McDonald’s reputation is weaker than ever this year, taking a nosedive from an average reputation last year. With an 8-point drop in reputation year over year, McDonald’s had the largest decline in reputation of any U.S. restaurant chain. It’s no wonder the fast food chain is trying new ways to improve customer satisfaction and attract new customers in an attempt to revive its corporate brand.
McDonald’s is also trying new tactics to improve its flagging earnings, including shuttering stores across the U.S. and beyond. McDonald’s has also aired new commercials, launched a new line of customizable burgers and extended its breakfast menu to full day. Clearly, McDonald’s is trying to both innovate its products and improve customer satisfaction, which it hopes will result in increased sales.
Case in point, come January McDonald’s is planning to launch a “McPick 2” deal, allowing customers to pick two of the following items for $2: a McDouble, a McChicken, small fries and mozzarella sticks. And yes, McDonald’s will begin selling mozzarella sticks, so it’s asking us to think outside the happy meal box of burgers and fries when we think of McDonald’s.
McDonald’s declining earnings over the last two years have led to a shuttering of stores and a turnaround strategy. But, even with the turnaround strategy, there has been only a slight uptick in Q3 earnings this year in the U.S., up 0.9%.
So, what gives?
Products and services are, by far, the leading driver of reputation in the U.S. hospitality industry. And yet, that is one of the areas of reputation where McDonald’s scores the lowest. McDonald’s extreme focus right now on its products and service makes good business sense.
But, it won’t be easy for McDonald’s. Over the last decade, the focus has been on the quality of food offered by fast food restaurants. Consumer perceptions, however, are skeptical of the freshness and quality of McDonald’s ingredients. People remember the news reports of ‘pink slime’ in meat, yoga mats in chicken McNuggets, and a McDonald’s supplier in Shanghai pumping chickens with excessive amounts of antibiotics.
McDonald’s is willingly shedding its identity as just a hamburger fast food restaurant in favor of a more diversified menu, and is changing its value meal by scrapping its Dollar Menu in exchange for its McPick 2. Time will tell us if McDonald’s is successful at improving its reputation. So, let’s wait and see how its Q4 earnings and 2016 reputation turn out (around?).