McDonald's kicks up its drink options

The company is counting on frappes, smoothies and lattes to bring in $1 billion this year.

By Kim Peterson Jul 12, 2010 2:56PM

fast food © Bananastock/JupiterimagesPop quiz: What's expected to add $125,000 to the sales of each McDonald's restaurant in America this year?

The answer is beverages. And that's why McDonald's (MCD) has pounced on frappes, smoothies and other drinks as the economy struggles to improve.

McDonald's beverage line is also estimated to contribute $1 billion to the company's bottom line this year, Advertising Age reports. The company officially begins advertising the beverages this week.

Even before the ad push, McDonald's is seeing nice customer response, writes Emily Bryson York. Frappes helped boost same-store sales by 3.4% in May, the company said, and smoothies were also selling well.

 

 Post continues after video:

McDonald's has already spent considerable time and money on its McCafe line of drinks, hoping to make a run at Starbucks (SBUX). Now it's offering the new drinks in 14,000 U.S. stores, York writes. And it will begin an education for campaign for people who aren't too familiar with a frappe.

Women are the most likely target audience here, York writes.

"Another important aspect of the premium beverages is the ability to build business in off-peak times," York adds. "While the drinks are an easy upgrade from a coffee or soda, smoothies and frappes also fit the bill for a late-morning or midafternoon snack."

McDonald's is also tinkering with its milk shakes, York writes. They're being served in clear cups with whipped cream and a cherry. And the company is doing a small test of ice-blended strawberry lemonade.

More from MSN Top Stocks:

18Comments
Report
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
Categories
100 character limit
Are you sure you want to delete this comment?

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

STOCK SCOUTER

StockScouter rates stocks from 1 to 10, with 10 being the best, using a system of advanced mathematics to determine a stock's expected risk and return. Ratings are displayed on a bell curve, meaning there will be fewer ratings of 1 and 10 and far more of 4 through 7.

123
123 rated 1
266
266 rated 2
485
485 rated 3
660
660 rated 4
586
586 rated 5
652
652 rated 6
640
640 rated 7
504
504 rated 8
289
289 rated 9
159
159 rated 10
12345678910

Top Picks

SYMBOLNAMERATING
TAT&T Inc9
VZVERIZON COMMUNICATIONS8
CTLCENTURYLINK Inc8
EXCEXELON CORPORATION8
AAPLAPPLE Inc10
More

VIDEO ON MSN MONEY

ABOUT

Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.

Contributors include professional investors and journalists affiliated with MSN Money.

Follow us on Twitter @topstocksmsn.