Ethnic Insights Form Foundations of McDonald’s Marketing

Emily Bryson York, Ad Age, November 6, 2009

The marketing at McDonald’s is informed first and foremost by ethnic insights that shape the chain’s marketing to African Americans, Asians and Hispanics. Then McDonald’s lays those insights over work for the general market.

“Ethnic segments are leading lifestyle trends,” Neil Golden, chief marketer officer of McDonald’s USA, told the ANA assembly. He added that his team decided to “start with the ones who are setting the pace.”

They’re also where a lot of the money is. Mr. Golden said 40% of McDonald’s current U.S. business comes from the Hispanic, Asian and African-American markets, and 50% of consumers under the age of 13 are from those segments. “And they’re among our most loyal users,” Mr. Golden said.

‘No malls in the ghetto’

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{snip} McDonald’s has instituted an “approach that ensures this [ethnic considerations] will never be an afterthought.” Now during in the product-development cycle, McDonald’s looks for a disproportionate level of ethnic insights, he said. Out of nine focus groups, whenever possible, two are Hispanic, two are Asian, two are African American and the remaining three represent the rest of the market.

When McDonald’s takes its ads to market, the chain makes sure that spending behind certain spots represents the country’s ethnic makeup, such as 15% behind Hispanic marketing, 12% behind African America, 5% behind Asian.

As for the ad-creative-development process, Mr. Golden said each ethnic agency is given a blank canvas–within the “I’m Lovin’ It” framework–to create campaigns that will resonate in the respective market. The chain’s McCafe launch, for instance, included a Hispanic push aimed at the increasingly empowered Latina. The Asian McCafe work focused on the quality of ingredients. And while McCafe is performing well in the general market, it’s doing even better in many ethnically driven locations.

The chain has also looked for more meaningful touchpoints, including a scholarship program for Hispanic students in Texas and tie-ins with Lunar New Year celebrations to target the Asian community.

And it’s paying off. McDonald’s ethnic marketing continues to receive accolades from trusted names in the communities they’re targeting, such as Latina Style and Black Enterprise magazine.

He also pointed out McDonald’s “walks the talk” in its C-suite as well. His boss, McDonald’s USA President Don Thompson, is African American. Mr. Thompson’s boss, Chief Operating Officer Ralph Alvarez, is Hispanic. CEO Jim Skinner has said his goal is not to have to talk about it anymore.

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