McDonald’s tests new formats to counter fast-food fatigue

Change is in the air at the Golden Arches, which is exploring where ‘to take its brand in the future,’ according to Neil Everett, VP marketing at Toronto-based McDonald’s Canada. ‘It’s no secret the company’s been struggling lately, so it’s a good time to figure out whether we’re positioned for growth and whether we’re meeting customer needs,’ he says. ‘People are far more time-pressed and programmed today than they were 15 years ago.’

Globally, McDonald’s saw its comparable sales for March 2003 decline 3.7%, continuing a trend that has seen sales fall each month in the last year. (Figures pertain to restaurants in operation at least 13 months.)

As a result, every aspect of the business is being analyzed by management in Oak Brook, Ill., from its menus to advertising and store design. The parent company even conducted a worldwide design review in January, says Everett, who isn’t able to offer more insight on what the store of the future might look like.

Meanwhile, north of the border, the fast-food chain has been testing 20-odd McCafés in existing McDonald’s venues for up to 18 months. According to Everett, they range from a kiosk to various store-in-store concepts. ‘It’s about giving moms more options in terms of what they can have at McDonald’s, and providing a better experience,’ he says, adding that there haven’t been any decisions on when a rollout would occur, or which version would be adopted.

Another format being evaluated by McDonald’s Canada is the Boston Market chain, which boasts ‘homestyle’ cooking. Two locations were unveiled in the GTA this past fall, offering what Bob Hissink, SVP, partner brands, calls the ‘four o’clock meal solution.’

‘We appeal to prototypical time-pressed households where mom and dad both work out of the home and have to prepare a meal quickly,’ he explains. ‘They are searching for convenience and have a desire to serve their families a meal they can feel good about.’

Advertising, from Bos Toronto, includes newspaper, local radio, and billboards featuring a close-up of the food with the tagline ‘take home like home.’ A plate promotion is also running, whereby every week 10 households return home to a bag hanging on their doorknobs. Inside is a plastic plate, along with an invitation for a free family meal. The redemption rate for the plate promo is close to 100%, reports Hissink, who stresses that McDonald’s is taking small steps with the chain.

‘We have plans to open another restaurant this year, but we’re going to take a deliberate and methodical approach.’