McDonald's Salad Days Over?

Although CEO is down 20 pounds, salads not "major growth driver"

Published in CSP Daily News

By  Greg Lindenberg, Online Editor

Donald Thompson

NEW YORK -- Speaking at the Sanford Bernstein 2013 Strategic Decisions Conference in New York on May 29, Donald Thompson, president and chief executive officer of Oak Brook, Ill.-based McDonald's Corp., said that he eats at McDonald's "every single day" and has lost 20 pounds since last year.

How did he do it? No, it's not the food. The fast feeder will not be launching a "McDiet" promotion to tout the weight-loss potential of the Big Mac, and Thompson will not follow in the footsteps of Subway's Jared as the chain's pitchman.

"I got my butt up and started working out again," Thompson revealed.

He said the chain is about options. "All of us have to make personal choices, whether you're a parent, whether you're an individual, we want to make sure we provide you the options so you can come in and get whatever you want at McDonald's," he said. "So one day get that Big Mac. It's only 540 calories. Another day, you might want to get that grilled chicken salad with the balsamic vinaigrette. Don't go and get the ranch, get the balsamic. And another day you may just decide, 'You know what, I haven't had it in a while, but I think I want to try that new McWraps.' And so I think that balance is really important to people."

However, while Thompson is still "bullish on salads," he doesn't see them as being a major growth driver in the near future," he said.

"From the time we implemented salads to today, salads have probably ranged about 2% to 3% of sales. It went as high as 3%, and we have some really great salads. ... So salad in and of itself won't be the innovative arm of growth for McDonald's. The growth categories are beef--and that's premium beef. [And] chicken is the major protein growth category right now. Breakfast is still a growing category and a driving category and then beverage is a huge category and opportunity of growth," said Thompson.

He added, "We will innovate around salads and continue to bring our freshness. There was a time when we would always have one of our seven national windows of marketing [dedicated] to salad. So we were dedicating one sixth of our national marketing windows to something that was yielding about 2% to 3% of sales. I'm still bullish on salads, but not bullish to the extent that I wouldn't take that window and put the Quarter Pounder line or chicken sandwiches or wings or something else in that window. And so I think at this point we'll continue to market, continue to innovate around it, continue to bring a lot more of vegetables and fruits to the marketplace as you see in the McWraps. ... But we've got to figure out there's other ways of being able to bring that produce to market [besides] salads."

McDonald's has about 14,000 U.S. restaurants.