McDonald’s Corporation (NYSE: MCD) is not known for being hip. It’s a rock-solid multinational with one of the most valuable brands in the world.
In many parts of the world, going to a McDonald’s is a family night out, a special occasion. That’s certainly a different way to see the Golden Arches than how most Americans view it — a quick bite to eat that is consistent from Portland, Maine to Portland, Oregon.
But, MCD has always been adaptable. For example, in the UK, the top-selling sandwich is actually a chicken tikka masala (an Indian version of grilled chicken). It has been very good at recognizing opportunity and acting on it.
In recent years, that might not have been the case, but things are turning around and leadership is going back to its roots.
Recently, MCD has hooked into the hottest new game app on mobile devices — Pokemon Go. Basically, players walk around and capture prizes or treasure from various locations. MCD is the first big company to get a Pokemon “gym” for each of its stores.
This is a very big deal. Pokemon Go already has more daily users than Netflix, Inc. (NASDAQ: NFLX), Twitter Inc (NASDAQ: TWTR) and Spotify. And, MCD is going to give Pokemon a home in its 3,000 stores in Japan.
There’s no doubt that this is certainly a massive global fad. But, by committing in Japan, where Pokemon was conceived and has a nearly universal following, MCD management can gain some significant market research that it can use in other markets.
This kind of agility in such a hulking company signals that MCD stock is moving in the right direction again. In some small sampling, traffic has increased in stores where the Pokemon dwell. Now, MCD has an opportunity to learn more about these consumers.
This is also a big experiment to see how well “sponsored location models” work, instead of what’s called an “in app purchase model.” As a sponsor location, McDonald’s stores will attract people with the hope that they buy something while they’re there, compared to in-app purchases, which can be clunky and detract from the user experience of the game.
Final Thoughts on MCD Stock
The bottom line is, this is a significant opportunity for MCD to learn how to best monetize mobile computing for its stores and franchises.
It will also help keep earnings on the path to recovery now that the “all-day” breakfast menu is getting a bit more established.
Underlying all this is the fact that MCD stock has a solid dividend, paying out around 3% at current prices. That makes it worth your time as the stock turns itself around.
Richard Band’s Profitable Investing advisory service helps retirement savers outperform the market without losing a minute of sleep along the way. His straightforward style and low-risk value approach has won seven Best Financial Advisory awards from the Newsletter and Electronic Publishers Foundation.
