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Coke_McD-Asks_Brochure_2.20.indd 1-2 2/20/17 11:40 PM
Modernizing the Beverage Experience .............3-4
Refreshing the Fountain ......................................5-6
Innovating Sprite..................................................7-8
Elevating McDelivery .........................................9-10
Evolving McCafé OJ ........................................11-12
Introducing Honest Kids ..................................13-14
Appendix ..........................................................16-30
Coke_McD-Asks_Brochure_2.20.indd 3-4 2/20/17 11:40 PM
BEVERAGE EXPERIENCE
modernizing the
MCDONALD’S ASKS | 43
PROMOTIONSSPECIALTY BEVERAGE
DIGITAL ADVERTISING
ASK Freesyle Investment
• By the end of 2017 Coca-Cola/Cornelius to invest in the installation of new Freestyle dispensers in Florida Region (900 stores) with 100% funding to prove business case
• Coca-Cola to develop a 12 month activation/innovation plan in Florida
ANSWERYes, we can deliver and fund an integrated solution with Cornelius that incorporates the best components to drive beverage sales, consumer experience and operational efficiency.
• Committed to market ready equipment by April 2018 and a full in market Florida solution by September 2018.
BUILDReached agreement with Cornelius and would like lead McDonald’s Equipment engineer to drive process collaboratively. Continue to move forward with the McDonald’s Fountain 2020 which would include the following:
• Integration for Bulk Coke and Diet Coke flavor profile
• Integration with Multiplex to facilitate McDonald’s beverage volume requirements
• Consumer interface, connectivity, and microdosing are Coca-Cola led
Should develop 2019 EOTF requirements to integrate beverage solution.
Coke_McD-Asks_Brochure_2.20.indd 5-6 2/20/17 11:40 PM
MCDONALD’S ASKS | 65
REFRESHING
the fountain
ASKFountain Valve Refresh
By April 2017, add Fanta and DASANI Sparkling to all McDonald’s fountain valves in the US
LAUNCH PROMOHALLOWEEN PROMOTION
MERCHANDISING HALLOWEEN
ANSWERCan do all without Dasani Sparkling by September 2017. Cannot receive materials for Dasani Sparkling for 10 months.
• Will have following lineup – Coke, Diet Coke, Sprite, Dr. Pepper, Sprite Mix, Fanta, Regional Flavor, Healthy Halo Still.
• Dasani Sparkling – not an option on current equipment – based on pungency of lines.
• Dasani Sparkling can be delivered via slim line can.
BUILDHave “national style” activation for Sprite Mix and Fanta. Will increase national marketing dollars with converted valves. Must “rightsize” Diet Dr. Pepper to regional preference area and include no locally funded conversions as part of agreement. Must agree to changes as revisions to the Letter of Agreement.
Coke_McD-Asks_Brochure_2.20.indd 7-8 2/20/17 11:40 PM
MCDONALD’S ASKS | 87
INNOVATING
SpriteASK
Sprite Innovation
• Beginning in 2018, Coca-Cola to launch 1 (consumer validated) proprietary fountain Sprite Flavor each year across all restaurants
• Coca-Cola to provide exclusivity for 12 months to McDonalds
LAUNCH PROMO MERCHANDISING UBEREATS EVENT
ANSWERYes, we are committed to a proprietary and exclusive Sprite sub brand (current working concept Sprite Mix) to drive interest and innovation for Fountain. Can deliver by September 2017, possibly earlier, depending upon approvals.
BUILDCan accelerate Sprite Innovation to be pushed up to earlier in Q3. All Valve changes will be completed at once.
Required national merchandising commitment
Coke_McD-Asks_Brochure_2.20.indd 9-10 2/20/17 11:40 PM
MCDONALD’S ASKS | 109
ELEVATING
McDeliveryASK
Delivery Launch Plan
• Delivery will launch nationally July 2017 with UberEATS and reach 3500 restaurants
• Coca-Cola to provide complimentary beverage recommendation for delivery (pack sizes)
• Coca-Cola to create 500MM impressions in support of delivery launch
• Coca-Cola to offer incentive for first time triers of McDonald’s UberEATS
ANSWERYes we can.
• We will deliver a holistic marketing campaign to drive consumer awareness, trial and unique experience - have plan to drive orders, repeat, and consumer choice
• We will provide drive thru and front of house cooler options (floor and countertop) with 3 options for placement
BUILD• Participating restaurants for Delivery program must sell RTD for in restaurant and drive
thru purchase as well
• 12 week lead time for coolers
• Assumes 50 percent of delivery orders will be fountain
• Provide choice in core beverages plus fill in with hydration, energy, healthy halo depending on restaurant location and equipment
serve with a
LAUNCH PROMO MEDIA DIGITAL / SOCIAL
Coke_McD-Asks_Brochure_2.20.indd 11-12 2/20/17 11:40 PM
MCDONALD’S ASKS | 1211
EVOLVING
McCafé OJ
ASKMcCafé OJ
KO to produce an NFC RTD bottled McCafé OJ we can sell in coolers (with DASANI) in all our restaurants
ANSWERCan produce a cobranded MM Pure Squeezed product with lead time for decision required to procure juice crop and build line capacity (by March 2017 for an in restaurant date for June 2018)
Recommend Region wide test to understand consumer preference of package and brand on OJ offering for decision date of March 2018
BUILD Request Region wide test with following cells:
1) Optimize – Current Dispensed FC OJ – Pricing/Merchandising/Cup Sizing/Branding
2) Minute Maid branded Dispensed FC OJ in restaurant; Minute Maid branded FC OJ bottle for drive thru
3) McCafé branded Dispensed FC OJ in restaurant; McCafe branded FC OJ bottle (by Minute Maid) for drive thru
4) McCafé by Minute Maid Pure Squeezed NFC bottle for both in restaurant & Drive Thru
5) Simply Branded NFC bottle for both in restaurant & Drive Thru
These cells intended to test Brand, Pack, Price and Product Preference and impact on restaurant operations and economics.
Coke_McD-Asks_Brochure_2.20.indd 13-14 2/20/17 11:40 PM
MCDONALD’S ASKS | 1413
INTRODUCING
Honest Kids
PACKAGING MERCHANDISING DIGITAL / SOCIAL
ASKHonest Kids Juice boxes
Coca-Cola to provide Honest Kids juice boxes for Happy Meal option in all restaurants by summer 2017 at cost parity
ANSWERYes, we can move to Honest Kids Appley Ever After Juice drink 6oz box.
• With a February 28th decision, system-wide implementation to begin by August as a soft roll with System conversion completed by end September
• Would build a 50 count case as a benefit to McD’s system
• Only 35 calories / serving. Product has no added sugar, no artificial coloring, and no artificial flavors
BUILD• Current case count is 40 drink box servings. We plan to optimize McD’s system cost
by launching with a 50 ct case
With a decision to launch we will build out our organic raw material supplier and work with McDonald’s supply chain for assured supply.
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MCDONALD’S ASKS | 1615
Appendix
Coke_McD-Asks_Brochure_2.20.indd 17-18 2/20/17 11:40 PM
MCDONALD’S ASKS | 1817
BEVERAGE EXPERIENCE
modernizing the
Operational Considerations
• CCFS + Cornelius Prototype to begin development to include:– Integration for Bulk Coke and Diet Coke flavor profile– Integration with Multiplex to facilitate McDonald’s beverage
volume requirements– Non-nutritive sweetener in 2.5 gallon BIB– In store field test (10-25 dispensers) to occur within 8-10
months of decision (end of 2017)– Commercialization to occur 2-3 months after in store field
test (April 2018)• Activate DCs to carry cartridges from the onset• Requires full commitment from McDonald’s engineering and
development• Will train and activate CCNA Service Providers across FL to
work on McD Equipment (e.g., modifying Pythons to support removal of legacy equipment)
• Engage and contract McD GCs to perform site prep (e.g., adding electrical outlets, performing counter modifications, and installing ice makers, etc.)
• Engage KES to shore up supplies of capital components and small wares
• Identify and contract climate-controlled storage facilities to store legacy equipment if required
• Coca-Cola and Cornelius to co fund development and test. Test will place equipment at no charge and will be sold to operators after complete
• Operators must buy cartridges and syrups. All other cost and activation covered.
Research Implications
• The Coca-Cola Freestyle dispenser puts the power of choice and customization in the hands of the consumer via a modern and progressive delivery platform.
• Coca-Cola to lead agreed upon testing protocol funded by Innovation Budget.
Calendar
• Alpha test CCFS + Cornelius Prototype by end of 2017• Introduce at McDonald’s Worldwide Convention in April 2018 • Florida region 900 store test with installs to be completed in Q4
2018 (target final install by September 1, 2018)
Coca-Cola Freestyle: Your Choice, Your Way
Coke_McD-Asks_Brochure_2.20.indd 19-20 2/20/17 11:40 PM
MCDONALD’S ASKS | 2019
Operational Considerations
• Material sourcing for python replacement is time and cost prohibitive based on timing of Freestyle launches
• Current system limitations and age of equipment will limit certain restaurants
• Carbonation and pungency drive certain limitations• Coca-Cola can accelerate change outs with the delay of Dasani
Sparkling from fountain consideration• Need to limit choices and have certain flexibility depending on line and
equipment limitations• Proposed line up leaves 2 local valves where one must be healthy halo
still and one super regional choice.
Research Implications
Current research suggests limited downside to changes and all upside coming from proper activation of Sprite innovation.
Calendar Launch September 2017
Other Considerations
• On trend with consumers changing needs and desires. Distinctly differentiates McDonald’s with exclusive Sprite Innovation.
• Maximizes unduplicated reach and frequency and grow sales and store operating profits.
• Coca-Cola, Diet Coke, Sprite, Dr. Pepper, Fanta and Sprite Innovation to deliver on stated strategic objectives, leaving 2 Valves for Regional Optimization.
REFRESHING
the fountain
Coke_McD-Asks_Brochure_2.20.indd 21-22 2/20/17 11:40 PM
MCDONALD’S ASKS | 2221
INNOVATING
Sprite
Operational Considerations
• First launch is limited by time and pungency of lines
• Coca-Cola will develop a sub brand to be used exclusively at McDonald’s and will develop an agreed upon cadence of innovation change outs dependent upon consumer and operator preference
Research Implications
• Consumer testing of future innovation to be funded by innovation budget
Calendar • Launch September 2018
The Sprite in You: You Make the Flavor
Coke_McD-Asks_Brochure_2.20.indd 23-24 2/20/17 11:41 PM
MCDONALD’S ASKS | 2423
ELEVATING
McDelivery UberEATS: And Ice Cold Drinks – Journey
Operational Considerations
• Ensure beverage quality, temperature are within acceptable range• Coca-Cola concerned with quality, handling and potential tampering of
open beverages - observed and measured in test market• Offer immediate consumption packages for easy portability,
resealability and added choice• Optimize existing cooler or place new cooler: GS3 countertop
or GCG9
Research Implications
• Validate consumer preference for delivery package type when installed
• McDonald’s to supply Coca-Cola usage data from UberEATS and GMA to better refine offers
Calendar
• Complement McDonald’s McDelivery launch plans• Support with digital marketing plan designed to ignite demand,
trigger action, extend experiences (geotargeted; MCR; social influencer; Coca-Cola assets; Coca-Cola led social media buy)
• July (12 week lead time)
Other Considerations
Holistic plan to connect with consumer throughout the delivery journey• Provide 20oz Bottle neckringers with special McDelivery Promo
Code to support launch• Discover: Drive trial and awareness with big promotion supported by
in restaurant, digital and social media• Order: Increase average check via UberEATS mobile offers• Process: Improve order frequency leveraging special GMA offers on
next purchase• Prepare: Provide choice and preferred package through RTD and
cooler placement program• Deliver: Ensure quality drink experience perfectly paired with
McDonald’s entrees• Repeat: Encourage repeat order via mobile offers and RTD
neckringers
serve with a
Coke_McD-Asks_Brochure_2.20.indd 25-26 2/20/17 11:41 PM
MCDONALD’S ASKS | 2625
Operational Considerations
• Product is shipped chilled and must be continuously chilled • Dispensed chilled OJ concentrate shelf life is 70 days
Determine cooler options for back counter replacing C009 dispenser
Research Implications
• Brand – McCafe or Minute Maid or Simply• Package – Dispensed/Bottle • Product – NFC or FC• Occasion – Drive thru vs Dine in• Price – Premium vs line price• Operations – storage and staging• Economics – effect of incidence improvement and margin
Calendar• System conversion would require a decision by March 1, 2017 in order
to develop an orange raw material sourcing strategy.
EVOLVING
McCafé OJ
Evolving – McCafé OJ
Coke_McD-Asks_Brochure_2.20.indd 27-28 2/20/17 11:41 PM
MCDONALD’S ASKS | 2827
INTRODUCING
Honest Kids
Honest Kids: Honestly Good!
Operational Considerations
• Would develop a 50 ct case to optimize McD operational cost• Requires McDonald’s to modify CGI agreements• Honest Kids Appley Ever after Juice drink box has shelf life of 243 days• We will build out our organic raw material supplier base as a strategic
strategy to mitigate risks on assured supply though annual risks include– Organic Apple Juice concentrate demand is challenging supply for
long term. – Issuing contracts to suppliers for raw material does not guarantee
supply. The material goes through quality testing – if testing fails then the supply is rejected which can challenge supply
Calendar• Soft launch planned for August with anticipated system conversion by
September 2017
Coke_McD-Asks_Brochure_2.20.indd 29-30 2/20/17 11:41 PM
MCDONALD’S ASKS | 3029
SUPER REGIONAL BRANDS
Barq’s Root Beer
Fanta Flavors
Sprite Zero
Coca-Cola Zero
Cherry Coca-Cola
Seagram’s
Mello Yello
HEALTHY HALO
PoweradeFruit Punch
PoweradeMountain Blast
Minute MaidFruit Punch
Vitaminwater XXX
Vitaminwater Revive
Minute MaidLight Lemonade
Region-Level Summary of Recommendations
Coke_McD-Asks_Brochure_2.20.indd 31-32 2/20/17 11:41 PM