McDonald's revamped Snack Wraps are winning over customers
After a nearly decadelong hiatus, the burger chain brought back the popular menu item earlier this month. So far, it looks like a hit.
From July 10 to July 12, the first three days of the launch, McDonald's locations saw traffic jump by double digits each day compared to the year-to-date daily average, according to Placer.ai data. Evercore ISI estimates U.S. same-store sales have climbed 7% so far in the third quarter, according to a research note from Thursday.
Some McDonald's U.S. stores even ran out of lettuce, although the company has since resolved the temporary shortage.
'After nine years of pent up demand, fans showed up in full force to celebrate the return of the Snack Wrap. We've been blown away by the response, from packed restaurants with lines out the door to nonstop social buzz,' McDonald's U.S. said in a statement to CNBC regarding the temporary lettuce shortage.
The success of the permanent menu addition is good news for McDonald's, which has struggled with sluggish sales in recent months. In the first quarter, the company reported its largest quarterly U.S. same-store sales decline since 2020, when the Covid-19 pandemic shuttered its dining rooms.
McDonald's has had some marketing wins: its $5 meal deal and a Minecraft movie tie-in. But discounts can weigh on restaurant profitability, and limited-time promotions only provide a temporary boost to traffic.
Most importantly for McDonald's, customers seem to enjoy the Snack Wraps, suggesting that the lift to McDonald's sales could outlast the social media buzz that fueled the initial traffic boost.
A Numerator survey of more than 200 verified buyers of the McDonald's Snack Wrap found that 90% of respondents would buy the item again in the future.
Those early Snack Wrap buyers are loyal McDonald's customers. Numerator found that the survey's average respondent has visited the chain 56 times so far this year. The typical McDonald's diner has only frequented one of its restaurants 25 times during the same period, according to Numerator.
In addition to lettuce, shredded cheese and sauce, McDonald's revived snack wraps are made with one of the chain's McCrispy Strips, which launched nationwide in May. The wraps, which sell for $2.99 each, come in two flavors: spicy and ranch. More than two thirds of Numerator survey respondents bought just the ranch snack wrap, 20% purchased the spicy version, and 12% went for both.
The company is expected to report its earnings for the second quarter on Aug. 6. The report will not include the effect of the snack wraps, which rolled out nationwide after the quarter ended.
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