McDonald's Unveils New Global Growth Strategy 'McDonald's > NEXT'

McDonald's on Monday unveiled its latest global growth strategy to help the fast-food giant become customers' first choice as it faces new rivals and consumer spending stretched by high gas prices.

A new restaurant design, better tasting food and drinks, consumer-led innovation and improved customer service are the four cornerstones of the new plan, which the company calls "McDonald's > NEXT."

Executives made the announcement at McDonald's biennial Worldwide Convention for franchisees, held this year in Las Vegas. The chain released its last global strategy, known as "Accelerating the Arches," in November 2020 as its sales bounced back from the pandemic.

The growth plan comes as restaurants compete for a smaller pool of customers, and a new crop of chains, like Raising Cane's and 7 Brew Drive Thru Coffee, threaten McDonald's sales. So far, McDonald's, the largest U.S. restaurant chain by revenue, has managed to hold onto its dominant spot, with four straight quarters of same-store sales growth.

"Traditional competitors are upgrading their menus, and a new wave of specialists are emerging and redefining taste and quality across chicken, beef, and beverages," McDonald's CEO Chris Kempczinski wrote in a memo to the chain's global system.

"In a world where every restaurant is a swipe away, there is no such thing as second place," he added.

To become diners' first option, McDonald's plans to focus on menu innovation that elevates taste and quality, like improvements to its McCrispy chicken line. For years, the chain has sought to improve and expand its chicken offerings as rivals like Chick-fil-A stole its customers. Plus, Americans have been eating more chicken than beef for the last 16 years, due to health concerns tied to red meat consumption and higher beef prices, according to U.S. Department of Agriculture data.

"We're raising the bar for our menu by improving quality and consistency at scale and innovating in spaces where we see growth potential and know matter to our customers, like chicken, beef and beverages," said Jill McDonald, the chain's global chief restaurant experience officer.

The chain also wants to "co-create" with customers, by listening more closely to what consumers want and how they interact with brands. Recent examples include the popularity of its viral Grimace milkshake and its collaboration with "A Minecraft Movie."

The new restaurant design will give McDonald's a recognizable look, but it should also ease employee headaches and improve kitchen operations. The company said back-end systems will be more intuitive and connected, for example.

McDonald's is also testing automated order taking at five U.S. restaurants using a system it named ARCHY to let employees focus on other tasks. More broadly, the chain also said it wants to "redefine hospitality" by improving customer service and training employees to interact more with diners.

In September, the company will hold an investor day that will include more details about the strategy and relevant financial targets.