What The Burger King/McDonald’s “Peace” Situation Teaches Us About Strategy
Yesterday on Facebook I got into one of those heated discussions only strategy geeks get themselves into. My friend thought McDonald’s missed a huge opportunity passing on an “International Day of Peace” integration with Burger King. I, on the other hand, thought McDonald’s responded perfectly for their business situation.
My friend is probably one of the best PR strategists out there, if not one of the one’s most versed in how to use social media for prime gains in brand reputation. He made some excellent points including the fact that any other burger chain could easily step up, take the challenge, and score some easy and effective “brand points” in social media.
Now, don’t get me wrong. “Brand points” are great but rarely, if ever, have a lasting impact on earnings and/or revenue. If this manufactured PR tiff turns long-term, then we’re talking a different ball game. However, and as I pointed out to my friend, to the people that care about McDonald’s this stunt is inside baseball and no one outside of the die-hard brand loyalists care.
Where some see McDonald’s as “lame” I see them as smart and measured. McDonald’s long-term strategy is about improving revenues by improving quality – or at least that’s what they say. Their restaurants are now more cafes than they are drive-throughs and that’s a calculated measure. They realize their revenues are being hit by the fast-casual segment, which draw away regulars.
What McDonald’s wants to do is reclaim their positioning not as a burger joint but as a wholesome food outlet. Wholesome and McDonald’s don’t sound like they go together but when they first started out, they very much did. Roy Kroc realized that there was a vacuum in the 1950s for a clean, consistent alternative to the one-off drive-in diners. He captured the “family meal” dollar and that’s what they are trying to do, today. That’s also what you see in McDonald’s reaction to Burger King’s overture.
Burger King, on the other hand, knows it needs to make its brand “hip” again. It’s been on a 10-year guerrilla media blitz starting with it’s relationship with advertising powerhouse Crispin Porter. They want to be the cult favorite in the burger wars, which is why their tactic was on-brand for them. They knew that the McDonald’s strategy playbook wouldn’t allow them to engage and deviate from a planned and purposeful journey and that’s why they did it. Their fans loved the overture and I’m betting it did just what it intended to do which is woo back McDonald’s customers that have defected to higher-end chains.
McDonald’s, meanwhile, is laser-like focused on building a new kind of customer. That customer is more interested in the “family meal” than it is the latest social media craze. McDonald’s reaction wasn’t exactly socially-savvy but it was a smart business play that not only met but exceeded expectations of their core audience. Proving they are trying to be adult alternative may not please strategy and social geeks like my friend and I but it does show clarity of purpose and a focus on the audience behind the brand.
The conversation my friend and I had is the key difference between insider baseball and the real world. We might care about these things and even Burger King customers – both current and potential – might care. However, PR and social media strategies have to serve the bottom-line rather than the needs and expectations of us, the “chattering class.”
Perhaps this dynamic might change in the future? Perhaps if Burger King keeps hitting McDonald’s and the “family meal” dollar can’t be convinced to abandon their new-found love of Chipotle social media tiffs like this might make a difference.
In the meantime, though, we have to remind ourselves that we don’t get paid because customers “like” a brand on Facebook. We get paid because they walk through the door of our client’s establishments and plunk down cold, hard cash.