Anyone with an office desk drawer full of old "Baltic Avenue" and other
game pieces can attest to the lure of McDonald's (NYSE: MCD ) perennial
Monopoly campaign. For almost a quarter of a century, consumers have been
guzzling down large fountain drinks and swallowing Big Macs trying to match
"Boardwalk" with one of their 12 "Park Place" pieces. Even though the
vast majority fail to score the $1 million prize, theyre content to win a few
free small fries. Apparently, the craze surrounding Uncle Pennybags hasn't
died down. The world's largest fast-food chain Tuesday cited the popularity of
its Monopoly game in America, as well as success overseas, for a 5.5% same-store
sales increase in October. Revenues rose 6.1% in the Asia and Pacific region,
5.2% in the U.S. and 4.8% in Europe for the month. That could be another booster
for the stock, which is up 21% over the past six months. The game's tractor
beam on consumers works twofold: It brings in those who otherwise might have
eaten at another burger slinger, and it brings them back again and again. While
many of the game's prizes can be won on single-shot instant-win tickets, the
big-ticket items including vacations, cars and varying cash awards can be won
only by collecting a complete set of colored properties or railroads. In any
three-property section, two tickets can be found en masse, compelling consumers
to repeatedly return in search of the McMuffin that can change their lives. But
while the giant continues to reap gold from reawakening its decades-old partner
year after year, it's been McDonald's willingness to stick its toe into
newer waters that has kept the revenues rolling in. In the past half-year alone,
McDonald's has unveiled several new initiatives to help both the bottom and
top lines alike, with many hitting the mark. This summer, McDonald's unveiled
its frozen strawberry lemonade , which was branded under the already-successful
McCafe line, which consists of lattes and other specialty coffee drinks. The
company saw a 6.9% jump in sales for June, with much help from the summer treat.
The McCafe line itself has been a boon to McDonald's. The fluffy coffee
drinks, in addition to biting the ankles of popular barista Starbucks (NASDAQ:
SBUX ), account for 20% of company sales and contribute about 80% of their price
to profit; McDonalds bread-and-butter hamburgers contribute about 60%. Among
other initiatives: McDonald's has rolled out (and will continue to tinker
with) healthier Happy Meals, returned the cult hit McRib and expanded it to a
national rollout, unveiled touchscreen-powered self-checkout at European stores
and currently is testing its own in-store TV channel , which would show local
content and more importantly more advertising. In addition to McDonald's
willingness to evolve, there's still plenty of upside to the annual rite of
Monopoly passage and other short promotions, such as the St. Patrick's Day
Shamrock Shake as evidenced by Tuesday's report. These games and products at
best fill the company's coffers, or at the very least excite consumers enough
to get them into stores, where they can buy more high-margin goods. And as
McDonald's has proven, it can provide plenty of those. Kyle Woodley is the
Assistant Editor of InvestorPlace.com . As of this writing, he did not own a
share in any of the aforementioned stocks.
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