Mcdonald's Strategic Turnaround

McDonald’s has never been shy about spending advertising dollars. Every year, they take a well-deserved place on the “ Top 100 Advertisers” list. The total amounts spent from year to year make one thing very clear, McDonald’s believes in the power of advertising and they utilize advertising, in various forms, to achieve their marketing objectives. The losses that were posted in 2002, ultimately, fostered changes that caused the overall marketing objective and strategies of McDonald’s to shift. McDonald’s was operating with the priority objective being growth. Franchise expansion was the number one priority, and in the late 90s and early 2000s, this lack of “customer first” thinking was showing. There was not a single, clearly definable brand direction.1 Instead, various marketing campaigns and slogans were used in, what was considered, a mass marketing effort. In 2003, when Larry Light was handed control of McDonald’s marketing, a very clear strategy was put into place, one that coincided with the newly defined objectives of the company. What were these objectives? The most important objective was to listen to the customer and meet the needs of the customer. Delivering quality, value and service in a clean and comfortable environment was also priority. In addition to these objectives, McDonald’s also now had two target market groups and a new direction and voice for the brand. This wasn’t just another advertising campaign, this was quantum change; change that paid off in increased sales and profits for the company. The changes that took place in 2003 have stayed with McDonald’s and continue to be reflected in the marketing strategy. Any analysis of the current strategy will need to include an awareness of the 2002 circumstances that precipitated them. The wisdom of McDonald’s response during that crisis, was in analyzing the situation thoroughly, taking the time to fully understand the mistakes being made, and then formulating a long-term strategy that applied...