Spice up Sliders with Non-Burger Options

May 10, 2016

SS-CrabCakeSlidersSmall

by: Marzetti Foodservice
http://blog.marzettifoodservice.com/spice-up-sliders-with-non-burger-options/

Customers continue to crave sliders, those mini sensations that pair well with warm weather and cold beverages. The opening of seating on patios and sidewalks always signals an uptick in orders for these shareable snacks. Sliders are the ultimate treat for customers who want “just a bite” of something at happy hour or snack time. They’re a popular option for grazing-prone millennials, who often choose “snack like” items over larger entrées. Operators love the versatility of sliders, since they represent a single menu item that can be used as a hors d’oeuvre, appetizer or entrée.

The Slider Evolution

“Sliders are part of the increased trend for personalization, customization and miniaturization that we see throughout the industry,” says Darren Tristano, president of Technomic, a food industry research and consultancy. “Sliders are going through their own evolution now, and chefs are moving beyond the basic burger, using the soft bun as a carrier for different proteins like pulled pork, chicken or salmon.”

Tristano says the highly customizable format allows operators to demonstrate their culinary credibility. “Because consumers are ordering a smaller portion, they’re usually willing to be more adventurous, or to order a combo plate of a few different types of sliders, one of which can be a more creative stretch for the kitchen.”

Sliders on the Menu

There are endless options for what goes inside a signature slider. Beef ‘O’ Brady’s Family Sports Pub serves Southern Fried Chicken Sliders with smoked Gouda cheese and honey mustard aioli. Del Frisco’s Grille’s Asian Street Bao Sliders include barbecue pork, pickled daikon and carrot, cucumber, cilantro and chiles. And Bar Louie offers Blackened Salmon Sliders with bacon, spinach, tomato and pesto mayonnaise.


McDonald’s All-Day Breakfast Sparks a Fast Food Fight

May 9, 2016

by Leslie Patton

http://www.bloomberg.com/news/articles/2016-05-03/mcdonald-s-breakfast-push-sets-off-morning-scramble-in-fast-food

Fast-food joints aren’t hitting the snooze button anymore.

McDonald’s Corp.’s decision to start selling Egg McMuffins all day long last year — meant to help sales during lunch and dinner time — has boosted its morning business as well. That, in turn, has kicked off a scramble among its rivals to find new ways to combine eggs, potatoes and meat for a tasty breakfast.

The latest example is Burger King’s Egg-Normous breakfast burrito, which is being introduced in the U.S. on Tuesday. It’s stuffed with sausage, bacon, eggs, hash browns, cheddar and American cheese and served with picante sauce. The home of the Whopper, which still serves breakfast only during morning hours, also recently added a supreme breakfast hoagie and got rid of slower-selling English muffin sandwiches.

“We’ve invested more in breakfast,” Alex Macedo, head of Burger King North America, said in an interview. “The environment is very competitive.”

Along with adding and deleting items, Burger King tweaked its smaller egg burrito earlier this year, removing green and red peppers and replacing them with hash browns.

Skillet Bowls

Taco Bell revised its morning offerings in March to include $1 options such as skillet bowls and sausage flatbread quesadillas. Subway Restaurants just announced buy-one-get-one subs for the month of May. The catch: They have to be purchased before 9 a.m. And Dunkin’ Donuts revamped its menu boards to focus on all-day choices and started advertising $1.99 Coolatta drinks that are sold at all hours.

The changes come as more U.S. consumers grab eggs and coffee outside the home, according to a study by researcher GfK MRI published by EMarketer.com. Last year, more than 34 percent of Americans reported buying breakfast at fast-food restaurants, an increase from 32.8 percent in 2011. Meanwhile, fewer consumers said they’re dining out for lunch and snacks. Dinner increased less than 1 percent.

McDonald’s all-day breakfast in the U.S. has helped turn around its worst sales slump in more than a decade by drawing more customers throughout the day, including the morning. The plan is surpassing its goals.

Exceeding Expectations

“It’s still exceeding our expectations,” Chief Executive Officer Steve Easterbrook said on a conference call in April. “Whilst we clearly added incremental visits and incremental spend across rest of day, our breakfast business has also prospered.”

Items like Egg McMuffins and hash browns fueled a 5.4 percent U.S. same-store sales increase at McDonald’s in the first quarter. That’s stronger than the most recent quarterly gains posted by Burger King, Dunkin’ and Taco Bell.

“It’s helped drive success, which they haven’t seen for several years,” said Darren Tristano, president of industry researcher Technomic Inc.

After losing customers to McDonald’s all-day Egg McMuffins, Jack in the Box Inc. has been advertising a triple-cheese and hash-brown breakfast burrito. Same-store sales at company-owned Jack in the Box locations may be down as much as 3 percent in the recently ended quarter, the company said in Februar-1x-1y. The chain also is adjusting and improving other breakfast items, CEO Lenny Comma said during a conference in March.

Dunkin’ Donuts said last month that its new menu boards are helping drive breakfast-sandwich sales. It’s also focused on introducing mobile ordering and will start a 1,650-store test in metro New York in May to get customers their morning meals even faster. CEO Nigel Travis says McDonald’s push has actually helped Dunkin’ in the breakfast battle by highlighting that the doughnut chain has the same menu all day. Still, the change has increased competition for diners’ dollars.

“Clearly, the value war is pretty intense,” Travis said in an interview.


10 Nuggets For $1.49? Here’s Why Fast Food Is Ridiculously Cheap Right Now

April 1, 2016

Venessa Wong
Buzzfeed News
Feb 29, 2016
http://www.buzzfeed.com/venessawong/why-fast-food-is-ridiculously-cheap-right-now#.gnYqPoN15

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The country’s largest fast food chains have been showering customers with deals after years of losing out to newer, higher-end chains. And now, in a battle for customers who remain loyal to old-school fast food, the big chains are engaged in a brutal price war.
Fast food companies have always targeted lower-income consumers. What’s different now is that these customers are expected to benefit from lower gas prices, falling unemployment, and rising minimum wages, according to research by investment bank Cowen and Company. And as low-income consumers find more money in their wallets, commodity prices are no longer shooting upward as they did in recent years.
As “forecasts for key restaurant commodities including beef, chicken, pork, dairy and wheat are in-line to below long term averages,” restaurants are particularly eager now to take advantage of the lower costs to boost traffic to stores, said Cowen’s report.
McDonald’s announced that starting Feb. 29, customers could pick two of four “iconic menu items” — a Big Mac, a 10-piece order of Chicken McNuggets, Filet-O-Fish or a Quarter Pounder with Cheese — for $5. This deal replaces the even lower-priced McPick 2 deal launched in January, in which customers could get two items — McChicken, McDouble, mozzarella sticks, or small french fries — for $2.
Meanwhile, Wendy’s has been offering a four for $4 deal. Value monger Burger King has an even cheaper five for $4 promotion, as well as an ongoing two for $5 sandwich deal, and 10 chicken nuggets for $1.49. Even Pizza Hut has a $5 “flavor menu.”
“All the major chains have jumped on the dollar pricing in an effort to maintain share against competitors,” said Darren Tristano, president at restaurant consultancy Technomic.


The remarkable rise of the sushi burrito

March 7, 2016

By Becky Krystal
The Washington Post
March 4th, 2016
https://www.washingtonpost.com/news/going-out-guide/wp/2016/03/04/the-remarkable-rise-of-the-sushi-burrito/

Korrito

Has your sushi been a bit different lately? Maybe longer, pudgier and rolled up with rice, protein and vegetables? You know, kind of like a burrito?

Actually, let’s call a spade a spade. Your sushi isn’t just like a burrito. At an increasing number of eateries, it is, in fact, a burrito. The sushi burrito has officially joined the ranks of such culinary chimeras as the Cronut and the ramen burger, seducing both eager customers and the restaurateurs who want to feed them.

Even as diners eat fewer Chipotle burritos, sushi burritos are gaining traction around the country and in the Washington area. The latest purveyor joined the D.C. scene last week: Seoulspice in NoMa, which sells what it calls the Korrito, a Korean-style burrito wrapped in seaweed and filled with sushi-grade rice, plus a variety of meats, vegetables and sauces.

Eric Shin, a percussionist for the National Symphony Orchestra, said he hit upon the burrito concept almost by accident about two years ago. He’d originally planned to offer kimbap, Korean rolls sliced into bite-sized pieces. Unfortunately — or perhaps fortunately — the machine he bought to cut them destroyed the food. “It was a huge mess,” he said. Amid the disappointment, Shin’s wife was so hungry she just picked up an uncut roll and started eating it like a burrito.

“It just sort of stuck,” Shin said.

Darren Tristano would tell you that the popularity of the sushi burrito is no accident. The president of Technomic, a Chicago-based firm that specializes in food industry analysis, said a number of factors are at play. Primary among them is the form itself. Four years ago, a Technomic concept study predicted “burrito-inspired” would be a common industry trend. Good call.

Sushi burritos have also been propelled by the growth in fast-casual dining and its build-your-own mentality, Tristano said. And with sushi available at almost every grocery store these days, it’s become an accessible and familiar food.

Like so many food innovations, sushi burritos gained traction on the West Coast and are continuing their march across the country. Sushirrito, a five-location California chain that bills itself as “the original sushi burrito concept” debuted in San Francisco in 2011, the same year the Jogasaki food truck hit the streets of Los Angeles; the Kome truck peddles sushi burritos in San Francisco.

“The concept for Sushirrito came to be since we love sushi and wanted it to be more accessible and portable. Burrito-sizing sushi makes a lot of sense given the handheld aspect of it,” said Sushirrito founder Peter Yen. “We weren’t trying to start a trend. We simply wanted to create a new type of food that we like to eat. Hybrid foods only make sense when the foods belong together — just because you can do a mash-up, doesn’t mean you should.”

Even given the wave of sushi burritos in California, lifelong friends and first-time restaurateurs Mike Haddad and Travis Elton weren’t quite sure what to expect when they debuted Buredo in downtown D.C. last summer.

[There’s no way we couldn’t try Buredo’s burrito-size sushi rolls]

“We didn’t know how it would be perceived,” Haddad said. When the doors opened and curious diners snaked down the block, “I said, ‘I think we have something here.'” Something big enough that the duo is close to opening a second location, near Dupont Circle.

Haddad and Elton think they’ve hit on customers’ interest in food that is fresh and healthful.

Darren Norris knows he’s tapped into that market at his almost year-old Maki Shop on 14th Street NW, where evenings will see diners trickling in from CrossFit and other nearby gyms. The owner of the late Kushi in Mount Vernon Triangle — whose six-ounce maki fall somewhere between the size of smaller sushi and sushi burritos — said his “sushi hand rolls” are “a lifestlye product” for on-the-go diners. “I want to be that thing that you could eat three days a week and not feel guilty about it,” Norris said.

Kaz Okochi, the proprietor of Kaz Sushi Bistro near Foggy Bottom, said he thinks size is what attracts people to sushi burritos — “too much rice,” he opined — and worries that diners who eat them will come to his restaurant and wonder why his food isn’t bigger. “They might get disappointed,” the Japanese native said. (Okochi’s own fast-casual, design-your-own sushi endeavor, Oh Fish!, lasted about two years downtown.)

Their size and torpedo shape notwithstanding, sushi burritos have forced us to reconsider what we think of as sushi, especially when it comes to fillings. At Buredo, nori is wrapped around everything from yellowfin tuna or salmon sashimi to tofu and pulled pork shoulder. Seoulspice’s Korean-accented items include bulgogi beef, pickled radish and, of course, kimchi. At Burrito San in Miami, you can have your sushi burrito by way of the Philippines (braised pork, banana ketchup) or India (spiced chicken, potatoes, curry). Denver’s Komotodo not only sells rolls such as the Bee’s Knees (fried chicken, asparagus, bacon, Monterey Jack cheese) and Fish n’ Chips (white fish, slaw, potato chips), but also gives you the $2 option to have your burrito deep-fried. Really, the question these days is not what can you put in a sushi burrito, but what can’t you?

Okochi, though, doesn’t take umbrage with the burrito entrepreneurs’ use of the word “sushi.”

“I’m not saying burrito sushi isn’t true sushi. Sushi is vinegared rice,” he said. Sticklers could even contest whether Okochi’s food is “true” sushi, since the chef said he’s developed his own style at his restaurant.

As long as sushi burritos don’t take over the entire sushi market, he’s fine living side-by-side with them, he said.

In fact, self-professed sushi lovers Haddad and Elton view themselves as “introducing sushi to a new audience,” Elton said.

“It is definitely opening up people’s minds,” Haddad said.

Seoulspice’s Shin said he’d like his Korritos to similarly encourage diners to seek out the kind of traditional Korean food he grew up eating.

Even with more people like Haddad, Elton and Shin getting in on the sushi burrito game, Technomic’s Tristano said there’s still room to grow in the genre. He said reasons why sushi burrito establishments are still less common than their popularity might indicate include food safety issues with sourcing and serving raw fish (although many burritos rely on cooked, fried or even vegetarian fillings) and the fact that the concept is hard to replicate.

“A good sushi burrito can be tricky and sometimes challenging to get the flavors to blend together well in a larger roll,” said Mauricio Fraga-Rosenfeld of Rolls by U in Arlington, which opened in the fall with sushi “ritos” such as the Frida (with roast beef and kimchi) and the Van Gogh (a more traditional pairing of tuna and avocado). “Also, price point may play a part in why others don’t want to risk it. It’s cheaper to do tacos or Mexican burritos. It takes creativity and great quality in product and recipe to get it right, as well as extremely fresh ingredients.”

“I think it’s really difficult to pull off,” Shin said. “Most of the restaurants that open up are afraid to do something different.” Shin said he had to battle through questions and skepticism from his own family (his parents ran a Korean restaurant in Atlanta), some of whose recipes he’s using at Seoulspice. “I caught a lot of s— from my grandma,” he laughed.

When other sushi burrito spots do inevitably open, Shin won’t be too worried. “The more, the merrier,” he said. “I’m so proud of D.C. for embracing ethnic foods and creative ethnic foods in general.”

The Buredo duo was slightly more measured.

“Time,” Haddad said, “will tell on who will last.”

Correction: A previous version of this story misidentified the geographical origins of Jogasaki and the Kome truck. This version has been updated.


Cage-free eggs could boost Bloomin’ Brands’ bottom line

February 29, 2016

Ashley Gurbal Kritzer
Tampa Bay Business Journal
Feb 23, 2016
http://www.bizjournals.com/tampabay/blog/morning-edition/2016/02/cagefree-eggs-could-boost-bloomin-brands-bottom.html

Don’t count the cage-free eggs before they’re hatched, but Bloomin’ Brands Inc.’s latest supplier decision could boost its bottom line.outback-ft-myers-evening-750xx1800-1013-0-104

Tampa-based Bloomin’ (NASDAQ: BLMN) said Monday that it will transition to 100 percent cage-free eggs in its restaurants by 2025. Bloomin’ is the parent company of Outback Steakhouse, Carrabba’s Italian Grill, Bonefish Grill and Fleming’s Prime Steakhouse and Wine Bar.

“Our guests expect us to source and purchase wholesome ingredients responsibly,” Juan Guerrero, chief global supply chain officer, said in a statement. “We are working with our suppliers to ensure we meet or exceed this deadline.”

Committing to cage-free eggs is a popular move in the restaurant industry. In September, McDonald’s Corp. (NYSE: MCD) said it would shift to cage-free eggs, as is Dunkin’ Donuts (NASDAQ: DNKN) and Taco Bell, which is owned by Yum! Brands Inc. (NYSE: YUM).

Bloomin’ operates close to 1,500 restaurants throughout 48 states, Puerto Rico, Guam and 22 countries.

The cage-free move, Bloomin’ said, “reaffirms the company’s commitment to the humane treatment and handling of animals” — and that’s important to consumers, according to Technomic Inc., a Chicago-based food industry research and consulting firm.

“Cage-free is particularly important right now,” Darren Tristano, Technomic president, wrote in a Feb. 2 blog post. “Forty seven percent of consumers said they are more likely to order dishes made from cage-free eggs or poultry during breakfast dine-out occasions.”

“The preference ties into health and wellness concerns from consumers,” Tristano said.

“Consumers are increasingly concerned about transparency — what’s in their food and where it came from,” he wrote, “and operators and suppliers are feeling the heat.”


McDonald’s reaps the benefit of all day breakfasts and table service

February 9, 2016

McDonald's signature rangeEven though we’re only into its second month, 2016 been rather a good year for Steve Easterbrook, McDonald’s chief executive. His football team, Watford, is enjoying its best season in years and much the same can be said for the US fast-food giant.

The company surprised analysts with its latest quarterly results last week, with sales up 5.7pc in the US – nearly twice as much as had been predicted. Global sales are up by 5pc.

It has taken a Briton – albeit one steeped in McDonald’s corporate culture – to revive the most American of institutions, which was in danger of being left behind by rather nimbler competitors in the fast food industry.

From introducing all-day breakfasts throughout the US to testing waiter service at some of its outlets, including in the UK, Easterbrook has overhauled how the company operates at a bewildering pace.

The chain was in something of a mess when Easterbrook took over as chief executive in March 2015. Last August, for the first time in more than 45 years, McDonald’s announced that it was closing more outlets than it was opening.

European sales had dropped by 1.4pc, between 2008-14. In the US, the decline was 3.3pc and in Asia, the Middle East and Africa, once considered a growth region, a rather frightening 9.9pc.

It was not just the dire figures which suggested that McDonald’s was in need of a cultural shift. The company was facing competition from not only its traditional rivals, such as Burger King and Wendy’s, but also from hipper new competitors entering the market, such as Honest, Byron, Five Guys and Shake Shack.

It was pretty clear that the golden arches had lost their sparkle. Within weeks of taking over the reins, Easterbrook appeared on CBS’s This Morning television progamme in the US to signal that the 60-year-old company was in for a radical overhaul.

“We really want to assert McDonald’s as a modern burger company. To do that you have to make meaningful changes in the business,” he said. “The pace of change outside McDonald’s has been a little quicker than the pace of change within. You act your way to success, you can’t talk your way to success.”

For once, this was not empty corporate-speak. All-day breakfasts were tested in San Diego in April, and within months were available at all the company’s 16,000 US restaurants. This has brought back customers who might have gone elsewhere and even tempted in newcomers.

Other changes have seen the introduction of a “McPick menu” where US customers can have two items for only $2, despite the wafer-thin profit margin the deal provides.

The range of burgers has also been increased to include Pico Guacamole and Buffalo Bacon, and diners are now being allowed to customise their burgers. McDonald’s has also launched its first loyalty programme for people who register their details, offering, for example, a free cup of coffee for every five bought at one of its restaurants.

Easterbrook has also done something to improve McDonald’s corporate image, announcing a 10pc pay rise for the 90,000 people who work in outlets directly owned by the company in the US. This has taken their hourly minimum wage to $9.90 an hour – increasing to more than $10 this year – considerably higher than the legal minimum of $7.95.

The one caveat, however, was that the pay rise was limited to those staff who work for the 10pc of restaurants which are owned by the company rather than franchisees. Even the white packaging is being ditched after more than a decade. Instead, food now comes in brown paper bags which, in theory, are seen as more environmentally friendly.

According to a company spokesman, the change is “consistent with our vision to be a modern and progressive burger company” –a phrase now something of a corporate mantra.

“One of the things Easterbrook has done is create a sense of urgency in the the McDonald’s business culture,” said Mark Kalinowski, a restaurant analyst at Nomura in New York. “When the company started trialling the all-day breakfast in San Diego county in April, it only took until October before it went nationwide.

“He doesn’t want to waste time, he operates on speed to market and saw it was clearly something customers wanted.

“For McDonald’s, that is rather quick. Although it can be innovative, the company is traditionally slow- moving. I think it’s a reflection on its sheer size.” Even though Easterbrook has spent much of his career with McDonald’s, having joined in 1993, he also spent time with the rather more upmarket Wagamama and Pizza Express chains. He returned to McDonald’s in 2013 as chief brand officer, having held previous roles including its head of Europe.

“Most of the presidents and chief executives at McDonald’s we have seen have been promoted from within. Having somebody with an outside perspective is exactly what the company needed” said Darren Tristano, president of Technomic, a Chicago-based company specialising in the food industry.

Tristano believes that Easterbrook’s strategy has been shrewd. “He has aggressively marketed the all-day breakfast, which has put McDonald’s back at the top of the mind of consumers.

“The price point appeals to lower and middle-income consumers who are looking for something which is less expensive than the dinner menu. This has helped McDonald’s get back some of the market share which it had been losing to rivals.”

McDonald’s has also been helped by the rehabilitation of the egg in the mind of the consumer, Tristano added.

“If you go back a few years, eggs were seen as high-cholesterol. Now they are seen as high-protein and eggs are a key part of breakfast.

“The sales growth on a year over year basis is over a few years of weak sales performance, so the numbers are good but we should expect to see sustainable growth and especially year over year, fourth quarter 2016 would signal McDonald’s is officially back.

“McDonald’s appears to be listening to their customers and staying more true to their brand under Easterbrook.”

The consensus appears to that Easterbrook has enabled McDonald’s to regain its mojo. “He has brought a sense of strategic clarity, said John Quelch, professor of marketing at Harvard Business School.

“There is a tendency when a company gets into trouble to sling products at the wall and see what sticks. All that does is adds complexity. If you reach a point when you can’t explain to an employee or a franchisee what the point of a product is, then how can you expect them to explain that to a customer?

“The bench strength of McDonald’s is enormously good. It is no surprise that they were able to find somebody like him to step up,” added Quelch.


How McDonald’s Easterbrook can maintain momentum

February 4, 2016
Joe Cahill
Crains
January 27, 2016
http://www.chicagobusiness.com/article/20160127/BLOGS10/160129896/how-mcdonalds-easterbrook-can-maintain-momentum

McDonalds-all-day-breakfast-win-for-CEO-Easterbook.jpgAll-day sales of Egg McMuffins did more than reverse a three-year slump at McDonald’s: It has inspired confidence in CEO Steve Easterbrook and buys time for the new chief to lock in the elements of a long-term growth strategy.

Last fall, Easterbrook answered the prayers of many customers who had yearned for years to buy breakfast after McDonald’s long-standing 10:30 a.m. cutoff. This week, McDonald’s credited all-day breakfast for the lion’s share of a 5.7 percent rise in fourth-quarter sales at U.S. locations open more than a year. The quarterly increase, outstripping even the expectations of McDonald’s executives, was the second in a row and a sign that McDonald’s is finally moving in the right direction under Easterbrook, who replaced Don Thompson in March.

A pair of quarterly sales gains doesn’t mean Easterbrook has put McDonald’s on track for long-term sustainable growth. But together with some other recent moves, it shows he understands the challenges facing McDonald’s and will move aggressively to meet them.

If Easterbrook still has a long way to go, all-day breakfast gives him a bit more time to get there. He’ll enjoy a grace period of three more quarters, as extended breakfast hours continue to generate sales increases over periods that predate the change. That cushion will disappear in the fourth quarter, when McDonald’s will lap a quarter with all-day breakfast for the first time. “That will be the telling moment,” says Darren Tristano, president of restaurant consulting firm Technomic in Chicago.

During the next three quarters, Easterbrook must build on the success of all-day breakfast, which is bringing in new customers and others who hadn’t visited McDonald’s in years. Now he needs to turn them into regulars. Strong store traffic is essential to the long-term health of any fast-food chain. Guest counts at McDonald’s declined again for the full year of 2015, but turned upward in the fourth quarter.

Customer traffic will keep rising if Easterbrook gives people more reasons to keep coming back after the novelty of afternoon Egg McMuffins wears off. That requires steady progress in three key areas:

Service. Service slowed as McDonald’s menu grew more complex in recent years. Drive-in speeds lagged those of key rivals. Easterbrook has begun to address the problem by expanding on a menu-decluttering effort launched by Thompson. “Simplifying the process is what people want nowadays, and they’re finally addressing that,” says analyst R.J. Hottovy of Morningstar in Chicago.

On McDonald’s earnings call with Wall Street analysts on Jan. 25, Easterbrook said customer feedback shows improvement in “food quality, order accuracy, speed and friendliness.” But all-day breakfast adds a new layer of complexity, potentially undermining service speed and accuracy.

Ruthless purging of slow-selling items will be essential to keep restaurants running smoothly. Restaurant efficiency also could benefit from new technologies that allow customers to order via kiosks and mobile devices. McDonald’s is testing these systems in the U.S. but hasn’t set a date for national rollout.

Value. McDonald’s is still searching for a successor to the Dollar Menu, the low-price offering that drove its last turnaround, in the mid-to-late 2000s. The company badly needs a compelling deal for budget-conscious customers who faded away during the last recession and its aftermath. Always a bulwark of McDonald’s business, lower-income families matter even more today as affluent consumers migrate to fast-casual chains like Panera. “Value-conscious” consumers now represent about 25 percent of McDonald’s customer base, Easterbrook told analysts on the earnings call.

Early this month, McDonald’s began a six-week test of “McPick2,”which offers two menu items for $2. Easterbrook said initial response has been favorable and acknowledged the need to settle on a permanent value proposition this year.

“Value still has to be at the core of their menu,” Tristano says, noting most of McDonald’s rivals offer a low-price combo. “It’s what a lot of their customers want, and if they can’t get it they’ll go elsewhere.”

Listening. McDonald’s boffo launch of all-day breakfast shows what happens when a company listens to customers. For years, McDonald’s rejected customer pleas to extend breakfast service beyond late morning, citing insurmountable operational hurdles. Easterbrook pulled it off in a matter of months, a clear sign his efforts to winnow bureaucracy and accelerate decision-making based on market feedback are bearing fruit. “That shows the company is much more nimble now than it was before,” Hottovy says.

A streamlined management structure established last summer has “sharpened our focus,” and “removed distractions to speed up decisions and increase our ability to move winning strategies quickly across markets,” Easterbrook told analysts.

Of course, faster product rollouts won’t help if customers don’t like them. McDonald’s has struggled for years to cook up menu innovations that click with consumers. Remember, the Egg McMuffin isn’t a breakthrough innovation but a proven winner that McDonald’s made more available.

Acknowledging that all-day breakfast demand will “settle down” from its initial euphoria, Easterbrook said McDonald’s has more initiatives in the pipeline for 2016. We’ll see if he can come up with a hit new product—the true test of whether McDonald’s has developed an ear for customers’ ever-changing preferences.

“As long as they’re listening to the customer and giving them what they want, instead of trying to force something on the customers, they can be successful,” Tristano says.


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