海角大神

海角大神 / Text

McDonald's new leadership searches for menu hits

The McDonald's menu under departed CEO Don Thompson became too big 鈥 complicated and full of expensive duds. The company's new leadership should focus on a streamlined McDonald's menu with a few core products that can make some news but not overly complicate operations.

By Scott Hume, Burger Business

In July 2012, in his first quarterly earnings conference call as CEO, Don Thompson put his faith in a three-pronged strategy to bring McDonald鈥檚 up to date and beyond. 鈥淏y remaining committed to our long-term strategies to optimize our menu, modernize the customer experience and broaden accessibility to brand McDonald鈥檚 while continuing to fortify our short-term plans, I鈥檓 confident we will continue to grow the business for the system and our shareholders,鈥 Thompson said then.

It was a mistaken definition of 鈥渙ptimize鈥 that led, at least in part, to Thompson鈥檚 departure this week, replaced by Senior EVP, Global Chief Brand Officer Steve Easterbrook. Had Thompson and McDonald鈥檚 understood sooner that the optimal McDonald鈥檚 menu was smaller and more streamlined rather than eclectic and ungainly, he might have gotten longer than two-and-a-half years to see if his vision for the 鈥渆xperience of the future鈥 really would turn around the brand.

鈥淥ptimizing the menu鈥 required short-term answers and McDonald鈥檚 didn鈥檛 have enough of them, in the U.S. at least. There鈥檚 irony in the introduction by McDonald鈥檚 Canada of a聽Double Big Mac聽just as Thompson stepped down. The Double Big Mac is just the sort of unflashy but fun menu item the chain needs: a core product that can make some news and not overly complicate operations. The Thompson years saw problems with chicken wings that were overpriced, elimination of the Angus Third Pounders and the addition of time-consuming Premium Wraps that slowed service times.

Read the comments to the聽earlier McDonald鈥檚 post. There is some smart thinking there about the chain鈥檚 need to focus on reestablishing consistency and to stop being bullied into continually remaking the menu to please nutritionists鈥 unreasonable demands.

Although he was global chief brand officer, Easterbrook is not by background a marketing man. That鈥檚 good because McDonald鈥檚 needs to look at how to deliver high-quality food to everyone at its counter or drive-thru. After that it can worry about being digital enough in its communications strategies. If Millennials don鈥檛 like McDonald鈥檚 food, a cool phone app or the chance to customize a burger on a touch screen won鈥檛 change their buying habits.

Scott Rothbort, Seton Hall University Stillman School of Business Finance Professor and Chief Market Strategist, sent me a comment on the Thompson ouster, arguing that 鈥淢cDonald鈥檚 not going far enough鈥 because it once again pulled from its bench. He said he鈥檚 been arguing for Thompson鈥檚 ouster but 鈥淚 was calling for that replacement to come from outside of McDonald鈥檚 as the company needs a fresh, new and independent leader. So, to some extent, the announcement yesterday was welcome, but only went halfway.鈥

I don鈥檛 agree. I don鈥檛 think McDonald鈥檚 can afford the time for an outsider to learn the ropes and dissect the problems anew. Easterbrook began his McDonald鈥檚 career in 1993 as a financial reporting manager in London. He handled various operation roles until 2007 when he was named SVP and Division President, Northern Europe. In 2010 we became president of McDonald鈥檚 Europe. He left McDonald鈥檚 in 2011 for stints atop the PizzaExpress LTD and Wagamama LTD restaurants chains before returning to the Arches in 2013.

McDonald鈥檚 UK operations with which Easterbrook is familiar have fairly steady performers. Yes, investments have been made in digital engagement (witness the recent鈥淗ackathon鈥澛爄n London), but it also has managed to balance a low-price-point Saver Menu with higher-price LTOs and the My Burger initiative that invites consumers to dream up the next McDonald鈥檚 menu star. McDonald鈥檚 doesn鈥檛 need to be fancy or digital or Millennial or nutritional. It needs to be good. It needs to be McDonald鈥檚. Optimize that.