How McDonald's is targeting the bakery crowd

Consumers have been receptive to the McDonald’s all-day breakfast menu.

As quick-service restaurants seek to reinvent their menu offerings to drive sales, the bakery business needs to pay close attention to the latest developments at heavy hitters like McDonald’s. A new study from The NPD Group examines the early stages of McDonald’s recent decision to offer all-day breakfast, providing useful details to the foodservice industry including bakeries.

Orders of McDonald’s breakfast foods throughout the day increased from 39 percent pre-launch to 47 percent post-launch, according to the NPD Checkout Tracking study, which analyzed a database containing receipts from more than 27,000 McDonald’s static buyers who visited before and after the McDonald’s all-day breakfast launch.

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

For bakeries, the takeaway insight here is that consumers appear willing to enjoy breakfast foods beyond breakfast. Think of savory pastries that can serve both as breakfast and lunch, and bakeries have a perfect menu item to entice customers to stop at their place instead of any national chain.

Another sign of new competition from McDonald’s is the recent unveiling of McCafé Bakery, the first extension of the McCafé brand into food, which is rolling out across McDonald's restaurants in Canada. McCafé Bakery features authentic French croissants, a mini Chocolatine and cream cheese Danishes made with real fruit.

On Dec. 9, McDonald’s unveiled the first-ever standalone McCafé experience in Canada at Union Station in Toronto, with a second to open at First Canadian Place early in 2016. Establishing McCafé as a standalone destination is part of the company's ongoing strategy to build on its reputation as a leading coffee brand and showcases the company's passion for elevating the café experience for its guests in ways that are both convenient and relevant. New products include freshly prepared sandwiches, like the classic grilled cheese on stoneground multi-grain bread and signature apple and brie croissant with honey.

"We're putting the café in McCafé and making the brand a destination in its own right," said John Betts, President and CEO of McDonald's Canada. "The new standalone McCafé locations allow us to build on our strong coffee credentials and create even stronger connections with our brand by offering our guests the more complete café menu they've been asking us for."

These developments provide crystal-clear evidence that McDonald’s is stepping up its game in efforts to lure customers away from premium retail shops like high-end bakeries. That’s why this trend is worth keeping an eye on.