REBRANDING

Re-branding Of Chain Restaurants Or Hotel Group



Re-branding Of Chain Restaurants Or Hotel Group

Rethinking the McDonald's empire

Established in California during the 1940s by two brothers, the McDonald's restaurant became a popular teen hangout in the first flush of post-war affluence. To feed these youthful bodies, the brothers reduced the menu to the perennial favourite - hamburgers - applied assembly line techniques to food production, the Speedee Service System, and expanded to four restaurants by 1953. Taking note of the brother's success, in 1955, Entrepreneur Ray Kroc bought the right to franchise the McDonald's System. Renamed the McDonald's Corporation in 1960, Kroc focused his marketing effort on the family meal and children, spending heavily on television advertising which promoted the smiling clown face of its child-friendly brand mascot, Ronald McDonald. Boje et al. (2005) argue that the clown motif associated excitement of the circus was a consequential choice. It enchanted children while imbuing Kroc's simple business credo - be efficient, be clean, be a good citizen - with a brand narrative grounded in the dynamic imagery of the carnivalesque.

Kroc's family-oriented marketing strategy guided the chain's rapid expansion through American suburbs and inner cities. Love's (1986) corporate history portrays Kroc as the quintessential American marketing guru, who devoted himself to polishing McDonald's brand image at all times, and at all costs. Using bright primary colours, indoor playgrounds, Happy Meals featuring popular licensed toys and small hand friendly food McDonald's established itself as the family restaurant that made food seem fun for kids. The chain saw profits increase in every consecutive quarter from incorporation to the millennium. Kroc himself proclaimed, that the astonishing success of the McDonald's chain was less due to the efficient delivery of low cost hamburgers, than to its unsullied corporate image and his own flair for “show business”. His commitment to a style of brand promotion which focused on the family helped McDonald's become America's best know restaurant, with a larger share of the fast food market than the next four chains combined. Today, McDonald's US holdings consists of 13,300 US franchised outlets that account for 43 per cent of total US burger sales.

In 1967, the McDonald's brand began its much-noted assault on the global marketplace too, opening its first foreign family oriented fast food outlet in Vancouver, Canada, and in 1971, expanding into Europe and Asia. McDonald's triumphal ascent to the world's leading food chain grossing $41 billion dollars annually is a well-known American rags to global riches tale of an exemplary services marketing enterprise. Backed by escalating advertising spends, McDonald's brought the American burger culture to nations where it never existed before. By 1992, global franchises were often earning twice that of domestic outlets, with the average franchise earning $114,149 in the US, compared with $188, 006 in Canada and $269, 225 per outlet in Europe. With 30,000 restaurants in 121 countries the brand dominated the market grossing four times Burger King's $11.3 billion and Wendy's 9.4. According to Advertising Age, McDonald's ranks the 12th largest global ...