Source: McDonald’s

McDonald’s Wants to Woo You With Two New Big Macs

The soul of the burgers is still all-beef patties and special sauce.

Like most 50-year-olds, the Big Mac is starting to show its age: That toasted sesame seed bun and secret sauce can’t hide the fact that Mickey D’s still uses frozen patties. Today’s fast-food consumers trend toward better burgers with fresher beef and a wider variety of toppings. Last year an internal company memo revealed that only 20 percent of millennials had even tried a Big Mac. McDonald’s decided it was time for a makeover.

On Jan. 18 the company unveiled two new-look Big Macs, the limited-edition Mac Jr. and Grand Mac, to accompany the original. All three versions hold to the traditional frozen patties and classic sauce. The difference is size: The Mac Jr. lacks its middle bun(!), has only one patty, and has fewer calories (460) than a turkey sandwich from Panera Bread; the Grand Mac, an 860-calorie monstrosity about 1 ½ times as big as the 540-calorie original, will likely serve as a novelty item, ordered by the incredibly hungry or the unashamed.

“This is a smart idea, because customers keep saying they want more choices, especially in portion size,” says Bonnie Riggs, a restaurant industry analyst with market researcher NPD Group. And since traffic is expected to remain unchanged this year at all restaurants, McDonald’s will need to siphon off customers from its competitors to grow. With this campaign, the chain is doubling down on a classic offering instead of trying to lure people in with new concoctions. “If this works, it’ll have a lot of implications for what McDonald’s may try in the future,” Riggs says.

Unlike other chains, such as Taco Bell, whose Doritos Locos Taco did $1 billion in 2012, its first year, McDonald’s has struggled to draw crowds with its creations. Burgers account for almost 20 percent of the restaurant chain’s sales, but it’s been decades since there was any groundbreaking innovation. In 2013 the company pulled its Angus burger off the menu. People weren’t willing to buy it for $5 when they could get an “original” burger off the Dollar Menu instead. Sandwich wraps, which were supposed to attract younger customers, didn’t, and last year they were pulled as well. McDonald’s most recent win, adding all-day breakfast in 2015, only extends the hours that diners can order an Egg McMuffin—a sandwich invented in 1971. “When people go to a particular restaurant chain, they are going for what the restaurant specializes in,” Riggs says. That’s especially true for McDonald’s, whose Golden Arches make people instantly salivate for a burger and fries.

The Big Mac’s revival has been a year in the making. (It comes only months after the death at age 98 of the sandwich’s inventor, Pennsylvania franchisee Jim Delligatti, who had his stroke of genius in 1967.) The company test-marketed different sizes and flavors—“We’re still working on a sriracha version,” says Mike Haracz, the chef who spearheaded the overhaul—before sending cooking instructions to all 14,300 U.S. locations. “We tried to make it as easy as possible,” he says. “The Mac Jr. uses our quarter-pounder bun.” The Grand Mac requires a grander bun.

McDonald’s used to mail franchisees paper instructions for each new item to ensure uniformity—a Big Mac should taste the same in Maine as it does in New Mexico. But this time it partnered with San Francisco’s Inkling, which created a mobile training guide for line cooks with language options and instructional videos. The software, accessible on desktops and tablets, will provide McDonald’s with real-time data on which locations are using the materials, says Matt MacInnis, Inkling’s chief executive officer. “They’ll know which franchisees are making the burgers properly and which ones are just winging it.”

Still, it’s going to be difficult for McDonald’s to woo younger customers by changing something they haven’t been interested in trying. Millennials prefer seemingly healthier burgers, the kind made at chains such as In-N-Out and Shake Shack. McDonald’s is experimenting with fresh meat; last year it removed artificial preservatives and additives from breakfast items and chicken nuggets, but that’s not enough to ensure it’ll continue to have billions and billions to serve.

Luckily for the company, millennials are charmed by nostalgia plays. A recent McDonald’s ad campaign showed children from the 1970s sharing McNuggets with modern kids. If the company banks on throwback appeal when new Big Mac ads start airing in February—perhaps using the old jingle highlighting “two all-beef patties, special sauce, lettuce, cheese”—it could persuade a new generation to try the salty, calorie-laden, iconic fast-food favorite their parents eat.

Before it's here, it's on the Bloomberg Terminal.
LEARN MORE