Everyone knows that McDonald’s is struggling. It has been a behemoth of the fast food chains throughout the world for so long. However, all good times must come to an end and that is precisely what is happening to McDonald’s. A mixture of weak emerging economy growth combined with changing eating trends in developed countries is hurting McDonald’s revenue growth and contributing towards their shrinking global market share. In the United States and other developed nations, there has been a strong trend of health conscious eaters who would rather make meals at home, have them conveniently delivered, or go out to healthier fast food types of places like Chipotle and Panera. The diversity of fast food options is killing McDonald’s in these markets mainly because of their terrible reputation of being very unhealthy. Even though their prices are low compared to Chipotle and other healthier alternatives, consumers have more disposable income (especially since oil prices have dropped so significantly) and will have even more once wage inflation inevitably picks up. This means they will spend more for the healthier alternative. Currently, McDonald’s is experiencing most of its growth in developing nations where they are seen as an iconic and somewhat luxurious brand. However, the spending power of emerging market consumers is dwindling as most emerging market are lowering interest rates and their economies are struggling with high unemployment. So what besides firing its CEO can McDonald’s do about these problems?
Clearly they will have to update the designs of the stores to make it more comfortable and modern and well as updating their menu options to make them tastier, unique, and healthier. This is easier said than done. But to get people back into the stores, McDonald’s has revamped its advertising and launched a new campaign. Although the company is struggling, you must admire their resolve and their efforts for trying to recreate their brand image that has been sown so deep into American’s minds. They have a bunch of new commercials, some focusing on emotions (signs commercial) and some on poppy themes like love and friendship (with lots of color). Many think McDonald’s has failed in changing customer perceptions and their commercials in some cases are out of line and/or taken from elsewhere. McDonald’s Ad Review This may be true, but you gotta love their effort. After prolonged commercials covering a wide range of topics and positive public relations, McDonald’s can (over a long period of time) change their perceptions of being unhealthy and thrive in the new fast food environment. Who knows, maybe Grimace of the old McDonald’s commercials can lose some weight by eating McDonald’s for 30 days straight.