Blog

Business intelligence spurs 'future lab' innovation at McDonald's Corner Café

The latest data trends continue to show a consistent and predictable migration to, "better for you" healthier meal options. These trends are on McDonald's radar and their approach was to both upscale the menu and design a great café as opposed to an evolved McCafé.

Photo courtesy of LandiniAssociates.com. Photographer: Sharrin Rees

December 16, 2015 by Lon Southerland — Executive Vice President, GuestMetrics, LLC.

Customers just won't wait for the restaurants they buy from to understand their needs, and competitors won't wait either. Valuable insights about real time and potential purchasing shifts are all contained within the "big data" coming out of transactional systems, social media and more. As technology rapidly improves, better business intelligence and integration helps speed the pulling together of customers data to yield actionable results. The latest data trends continue to show a consistent and predictable migration to, "better for you" healthier meal options. These trends are on McDonald's radar, and their approach was to both upscale the menu and design a great café as opposed to an evolved McCafé.

Strategic innovation

Insights, innovation and transformation are areas I've focused on and enjoy about our industry. These competencies are truly a requirement for restaurants when it comes to the process of staying relevant with today's consumer and breathing new life into a brand. McDonald's one-off soft launch concept called "The Corner Café" is one I've been eyeing since it opened in Sydney, Australia, in late 2014. Over the ensuing months, it has been a successful proving ground for menu items with arguably a more healthy focus.

Why is this important? This is where a growing customer base is telling us we need to be. A recent Technomic report stated that, "many restaurant-goers say they are more likely to visit an eatery that offers some healthy options, even if they don't end up ordering that healthy choice. Almost two-fifths (38 percent) of consumers said as much, a figure that is up from 33 percent two years prior."[1] I'll cover this in more detail in a future post. For now, if you are interested in further perspective, some of this is covered in my recent chat with Rebecca Patt.

What is on the Corner Café menu?

The Corner Café's up-market leap in innovation is primarily on the food side of the equation with a focus on balancing value with higher quality ingredients. The menu was recently updated in late October and is continually changing.

The beverage menu expands beyond the familiar U.S. version to include barista-crafted coffee and tea beverages and craft sodas with fresh flavors such as Cucumber and Mint ($3.65 range U.S.).

Breakfast options include Cheesy Scrambled Eggs in several formats — Toast with Bacon, Spinach and Tomato ($7.30 U.S.) or on a Crispy Bacon Roll for slightly less. The new Brioche Cinnamon Toast (pictured, right — $3.65 U.S.) pops up on online reviews as popular and well received.

Photo courtesy of facebook.com/thecornerbymccaf

Open toast sandwiches make the transition from the morning (Avocado, Tomato and Ricotta) to midday dayparts (Basil Chicken with Bruschetta, Tomato and Parmesan).

Panini pressed sandwiches, dubbed "Toasties," are a mainstay on the menu where the four morning offerings change at 11 a.m. to four offerings appropriate to midday. Sandwiches also come in portable Flatbread and Pressed Wrap formats. There are a number of rice and salad bowls available including the Moroccan Chicken Salad & Rice Bowl with Bruschetta Tomato, Charred Pumpkin, Croutons, Pepita Seeds and Curry (pictured, below).

Photo courtesy of facebook.com/thecornerbymccafe

The dessert menu continues the upscale theme featuring items such as Double Chocolate Cake and a Macadamia Chocolate Brownie where ice cream and caramel add-ons are available.

This test bed likely informed decisions across the globe such as placing kale bowls on the menu at nine McDonald's locations in Southern California this summer. Kale certainly has a healthy halo and lends well to a multitude of formats and the perception of healthy choice.

The fast casual like concept also features an open kitchen, bringing food forward and adding a layer of transparency to preparation where it is cooked and served in view of the customers. Grab-and-go fresh food is available via a customer accessible refrigerated display (Pret A Manger style) and baked goods are nicely displayed behind a sneeze guard on the front line (like Panera). Interiors are classic versus trendy and will likely stand up better to the test of time. The uniforms we have come to expect at a QSR are replaced with servers wearing hemp aprons. Orders are delivered to customers using "for-here-ware" rather than disposables, adding to the enhanced experience.

McDonald's worries, as many do, that challenging competition and the evident migration of customers to fast casual venues will continue to outpace the QSR segment. Bolder moves toward healthier dining options are a growing method to reverse the expectation (right or wrong) of finding less healthy choices at a QSR.

McDonald's is not the only brand working to leverage business intelligence to better understand insights while transforming and innovating — many are. Starbucks Coffee announced they will accelerate pursuing their "Starbucks evenings" beer, wine and food program, and have applied for hundreds of liquor licenses across the U.S. Quiznos is pursuing rebranding with two test lab concepts; "toastaria," the evolution of their core brand, and the "grill," a fast casual approach. Taco Bell began testing alcohol in September as discussed in a previous post. I'd like to see a Corner Café open in the U.S., as it is closer to the consumer pulse in McDonalds' largest market.

The way America eats is changing, and certainly much can be learned from the data and the timing seems right. What are your thoughts? Do you see these trends in your business?