Welcome Hamburger Scholars!
We’re thrilled to be in the company of Dr. Marcia Chatelain for this episode. Dr. Chatelain is the author of Franchise: The Golden Arches in Black America, an engrossing history of fast food franchising’s path through the civil rights movement and Richard Nixon’s big idea for what should come next. (Hint: it was not favorable credit terms for independent Black-owned businesses.)
We start off our discussion with a retelling of the boycotts and eventual dynamiting of a Portland, Oregon McDonald’s on Union Avenue in the summer of 1970. We learn where to go when the corporation you’re researching doesn’t want you in their archive, what it is like to win a Pulitzer Prize for history, and why McDonald’s CEO Chris Kempczinski has a bigger opportunity than he seems to realize.
Come for the multifaceted American story of not-so-small business and not-so-free markets. Stay for her approach to McDonald’s-neutral parenting, why it helps to look like a soccer mom, and a brilliant prequel idea for Coming to America.
Speaking of McDonald’s and Black business, media mogul Byron Allen has settled his 11-figure lawsuit against McD’s last month. Mr. Allen is the owner Allen Media Group, a conglomerate in control of the Weather Channel, nine different TV court shows, and 40 TV stations across 16 states.
Allen’s lawsuit alleged that McDonald’s classified his networks as specifically for Black audiences, thereby excluding them from the main tranche of McDonald’s ad spend. McDonald’s and Allen settled for undisclosed terms. The restaurant chain says it will buy advertising time from his networks at market rates.
Here’s an 18-year-old Byron Allen doing stand-up on the Tonight Show with Johnny Carson in 1979:
What’s behind the smash burger phenomenon? Mike and his friend Xavier don’t find out, but do dig into double and triple cheeseburgers from For the Win. The verdict? It’s like a Big Mac.
Chicken McNugget inventor…Ray Dalio?!
We like to think that all you need for a good fast food invention is a concept and a recipe. But what about the packaging, the machinery, the supply chain? What about the financial engineering to guarantee your product a stable price over the surges and dips of its underlying commodity?
A few months ago Ray Dalio went on a Bloomberg podcast and re-told the story of doing this work on chicken so that McDonald’s could unveil the McNugget. Cleverly breaking down the cost of a chicken into it’s component parts (mostly soy and corn), Dalio was able to get close enough to a futures market on chicken that suppliers could get their feed, McDonald’s could get their chicken, and we could get our McNuggets.
MCD cooling off from $300
Here at HBR we keep our eyes on the MCD share price at all times. After hovering below $300/share, it finally got there for a few weeks only to be pulled back by tariff chaos and expanded war in the Middle East.
This fall will mark two years since the October 7 terrorist attacks on southern Israel and the subsequent leveling of Gaza, obliteration of hospitals and infrastructure, and starvation resulting from a tightened Israeli blockade. As we have covered on the show, these developments invigorate anti-American sentiment and drive down spending at iconically American chain restaurants in the region.
McWieden + Kennedy
You know that Portland, Oregon-based ad agency that did groundbreaking work for Nike in the 1980s? Would it surprise you to learn that they’ve been doing the bulk of McDonald’s strategy work for coming up on six years now? This insightful Reddit thread parses out what they’ve done in that time, particularly the way that McDonald’s promotions now are less and less about the food and more and more about media tie-ins and celebrities.
Come to think of it, didn’t Grimace just have a birthday? It’s been two years since the Grimace birthday meal and milkshake and we’ve yet to see any of that stuff return. Here is to hoping he is still with us.
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