McDonald's brand value declined from $42 billion in 2014 to $39 billion in 2016 due to increasing prices, strong competition, and declining customer traffic. To combat this, McDonald's introduced strategies like co-branding, value menus, customized orders, and technology. Recent changes such as menu simplification, premium sandwiches, improved service, and delivery have helped performance. To further improve, McDonald's could add healthier options and more ordering methods to attract millennials.

1. Module Three: Application
Ava Russell-Morrison
American College of Education
Brand Positioning for McDonald's

2. Introduction
This presentation looks at the reasons for a a decline in brand value for
one of Fortune 500 companies, McDonalds for the past several years. It
also examines the postioning strategies that the company has used and
how it diffrentiates itself from its competitors.

3. Decline in Brand Value of
McDonald's
According to statistics from www.interbrand.com the brand value
for McDonald's saw a steady decline from $42, 254 million in
2014 to $39, 809 million in 2015 and $39, 381million in
2016.

4. Chart taken from www.interbrand.com showing the decline in brand value in McDonald's

5. Reasons for the Decline In Brand Value
McDonald's started to experience a decline in brand value when:
❑ they decided to "break the buck" (Duprey, 2016) and increased the prices
on its Dollar Menu;
❑ The Dollar Menu was changed at that time to the Dollar;
❑ More Menu where the range of prices went up to as high as $5.00;

6. ❑ Strong competition from other fast-food companies such as
Wendy's and Burger King;​​
❑Long service times which took eight to ten minutes (The Four-year Trend
That Is Killing McDonald's, 2017).
❑A steady four-year decline in customer traffic (The Four-year Trend
That Is Killing McDonald's, 2017).

7. ❑Poor quality of some of the ingredients that are used to prepare meals. For example,
the use of frozen beef to make their burgers;
❑Limited choice of accessing products in comparison to competitors who had started
to cater to millennials. For example, the use of apps, kiosk and delivery of its
products.

8. McDonald's Positioning Strategies
After experiencing several years in declining sales,
Easterbrook the then CEO of the company produced several
strategies to get this done. Some of these strategies include:
❑The introduction of a new Slogan, "To Be a Modern and
Progressive Burger Company".
❑The utilization of branding and cobranding, which
means there is somewhat of a partnership with
companies to work together to market a good of service
(HowMcDonald's Became The Leader in the Fast Food
Industry, n.d.)

9. Positioning Strategies cont'd
❑Companies such as Walmart is an example of companies
that McDonald's cobranded with as 340 of Walmart's
outlet now have the Franchise located within their stores.
❑Coca Cola is another company that they have used in the
branding and cobranding process as well. It is the
company's main supplier of soft drinks.

10. Positioning
Strategies
Nickelodeon and Barbie with the toys that
they put in the Happy meals were two
other companies that the company
cobranded with.
The company may have used cobranding
as a strategy to associate its brand with
others that have a salient brand attitudes
and obserrvable cues that will influence
the perception of consumers (Walson &
Charlton, 2015).

11. Maintaining Its Competitive Advantage
To ensure that it diffrentiates itself from its competitors, McDonalds have
engaged in the following activities:
❑The provision of value to their customers by keeping their dollar value menu
and allowing customers to have options to make their own menus;
❑The use of fresh ingredients and additions to the menu to cater to more
customers;

12. Competitive Advantage cont'd
❑Providing additional ways for orders to be made. For example, the use of
Kiosk, mobile ordering, shorter wait times and delivery options;
❑A new approach to market was taken on by the company which involved the
Marketing Mix. Cheaper prices for products, offering products that customers
want to include specific offerings at special time, promotion through contest
and coupons and targeting of customers of all ages (How McDonald's
Became the Leader in the Fast-Food Industry, n.d.) .

13. Recent Changes to Combat Decline
The measures that were put in place by the company has already been made
mention of in the competitive advantage above, but they include the following:
❑Lucas, (2019) stated that McDonald's had beaten earnings estimate due to
successful promotions;
❑an upgrade in over 5000 stores over the last two years;
❑Simplifying its menus and allowing consumers to customize their meals.

14. The company has also been incorporating these measures:
❑ Adding technology to its offerings​ such as mobile orderings;
❑ Catering to millennials and not just children and teenagers.
❑ Improvement in customer service​

15. In an interview in 2018, CEO, Easterbrook, stated that the company
has also been:
❑ premiumising its menu offering, introducing a more gourmet range of
‘Signature’ sandwiches and fresh-cooked burgers (Vizard, 2018).
❑ Offering delivery options to some customers as well as the the speed at
which orders are prepared is another thing that has been improving
performance so far.

16. Ways to Reposition McDonald's Brand
To attract more millennials, McDonald's I would suggest that they:
❑add healthier choices to their menu such as fat free items, gluten free
products and burgers that are made of vegetables only;
❑Provide more options to order such as calling in via the phone;
❑Delivery options in all locations.

17. References
Duprey, R. (2016). Why McDonald's Corp. Is No Longer a Top 10 Global Brand. Retrieved
from https://www.fool.com/investing/2016/11/04/why-mcdonalds-corp-is-no-longer-a-
top-10-global-br.aspx
Lucas, A. (2019). McDonald’s Earnings Beat Estimates as Promotions Drive Sales Growth
Retrieved from https://www.cnbc.com/2019/04/30/mcdonalds-q1-2019-earnings.html
Wason, H., & Charlton, N. (2015). How Positioning Strategies Affect Co-branding Outcome.
Retrievedfrom https://www.tandfonline.com/doi/full/10.1080/23311975.2015.1092192#aHR0
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TI/bmVlZEFjY2Vzcz10cnVlQEBAMA==

18. Vizard, S. (2018). McDonald’s CEO: We Are Not Trying to Take the Brand Upmarket. Retrieved from
https://www.marketingweek.com/mcdonalds-ceo-we-are-not-trying-to-take-the-brand-upmarket/
How McDonald's Became the Leader in the Fast Food Industry. (N.d.) Retrieved from​
https://profitworks.ca/blog/541-how-mcdonalds-became-the-leader-fast-food-industry-marketing-strategy
The Four-year Trend That is Killing McDonald's, 2017. Retrieved from
https://www.arcature.com/the-four-year-trend-that-is-killing-mcdonalds/
12 McDonald's, 2016 Retreived from https://www.interbrand.com/best-brands/best
-global- brands/2016/ranking/mcdonalds/
https://bstrategyhub.com/mcdonalds-swot-analysis/