McDonald’s is considering to integrate more organic produce in order to increase its decreasing growth and attract customers away from its competitors (Patton).

A major portion of the developed world’s general public  have recently gone under a lifestyle shift to supporting the consumption of all organic natural foods. Organic food usually means non-GMO, pesticide , additive free and many other  specifications. Now, many businesses have appealed to this lifestyle with their products and brand image because they truly believe in the authenticity of this lifestyle and every part of their operations, from their human resource management to their supply chain management supports the belief.

However, it is becoming more apparent that some businesses will try to jump on the band wagon of organic food and exploit the lifestyle . What is so disappointing about this consideration is that it is apparent that McDonald’s is not fully convinced that organic food is the only way to go.

The value proposition of McDonald’s is that it provides fast service for a low price. Unfortunately, organic produce is ultimately more expensive that non-organic produce. Also suppliers of organic produce is much less common. These implications all translate into higher costs of supply. If overall costs are increased with the purchase of organic supplies, costs will obviously have to be decreased elsewhere. Which leads to the question of where that cost cut will have to come from. Will the other non-organic supplies come from even more low quality, but low price suppliers? McDonald’s is notorious for using suppliers that do not fully adhere to local and national food and health safety standards.

The article mentions Chipotle as its main competitor that uses organic food that tastes delicious and healthy as it’s value proposition. Chipotle has a shared value with it’s customers . The term shared value will imply that the customers and business values the proposition both equally. However, to devout consumers of organic food, McDonald’s looks unconvincing. A much higher percentage of the McDonald’s consumer base has complete disregard to whether their food is organic or not. The bottom line is, including more organic food in it’s menu to boost it’s stagnant growth is a strategy that is purely for profit and will not appeal to customers who are emotionally invested in this certain lifestyle.

Patton, Leslie. “McDonald’s May Sell More Organic Foods to Boost Sales.”Bloomberg.com. Bloomberg, 22 Oct. 2014. Web. 02 Nov. 2014.

Customers in emerging markets have had their personal preference influenced by cultures that are thousands of years old. With something as  culturally and historically relevant as food, I understood the need for food giants such as McDonalds, Kit Kat and KFC to create new recipes or customize current ones to fit the taste preference of it’s local market. It has never considered my mind that Listerine would actively  increase R+D so that it can fulfill the needs of its global customers.

A McRise (rise patty) burger from the McDonald’s in the Philippines. (Google Images)

There are many brand name products with much historic legacy that brand renewal and reinvention is seen as unnecessary. I presumed that with Listerine’s history and US market dominance, there will only be varieties on the product packaging.

Listerine proves that a basic product such as a mouthwash, that really needs to get a simple job done, a job that may be universally done the same way still needs to have variety in order to meet the needs of a diverse customer base. It is also a survival model. Globalization is not going to lead to a  successful world domination if the exotic customers are overlooked.

With the changing  macro-environment of USA and the change in consumer behaviour, Listerine (like many other brands) were forced to innovate. Should innovation and creativity be an active pursuit, even for a product that really needs 4 ingredients to do the job it promises? Should innovation be only preserved in a face of a sudden change? Does the necessity of the product in the daily lives of customers influence the need for a product to be continuously evolving and offer many varieties?

Works Cited List

Abrams, Rachel. “Adapting Listerine to a Global Market.” The New                             York Times. The New York Times, 12 Sept. 2014. Web. 08 Oct. 2014.

Welcome to UBC Blogs. This is your first post. Edit or delete it, then start blogging!

CVS’s strategic move of discontinuing the sale of tobacco products will create a uniform understanding in its customers that CVS is a provider of products geared toward the well being of its customers. Simply put, eliminating tobacco products from its sales racks sets a new, a much more concrete identity of the CVS pharmaceutical brand.  The article states that 2 billion USD of sales revenue came from tobacco, which is roughly 1.6% of its total revenue (Stephanie) . CVS obviously chose to fulfill its social responsibility to the majority of its customers and ignore a somewhat niche group of the population. This decision was possibly highly supported by today’s general social stigma against tobacco smokers and the existence of evidence health hazards of smoking.

The plan seems like an action of a company that is finally fulfilling its social responsibility in striving towards the improvement of it’s customer’s health. This decision may have been driven by the altruistic intentions of CVS’s executives. However, it also could have been a strategic decision that sacrificed an average of 2 billion USD in revenue/ per year for long-term annual revenue greater than their loss of 2 billion. They are able to bear this loss because they are in a position that is able to sustain itself without the tobacco sales and a position that forecasts greater revenue after having appealed to the desires of the majority.

Works Cited List

Strom, Stephanie. “CVS Vows to Quit Selling Tobacco Products.” New York Times 5 Feb. 2014. Web.