McDonald's mimicking Starbucks a good idea?
Hi Class!
The November 20th edition of Brandweek featured an article titled "The Golden Arches Rains McDVDs on Consumers." The article talks about how McDonalds is continuing their attempt to mimmick Starbucks. Over the past few years, McDonalds has tried to revamp their restaurants to a cozier, earthier feel, reflecting a Starbucks-esque style. This includes replacing the plastic chairs with cushioned chairs, booths, and even leather one-seaters. Dimmer lights and flat screens decorating the walls are just more examples of how they are mimicking a Starbucks environment. In addition, they just recently introduced new premium coffee.
Their latest copy-cat-with-a-twist move is selling entertainment. While Starbucks is getting comfortable with CD sales, McDonalds has decided to invest in movie entertainment. Here they are renting DVDs for $1/night via Redbox Kiosks, a wholly owned subsidiary of McDonalds. The rationale for their move? According to the article 70% of their customers eat off premise. This ultimately translates to customers spending a simple additional dollar for take-home entertainment that is conveniently right there.
Is all this a good move for McDonalds? The environment at Starbucks, the CDs, and the premium coffee all contribute to Starbucks' impressive success. But can McDonald's take all these ingredients and expect to bake a similar cake? Its hard to tell but my ultimate answer is yes, to a certain degree. Starbucks has mastered this kind of environment for years, and has with it a premium product - high end coffee. The associations in its brand meaning are mainly positive. McDonalds on the other hand, still has the negative associations of junk-food, an association that is weighed heavily when considering the current health-conscious trend. However, the positive associations that will come with the new environment will give it a competitive edge over Taco Bell, Wendy's, Burger King and other fastfood chains that not only are unhealthy but have an inferior environment.
-John Lewis
posted by Brand007 @ 5:27 PM
1 Comments:
I actually disagree. In some ways renting DVDs does seem like a good move for McD's. The DVD rentals are cheap which fits with McD's pricing strategy, plus I would assume that consumers have to come back to McDonalds to return the DVD, thus giving McDonalds the chance to make a second sale.
But as far as the leather furniture and more upscale environment, this makes no sense. It works for Starbucks because of what their brand meanings are. It is supposed to be a leisurely experience, a break from the rest of the world. This is why Starbucks has no clocks and provides the consumer with a comfortable environment to sit and lounge. Plus the longer you stay, they figure the more you will buy. But this environment is consistent with their premium products. McD's does not have premium products. They do not charge a price premium, and they make their money because they are able to service so many people with their quick turnover. That is why the products are ready made for you and not all made to order. Making the environment comfortable tends to have the effect of making people stay longer, but do you really want to meet people in McDonalds and hang out there, no. At least I don't. Plus I don't think that keeping the consumer longer in this environment will get them to spend any more money. They've already got more than they can eat with their super size meal. McDonalds is supposed to be about fun, fast and cheap, not a leisurely, upscale experience.
- Berit Auerbach-Lynn
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