Chicken. Is it the new hamburger?

McDonald’s announced it’s joining a flock of competitors from the other side of the road. In a bid to keep their newfound sales momentum alive, they’re greatly expanding their chicken-based menu items. To quote from the Chicago Sun-Times:

”The new sandwiches are larger than McDonald's McGrill or Crispy Chicken sandwiches. They consist of chicken on a honey wheat roll served with leaf lettuce and Swiss cheese. Three kinds will be available -- the Classic, the Ranch BLT and the Club -- and customers will be able to buy crispy or grilled versions of each. McDonald's, the world's largest restaurant chain, will unveil the products today in New York City and sell them nationally beginning on Aug. 2.”
"It's an upgrade," said Malcolm Knapp, a New York-based restaurant consultant. "It's going to appeal to the higher income demographic."

McDonald’s is on a health kick and they’re fueling it with salads and new chicken dishes. Why chicken? It seems to be attracting new customers because they perceive it as "healthier."
McDonald’s Chicken Selects helped turn around a sales slump.

But McDonald’s chicken sandwiches usually have about as many calories as a Big Mac. Their healthy image might be because they’re served on those honey wheat rolls, instead of the boring and bland white bread buns used with their burgers. An extra flavor boost comes from the addition of things like bacon and Swiss cheese, excellent sources of additional fat and cholesterol.
Chicken now represents over 30% of McDonald's sales. "It's almost hard to overstate how important (chicken) has been," said Wade Thoma, V.P. of Menu Management. "Most of our growth has been through innovations within chicken."

Because chicken is such a hot item at McDonald's, it’s driving Burger King and Wendy's, ersatz burger chains all, to fire their biggest marketing guns at each other creating a chicken war with chicken salads, sandwiches and the fowlest of other fare. Wendy’s is generally credited with starting the three down this path with the successful introduction of products like their spicy chicken sandwich several years ago.

With the three biggest burger barons slugging it out for market share, the National Chicken Council is delighted to report that quick service restaurants now serve 25% of all chicken consumed in the United States up from 17% in 1995.

Stepping up the fast food row warfare, McDonald's tosses its new sandwiches into the fray, Burger King battles back with BK Chicken Fries, their answer to McDonald's and Wendy's chicken strips, and a product that platoons nicely with their TenderCrisp chicken sandwiches and salads.

Wendy's had the field to itself for a long time with Homestyle chicken strips and Chicken Temptations sandwiches. Now they’re in a defensive mode, forced to fight back with new products which might include flavored chicken strips and deli-style sandwiches snatched form Arby’s play book. The chain will also promote a Monterey Ranch chicken sandwich next month as a limited time offer.

But wasn’t the big player in the poultry wars an outfit called KFC? Or more recently Kitchen Fresh Chicken? Let’s use their most current name: Kentucky Fried Chicken. And how about a tasty regional player called Chic-fil-A?

Kentucky Fried Chicken is no stranger to protecting its turf with price wars. They’re shooting back with chicken salads and a 99-cent sandwich which seems to be a big seller. Maybe they need to add a lean ground beef patty to their menu and sell it as a healthy alternative to fried chicken.

Those Chic-fil-A folks in Georgia are refusing to do battle with the burger barons. Instead, they seem to be trying to expand their weak breakfast business by taking on another big gun (Starbucks) by introducing new “Café Blends” coffee. The company describes the coffees online as “Three rich roasts all the way from Central and South America that do anything but blend in. They're the warm spot in any morning.”

Time for my mid-terms

At the beginning of the year, I joined a lot of other dime store fortune tellers and made a few predictions for 2005. Now, it’s time for mid-terms to see how well (or poorly) I’m doing. Please allow me to do one of those fist-pumping, bottom-of-the-ninth, walk-off home run trips around the bases when I’m right. In return, I’ll personally kick my own fanny when I’m wrong.

1. McPlastic – The fast fooders find credit cards so successful that they’ll begin offering their own affinity cards. A McDonald’s Visa card with Ronald McDonald’s picture anyone? Or a Wendy’s MasterCard featuring the dearly departed Dave?

My lead off pitch and it never crossed the plate. Yet. I’m still betting on the Oracles of Oak Brook to see the huge financial opportunity and take a big swing at this one.

2. Grain – Whole grain, that is. After a half decade of being Atkinized out of favor, artisanal breads make a comeback touting the health benefits of whole grains. Pass a slice of the nine-grain “made with cracked whole wheat, rye and corn meal, oats, rye flour, soy grits, barley flakes, millet and flaxseed” bread please.

Yes, ma’am and thank you! The baking business is back and whole grains are good for you again. It has to be true, the USDA’s new food “Pyramid” (see item #9) says so. Panera Bread and all the cereal makers in Battle Creek are jumping on this little marketing bonanza.

3. Soda – The diet variety will far surpass its high fructose cousins in total sales. A #3 super-sized with a Diet Coke will not trim the waist line, however, even if you use McPlastic. Is aspartame really better for you than corn syrup?

Let’s call this one a walk with no one on base. It’s neither a two bagger nor a strike out. I was looking for a major change in buying habits. Instead, I got a brush back pitch.

4. Juices - Fruit “drinks” that contain as little as 0% real juice will be “outted” as outrageous imposters, especially after the contents (odd ingredients like wood ester) are revealed. For those not in the juice or chewing gum business, wood ester is used as an emulsifier or stabilizer and it’s a close relative of pine tar.

I’m impressed. Fruit drinks that contain 0% fruit juices seem to be re-inventing themselves as healthy-for-you “flavored” waters. Finally, truth in labeling. We’re looking at marketing wizardry here although some might call it marketing flim-flammery. Good thing – they’re not defining themselves as fruit juices anymore. Bad thing – it’s still an excuse to sell water for $12 gallon.

5. Organics – Organics and “all natural” foods grab more and more shelf space as echo boomers, the newest generation of young adults who are replaying their grandparent’s hippy generation attitudes, want to return to the romance of an agrarian society no one ever knew. A new pure food and drug act, anyone?

Yahoo and hang on for the ride! That most recent famous Texan, the mad cow, is helping make organic meat a mainstream product. “All natural” is headed for the big leagues. Main stream supermarkets are scrambling to grab a piece of the action.

6. Cereality – It’s a back-to-the-fifties, comfort-food-for-breakfast concept that’s just finding its sea legs. Could it be the next Starbucks? Could Kellogg’s be any happier and why didn’t some bright light in Battle Creek come up with this idea in the first place?

I’m ready to bet the farm on this one. Somebody tell me where to send the mortgage to my house. I want to be a major investor! Even the management team trying to control this runaway horse is amazed at how wide spread its appeal is…students( of course), housewives, children, Wall Street bigwigs looking for breakfast as well as big bucks. It’s a grand slam.

7. Coffee – Speaking of Starbucks, after putting a coffee shop on every other street corner and in most of the Target stores in North America, they’ll finally hit the wall. Over-stored in most markets and facing stiffer competition from local mom and pops and regional chains like Gloria Jean’s Gourmet Coffee and Peet’s as well as a decline in overall consumption, they’ll put the brakes on U.S. expansion as their overseas stores start to take off.

I think I’m right, I think I’m right…time to bring in the relief pitcher but I can still win this game. Starbucks is working hard on overseas expansion, let’s see how it effects their North American domination plans.

8. Donuts – If the coffee craze hits the wall, can the donut craze that swept the country with the expansion of Krispy Kreme be far behind? No. KK with its accounting irregularities diverting management’s attention goes down hard. Dunkin’ Donuts weathered the KK marketing storm and survive quite nicely, thank you. Great cuppa joe there, too.

KK had its 15 minutes of fame and their corporate offices now resemble the Kuwaiti oil fields at the end of the first Gulf War. This time the feds are burning down the house. Donuts move back to the minors after a fast “cuppa coffee” in the bigs.

9. Food Pyramid – The USDA issues a new food pyramid which might not even be a pyramid this time. It satisfies no one in the food industry but everyone starts to introduce products that are at the top of whatever the new shape might be.

OK, it might still be a pyramid but it appears to have been hand-built by that infamous old committee of blind men who tried to figure out what an elephant was. Whole grains won. Everything else might have taken a step back. Nobody is sure, yet, so let’s wait until December for what will probably be a called third strike.

10. RFID – Driven by Wal-mart, Albertsons, Target and Britain's Tesco, all large marketers who want to pass some of their distribution costs back to the suppliers, RFID gets some traction and the food industry will rush to climb aboard a fast accelerating bandwagon.

RFID is still gaining traction. Wal-Mart demands it. Traceability requires it. The Department of Defense has already mandated it. It’s outta here and time for the seventh inning stretch.

11. Beverages – We’re a nation of hard-drinking caffeine lovers so what can possibly replace coffee, Red Bull and Mountain Dew? Teas and enhanced waters, that’s what. Had a cup of chai lately? This tea-based second cousin to a latte should hit it big this summer as a cold, refreshing, beat-the-heat drink. Pick up a cup at Starbucks, the tea store? Look for more “water, caffeine added” at your local supermarket, too.

Flavored waters,“ water, caffeine added,” Starbucks’ Chai – we are a nation of heavy drinkers. Here’s proof positive that we’ve finally overdone it and reached wretched excess. Cadillac has just introduced a new high tech option for serial slurpers: cup holders that can either heat or cool your “go cup” at the flip of a switch. Does anybody actually use their teeth anymore? Other than to chew those tapioca blobs at the bottom of bubble tea?

12. FAT – Hardee’s started it with their Monster Thickburger, a full day’s supply of almost everything that’s bad for you in one enormous sandwich: 2/3 pound of certified Angus beef, three slices of American cheese, a half dozen slices of bacon, mayonnaise, butter-flavored shortening on a sesame seed bun that crushes the fat-o-meter at 1418 wide bodied calories. The food industry rediscovers the joys of serving their biggest consumers (pun absolutely intended}, switches to stealth mode and quietly tip-toes after an extremely lucrative market.

Damn, I’m good! Hardee’s burger sales jump. Sister QSR Carl’s Jr. sells the same stuff and posts numbers that are off the scale. Burger King intros a breakfast sandwich that knocks it out of the park, calorie- and sales-wise. Paris Hilton caps it off with an already legendary commercial that ties up soft core porn, Bentleys and big burgers in the world’s sexiest car wash.

Hamburger patties and poker chips

At most restaurants, especially the quick service and mid-range variety, patties and poker chips are interchangeable. Drop into a White Castle for a sack of sliders and they’re even the same size: small, thin, and as hard as a brick, at least until they’re dropped on the grill for a few seconds.

Frozen patties and poker chips have a lot of advantages, too, for distribution and handling. They stack well. They have an almost unlimited shelf life. They’re damn near unbreakable. And a lot of people claim they taste the same. I’ve often wondered if most of these restaurants saw ground beef as a distant third cousin to the taste delivered by the sesame seed bun and the special sauce.

Why hasn’t a shrewd chain-level restaurant marketing wizard decided to break the mold – the one that spits out those pre-formed patties by the billion – and take a chance on fresh, NON-FROZEN patties? If the meat is really supposed to be the star of the show, shouldn’t it be truly special?

I mean McDonald’s never bragged about selling millions of salads. Red Robin doesn’t feature onion rings in their ad campaign. A quarter century ago, Wendy’s Clara Peller asked “Where’s the beef,” not “Where’s the Frosty.”

Sure, a few small restaurants and some of the top steak houses sell fresh ground beef but that’s been the end of the story until now. Good Times Restaurants, a 40 store chain based in Colorado announced the conversion from frozen beef patties to an all-natural fresh product supplied by Coleman Beef (they call themselves Coleman Purely Natural now).

It’s a change that makes Good Times slogan "Fresh Never Frozen" a little more truthful and a little less marketing hype. Deleting the boilerplate from his prefabbed press release statement, Eric Reinhard, Chairman and Chief Development Officer said "This adds to the line-up fresh ingredients that we use across our menu (such as) fresh-squeezed lemonade, fresh frozen custard made every two hours, lettuce, tomato, and Bermuda onion.”

Boyd Hoback, President and CEO added, "Coleman now supplies fresh beef patties for Good Times, controlling the quality assurance and safety from the ranch to our restaurants with rigorous protocols, certification, testing, (from) a state-of-the-art facility."

Good Times features burgers and chicken sandwiches on their menu. Maybe they should ask Coleman Purely Natural for a little help on the poultry front, too, and make their slogan completely truthful.

L.A. Times takes USDA to the woodshed

The Los Angeles Times took the USDA’s beef policy to the woodshed last week in a harshly worded editorial. Calling it a “Mad Beef Policy,” the writer led off with this scathing comment: “The more federal officials downplay mad cow disease, the scarier things get.”

The newspaper claims the system is deeply flawed and works only when safety-minded leaders reject complacency. It was a direct reference to the forced third test, ordered by the controversial Phyllis Fong, the USDA’s Inspector General, and a direct shot at top-level management at the Ag Department.

The Times adopted a position squarely in line with certain activist groups citing an alleged soft spot in the ban on feeding beef and beef products to cattle. Taking a page written by Dr. Linda Detwiler and promoted heavily by organizations like Consumers Union, the newspaper said, “Those (products) can, however, be put in the feed given to other animals, such as pigs and chickens, and it is easy for different types of feed to get mixed up or misused. In addition, the waste left after butchering chickens, including their leftover feed containing cattle meal, can be fed to cattle.”

Jumping hobnailed boots first on the issue of inconsistency of message, the Times also pointed out the USDA, in a letter written only a few months ago to Consumers Union, dismissed any need to use the Western blot test for confirmation of the disease. Only after Fong ordered it for the Texas cow did the USDA quickly shift positions and prescribe the blot test for confirmation.

To repair the credibility damage the newspaper called on the USDA to take several steps including quick implementation of former Agriculture Secretary Ann M. Veneman’s plan for a national animal identification system. Announced two years ago, it’s been trapped in a lengthy political debate while some large and impatient corporations, such as McDonald's, have already made it part of their purchasing requirements.

The Times also demanded the USDA:
• Ban the feeding of cattle meat, bone meal and other byproducts to any livestock.
• Prohibit the use of cattle blood as a "milk replacer" for calves.
• Allow beef producers who want to test all of their cattle to do so. The USDA has barred Kansas meatpacker Creekstone Farms from such testing, which would enable it to market its meat in Japan.
• Expand testing to include more healthy-seeming animals.