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You Want Teenie Beanie Babies With That?

May 21, 1998|DIANE SEO

Those squishy, cuddly Teenie Beanie Babies are back at McDonald's, and this time the fast-food chain assures that there are plenty to go around.

The tiny versions of the popular beanbag toy line will be available for four weeks starting Friday, coinciding with the high-traffic Memorial Day weekend.

Last year's Happy Meal campaign, the most successful in McDonald's history, saw the miniature stuffed creatures scooped up in mere days, leaving thousands of frustrated, Beanieless customers across the country.

This year, McDonald's has doubled its Beanie order from Ty Inc., with some analysts estimating the count at 240 million. The company also has boosted its Teenie Beanie lineup from 10 characters to 12, and increased the ways customers can acquire the collectible toys.

"Since last year, customers have been asking us when the next lineup was going to come," said R.J. Milano, vice president of marketing at McDonald's USA. "Based on last year's overwhelming customer response, we obviously wanted to produce more quantities this year."

With nationwide demand for Beanie Babies still going strong, McDonald's expects the campaign to help lift its sluggish domestic sales during the important summer months, typically the strongest periods for fast-food chains. McDonald's also needs a strong promotion to counter rival marketing programs, such as Taco Bell's much-advertised tie-in to the movie "Godzilla."

Analysts believe the Beanie campaign will help drive the company's second-quarter sales in the United States and Canada. But they doubt customers will react with the same enthusiasm as last year, when McDonald's seized on the Beanie craze at a time retailers couldn't keep the plush toys on their shelves. Beanies, though still popular, are more widely available now.

"It probably will be popular but not match the intensity of last year's campaign, which was just mania," said Damon Brundage, a restaurant industry analyst with J.P. Morgan. "The company is also better prepared. They've gone to great lengths so they don't see a rerun of last year."

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Last spring's Beanie rush may have been a financial hit for the world's largest fast-food chain, doubling Happy Meal sales in April and boosting overall sales by an estimated 8% the same month. But McDonald's found itself in a public relations mess after customers frantically snapped up Happy Meals to get the Teenie Beanie Babies, then sometimes threw away the food.

"The perception was that McDonald's today is more about giving away cute little stuffed animals than selling high-quality food products," Brundage said.

Along with the Beanie promotion, McDonald's is in the midst of implementing other changes to enhance its food offerings.

In the Northeast, McDonald's is testing a new lettuce, tomato and onion burger called the MBX, short for McDonald's Big Extra. The MBX also will be tested in Bakersfield sometime this summer. And the company is planning to install a new cooking system by the end of next year that will allow sandwiches to be made-to-order.

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Besides offering Beanies in Happy Meals, McDonald's is selling them separately. Customers can buy individual Beanies for $1.59 with any purchase. Adults can collect Beanies by purchasing a $1.95 combination special, which includes the toy, a small order of French fries or a small drink.

The chain will promote the campaign through print, radio and television ads aimed at children, mothers, African Americans and Latinos.

To avoid confusion over which Beanies will be available, the company will post signs throughout its restaurants announcing which three characters will be available each week.

The new lineup comprises Bongo the Monkey, Twigs the Giraffe, Pinchers the Lobster, Mel the Koala, Bones the Dog, Waddle the Penguin, Doby the Doberman, Inch the Worm, Happy the Hippo, Scoop the Pelican, Zip the Cat and Peanut the Elephant.

McDonald's is likely to benefit from the fact that on May 1, Ty retired eight of the 12 characters in the restaurant's lineup. This is significant because Beanies that make the retirement list tend to become sought-after collector's items.

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