McDonald’s is revamping its global strategy in hopes of stimulating sales and profits. Some of its planned changes are substantial. And, it has offered an honest self-assessment in a very public way. [Many firms do not even acknowledge their weaknesses outside of the company itself.]
Just a few days ago, the fast-food giant issued a major press release, “McDonald’s Unveils New Global Growth Plan.” Here are some highlights:
“The growth plan focuses on enhancing digital capabilities and the use of technology to dramatically elevate the customer experience; redefining customer convenience through delivery; accelerating deployment of ‘Experience of the Future’ restaurants in the U.S.; initiating a new 3-year target for cash return to shareholders; and establishing new financial targets for sales, operating margin, earnings per share, and return on incremental invested capital.”
“The strategy connects key tenets of the brand to well-defined customer groups built around three pillars: (1) Retaining existing customers by fortifying and extending our areas of strength. Through a renewed focus on areas such as family occasions and food-led breakfast and transforming the experience in our restaurants, McDonaldâs will build on the strong foothold it has and grow the core of the business. (2) Regaining customers lost to other QSR [quick-service restaurants] competitors. As customersâ expectations increased, McDonaldâs simply didnât keep pace with them. Making meaningful improvements in quality, convenience, and value will win back some of McDonaldâs best customers. (3) “Converting casual customers to committed customers by being more present in underdeveloped categories and occasions and competing more aggressively given the untapped demand for McCafeĚ coffee and other snack offerings.”
âWe have fundamentally changed the trajectory of our business over the past two years. Now, we are ready to build on our momentum and transition to focus efforts on profitable, long-term growth. We are building a better McDonaldâs, one that makes delicious feel good moments easy for everyone, and the moves we are making will reassert McDonaldâs as the global leader in the informal eating out category.â
“To bring customers into the restaurants, McDonaldâs must matter to people and be relevant in their daily lives. To do so, McDonaldâs is accelerating digital capabilities and enhancing its use of technology in restaurants, in the drive-thru, and on the go. The result is a more stress-free, personalized experience, enhanced by technology and world-class hospitality that puts customers in control.”
“One of the most significant disruptions in the restaurant business today is the rapid increase in delivery . Because of our extraordinary footprint, McDonaldâs is uniquely positioned to become the global leader in delivery. In McDonaldâs top five markets (U.S., France, the U.K., Germany, and Canada), nearly 75% of the population lives within three miles of a McDonaldâs. Currently, McDonaldâs is experimenting with different delivery models including partnering with third parties for ordering and fulfillment throughout the world.”
“Experience of the Future restaurants elevate the customer experience at McDonaldâs to provide a more convenient, more personalized, and more enjoyable visit. It leverages the convenience and technology of kiosk ordering and table service, increasing functionality of the mobile app to enhance the enjoyment of our food and the hospitality of the McDonaldâs crew, all in a more modern, more exciting restaurant environment.”
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Tags: business model, competition, customer expectations, Global Attitudes Toward Work Report, McDonald's, strategy, SWOT
