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The Revitalisation of McDonald’s Australia
VP Strategic FranchisingJoanne Taylor
- 10
- 5
0
5
10
15
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 J an- 03
Sales TC
McDonald’s Performance History
Key Customer Insights
• “I grew up - McDonald’s didn’t”
• “The food, environment, service
is plastic and processed”
• “Maccas is for everyone else!”
Key Issues- Internal
• No business plan or planning culture• Lots of activity without purpose or direction• Growth through new restaurants• Functional silos & politics• Constrained by Operations culture/focus• Vision limited by tenure• Franchisees and Company not aligned• Little expectation of future success
Key Issues- External
• Unresponsive to customer needs
• Become a follower not a leader
• Increased direct /indirect competition
• Reduction in QSC
• Perceived and real food quality issues
• Perceived and real health/nutrition issues
• Obesity whipping boy
• Silence on issues equalled guilt
In November 2002 we set out on a mission to address key issues
“…doing the same things does not produce different results…”
180 Business Approach
OLDHomogenous Model
Attract people to McDonald’s
NEWHeterogeneous Model
Make McDonald’s
attractive to people
Look Inwards
BRAND VALUES
Look Outwards
‘Blueprint’ Objectives
• Fix the food
• Get relevant
• Become Australia’s favourite brand
‘Blueprint’ Imperatives
• Customer first
• System wide approach
• Focus- ‘Less is more’
• Zero tolerance
• Stay the course
Critical Actions- External
• Transparency- consumer & media
• One on one’s with opinion leaders
• Food: myth busting; quality stories; new options
• Advertising: new messages and tone of voice
• Website: interactive menu
• Change the restaurants: design & merchandising
TFA Free Oil
Espresso Coffee
Never Stop Playing TVC
Yagoona 1971Welcome to McDonald’s
Gosford West – NSW
Collingwood
Northland - VIC
Edgeworth – NSW
Lakehaven – NSW
Young - NSW
Happy Meal Choices
Heart Tick
Made for You
100% White Meat
PremiumChicken
McChickenChickenDippers
Angus Beef
QSC – The Core of McDonald’s
• New measurement technologies Improved physical layouts & service platformsStreamlined communication & simplified processesChanges to consulting practices
…and the results?
Who would have thought?
Maccas would become Australia’s largest retailer of ready to eat salads
Salads Plus = a $130 million brand
Who would have thought ?Maccas would be a main exhibit at the
Dieticians of Australia Convention
Who would have thought ?
A Macca’s CEO would be a key note speaker at a Kids Nutrition Seminar and on the Board of The Diabetes
Association of NSW?
moremoreofof
thisthis
Customer Insights
• “McDonald’s is definitely changing for the better…”
• “I used to associate McDonald’s with greasy burgers…now it’s a very different place…”
• “I feel a lot better about going to McDonald’s…since they changed the menu and started telling the truth…”
*Benchmark Research
Progress … not success
“ …Its clear to preferrers and non-preferrers alike that McDonald’s is changing; however it is regarded as evolutionary not revolutionary…
…they see McDonald’s as catching up with the dramatic shifts in informal eating behaviours of the past decade…”
*Benchmark Research
Sales & GC Comps
8.7
5.9
3.5
8.7
13.78
10.63
5.0
0.71.9
4.4
7.5
5.14.2
2.12.7
-2.6-0.9
0.6
-2.9
-6.8
-4.2
-10
-5
0
5
10
15
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Sales GC's
Results
• 6th year of positive Comp Sales and GCs
• Average restaurant sales up over 47%
• Company & Licensee profits @ record levels
• Average restaurant value up
• Market share increasing
• Customer attitudes changing for the better
• Focus on sustainability
• Become a leader in CSR
• Continue to work with nutrition groups
• Ongoing support for community initiatives
• Help bridge the gap between education and industry
• Continuous improvements in QSC
• Bringing it all together
Moving Forward
Bringing it all together …
Long Term Growt
h
Focus on CustomersImprove QSC
Licensees as best practice
• Rewards, recognition and consequences
• Grow best practice Licensees
• Licensee development programs
• Recruitment and selection of the best new Licensees
• Licensee engagement
Licensees Leading the Charge
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