift on average to burger transactions to date, despite receiving no advertising at the local level until just this week.”
