Marketing concepts and strategies

Marketing Case Study

How should McDonald's respond when ads prompting healthy lifestyles featuring Ronald McDonald are equated with Joe Camel and cigarette ads? Should McDonalds' eliminate Ronald McDonald ads?

As Ronald McDonald is at the center of many of the company's global branding efforts and is the personification of their brand itself, it would be foolish to eliminate the ads featuring Ronald. Instead McDonald's needs to rely on its range of characters and create story lines that accentuate and focus on healthy activity, including bike riding, going out and playing sports, and create team-based scenarios to underscore cooperation and collaboration. The messaging could still focus on food as a means to refuel after fun and healthy activity as Ronald works to get back into shape for a favorite sport, say soccer for example, which is very popular throughout European nations. McDonald's would be wise to create an entirely new healthy kids menu too, and have Ronald promote that as part of his "get in shape for soccer" campaign. That would completely negate this threat to their brand and still generate add-on revenue.

2. Discuss the merits of the law proposed by France that would require fast-food companies either to add a health message to commercials or pay a 1.5 per cent tax on their ad budgets. Propose a strategy for McDonald's to pay the tax or add health messages and defend your recommendation.

The tax is punitive and meant as a threat and tariff for not delivering healthy messages to children. McDonald's should not pay the tax and instead should focus on story telling of healthy adventures by Ronald McDonald and the cast of characters that the company has already created. The stories could center on "getting in shape for soccer" and could focus on specific activities and programs that are specific seasonal sports. One entire series of stories could focus on getting in shape for summer and summertime sports, including hiking, swimming and diving. The entire series of story lines could focus on healthy activity, and with added items on the menu, McDonald's could transform itself into a leading proponent of healthy activity and healthy eating for children.

3. If there is no evidence that obesity rates fall in those countries that ban food advertising to children, why bother?

Because McDonald's cannot be ethical and morally focused in some countries and not in others, they must be consistent from a Corporate Social Responsibility (CSR) standpoint across all countries they operate in. The essence of a strong brand is consistency. The research also is inconclusive about the effects of advertising over the long-term and as a result, opens to interpretation by lawmakers and consumer rights groups. In other words, the data can be easily used as a means to push more taxes and laws on McDonalds' and companies in this industry due to lack of compliance. It is better from a branding standpoint to be consistent globally and reinforce a single message across all geographies the company operates in.

4. The broad issue facing McDonald's in most of the Western countries is the current attitudes toward rising obesity. The company seems to have tried many different approaches to deal with the problem but the problem persists. List all the problems facing McDonald's and critique their various approaches to solve the problems.

The first problem is the fat content of the foods and the tripling of the portion sizes. The calories in their meals are nearly three times what a typical child needs for an entire day of caloric intake, and to make matters worse, the fat percentage of French Fries is at 60% or more. The combination of serving sizes and calories is a major challenge for the company going forward. According to the case study, the focus has been on gaining the approval of various European government agencies to support their claims of certain food items being less fattening than others, yet this has been seen as dubious by Nordic nations and their governments.