McDonalds Goes Upscale from Paris to Peoria

March 28, 2012 Hongyeon Lee

Topics to be covered
. McDonalds Corporation . Description of the Case

. Case Questions & Answers

. McDonalds Corporation
The business began in 194 0, with a restaurant opene d by brothers Richard and Maurice McDonald in San Bernardino, California McDonald's first filed for a U.S. trademark on the na me "McDonald's" on May 4, 1961, with the descripti on "Drive-In Restaurant Se rvices"
http://www.youtube.com/watch?v=GxXDD_7lgYw

. McDonalds Corporation (continued)

McDonald's restaurants are found in 119 countri es and territories aroun d the world and serve 5 8 million customers eac h day McDonald's operates ov er 33,000 restaurants w orldwide, employing mo re than 1.7 million peop le

. McDonalds Corporation (continued)

Most standalone McDo nald's restaurants offer both counter service an d drive-through service, with indoor and someti mes outdoor seating. Some McDonald's in su burban areas and certai n cities feature large ind oor or outdoor playgrou nds

. McDonalds Corporation (continued)

Approximately 15% of McDonald's restaurants are owned and operate d by McDonald's Corpor ation directly The remainder are oper ated by others through a variety of franchise ag reements and joint vent ures

. McDonalds Corporation (continued)

In 2006, McDonald's int roduced its "Forever Yo ung" brand by redesigni ng all of its restaurants, the first major redesign since the 1970s McDonald's has increas ed shareholder dividend s for 25 consecutive yea rs, making it one of the S&P 500 Dividend Aristo crats

. Description of the Case

McDonald planned to move upscale in Europe. Modifying the menu. Upscale in space and showcasing. New modern interior and decoration. 5% revenue increase in France. 15% revenue increase in Europe. Changing Lifestyle for coffee culture.

. Description of the Case

Customers can order meals made from fresh, locally grown produce and sip more sophisticated beverages The restaurants look more luxe, some with sleek coffee bars and stylish armchairs that give customers a comfy place to linger over their lattes

. Description of the Case

McDonalds moved upscale in France by modifying the menu for local tastes, introducing salads, desserts, and smoothies featuring fresh fruits and vegetables from French supplies

. Description of the Case

The next step was to give McDonalds restaurants in France an updated, upscale look to showcase the more upscale menu and to invite consumers to savor the fast food

. Description of the Case (continued)

Now McDonalds 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

. Description of the Case (continued)

In USA, the cappuccinos, iced coffees, and flavored teas served in its 1,000 McCafes are attracting many customers who otherwise would have gone to nearby Starbucks outlets

. Description of the Case (continued)

III. Case Question No.1

1. How do the changes that McDonalds has made to move upscale address changing consumer lifestyles?

III. Answer to Case Question No.1

McDonalds provided convenience, comfortable seating, great locations, along with value and the right offerings by satisfying consumers in different countries having characteristic lifestyles.

III. Case Question No.2

2. What values seem to be reflected in the changes that McDonalds has made?

III. Answer to Case Question No.2

Values such as materialism, the home, family and children, health, hedonism, authenticity, the environment, and technology have been reflected in the changes that McDonalds has made. People in different countries are exposed to different cultural experiences, a situation that leads to cross-cultural differences in values. All cultures can be classified according to four dimensions of individualism versus collectivism, uncertainty avoidance, masculinity versus femininity, and power distance.

III. Case Question No.3

3. What aspects of personality do you think McDonalds marketers should pay particular attention to as they plan future menu and restaurant changes?

III. Answer to Case Question No.3

I think McDonalds marketers should pay particular attention to national character based on the following reasons: Personality traits can sometimes be used to stereotype people of a particular country as having a national character. These characterizations represent only very broad generalizations about a particular country; obviously, individuals vary a great deal.

Q & A Session