Do People Really Hate McDonald's?
A new survey from Consumer Reports indicates that people queried prefer food from Chipotle Mexican Grill Inc. (NYSE: CMG) and Panda Express over what is offered by McDonald’s Corp. (NYSE: MCD), Burger King Worldwide Inc. (NYSE: BKW) and Yum! Brands Inc.’s (NYSE: YUM) KFC. Sales numbers would show otherwise. And the race is not even close.
Chipotle, once part of McDonald’s, had revenue of $3.2 billion last year. McDonald’s revenue was $28.1 billion. The preference for Chipotle does not show up in the numbers.
Outside of China sales, KFC sales are first among Yum’s three brands, followed by Taco Bell and Pizza Hut.
For all the discussion about customer service and food preference, and the occasional wars on food with high calories, too much sugar and abundant fat, American consumers continue to flock to McDonald’s. The food may be bad for people’s health, as well as a contributor to heart disease and Type-2 diabetes. Additionally, McDonald’s food may taste bad. However, these things do not explain why McDonald’s has more than 14,000 stores in America.
Taste testing and customer preference results often yield odd results. People will claim they prefer import and craft brew beers to Budweiser. Although the sales of Bud and Bud Light have fallen, they remain the market leaders in America, along with Coors Light. Some huge group of beer drinkers has not turned to the products of local breweries.
Whether the consumer research measurement is Consumer Reports, the American Customer Satisfaction Index, J.D. Power or some other well-known yardsticks of consumer preference, disliked products and services often sell well. Another case in point is the poor ratings that Chrysler and some of its divisions receive in some J.D. Power research. Yet, Chrysler can claim it is the fastest-growing large car company in America. AT&T Inc.’s (NYSE: T) wireless division ranks poorly in the American Customer Satisfaction Index. However, it is well above Sprint Corp. (NYSE: S) and T-Mobile US Inc. (NYSE: TMUS) in subscribers.
Disliked companies may not like their ratings, but their managements are laughing all the way to the bank.