The first McDonald's opened it's doors on Grafton Street in Dublin in 1977. This global brand created and pioneered the concept we all now know as 'Fast Food' ... changing the convenience food industry forever.
"Since then we’ve been proud to serve the Irish people with some of their favourite food." the web site kind heartedly reveals. With 87 outlets in Ireland, families have become hooked on Big Macs, Quarter Pounders, Happy Meals as the ever cheery.... but slightly erie Ronald McDonald.
With a market capitalisation of $89 Billion, McDonald's has become the ultimate marketing machine with 68 million customers per day in 35000 stores across 119 countries. That's a stack of burgers with fries and although you have to admire the operational efficiency and scale of the company it does trigger concerns about a 'corporatisation' of the food chain.
Since moving to Ireland in 2008 we've kept our kids away from McDonalds...save for the occasional visit for McFlurry's or invitations to Kids Parties. Even with limited exposure to the brand we've found it fascinating how much they know about McDonalds...the products and experience, colours & concepts...have become deeply embedded in their young minds.
However are the Golden Arches starting to lose their lustre? In Ireland people are getting fat to the point of crisis. Nearly 2/3 of us are either obese or overweight and young children are also being affected. The results of a McDonald's diet were vividly depicted in Morgan Spurlock's revealing documentary "Super Size Me" Now 11 years old it's as prescient as ever and worth another watch on Netflix.
Even though people are becoming more aware about food & lifestyle choices the 'ubiquity & pull' of the McDonald's brand remains very powerful. Advertising targeted towards kids singularly promote "Happiness" the free toys and discounted products have a predatory feel designed to lure little children in. Fun advertising trains children to want what's on the package and once they've had 'their line' of 'feel good' sugar and high fat content...they become physiologically and psychologically addicted.
With market trends and consumer perceptions changing McDonalds has been forced into offering healthier choices. Carrots suddenly appeared in a wall in our local Douglas store and the colours have been changed from the 'bright & catchy red and yellow' to a healthier greens and earthy brown hues on the exterior. Although they're offering us healthier choices my problem is that they remain committed to the less healthier options and excessive consumption...because this is where the money is.
When your brand has been Super Successful its hard to change even though the market around you is changing. You can put all the spin on it you like....change the signage, hire the PR company, build a new Website.... but it's akin to putting lipstick on a pig.
Not surprisingly in 2014 McDonald's profits were down 30%.....as the brand struggled to remain relevant. Even with the most creative TV ads and Social Media campaigns it seems that their core customer group - the Millennials in their 20s and 30s were no longer 'lovin' it'
In the US, the younger market is looking for fresher, healthier options. "Fast casual" restaurants like Chipotle Mexican Grill 'food with integrity' and Panera "a symbol of warmth & welcome" are grabbing market share.
Uniquely these brands offer high quality food with the custom ordering of table service restaurants with the convenience and price point of the fast food chains. Millennials "want to buy into a brand not just from it" The appeal of authentic ingredients with a genuine social responsibility message is gaining traction with a more aware, younger generation.
In some respects McDonald's has become so BIG that it's difficult for them to make meaningful change. In its existing form its challenging for them to embrace the obesity problem and their contribution towards creating it.
On the positive side McDonald's does seem to be aware that it needs to re-invent itself as painful as it may be. Quietly "Down Under" the brand has started to experiment with a new concept restaurant in Sydney called "The Corner'
Through research driven insights, McDonald's has invested in shifting its McCafe brand into a hip & healthier alternative. It doesn't feel like a McDonald's.... the artificial feel, bright colours and back-lit signage has been replaced by an earthy, home store feel with loads of natural light & surfaces...all sub-consciously communicating a message of 'health & wellbeing.' You'll see the McCafe brand...although small is still subtly present and maintains the tie to the McDonald's mother brand.
The menu includes “salads featuring Moroccan roast chicken breast, chipotle pulled pork, brown rice, pumpkin, lentil and eggplant salads, sandwiches and barista-made quality coffee. It also offers a range of tasty 'health on the go' options including bean & cannelini snacks, ready made salads with tofu, vegetables brown rice and quinoa as well as a colourful array of fresh fruit salads alongside tasty muesli pots.
What's interesting is that this new approach is not accidental. Every touch point is carefully considered in a way that's congruent and aligned to the ethos of the brand. The 'story' then plays out across the dimensions of Space, Products and Service and is 'wrapped' up in a carefully crafted "Corner Store' Customer Experience.
A new design language and visual cues create an 'experience' that feels authentic and almost home made. "The Corner" store concept is communicated through distinct shapes, colours, fonts, typography, imagery & packaging......all forming part of a whole that's greater than the sum of the individual parts. This kind of creatively congruent design makes the brand more trustworthy and helps to 'code what the brand stands for' in the minds of their customers.
The natural feel is reinforced by barrista coffee stations, food served on wooden boards, hand drawn menus, old fashioned glass jars, staff wearing home kitchen styled aprons and smells and sounds that create a sensory experience.
This is a brilliant example of a Brand that is shifting it's focus from Brand Promotion (sales, ad campaigns) to Brand Relevance (creating relevance and value) for the customer. The teaching point for brands embarking on a journey of change is to know where to begin.
These companies are headed in a direction which will not support long term growth. Their lack of imagination & investment in brand building and obsession with tactical advertising will see margins erode and them eventually become obsolete.
They seem unwilling to recognise new trends, and find innovative ways to align with them. If they don't change new competitors like Nandos will simply eat their lunch and customers will vote with their feet.
It's important for brands to learn the McDonalds lessons and pay attention to the trends that are impacting the market. Growth only comes from companies that are on trend, do something differently and understand how to create and deliver value to customers through a distinct branded experience.
So if you're embarking on a project of re-inventing your Brand please don't start at a tactical level. Great brands are built from the inside out and you need to be crystal clear on your Concept first .....or the communication or experience of your Brand will be haphazard and confusing to customers.
Understand your context by generating deep insights around real behaviours of real people in real life situations. Take a close look at both loyal customer and non customer behaviour to understand both 'pleasure & pain" points. Design the new concept with your customers instead of for them. This helps to spark the creativity that's the vital ingredient required to set out a Vision for where you want to be in the future.
So hopefully there's a beautiful irony in their new name and McDonalds has finally turned The Corner. It will be interesting to see how far McDonald's evolves the concept and if in the next decade it starts to move from an 'unhealthy food' company to one that's kinder to people and our planet.