McDonalds (NYSE:MCD) reported a 4.3% increase in same store sales for July. Same store sales are considered the most important comparison statistic for multi unit restaurant chains and retailers. Here in the US, Same store sales rose 2.6%, which is being attributed to the new line of McCafé Espresso-based coffee drinks. McDonalds stock closed today at $56.02 a share, significantly off the 3 month high of $60.99 on June 3rd.
McDonalds is now switching advertising emphasis back towards value and meal combinations, although the “McCafé Monday” promotion that ran in July through August 3rd, giving away samples of specific coffee drinks on Mondays, turned out to be a good traffic driver, according to anecdotal evidence. The new launch now is 1/3 pound Angus Beef burgers, with a higher price point that McDonalds traditionally hits. The “Any size fountain drink for $1” has been a good component to the value message.
While restaurants overall are struggling in the economic climate, fast feeders, and McDonalds in particular, have acquitted themselves well. Americans love to go out to eat, and it seems that the casual dining houses are feeling the brunt of the crisis in consumer confidence. McDonald turning in a 2.6% same store sales increase in the US market, when the US GDP shrank 1% in the second quarter, shows that the Golden Arches continue to be a family destination and place for value conscious consumers to go.
No comments:
Post a Comment