A worker in protective gloves fulfills an order in the prototype of fast food giant McDonald’s for restaurants that adhere to a 6-foot removal measure.
Piroschka van de Wouw Reuters
McDonald’s sees that consumer behavior is reversing because it blocks simplicity, but the fast-food giant believes higher orders for delivery and other purchasing methods will be followed long after the coronavirus pandemic.
The company announced second-quarter results on Tuesday. Shares fell 2.1% during the morning trade after she said earnings fell 30% in the three months ended June 30.
McDonald’s executives said its average order was higher, but the total number of customers fell during the quarter. As the traffic level improves, the size of the order decreases.
“Part of that was related to the mix, so you saw deliveries become a much more pronounced part of the mix during the second quarter,” CEO Chris Kempczynski told analysts.
In Australia, shipping accounted for almost 10% of sales, doubling the down payment. Deliveries to the United States have not yet reached these heights, although they increased during the quarter.
“As for enduring behavior, I think whether it’s the use of kiosks, the use of mobile devices, the use of delivery, the use of drive-through, of course, one of the things is that customers are looking for a more contactless type of experience,” Kempczynski said. “They’re looking for a more digital experience, one they can enjoy on their own.”
In addition to more delivery and digital orders, consumers also used the tractor drive more than usual. In the United States, almost 90% of sales fell on its lanes. CFO Kevin Ozan said markets with a higher percentage of lanes are recovering faster.
But places near shopping malls, city centers or travel sites are under more pressure, as tourism, shopping and working with office buildings are not good for consumers. Weekend sales fell short of the pre-pandemic level, but business recovered faster on weekdays.
In the United States, breakfast remains the most difficult time of the day. Consumers prepare their early morning meals by choosing cereals and frozen waffles during a trip to McDonald’s Drive. However, executives said the chain’s market share increased during the quarter, which could mean that some new customers will continue to buy their McMuffins eggs even after they resume their previous procedures.
The economy also plays a role in consumer behavior, and McDonald’s seeks to use valuable deals and affordable prices to gain an edge over the competition.
“When you find yourself in a potentially more recessionary environment in a number of key markets, good availability and confidence that this is a key component of your marketing mix is very important,” Kempczynski said.
Kempczynski noted that the expiration of higher unemployment benefits is likely to negatively affect McDonald’s business. Senate Republicans have proposed reducing additional benefits from $ 600 a week to $ 200 a week. Kempczynski said he could not predict what impact the plan would have on sales.