The McDonald's brand is almost as universal as Coke. The group's 36,000th restaurant opened in 2014, and those golden arches now spread across 119 countries, welcoming some 69m 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. 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 management, those troubles have yet to be fully resolved.
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Adbrands Company Profiles provide a detailed analysis of the history and current operations of leading advertisers, agencies and brands worldwide, and include a critical summary which identifies key strengths and weaknesses. Adbrands Account Assignments tracks account management for the world's leading brands and companies, including details of which advertising agency handles which accounts in which countries for major markets. Subscribers may access the following website links:
|McDonald's Australia||McDonald's worldwide|
|McDonald's UK||McDonald's Japan|
Adbrands Weekly Update 2nd Nov 2017: Another week, another big media review. McDonald's called its first global review since the early 2000s. Main incumbent OMD is defending the $2bn account and is expected to retain much of the business, especially key US and European markets. However, unusually, the fast-food giant is leaning towards assembling a patchwork of best-in-class agencies in individual markets rather than a single global network. "The goal of this is really not to drive down agency fees," said McD's media chief David Rupczynski. "The goal of this is to find what is the most efficient way to reach the consumer."
Adbrands Weekly Update 25th Oct 2017: McDonald's recovery maintained momentum. Global same-store comps were up 6%, including a healthy 4.1% in the US, while profit jumped by almost 48% year-on-year, well ahead of expectations. In the domestic market, the chain is continuing to win with a high/low strategy that aims to please both ends of the market at the same time. For budget customers, the McPick promo offered two meal items for just $5, and an even bigger value offer is set to break in 2018; meanwhile, for those with more to spend there are semi-customised premium burgers priced above a Big Mac, but still below rivals such as Five Guys. Globally, the group is also winning over new customers with the global roll-out of its "McDelivery" partnership with Uber Eats. As anticipated group revenues were down by 10% reflecting the group's sell-off of company-owned stores to franchisees.
Adbrands Weekly Update 12th October 2017: Ads of the Week: "Le Grand Veggie". As John McEnroe always used to say, "you cannot be SERIOUS!!!" Some kind of first here as the French arm of McDonald's unveils Le Grand Veggie, an entirely vegetarian burger. Yes, really! Will it really catch on? Keep watching the ad as TBWA Paris whips up some excitement by getting a collection of its other clients to share in the general astonishment.
Adbrands Weekly Update 31st Aug 2017: In an important victory for Publicis Groupe's consulting arm, Publicis.Sapient has secured a five-year global contract to provide digital and IT services to McDonald's as junior partner working alongside traditional consultancy Capgemini. Accenture had also pitched for the job. The brief is to support the expansion of McDonald's digital capabilities. "We will be part of the team deploying and maintaining their restaurant and digital technology solutions, including kiosk ordering, web applications, mobile order and pay, that help put the customer at the centre of McDonalds' business," Publicis CEO Arthur Sadoun told staff in an internal email. "We will also help create innovative digital services internally for employees, in their kitchen and store operations, and for their customers through table service and home delivery." It's certainly a big win for Publicis, but an even bigger one for Capgemini. According to the WSJ, the project is expected to generate around $600m for CapGemini over five years, but only $150m for Publicis.
Adbrands Weekly Update 27th Jul 2017: There was a sudden turnaround in performance at McDonald's, which delivered its best global and US same store sales growth for five years. US comps were up 3.9%, and global by 6.6%, while total systemwide sales got an 8% uplift. Reported revenues were down year-on-year because of the sell-off of outlets to franchisees, but the topline figure of $6.05bn was well ahead of analysts' expectations. Net income jumped 28% in the quarter, lifting McDonald's shares to an all-time high. "Whilst we're encouraged by our results from the first half of 2017, we're not complacent," said CEO Steve Easterbrook. "Today, we're acting like a leadership brand, taking on new challenges and opportunities and moving with a greater sense of purpose and urgency."
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