McDonald’s Goes Upscale from Paris to Peoria A Big Mac, fries, and … a cappuccin
ID: 419073 • Letter: M
Question
McDonald’s Goes Upscale from Paris to Peoria
A Big Mac, fries, and … a cappuccino? These days, when consumers from Paris to Peoria go into a neighborhood McDonald’s, they can order meals made from fresh, locally grown produce and sip more sophisticated beverages. Of course, the fast-food chain’s well-known hamburgers are still the main attraction, but it is not just the food that is changing. The restaurants also look more luxe, some with sleek coffee bars and stylish armchairs that give customers a comfy place to linger over their lattés.
McDonald’s plan to move upscale started in Europe, an area that accounts for nearly $4 out of every $10 that the company earns. Only a decade ago, however, McDonald’s European sales were lagging as local consumers fretted over the few healthy choices and turned up their noses at the frumpy décor. The movement actually began in France, where people are famously particular about what they eat. “To make McDonald’s and a Big Mac work in the country of slow food, we felt we had to pay more attention to space and showcasing,” remembers Denis Hennequin, who was then in charge of McDonald’s in France and now heads McDonald’s in Europe.
Hennequin and his team started by modifying the menu for local tastes, introducing salads, desserts, and smoothies featuring fresh fruits and vegetables from French suppliers. They also cooked up new twists on McDonald’s sandwiches, including cheeseburgers with French cheese and a hot ham-and-cheese sandwich called the Croque McDo, the chain’s answer to France’s popular Croque Monsieur sandwiches. To reinforce the idea that McDonald’s was doing things differently, the company invited consumers to tour its restaurant kitchens and even meet with its produce suppliers.
The next step was to give McDonald’s restaurants in France an updated, upscale look to showcase the more upscale menu and to invite consumers to savor the fast food. Hennequin set up a design studio in Paris to develop nine different restaurant décors, ranging from interiors with sleek, simple lines and neutral tones to colorful interiors with large pictures of freshly picked produce. In the new interiors, the designers replaced McDonald’s usual bold red with a rich burgundy and toned down the glaring neon lights for a subtler look.
French consumers noticed the difference: sales at the McDonald’s restaurants with new menus and interiors increased by nearly 5 percent. McDonald’s then began giving its other European restaurants a menu and design makeover, a move that has boosted its sales growth in Europe by 15 percent. Now McDonald’s customers in Lisbon can order soup for lunch or dinner while customers in London can settle back into leather seats and use wireless Internet access. Reflecting changing lifestyles, McDonald’s is also stepping into the coffee culture in a big way. In Germany, where Starbucks is not yet a major force, the McCafé coffee bars located inside McDonald’s restaurants dominate the market.
McDonald’s has also brought its upscale movement to America, where the cappuccinos, iced coffees, and flavored teas served in its 1,000 McCafés are attracting many consumers who otherwise would have gone to nearby Starbucks outlets. An ever-growing menu of old favorites and newer alternatives like salads and wraps gives McDonald’s customers more choices than ever before. Some of its U.S. restaurants now feature amenities such as big-screen TVs and fireplaces as well as wireless Internet access, letting customers relax and enjoy themselves if they have the time. “We really wanted to make sure that we were the customers’ destination of choice,” notes the chief operating officer, adding that this goal means providing “convenience, comfortable seating, [and] great locations, along with value and the right offerings.
How do the changes that McDonald’s has made to move upscale address changing consumer lifestyles?
Explanation / Answer
Answer:
McDonald: Fast Food Restaurant Chain – International Brand and Player.
McDonald is the fast food product organization started around 1940 in US. Then they spread the business all around the world and now they present in more than 100 countries with more than 36000outlets in the world. This is the highest revenue generating food chain organization in the world.
The McDonald food chain organization promoted the business in international level. The McDonald uses the various marketing and advertisement process for promoting the business in international markets.
The changes that McDonald’s has made to move upscale address changing consumer lifestyles are as below:
Quick changes to suit local taste and needs: McDonald was quick in changing the products so that they can match the taste and preference of the local people so that th McDonald business survive and grows in the local market. This was first observed in France, where the local people did not like the McDonald products due to lack of their local taste. Thus McDonald quickly noticed this issue and started the required changes in their products so that local people in France can like the McDonald products.
Europe market capture with changes in McDonald Products: For McDonald, the Europe market was not impressive and they were not making good sales in this region. So based on the learning from France issue, they have started modifying the products to suit the local taste and needs such that people finds it suitable to their interest and the sale stated significantly for the McDonald business in Europe market as well.
Product changes with respect to the life style and people interest strategy: The strategy of McDonald for product changes with respect to the people life style and interest made the significant impact for the McDonald business and they were able to achieve significant growth and success in the Europe and global market.
Change management was an effective tool being utilized by the McDonald organization for making the product changes on time so that they can keep the consumers happy and maintain the interest of the consumers towards the McDonald organization.