Marketing Blog (Comm 296)

McDonalds has been the leading global fast food chain for decades, but as seen in its aggressive efforts in the recent years, it has no plans to sit comfortably in its #1 spot. It has set ambitious goals on continuous global growth and gaining new markets – and its efforts have paid off as it reports consistent significant global sales increases. It has even given coffee giant Starbucks a run for its money.

Let’s take a look at McDonald’s major initiatives over the past few years that have strengthened its brand, attracted new market segments, and added value to its products.

1) Introducing McCafe: In early 2010, McDonalds planned to open more than 1000 McCafés within its outlets in Europe, with comfortable furnishing to compete with Starbucks to become the #1 coffee seller in Europe. It has an advantage in avoiding high investment costs by having the cafes within existing outlets and undercutting Starbucks by price. Store revenues rise by 20 – 25% on average after adding McCafe. In 2010, in the US, it added McCafe in all 13,900 locations, introduced free Wifi, and expanded its coffee drink menu.

2) Innovation in adapting menu offering to different countries: Effective market research has resulted in new (and profitable) offerings on its menu. In Taiwan, its Rice burger (introduced in 2005) has been so successful that it was introduced to other Asian countries. At McDonalds around the world, you can find pasta, poutine, souvlaki, and much more.

3) Healthy and Fast Food: catering to a more health-conscious society: McDonalds became the first fast food restaurant to provide nutritional info on most of its packaging in 2006. In the same year, it also added more salads, juices, yogurt parfaits, fruits, and bottled water. It introduced Fruit Smoothies in July 2010, reporting the highest increase in sales of the year.

4) Demographic Outreach: Addressing moms’ concerns over health and nutrition for their children, it introduced “Mom’s Quality Correspondents” in 2008: where moms are given access to McDonald’s food supply system and share about their (positive) experiences on the US website. In June 2010, it launched its first ad for gay customers in France.

5) Go where the crowd is – Winter Olympics 2010: As an official sponsor, its marketing strategy fully embraced the Winter Olympics with Twitter, special menu offerings, its McDonalds Olympic Champion Crew and Kids Program, and attracting athlete endorsements from J.R. Celski, Patrick Denee, Patrick Chan and Alexandre Bilodeau.