A new product may appear near you somewhere on the miles-long menu at McDonald’s. The massive fast-food chain has begun experimenting with selling Krispy Kreme doughnuts. (Click here for brands that customers are abandoning.)
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It is a frontal assault against Dunkin’, which sells doughnuts nationwide from its 9,468 stores. If the McDonald’s plan works, Dunkin’ has a problem. McDonald’s has 13,269 stores in America. It also has a much larger amount of foot and drive-through traffic.
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Few people know Dunkin’s revenue because it is privately held. McDonald’s has revenue of $32 billion, which must be much higher.
The McDonald’s playbook to devour competition has been in place for decades. It adds to its menu and captures customers who come to its stores. It has partially flanked Starbucks, and it has undermined breakfast sales at several other midsized fast-food locations, such as Burger King and Chick-fil-A.
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McDonald’s was a destination for people who wanted lunch or dinner. It found that this capped its revenue. It pushed into the breakfast business. It also opened most of its stores 24 hours a day. It may lose money at 3 a.m., but it offers every potential customer service. This, in turn, engenders a level of brand loyalty.
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CNBC summed up McDonald’s efforts: “McDonald’s saw its U.S. traffic increase in the second half of the year, bucking the industry trend thanks to its cheap deals. The burger chain has also been leaning into coffee — a common pairing with doughnuts —to encourage diners to visit more frequently.”
McDonald’s has carpet bombed the competition and will continue to do so.
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