|McDonald's Hope That They See Shareholders Smile|
|Subject||Characteristics and comparative statics|
|Key Words||Advertising, employees, company, revenue, shareholders, stock, restructuring, sales, technology, customer service, net profit|
McDonald's Corp. has unveiled a new advertising slogan: "We Love to See You Smile". It replaces the three-year-old "Did Somebody Say McDonald's?" slogan. The ad campaign will feature employees speaking of freshly painted restaurants and modern kitchens that make customers smile. It will cost $500 million. The company hopes that the ads will spark stronger domestic revenue growth and please shareholders who have deserted the company's stock. McDonald's has room for improvement especially in the breakfast and dinner hours.
The ad campaign follows closely on the heels of a corporate restructuring that decentralized decision-making power to division offices and allowed regional menu variations; consumer focus groups that suggested better service was critical; new menu items such as the McFlurry dessert and the McSalad Shaker; more efficient kitchens; and computerized ordering systems which give the cooks more accurate information. Observers believe that branding is not enough: the success of the advertising campaign and new technology depends on the standard of customer service.
Notwithstanding McDonald's stock price, the company dominates the market: of the top 100 restaurant chains, McDonald's accounts for $1.95 billion of the $5.95 billion net profit generated in 1999. Also, its overseas sales grew by approximately one-third over the 1995-99 period.
(Updated August 1, 2000)
|Source||Greg Johnson, "Did Somebody Say Cheese?" Los Angeles Times, June 30, 2000.|
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