At McDonald’s, butter is The New Nimble

We talked in class about brand equity’s dependence on marketing programs, including product innovation and trade relationships, and I used McDonald’s as an example of what this concepts look like in practice.

Now Bloomberg is just out with an article about how McDonald’s is trying to turn its fortunes around with more responsiveness and speed than any time in its past – it’s what they’re calling “the new nimble.”

Case in point? It took McDonald’s 4 years to develop McGriddles, and only 6 months to switch from margarine to butter. Seems simple, but that’s a Titanic shift. It better be. As the graphic of the chain’s food quality score above illustrates, if McDonald’s doesn’t get its changes right, it might just go the way of the Titanic. (with special sauce.)

http://www.bloomberg.com/news/articles/2016-06-22/tweaking-mcmuffins-speeds-mcdonald-s-ahead-of-breakfast-rivals

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4 thoughts on “At McDonald’s, butter is The New Nimble

  1. Paige O'Grady

    I think that “the New Nimble” is something that McDonald’s is well overdue for. It’s crazy to me to think that, over the course of four years, consumers taste preferences were tested, recipes were built and tweaked, and then finally the product was released. With the speed that the external environment changes, I think it’s obvious that the restaurant needs to either speed up the dispersement of change or flatten their system, or they will risk getting left behind.

    But with that being said, Bloomberg also makes an important point about the menu needing to be at the right pace and customer-driven. “You move too far, too premium or too edgy, then you lose the people.” This is also true, and McDonald’s needs to ensure they are never alienating their hardcore fans (i.e., seniors and late-night snackers, who both tend to love the classics).

    Reply
  2. joelleleung

    I think it is important for McDonald’s to be responsive to stay competitive in the fast food industry. Depending on the nature of the products, sometimes if it takes four years to develop a product, by the time the product is launched it might already be outdated to consumers. The Bloomberg article has clearly demonstrated the importance of understanding consumers’ needs and preference in order for a brand to successfully build a favourable products, but it also brought up a good question – ” How long should a new product to be tested before its launch is considered reasonable?” Aside from conducting focus group with consumers, studying insights from the franchisees sometimes might be a more efficient way to understand the consumers as they interact with the consumers on a daily basis. At the end of the day, the management’s confidence level is the key driver of the launch of a new product. There could be endless researches companies could conduct, managers still need to make some of their decisions based on their gut feelings and past experience, something that could not be quantify.

    It is also amazing to see how responsive and efficient McDonald’s suppliers are. With no doubt, the 4 month change would not be possible. It also demonstrates that one “simple” business decisions always involved layers of complex decisions before result could be executed.

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  3. Amy Lau

    I also believe that is important for McDonald’s increased responsiveness to the market is long overdue. There is such a huge emergence when it comes to healthy food and just food culture in general that McDonald’s really needs to step up their game in order to meet market trends, while still maintaining that McDonalds essence. With the emergence with the build your own burger campaign, I think they are definitely moving into the right step!

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  4. Royce Mok

    I also agree that McDonald’s increased responsiveness as been needed for quite a long time. Just the recent trend of healthy food has shown that McDonald’s needs to become more responsive to the trends of society in order to stay relevant to consumers. This is especially shown in the consumer perception diagram of McDonald’s that you posted as McDonald’s has the worst food quality score. While consumers may stop and eat once in a while, consumers will most likely prefer to eat at another other fast food restaurant that McDonald’s which means that McDonald’s need to respond faster to the changing consumer demands or it will find itself being less relevant to the consumers and losing market share to its competitors.

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