McDonald’s channel debuts
Steve Chiotakis: We’ll get earnings today from McDonald’s, and the fast food giant will tell investors just how much it spent on new products. But one of those items isn’t food-related — the company plans to install TVs in almost 700 restaurants, featuring “The McDonald’s Channel.” What kind of programming will you see?
Marketplace’s David Gura reports.
David Gura: It’s lunchtime at McDonald’s. It’s busy and noisy — and it could get noisier.
McDonald’s partnered with ABC, BBC America and Mark Burnett — the creator of “Survivor” — to start a new network. The catch is, it’s only watchable at McDonald’s. It’s debuting at hundreds of restaurants in California, but if The McDonald’s Channel catches on, then customers around the world might see it.
Darren Tristano: The communication will make their customers feel better about why they’re at McDonald’s and ultimately keep them there longer.
That’s Darren Tristano, a restaurant analyst with Technomic. He says that if McDonald’s can entice a customer to stick around — watching music videos and local sports highlights — it might sell more McFlurries and Baked Apple Pies.
But there’s another reason McDonald’s is doing this. Vince Vittore is with the Yankee Group.
Vince Vittore: There is advertising opportunity.
Other companies can pay McDonald’s to show their commercials to a big, captive audience.
Vittore: There is definitely an opportunity to leverage the millions of visits that consumers make to McDonald’s restaurants.
Supermarkets have done this kind of thing for folks in the check-out line, but this is new territory for a restaurant. Starbucks may have been the inspiration. The coffee chain got into the music business a few years ago, and now, analyst Darren Tristano says, it’s a big source of revenue for the company.
In Washington, I’m David Gura for Marketplace.
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