Syed Jafri eats breakfast at McDonald’s for one reason. “When I’m really hung over,” Jafri, a 19-year-old business student at Pace University in New York, said. “I get the Egg McMuffin or pancakes. And their hash browns are pretty good,” he said between bites of a fish filet sandwich during lunch with a friend at a McDonald’s in lower Manhattan Tuesday. Otherwise, “I would rather get a burger,” he said.
Citing popular demand, McDonald’s unrolled its all-day breakfast menu in branches across the U.S. Tuesday. The company has struggled in recent years to remedy declining sales and demand, and industry experts said deciding to serve breakfast all day instead of cutting it off at 10:30 a.m. is a smart move. But core problems continue to plague the Golden Arches, namely stiff competition, evolving consumer tastes and a seemingly immutable reputation for being unhealthy -- a series of hangovers that Egg McMuffins alone might not be able to cure.
“It’s a step forward, but it’s not a salvation by any means. McDonald’s still has a tremendous amount of work to do,” said John Gordon, founder of San Diego-based Pacific Management Consulting Group, which does research on the restaurant and hospitality sector. Although customers had long demanded all-day breakfast, McDonald’s was “very, very, slow in reacting to it,” he said.
Gordon and others predicted that the new all-day menu, which was launched with a blitz of advertising, will boost sales in the near future, but he said its long-term impact on profits remains to be seen, particularly because the plan itself has at least one major flaw. On the McDonald’s website, the full morning breakfast menu offers two dozen options that run the gamut from McMuffins and pancakes to hash browns and oatmeal. But toggle to the all-day breakfast menu, and the offerings shrink by half. No more cinnamon melts or bagel sandwiches. Plus, a caveat in the form of a miniscule asterisk that warns: "Menu items vary by location."
“To me, that’s misleading advertising,” said Larry Light, CEO of the consulting firm Arcature and global chief marketing officer for McDonald's from 2002 to 2005. “This promotion is not really McDonald’s all-day breakfast. It’s a very limited breakfast menu all day, which is very different."
In 2014, nearly one-third of the $27.44 billion in revenue McDonald’s took in worldwide came from the United States alone. But in this critical market, the number of Americans eating at the chain fell more last year percentagewise than it did globally, and sales also fell by 2.1 percent. In its 2014 annual report, the company blamed “an increasingly competitive marketplace and sluggish industry growth,” and vowed “a focus on continued growth at breakfast, which remains our strongest daypart” -- marketing-speak for a specific period of time.
The market for fast or fast-casual food is increasingly crowded, with Shake Shack, Chipotle, Starbucks and others constantly elbowing for customers. McDonald’s hasn’t been able to keep up with the competition, particularly as customers want and are willing to pay more for meals that are healthier, less processed and fresher -- or at least appear to be.
In one area, however, McDonald’s is still a leader. Its breakfast menu “is a source of strength,” said Hank Cardello, a former food industry executive and a fellow at the Hudson Institute, a Washington, D.C. think tank.
Now McDonald’s is trying to use that existing advantage as leverage, David Kincheloe, president of Colorado-based National Restaurant Consultants, said. “They’re already ahead of the crowd when it comes to breakfast,” he said, adding: “What they’re trying to do is solidify that position and provide an offering that they don’t currently have.”
Yet at the McDonald’s in downtown Manhattan Tuesday, several customers said they had not ordered from or even heard of the new all-day breakfast menu, even though it was displayed on surrounding TV screens. They appeared indifferent to the prospect of being able to buy a sausage, egg and cheese McGriddle at any time of the day.
Ricardo Santana, 23, who works as a deliveryman for the grocery company Fresh Direct, said he eats at McDonald’s every two weeks or so, usually ordering a McDouble or a McChicken with small fries and a Fruitopia soft drink. He said he would not come to McDonald’s any more frequently just to buy his preferred breakfast meal, the platter, during the day. “There’s nothing to be excited about,” he said before shrugging and adding: “McDonald’s is unhealthy.”
A Guilty McPleasure
Daphnie Denoi heads to McDonald’s when she is either in a hurry or on a budget. She occasionally buys oatmeal from McDonald’s, and now that it’s available all day, she might buy it in the afternoon, if she felt like it, she said -- or maybe not. “To be honest, I like oatmeal from other places better,” the 20-year-old fashion merchandising student at LIM College in New York, said. “In the back of my mind, I know that McDonald’s is not all that good, not all that homemade,” she said, sipping through a straw from her strawberry and banana smoothie.
— Fox News (@FoxNews) October 6, 2015
If McDonald's isn't healthy, however, that doesn't mean offerings at other fast-food or fast-casual restaurants are comparatively more nutritious, even if they come across that way.
An Egg McMuffin -- a slice of Canadian bacon and American cheese atop one egg, all sandwiched in an English muffin -- has 300 calories. It’s got 12 grams of fat and 730 milligrams of sodium, which is nearly a third of a person’s recommended daily intake of salt.
A Starbucks Egg and Cheddar Breakfast sandwich, by comparison, has 280 calories, with 13 grams of fat and 460 milligrams of sodium, or 19 percent of the recommended daily salt intake. Although it lacks the bacon, it too comes with an egg, cheddar cheese and an English muffin. It may have 20 fewer calories and less salt, but it also has more fat, even without the meat.
“They get a worse rap than they deserve,” Cardello said of the calorie-laden menus at McDonald’s.
Still, an expanded breakfast menu, featuring sausage links, eggs, cheese and pancakes dripping with syrup, is unlikely to help the company’s case, especially when plenty of McDonald’s customers seem ambivalent about or entirely unaware of the new offerings.
“There are times when you really want breakfast when it’s not breakfast time,” Jafri said. “Those times are rare, though.”