Innovation to the rescue of McDonald’s Corporation (NYSE:MCD)

The most expensive burger in the world according to Guinness Books of Records which cost $205 now can be made by free restaurants. The profit so earned by selling the burger “The Burger Extravagant” will be donated to charity.

McDonald’s Corporation (NYSE:MCD) shares fell down as it is not putting efforts in innovation. Undoubtedly the company is famous for its family friendly food but now cannot attract US customers as they are not introducing any new items.

So in order to increase new customers McDonald’s Corporation (NYSE:MCD) struck a deal with Starbucks where as its rival Burger King Holdings, Inc. (NYSE: BKC) has been pulling customers based on family-friendly foods concept started by McDonald’s Corporation (NYSE:MCD) years ago.

McDonald’s Corporation (NYSE:MCD) is trying hard to get its position back by means of advertising to increase its sales. McDonald’s Corporation (NYSE:MCD) introduced a new menu item of snack wrap and gingerbread Sundaes for holidays.

McDonald’s Corporation (NYSE: MCD) share price declined by 14% in the current year, while it was at a peak of 13% last year. So now to boost up the sale they are engaged in advertising activity.

Customer Focus

McDonald’s Corporation (NYSE:MCD), in the field of service emphasizes more on customer satisfaction. It focuses on serving customers and offering them a good experience in the food industry.

McDonald’s Corporation (NYSE:MCD) wants to increase its dollar menu, but it will not work to boost its sales, as an increase in dollar menu will increase the price too.

Labour Cost

McDonald’s Corporation (NYSE:MCD) narrowed down its margin to 19.8% as compared to 21.1% last year. It projected a lesser margin by showing increased labour, production and occupancy cost.

Drink Explosion

For 2013 it has some new plans to introduce a limited time offer for a chicken Mc bite. It introduced some beverage plan for chocolate drink, chips, lemonade and Mc café smoothies in a less expensive way.

The craze for McDonald’s Corporation (NYSE:MCD) food got affected as it puts more efforts in the beverage sector. As the food sector cannot not be ignored, so it decided to innovate for salad’s burgers and fries.

Cinnamon Roll

The company’s market share increased when it puts efforts in introducing salads and snack wrap which is most appreciated by women and seniors. It started selling apple and cranberry salad, chicken and BLT wraps.

It introduced Cinnabon brand and started selling Cinnabon rolls along with promoting the sale of gingerbread flavoured sundaes and holiday milk shakes.

Test Items

McDonald’s Corporation (NYSE:MCD) had nine test items in its menu from early June till September, including the sale of chicken and Bacon Mc wraps and arctic orange shake.

So in short, it can be said that in a restaurant business. Companies need to seek innovation by applying some new type of cheese or by modifying the dishes a little to attract new customers and to maintain and enhance the sale, keeping the customer satisfaction on top.

The share price of McDonald’s Corporation (NYSE:MCD) was up by 0.64% to close at 87.04 USD

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Published by Viraj Shah

Viraj Shah has done M.Com (Finance) and currently pursuing CFP. He is a technical analyst who tracks US markets along with other global markets like India very closely. He is very passionate about stocks and believes that money can always be made in market.

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