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NEW BUSINESS PITCH
I’M LOVIN’ IT
NAME BRAND PITCH TYPE
AdvertisingWork
MARKET
United States
DATE
April 26 , 2016
The Data You Need to Win This Pitch
McDonald’s puts U.S. creative
account in review.
th
DESCRIPTIONMcDonald's is issuing a request for proposals to three major holding companies to find a single creative agency to work on its massive
U.S. business. McDonald's currently has Omnicom's DDB and Publicis' Leo Burnett handling the bulk of its national advertising. Both Omnicom and Publicis are part of the RFP process that begins Monday, along with WPP. The move comes as McDonald's has
determined that it wants a more uniform set of creative and strategic ideas. It also wants to be able to push those concepts more rapidly across the variety of channels where it puts its messaging, including everything from its mobile app to television commercials.
Client Profile / Market
Dick and Mac McDonald opened their eponymous burger stand in 1948 in San Bernardino, Calif. Under the guidance of Ray Kroc, a onetime milkshake-mixer salesman wowed by the restaurant's success, McDonald's franchises grew swiftly: by the end of the 1960s, there were more than 1,000 across the U.S. The first international franchise opened in 1967 in British Columbia, and was followed by another in Costa Rica later that year. From there, the chain spread steadily: over a six-month period in 1971, Golden Arches popped up on three new continents, as stores launched in Japan, Holland and a suburb of Sydney. A Brazilian McDonald's opened in 1979, bringing Ronald McDonald to South America for the first time. McDonald's reached its sixth (and, barring a sub-Arctic drive-thru, final) continent in 1992, with the opening of a restaurant in Casablanca, Morocco.
FINANCIAL OVERVIEWCOMPANY BACKGROUND
MAIN COMPETITORS
2015 Sales (mil)
2015 Employees
Employee Growth Percent
Assets (mil)
Net Income Growth Percent
Sales Growth Percent
25,413
420,000
NA
37,938.699
-4.8%
-7.4%
Fast Food industry in numbers
2015 U.S. REVENUE
$225b- IBISWorld -
50% 50%
Quick Service Restaurants (Fast Foods + Fast Casual)account for half of sales in the entire restaurant sector
OTHERS QSR
200,000FAST FOOD IN THE U.S.
ANNUAL GROWTH 10-15
2.5%- IBISWorld -
Americans and Fast Foods
FAST FOOD FREQUENCY
AMERICANS EAT AT ONE FAST FOOD EVERYDAY
50MLN- Pew Research Center -
30%OF CHILDREN AND ADOLESCENTS,AGED 2-19, CONSUME FAST FOOD
ON A GIVEN DAY- CDC's National Center for Health Statistics -
Fast Food: a convenient choice
AMERICANS SPEND
10% OF THEIR DISPOSABLE INCOME ON FAST FOOD EVERY YEAR. 20% OF ALL AMERICAN MEALS
ARE EATEN IN THE CAR
30%
22,5%
7,5%
0%
15%
In-N-OutFive GuysMcDonald’s
29%
11%9%
17%
12,7%
4,25%
0%
8,5%
WhataburgerIn-N-OutFive Guys
17%
11%
17%
FAST FOOD WITHTHE BEST FRIES
FAST FOOD WITH THEBEST BEEF BURGER
Cheap 31,7%
I just Like it 30,6%
Lack of other Options 13,2%
Other 5,6%
Convenient 67,2%
REASONS TO EAT AT FAST FOOD RESTAURANTS
- Stanford University Research - - Advocate Health Care -
- YouGov, June 2015-
McDonald’s still the biggest player
40.000
30.000
10.000
0
20.000
McDonald’s
FAST FOOD by REVENUE
Starbucks Subway Burger King Wendy’s Taco Bell
35.447
12.68811.900
8.640 8.5128.200
McDonald’s 2015 Global revenue
$25.4b
of its system restaurants
40%U.S. Market represents
The Golden Arches had to Face 2 Years of Decline
McDonald’s 2015 ExpenditureOn measured media
$824M
(not franchised) outletstores in 2015
154In U.S. McDonald’s closed
1
0
- 2
- 1
McDonald’s U.S. BUSINESS FINALLY IMPROVING
- 3
0.70%
Q3-13
Q4-13 Q1-14 Q2-14 Q3-14 Q4-14 Q1-15 Q3-15
-1.40%-1.70%
-1.5%
-3.30%
-1.70%
-2.6%
-2%
Q3-13
0.90%
The restaurant chain’s U.S. comparable sales rose for the first time in 2 years in the third quarter
Source: Company Filings
McDonald’s Innovation to Rise Again
ALL DAY BREAKFAST CREATE YOUR TASTE GREEN COMMITMENTS
“Sales for Egg McMuffin in September were up 21% compared to the in-going
period”
Mike Andres, president of McDonald’s USA
- Nov. 2015 -
The company is working with franchisees to develop a consistent, predictable and compelling national
value platform.
“The new platform will not be tied to a singular price point, but it will enable
our customers the opportunity to bundle their own meals to suit their desire, which they have indicated to
us is very important to them”
The company previously committed to sourcing antibiotic-free
chicken by 2017
McDonald’s plans to use only cage-free eggs over
the next decade
McDonald’s also has changed beef-cooking and bun-toasting procedures to produce tastier, juicier hamburgers.
Consumer trends
83% of consumers like to patronize restaurants known for treating their employees well.
73% of respondents choose to patronize restaurants that support their local community or causes they believe in.
At restaurants that promote positive business practices and responsibly source ingredients, 52% expect fresher food, 48% expect healthier food, 45% expect the food to taste better, and 33% expect the food would cost a bit more but be worth it.
The top menu claims that influence consumers' menu choices were: Fresh (86%); Local (73%); Whole Grain (68%); All Natural (66%); and No High Fructose Corn Syrup (62%).
Other menu claims that influence ordering include: Grass Fed/Pasture Raised (59%); Hormone Free (57%); Antibiotic Free Protein (56%); Free Range/Free Roaming (55%); Non GMO (55%); Sustainably Caught/Raised (54%); Fair Trade (54%); Heirloom Fruits and Vegetables (52%); Cage Free (52%); and Organic (50%).
40%
30%
10%
0
20%
Jersey Mike’s Subs
FASTEST GROWING RESTAURANT CHAINS
Chipotle Mexican Grill Firehouse Subs
- Nation’s Restaurant News, June 2015 -
Total Unit GrowthSales Growth
THOUGHTFUL EATERS
• • •
• • •
QUICK DEFINITION
“These young consumers are responsible about their diet. Food for them is a source of nutrition as well as enjoyment. They are not on any particular diet, rather do their best to eat a healthy, balanced lineup of meals. They try to eat breakfast every day,
regularly eat organic foods, and rarely eat fast food. Eighty-five percent of this segment are female.”
HEALTH RESTAURANTS PEOPLE AND SOCIETY
FOOD
THOUGHTFUL EATERS: FOOD MCDONALD’S AUDIENCE CROSSOVERS
Organic & Natural foods are poorly popular
(P: 48.3)
The Foodies trait is popular also on McDonald’s audience
(P: 173.6)
Udi’s (R 46.9). Van’s foods (R 41.1) and Earthbound Farm (R 78.9) are not
appreciated food brands.
Juicing Vegetable (R 34.0), Food Babe (31.2) and 12Tomatoes (51.9) are not
followed.
TOP FOOD BRANDS TOP FOOD REFERENCES
UDI’S VAN’SFOODS
EARTHBOUNDFARM
JUICINGVEGETABLES
FOODBABE
12 TOMATOES
FOODIES168.6
( popularity index )
ORGANIC &NATURAL FOOD
199.6( popularity index )
KNOW MORE?
KNOW MORE?
THOUGHTFUL EATERS: RESTAURANTS MCDONALD’S AUDIENCE CROSSOVERS
Peet’s Coffe (R 50.2), Earth Fare (R 82.5) and The Cinnamon Snail (R 83.6) are
underindexing.
McDonald’s audience underindexing on Fine Dining Restaurants
(P: 73.2)
35% of McDonald’s followers is interested in Casual Dining Restaurants
Chez Panisse, Seasons 52 (R 57.6) and Commander’s Palace are underindexing.
TOP SERVICES
EARTHFARE
PEET’SCOFFEE
THE CINNAMONSNAIL
FINE DINING 26.8%RESTAURANTS122.9
( popularity index )
TOP SERVICES
CHEZPANISSE
SEASONS52
COMMANDER’SPALACE
Interested in casual dining restaurants, food trucks
& others
KNOW MORE?
KNOW MORE?
THOUGHTFUL EATERS: PEOPLE & SOCIETY MCDONALD’S AUDIENCE CROSSOVERS
They are not Local Participants at all(P 9.1)
Just the 58.8% of McDonald’s audience is interested in People & Society.
Social Issues and Advocacy (46.9%)And Green living and Environmental
issues (P 32.4) don’t catch their attention.
The Non-GMO project is almost unknown to the McDonald’s audience
(R 21.3)
80.8%Interested in
People & Society
70.2%cares about SocialIssues & Advocacy
Green Living &Environmental Issues
187.7popularity
TOP ORGANIZATION / MOVEMENT
NON GMOPROJECT
LOCAL PARTICIPANTS128.5
( popularity index )
TOP SOURCES
NATURALNEWS
ATTAINABLESUSTAINABLE
ONE GREENPLANET
KNOW MORE?
KNOW MORE?
THOUGHTFUL EATERS: HEALTH MCDONALD’S AUDIENCE CROSSOVERS
Sunwarrior’s holistic approach doesn’t attract at all the McDonald’s audience.
People interested in McDonald’s isn’t Health Conscious at all
(P 15.8)
Herbs & Oils World (R 29.5) and Mountain Rose Herbs (R 22.7) aren’t relevant
brands.
All the resources exploited by Thoughtful eaters are little relevant to people interest
in McDonald’s.
TOP HEALTH RELATED NEWS SOURCES
GLUTEN FREERESOURCESDIRECTORY
MINIBODY GREEN
EVERYDAY ROOTS.COM
HEALTHCONSCIOUS
192.7( popularity index )
TOP HEALTH BRANDS
SUNWARRIOR HERBS & OILS WORLD
MOUNTAINROSE HERBS
KNOW MORE?
KNOW MORE?
4.5%
THOUGHTFUL EATERS
McDonald’s - Thoughtful EatersAdherence
McDonald’s audience share just the 4.5% of
Thoughtful Eaters behavior on Food,
Restaurants, People & Society matters
and Health.
CONSUMER INSIGHTS SUITE
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