Chicken Sandwich Boosts Sales
Domestic comps growth benefited from an increase in average check and strong menu offerings, including the launch of McDonald’s new crispy chicken sandwich lineup in February.
So far, the product is exceeding projections. The chain is selling “substantially” more chicken sandwiches compared to its previous chicken sandwich line, and seeing strong unit movement, particularly after 4 p.m. Erlinger explained that whenever McDonald’s unveils a product, there’s a launch period and then a decay curve. Two months in, the decay curve for the sandwiches is dramatically different than what the chain saw in past years.
“I feel very confident about this chicken sandwich," Erlinger said. "I absolutely acknowledge that we’ve had many ins and outs of chicken sandwiches over the years, but I think we did our research. We really grounded ourselves in the consumer on this one in a very significant way. I also think we’ve done a good job of tapping more significantly into trends with our spicy offering as part of the chicken line. And I think our increasing focus on multi-cultural youth is also contributing to our success.”
Adding to Erlinger’s view, Kempczinski said McDonald’s uses the chicken platform with a holistic approach and won’t hang its hat on just one item. For example, the release of Spicy McNuggets ran in front of the chicken sandwich. The CEO said this means “using everything in our arsenal to drive chicken”— something the brand didn’t do as well on previous occasions.
Another major difference is alignment with franchisees and the sustained support that comes with it.
“This is not one of those ‘put a bunch of media weight against it in the quarter and then move on to the next thing," Kempczinski said. "I think there’s broad understanding and alignment that this has to be supported over a longer period of time. So certainly from my vantage point, those are two things that give me confidence about what we’re seeing in the U.S.”
McDonald’s U.S. witnessed double-digit same-store sales increases across all of its dayparts, including a morning segment that’s been surging since Q3.
Erlinger said part of the growth is due to McDonald’s historical strength with drive-thru speeds, and the other part comes from menu innovation. The chain pulled All-Day Breakfast in 2020 to improve execution, but it later bolstered the platform with a new McCafé Bakery lineup in October, which included an Apple Fritter, Blueberry Muffin, and Cinnamon Roll.
“We’re acutely focused on this daypart,” Erlinger said. “We believe that certainly as some consumer habits return to pre-pandemic ways of life, that the breakfast daypart will continue to come back and similar in the way that it was a real market share battle pre-pandemic. We think that market share battle will absolutely continue, and we’re ready and prepared for that.”