Thursday, May 31, 2007

McDonald's to expand Angus burger test

McDonald's to expand Angus burger test
By Nichola Groom

McDonald's Corp. plans to expand a test of premium Angus beef burgers this summer to some restaurants in the Northeastern United States, an executive said on Monday.

Karen King, who oversees McDonald's 5,200 restaurants from Key West, Florida to the Canadian border, said the company was "encouraged" by sales of the fancier Angus burgers in Southern California, where they have been test marketed since last year.

"We're going to be testing Angus burgers later this summer in one of the Northeast markets," King, McDonald's East Division president, said in an interview. "With all test products we want to get a sense of different geographies and demographics so we're going to take it around the block here in the East."

King declined to say which market would be getting the fancier burgers, and spokeswoman Danya Proud said a final decision had not yet been made.

The burgers are seen as a key way McDonald's is working to compete with rivals Burger King Holdings Inc. and Hardee's and Carl's Jr. parent CKE Restaurants Inc., both of which have been selling bigger, premium burgers for several years.

Expansion of the Angus burger test comes as McDonald's works to extend the success of a three-year-old turnaround that has revitalized sales at the world's largest restaurant chain. King, a 32-year McDonald's veteran, said new drinks like iced coffee and tea and new chicken and breakfast products would be key to sustaining the company's momentum.

King oversaw the introduction of iced coffee to McDonald's restaurants in New England and said she was optimistic about its addition to restaurants throughout the United States.

"It was a gap in our menu, and we've been tremendously surprised by the product," King said.

In addition to her regular job, King has also taken on a new responsibility -- convincing McDonald's restaurant employees and customers that a job at the restaurant chain offers opportunities for development and growth.

King, who started working at a McDonald's restaurant in Georgia in 1975, is appearing in a television commercial as part of a new campaign to emphasize career opportunities at the chain. It is the first time McDonald's has featured an executive in its advertising.

"We want to tell people externally that this is a great career no matter what your goals, and we're also talking to our current employees," King said.

The campaign is McDonald's latest effort to change the image of its restaurant jobs as low-paying and dead-end. In recent years, the company has improved pay and benefits for restaurant workers and has taken other measures to emphasize the opportunities a McDonald's job can offer.

As for King, who has overseen the East Division for two years, she said she is in no rush to move on to her next McDonald's job. Once that does happen, however, she said she might pursue an international opportunity as she has not yet had any experience outside the United States.

Her predecessor as head of the East Division is Tim Fenton, who now serves as president of McDonald's Asia-Pacific, Middle East and Africa business.

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