Skip to main content

Winning customers

Six out of 10 McDonald's outlets in the UK are run by franchise owners, each of whom contributes 4.5% of sales to the group's marketing budget. This may be a useful benchmark for your business when you think about how much you spend on promoting your business.

While McDonald's frachisees expect to see great TV advertising for their money, local retailers might like to think about the strategies behind the advertisements.

In 2005 McDonald's had a terrible year in the UK, losing sales and generating bad PR. In the past year, sales have grown by £460 million, chief marketing officer Jill McDonald tells Campaign magazine, driven by £90 million of marketing spend.

The turnaround has been achieved by refreshing the outlets, investing in better kitchen equipment so it could deliver hot food faster, and by promoting the quality of its food.

If you look behind most successful local shops in the UK you will see a similar pattern: investment in making the store attractive, getting the customer offer right and talking up the qualilty of what you do.

The real lesson is that even with a £90 million marketing budget, McDonald's says it cannot be complacent. "If we don't meet our customers' needs they'll soon tell us," says Jill McDonald.

As food-to-go becomes a bigger category for local shops and as the government pushes its healthy eating agenda, expect to learn from the marketing messages that McDonald's uses and to feel the chill wind of competition from its outlets.

Comments

Popular posts from this blog

Digital disruption in the UK wholesale space

“Twenty years ago I was driving boxes to the post office in my Chevy Blazer and dreaming of a forklift,” says Jeff Bezos in his most recent letter to shareholders. A blink later and he points out that the company has grown from 30,000 employees in 2010 to 230,000 now. But his ambition is the same. “We want to be a large company that’s also an invention machine. We want to combine the extraordinary customer-serving capabilities that are enabled by size with the speed of movement, nimbleness and risk-acceptance mentality that is normally associated with entrepreneurial start-ups.” Amazon is great at disruption because of its customers focus and the fact that the internet means it needs none (or very few) people between its warehouses and the shopper. The threat of Prime, its membership service, is the biggest challenge facing the UK retail market and the wholesale market by extension. It is both a direct threat and an indirect threat in that is inspiring countless numbers of othe...

New look: big copy small?

The owners of B&Q are talking up how they have cut the price of a store refit from £2.5m to £1m by using wood-effect vinyl instead of wood and painted MDF backboards for displays. Managers are learning to live with grey shelving instead of a warmer-looking cream. Shoppers notice the produce, not the fixtures, suggests one executive. Up to a point! Most local retailers will extract the maximum possible life from their fixtures, sometimes taking too long to change equipment that has become tired. As in all business, it is getting the balance right. Shops need to be refreshed and with a purpose.

What do shoppers see

I read a good post (http://www.newsagencyblog.com.au/2009/08/28/what-do-newsagents-charge-for-faxing.html) asking what price local shops charge for providing a fax service. The blogger had attached a photograph of his sign with his prices on it. What struck me was the message on the sign. "You drop, we fax," it said. "Pressed for time, drop your documents with us and we'll do it for you at no extra charge." That is a message that will persuade most shoppers that you want to give them good value, even if they stay to do the copying or faxing themselves.