Transcript generated automatically by AI and may contain errors.
Chapter 1: What is the main topic discussed in this episode?
Hey, it's Ryan.
Our colleague Imani Moise is here to guest host today's episode. Here it is. McDonald's and Coca-Cola are two of the world's most recognizable brands. And their success has been, in part, due to their more than 70-year collaboration. It all began in an Illinois parking lot in 1955.
So Whitey Pratt was a salesman at Coca-Cola, and he was looking to develop new business for the company. And he met with a new franchise restaurant CEO named Ray Kroc. Our colleague Heather Haddon covers restaurants. And he found Ray Kroc outside of a restaurant he had just opened in the Chicago suburbs.
And they struck up a friendship and a business relationship that would span for decades and decades.
Chapter 2: What is the history behind McDonald's and Coca-Cola's partnership?
McDonald's was basically a startup back then. This was the first location east of the Mississippi, but Kroc had plans to go bigger.
One thing Ray Kroc was really known for is uniformity and consistency in his restaurants. So he wanted to pick suppliers that could scale as much as his ambitions for the company. So he was seeing this very small restaurant chain that he had just embarked on as one day operating restaurants all over the country.
And so he wanted products that he could serve in these restaurants all over the country, and they wanted to be uniform, whether that was ketchup or cola.
So in the parking lot that day, Waddy Pratt had a pitch. Coke should be the signature drink at McDonald's. Kroc liked the idea.
And so he decided that Coca-Cola, the regular Coke, would be the beverage of choice in his McDonald's restaurant.
Striking a storied handshake agreement to just marry these two brands, you know? So it's really very all-American, the story.
That's our colleague Laura Cooper. She covers the beverage industry.
So while this, you know, started out as Coca-Cola, it's grown to involve, for instance, Sprite and all kinds of different drinks over the years.
The partnership has helped make both brands into American icons. But the relationship is having issues. Because McDonald's is no longer content planning all of its drinks around Coke. Tastes are changing.
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Chapter 3: What challenges are McDonald's and Coca-Cola facing today?
McDonald's just came out with some new fun drinks, so let's try them.
Do you guys know that McDonald's came out with new refreshers? I like this better than Starbucks.
I know. I know.
The cold foam ones have a richness to them, and I think this is exactly what the company wants. They want something that looks new and fresh and exciting and hope will trend, you know, on TikTok and social media.
Beyond these new dirty sodas, McDonald's also has a whole new partnership in the works, a deal with Red Bull, which is not owned by Coke. Coke says it respects McDonald's decision.
In August, we know through our reporting that they're going to start these Red Bull infused drinks. They're going to have syrups in them and other mix-ins. I do think when the Red Bull drinks come out, that will be a real splash because Red Bull is a big name. It has a lot of currency, including among younger consumers. And this is a real first, this brand partnering.
So big deal for both of those companies.
Instead of selling fast food with a drink on the side, with these new offerings, McDonald's is flipping the script, focusing on selling drinks first.
McDonald's would love to have new customers coming to their restaurants for these beverages, and they even served us what they believe customers will order with these drinks. So this is more for a snacking opportunity. So you get a drink, maybe you get McNuggets, maybe you get fries, maybe you get a cheeseburger, but you're not getting a whole Big Mac meal with these drinks.
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