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When brands grow up

January 14, 2009

beef-burger

I thought I’d never see the day when I have to shell out $10 bucks for a McDonald’s hamburger. Well, the day has come. McD is fast catching up with Wendy’s, Carl’s Jr and soon even Chili’s as far as prices go.

Not that I eat a lot of burgers, being the semi-vegetarian that I am. I also don’t do overpriced burgers but its interesting to watch how a major brand makes a bold move to leave the kiddies world to enter the young adult world. A brand that grows up, not just into your average young adult it seems. A young adult with money, willing to spend $10-15 on a meal that we used to pay $7-8 for.

Hey does anyone know what they’ve done with Ronald McDonald’s statues that used to sit outside the restaurant entrances? I miss that. Now I’m greeted with loud hip hop music. In fact, the in-store music in the outlet I went to was so loud I actually turned around and walked out. Ah so…they are planning to turn McD into a club. Would it be a matter of time before they clear the tables at the center for a permanent dance floor, and maybe even have non-alcoholic mocktails on the menu?

Anyway, the transformation of Ronald Mc-Donald into the Justin Timberlake image is a gamble that seems to have paid off – in the US, if you look at their stock prices in recent months that is. But is it a good long term bet?

Personally I suspect this is a temporary upswing before it’ll come crashing down, victim to a well-known disease called brand extension. That’s when you get caught in between trying to serve two profitable yet very different markets, and leaving the market confused in the end. You see, you can’t brand Mercedes Benz with snob appeal while at the same time, try to push a low-market model that competes with Proton and expect not to lose your prime customers.

Here we’re talking about a brand that tries to please 20-somethings with expensive burgers while also trying to please kids with their Happy Meals. So you end up with two sets of people in the premises, the young rebels who see kids or parent-types as an irritation and vice versa. The trick is how not to have one of them eventually desert you.

It also begs the question what will McD do when their loyal customers get old, people who stayed with the brand since they were kids. Will McD then take on the look and feel of an old folk’s home, with Frank Sinatra and the Andrew Sisters playing in the background? And do they actually believe youngsters will ditch their image to come to the restaurant?

Or, will the brand split into 3 sub-brands ? Will we begin to see a new Ronald McDonald’s restaurant for family with kids, a hip-hop designed McD outlet for 20-somethings, and a sedate diner-type McD for the elders?

Brand warfare’s an awesome thing to watch isn’t it.

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6 Comments leave one →
  1. January 14, 2009 9:52 am

    Part of the McD fans have grown up and are now in 20s-30s…thus the brand feels there’s a need to grow up together. But at the same time, they are reluctant to throw away their profitable kids business. The happy meals are still coming up wif new toys…and their adverts are still trying to influence kids to hv bday parties in their restaurants.

    Hmm but in regards to the increase in pricing…i do feel it’s not really a good idea since we all know McD for its affordable burgers (since they are not really nice, we buy coz they’re cheap!). But now tat they’re so expensive, we might as well go for BK or Wendy, or a restaurant which either serves cheap food, or serves tastier stuff at a slightly higher price.

    And not somewhere in btw…or something which is both expensive and not so tasty.

    I think in this case, their diversification will not pay well in the long run.

    I think their price increase is partly due to worldwide price increases and partly to pay for a lengthy rebranding exercise that’s far more expensive than branding for kids. I mean we’re talking restaurant refurbishment, celebrities, etc. Its a gamble, albeit a calculated one. And you are right about taste, coz I prefer Ramly burgers any day! 😀

  2. January 14, 2009 4:43 pm

    Branded food. Hmmm. I thought we’re talking about feeding the tummy here. And not even about nutrition or taste. All this sounds more like talking about clothes, footwear, watches, cars, etc…

    Can’t get used to it!!!

    Oh,you didn’t realize they were messing with our heads? Haha.:D Everytime kids say McDonalds instead of Wendy’s or Burger King when you ask them what fast-food burger they want, you’re witnessing the result of meticulous, well-engineered mental programming via ads, peer pressure, etc. In other words, branding. It leads to predetermined choice and behavior. Its a very subtle act but that’s how branding works.

  3. January 15, 2009 9:09 am

    Haha… I have to be blind, deaf and dumb not to realize that. Now, even my daughter’s in the advertising line…

    Ah so… she’s a mind programmer by way of words and imagery. Advertising is an exciting line and a lucrative one if a person is talented.

  4. January 15, 2009 10:44 pm

    Oh, Ramli burgers are always the best, esp those special ones with fried egg 😀

    Yup. Guaranteed to block your arteries. 😀

  5. January 16, 2009 11:11 am

    …and the medical products manufacturers can produce more stents and hospitals busy, which in turn helps to keep the economy healthy…

    Haha, maybe that’s why McD’s stocks is going up in the recession. Its always good to bet on a catalytic force that has beneficiaries like the medical sector. 😀

  6. January 18, 2009 5:15 pm

    i like yr take here. gets me thinking. i agree that mcd has grown up,though they seem to be differentiating as well. cos i can still find $2 burgers.

    one more think i ll like to note is that in thailand, we can can still find the old ronald in sawadikap. that’s nice 🙂

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