On the Margin

McDonald's all-day breakfast is apparently working

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This post is part of the On the Margin blog.

All-day breakfast appears to be a winner for McDonald’s Corp. in the early going, at least according to one report.

According to the market research firm NPD Group, McDonald’s decision to sell Egg McMuffins or biscuit sandwiches after 10:30 a.m. has brought new or lapsed customers into the chain’s restaurants in the program’s first two months.

The firm’s study was based on an analysis of receipts from 27,000 customers who visited McDonald’s before and after the launch of all-day breakfast Oct. 6. The study found that the chain has enjoyed a “sizeable lift” in breakfast orders throughout the day.

NPD found that a third of the people who purchased breakfast items at lunch or dinner had not purchased from McDonald’s at all before the promotion.

Perhaps most importantly to the chain’s franchisees: Customers aren’t just limiting their orders to breakfast items. Nearly two thirds, 61 percent, of customers who bought breakfast items at lunch also bought some non-breakfast items. That helped increase average check size.

Customers were most likely to buy breakfast items at lunch.

“This preliminary review of McDonald’s all-day breakfast offer suggests consumers are receptive to ordering McDonald’s breakfast foods beyond traditional breakfast hours,” Bonnie Riggs, NPD’s restaurant industry analyst and author of the study, said in a statement. “It’s early, and there are other questions to answer as time goes on, but for now it’s working.”

The results don’t come as a surprise. McDonald’s backed the promotion with heavy advertising spending in its early weeks. And consumers have been pining for this for years.

Three-fourths of consumers in various surveys have said they want breakfast items served all day. McDonald’s, which dominates quick-service breakfast, would clearly fulfill that demand.

The big question is how long the increased traffic will continue without the benefit of advertising. But at least for now it appears that the early results are good for McDonald’s all-day breakfast.

Contact Jonathan Maze at jonathan.maze@penton.com
Follow him on Twitter at @jonathanmaze

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Jonathan Maze

Jonathan Maze covers finance for Nations Restaurant News, as well as restaurant chains based in the Midwest. Jonathan came to NRN in 2014 after seven years covering restaurants for Franchise Times...
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