Customer relationship management and reputation strategies in company evaluation

Mcdonalds Customers

Customer Relations at McDonald's

McDonald's is a company that has increasingly come to face a dilemma regarding its relationship with its primary customer base. The fast-food giant is incomparably successful, having achieved a singular dominance in its sector and having likewise established an enviable brand recognition on a global basis. And yet, in terms of customer relations, the company is struggling today to achieve a positive resolution to its public image problem. In spite of its popularity and success, McDonald's is viewed as a major culprit both in the direct impact that its food has had on the public health and the indirect impact levied by its cultural connotations. As the discussion hereafter will show, this view has begun to have an impact on the fast-food chain's image-management strategy. Below, we explore the difficult customer relations balance that McDonald's must strike in simultaneously evolving to offer its customers healthier dining options and in protecting the characteristics and comestibles that have already helped to make it a top name in the food-services industry.

For McDonald's, the last decade has seen a major change in the way that consumers approach food choices. The rising epidemics of heart disease, diabetes and obesity have all forced us to reexamine the decisions we make as consumers. In turn, McDonald's has come under intense scrutiny for its role in damaging the public health. Indeed, as the leading fast-food purveyor, McDonald's is at the top of a list of food service retailers who are perceived as contributing to negative nutritional behavior and to all its related consequences.

An article by Bowman & Vinyard (2004) confirms this perception, reporting both on the rising trends relating to certain negative health conditions and on their connection to fast-food consumption. According to Bowman & Vinyard, "in the U.S., 64.5% of adults are overweight and 30.5% are obese [27]. Obesity increases the risk of many health conditions such as cardiovascular disease, stroke, hypertension, cancer, and diabetes [28 -- 30]. It is important that fast-food consumers should be aware of the nutritional consequences of eating fast food." (Bowman & Vinyard, 167)

This has placed McDonald's in a very challenging position with respect to consumer expectations. The convenience, familiarity, affordability and taste of its food are all contributing factors to McDonald's success. Improving the health of its menu offerings is critical but it is also essential that the company finds ways of doing this that don't eclipse these competitive advantages. This is elaborated in the article by Tsao (2002), which weighs the challenges facing McDonald's as it simultaneously works to alter its image and sustain its appeal to an established customer base. Tsao reports that the fast-food giant had been in something of an economic downslide as the public focus shifted to greater patterns of health consciousness, as its own market became more competitive and as McDonald's simply reached a plateau in terms of being able to expand its well-established brand in new markets.

Accordingly, the Tsao article reports that McDonald's would contend with a number practical difficulties in terms of meeting changing consumer expectations. With the patterns of consumer behavior beginning to shift toward health-consciousness and nutritional value, McDonald's has had to reexamine its credo of convenience at all costs. As the Tsao article reports, "it's a very large ship to turn around,' says S&P equity analyst Dennis Milton. And not only is McDonald's a mature company, with 30,000 stores worldwide, but its primary business is saturated: The market share that burger chains hold among all quick-service restaurants has fallen from 37.1% in 1997 to 35.3% in 2002, according to Chicago-based market researcher Technomic." (Tsao, 2002) In attempting to address this condition, McDonald's would begin modifying its menu in order to improve its poor nutritional reputation.

This would initiate the introduction of salad bowls, fruit and other healthier options on the McDonald's menu as well as more complete disclosure about the nutritional content of its various offerings. To the latter, McDonald's developed its online Meal Builder tool in 2010 in order to allow customers to shape their own nutritional experience at the restaurant. The calorie counting application allows customers to identify opportunities for limiting fat intake or improving the nutritional value of a McDonald's meal through certain combinations or exclusions. According to the McDonald's (2010) website, "whether you're looking to work with your own dietary needs, nutrition goals, or satisfy your cravings, we've provided the information you need. You can use the Meal Builder to subtract cheese from your sandwich, check the protein levels in your salad, or see the components of your kid's Happy Meal." (McDonald's, p. 1)

While this nutritional outreach has helped McDonald's to improve its repution somewhat, customer service still remains as one of the company's biggest obstacles. This is particularly problematic because customer relations with the large-scaled corporation are experienced almost entirely at the counter or drive-thru window of a restaurant location. According to the article by Lutz (2013), one in every five customer complaints relates to customer service in one of these locations. Because McDonald's employees are not well-compensated, turnover is high. This has a diminishing impact on the quality of service and, consequently, on the customer experience.

According to Lutz, McDonald's is working to improve customer relations by enhancing the technology that drives its customer experience. This, the fast-food chain hopes, will ultimately help to counterbalance the impact of high employee turnover and its attendant obstacles. According to Lutz, McDonald's is "implementing a 'dual-point' ordering system around the U.S., which involves the customer ordering at one end of the counter and taking a receipt with a number. When the number appears on a screen, his order will be ready at the other end." (Lutz, p. 1)

The hope is that this technology can help to expedite the ordering process and ultimately lower the possibility of human error. Additional steps taken to improve the customer experience, Lutz reports, would include the addition of a new staff position. The 'runner' would be dispatched to fetch sauce packets and juice boxes for Happy Meals, reducing the amount of time spent by cashier workers and food preparers moving from station to station. This would reduce floor traffic in the kitchen and lead to a consequently more efficient movement of the customer line.