McDonald’s global CMO hire shows the importance of marketing in its brand turnaround
McDonald’s decision yesterday (9 June) to appoint Bacardi’s Silvia Lagnado as its first global CMO since 2010 highlights the crucial role marketing must play in the company’s turnaround strategy.
When McDonald’s laid out plans in May to “reset and turn around the business” following poor global sales performance in recent years, it highlighted the importance of “returning excitement to its proposition and brand”.
The appointment of Bacardi’s Lagnado to oversee global brand management including marketing, menu and consumer insights is the company’s latest effort to carry out this strategy, which CEO Steve Easterbook suggested would involve actions that “disrupt and delight and show a brand on the move”.
He also highlighted the importance of building a “differentiated customer experience” through “world-leading digital engagement” and “less sweeping talk to millenials”, adding that the company will instead look to be “more specific on the customer groups where we need to win”.
McDonald’s sales have struggled in recent months as it faces a change in consumer behaviour as people look for healthier meal options.
In April the restaurant chain announced an 11% fall in revenues in the first quarter of 2015 to $5.95bn (£3.96bn), signalling an “urgent need to reset the business” according to Easterbrook.
Global sales also decreased by 0.3% in May, with its US market down 2.2%. Its Europe market, however, was up by 2.3% largely due to strong results in the UK.
While turning around the brand will be no easy task, Lagnado appears to be coming from a good place to take on the challenge.
Most recently she was responsible for Bacardi’s brand marketing as the company’s CMO. But perhaps more importantly during her time at Unilever she was one of the team behind Dove’s viral “Campaign for Real Beauty”.
Speaking on her appointment, Easterbrook said that “returning excitement to our business proposition and brand is foundational to our turnaround plan”, adding that she will play a critical role in bringing this strategy to life.
McDonald’s must build brand love through experience
Even before its May announcement, the fast good giant’s more recent moves have largely focused on customer experience.
In November it announced plans to launch a global mobile app, which will offer promotions and payments, as part of its mass personalisation strategy, having piloted a mobile coupon app in Amsterdam in 2013.
It initially announced its plans to introduce mobile and web ordering last year as part of an effort to offer customers more ordering options as part of a wider personalisation strategy.
Further, following the launch of McDonald’s “Create Your Taste” platform in Australia, which allows customers to order via a digital kiosk and choose their bun, size of burger and ingredients, the company announced plans to push the marketing platform as a global initiative to drive customer engagement not only through digital kiosks but also through table service and mobile ordering.
Speaking with Marketing Week in April, Pierre Woreczek, chief brand and strategy officer at McDonald’s Europe, said: “What creates love, buzz and attractiveness is the experience. For McDonald’s, it’s critical that the in-store experience becomes perfect, which isn’t the case at the moment if I’m being honest, but we’re working on it.”
He added that CMOs need to “have a great vision, be inspiring and create the right storytelling” in order to keep a brand’s DNA at the heart of the business.
“More than ever, people want to understand what makes a brand unique and powerful,” he added. “[CMOs] need to surround themselves with the right talent and create a learning culture around them. A learning company keeps the company on the move; it is never arrogant.”