The McDonald's brand is almost as universal as Coke. The group's 38,000th restaurant opened in 2019, and those golden arches now spread across 120 countries, welcoming some 70m customers every day. Not enough, the company still says. On any day McDonald's still only serves less than 1% of the world population, leaving plenty of room for growth. However profits fell dramatically in 2002 and the group took unprecedented steps to close under-performing outlets, even pulling out of a few markets altogether. That move appeared to have paid off by 2004, and McDonald's reported strong growth for much of the following decade, even in the face of an economic downturn. A key factor was the broadening of the menu with an enhanced range of breakfast items, healthier chicken and salad meals and premium beverages. The company also pushed aggressively into the coffee shop sector in several key international markets as well as the US with its McCafé brand. However the reviving US economy brought fresh challenges from 2013 onwards. Domestic sales suddenly stalled, despite a frenetic burst of menu innovation, as customers moved away to less established rivals, while international performance was dented by a variety of different challenges in regional markets. Even after several changes of both management and strategy those troubles have yet to be fully resolved. The biggest problem seems to be securing consistent growth in the company's key market, the US. There were signs that the group was finally on the right track by 2018 as a result of new innovations such as all-day breakfast and other menu adjustments, in-store digital order kiosks, home deliveries and other such introductions. At the same time, the chain has set about reducing the number of company-owned outlets in favour of franchised stores. By the end of 2018, only around 2,700 of the chain's 37,850 outlets were directly owned. As a result company revenues have steadily declined - to $21.0bn in 2018 - even as profits and systemwide sales have grown. The former hit a record $5.9bn in 2018, while the latter topped $96bn, up 6% year on year. The US alone accounted for more than a third of system sales, or $38.5bn in 2018. Steve Easterbrook is group CEO.
Capsule checked 26th September 2019
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Historical profile information for McDonald's
Adbrands Daily Update 16th Sep 2019: In a sizeable blow to Omnicom, McDonald's named Wieden & Kennedy NY as lead creative agency in the US, supplanting We Are Unlimited, the dedicated agency created specially for the fast feeder within DDB. The latter will continue to handle some assignments, but the bulk of the business moves to W&K. It's a big change for McDonald's which has traditionally consolidated all global marketing within Omnicom's DDB or TBWA networks or Publicis Groupe's Leo Burnett.
Adbrands Daily Update 28th Aug 2019: "Egg McMuffin: Director's Cut". You're unlikely ever to see another McDonald's ad quite as beautiful as this. TBWA Paris commissioned 3D animator Matthieu Braccini to conjure up a fantastical vision of the creation of a simple Egg McMuffin sandwich for a series of online GIFs. Here's Braccini's "director's cut", compiling all the sequences as a single film. The results are like a food-based fever dream of divine perfection, in which all the elements of the sandwich are constructed by a series of bizarre Rube Goldberg / Heath Robinson machines. It could probably be marketed as some form of meditation tool, to be watched for hours on end on permanent loop. Delicious and delightful.
Adbrands Daily Update 22nd Jul 2019: McDonald's global CMO Silvia Lagnado will depart the company later this year "to pursue new challenges and opportunities". She has spent four years in the role, but will not be directly replaced when she leaves in October. Instead, the fast food giant is promoting Colin Mitchell - currently VP global brand - to SVP global marketing, reporting directly to CEO Steve Easterbrook. Bob Rupczynski, VP global digital engagement, was appointed as SVP, marketing technology.
Adbrands Social Media 25th Apr 2019: "Make Your Choice". How about this for a bold piece of social activation from DDB Mudra? The general election is currently underway in India, a massive exercise that takes a full month to complete. In recent years, the undertaking has been further hampered by apathy. In the last election in 2014, almost 815m Indians were eligible to vote, but more than a third - 280m people - didn't bother. Hardcastle Restaurants, McDonald's master franchisee in the south and west of the country, commissioned this daring stunt from DDB Mudra in one of its outlets in the city of Hyderabad to make an important point. If you give up the hard-fought right to vote, why should you also have the right to choose what meal you eat? Customers who didn't have the telltale fingernail tattoo that is given to every individual who has cast his or her vote were deliberately served a different order. An idea perhaps that could be implemented in the US in 2020?
Adbrands Social Media 1st Apr 2019: "A Sweet Moment". Here's a lovely slice of food porn from TBWA Paris for McDonald's. The French really appreciate their food, even the humble Egg McMuffin. You won't be able to resist either after these 60 beautifully photographed seconds of gastronomic heaven. Delicious!
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