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Mickey D's McMakeover
Buisness Week Online ^ | 5/11/06 | By Pallavi Gogoi, with Michael Arndt in Chicago and Abed Moiduddin in Oak Brook

Posted on 05/11/2006 5:38:23 AM PDT by snowrip

Mickey D's McMakeover By Pallavi Gogoi, with Michael Arndt in Chicago and Abed Moiduddin in Oak Brook

A Bold New Look

A comfortable armchair. Cool hanging lights. Funky graphics and photos on the walls. Wi-Fi access. Premium coffee. Isn't Starbucks great? Except...this is McDonald's. McDonald's (MCD)? That's right. After 30 years without a major design overhaul, the 51-year-old fast-food giant is adopting a hip new look. The world's largest hamburger chain is redesigning its 30,000 eateries around the globe in a 21st century makeover of unprecedented scale.

The redesign is risky and has many franchisees up in arms over the high costs of a makeover. But company officials believe the overhaul is needed. McDonald's, whose restaurants are visited by more than 40 million people every day, has moved aggressively over the past three years to revamp its menu and attract a new breed of customer. It has added healthier items like premium salads targeted at women, and apple slices and skim milk for children. But as more upscale items like Asian chicken salad show up on its menu, the chain's typical starkly lit, plastic-heavy look is at odds with the contemporary, welcoming image the company wants to present. "McDonald's promises to be a 'forever young' brand," says John Miologos, vice-president of worldwide architecture, design, and construction at McDonald's Corp. "We have to deliver on that promise." The last major change at McDonald's restaurants was the introduction of play places for children in the early 1980s.

NEW COLORS What will the new McDonald's look like? "Think iPod: clean lines, simplicity," says Miologos. The signature mansard roof? History. "The big red roof looks too dated today," says John Bricker, creative director at design firm Gensler's brand-strategy arm, Studio 585. It's being replaced by a flat roof topped by a newly designed, contemporary, golden sloping curve. Ronald McDonald appears safe: The mascot was given a leaner, sportier look just last year. And the iconic twin golden arches will still play a big role in the branding.

After conducting a global contest among design firms, the burger giant chose New York-based Lippincott Mercer in the summer of 2004. Peter Dixon, the design firm's creative director, spent 2005 with McDonald's internal architecture and design team testing and prototyping the new look, which is being officially rolled out this year. Lippincott Mercer, which until it signed McDonald's had few clients in the restaurant business, has made a name for itself working with companies going through a shift in brand identity and image. In 2002, for example, it helped redesign Nissan Motor Co. (NSANY) dealerships to reflect the company's launch of several new upscale cars. Within a year, the redesigned dealerships saw an average of 57% sales growth, vs. 33% overall.

The traditional McDonald's yellow and red colors will remain, but the red will be muted to terra cotta and olive and sage green will be added to the mix. To warm up its look, the restaurants will have less plastic and more brick and wood, with modern hanging lights to produce a softer glow. Contemporary art or framed photographs will hang on the walls. Bob Dixon, a private school fund-raiser in Chicago, says of an Oak Brook (Ill.) restaurant that sports the new design: "It's bright, it's lively, it's clean. It stunned me how beautiful it was."

The dining area will be separated into three sections with distinct personalities. The "linger" zone will offer comfortable armchairs, sofas, and Wi-Fi connections. "The focus is on young adults who want to socialize, hang out, and linger," says Dixon. Brand consultant Robert Passikoff, president of Brand Keys, a brand consulting firm, says that Starbucks has raised the bar: "A level has been set by Starbucks, which offers the experience of relaxed chairs and a clean environment where people feel comfortable hanging out even if it's just over a cup of coffee."

The "grab and go" zone will feature tall counters with bar stools for customers who eat alone; plasma TVs will offer them news and weather reports. And in the "flexible" zone, families will have booths featuring fabric cushions with colorful patterns and flexible seating. The new design allows different music to be targeted to each zone.

From BusinessWeek

RESISTANCE McDonald's won't confirm the cost of a redesign. Richard Adams, a former franchisee and consultant to current owners, estimates they will have to pay $300,000 to $400,000 to renovate an existing outlet -- an amount roughly equal to a restaurant's annual profit. Tearing down a store and rebuilding from scratch could cost $1 million, Adams says. The franchisees will have to pay for the renovations themselves, which has some of them seething. "Many franchisees are dead set against this change, especially because they already spent millions remodeling their restaurants in the past four years," says Adams. In 2002, when McDonald's introduced premium salads, it did ask a number of franchisees to spruce up their dining rooms, but it wasn't a major redesign project. McDonald's says it worked collaboratively with franchisees to jointly develop a strategy for the current "re-imaging" of its restaurants.

In a recent letter to management at the company's headquarters in Oak Brook, about 160 franchisees from North Carolina spelled out why they oppose the new plan. They say the roof change erases 40 years of brand building and that "there has been no business case presented which justifies the change." Says Frederick Huebner, who owns 11 McDonald's in North Carolina: "We don't want to lose the iconic look of what we've got." If franchisees balk, McDonald's can refuse to renew their contract.

Right now, only 20 recently opened restaurants in the U.S. sport the makeover in its entirety. Another 20, primarily in Tulsa, Okla. and Columbus, Ohio, have been completely remodeled. All brand-new restaurants will have to hew to the redesign blueprints, and by the end of 2006, more than half of the 13,720 U.S. restaurants will feature some element of the design. Says Gensler's Bricker: "It's something that McDonald's has to do if it wants to be part of the 21st century."


TOPICS: Business/Economy
KEYWORDS: macdonalds; mcds; youwantfrieswifdat
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To: 50sDad

LOL, haven't seen the Arby's ads but wow, you're so right about the clown creepiness. What is it about clowns that they fit so well with horror movies, tales of possession and such? The King takes it a step further. Stephan King is surely inspired. Omigosh, King -- King....???? Is there something subliminal going on with fast food marketers?


61 posted on 05/11/2006 11:09:59 AM PDT by workerbee (A person's a person no matter how small.)
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Bookmark to read later...


62 posted on 05/11/2006 11:13:39 AM PDT by DocRock
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To: workerbee
As a young child, I was taken to the circus by a maiden aunt (an "unclaimed jewel" as my father would say.) There was this clown with a huge fake forehead that opened up and a cukoo came out, just like a clock. Scared the living hell out of me. To this day, I can't get behind grown men who dress in makeup, effectively lying about who they really are, who try to amuse children for a living. It's just creepy.

I Hate Clowns.com.

63 posted on 05/11/2006 11:15:14 AM PDT by 50sDad (ST3d: Real Star Trek 3d Chess: http://my.ohio.voyager.net/~abartmes/tactical.htm)
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To: freedumb2003
If I want a burger, I go get a Wopper, no mayo, no cheese, and put my own cheese and light mayon on it at home. But sometimes, when I don't really want a burger, I do want a Big Mac. I'ts not a real burger, I don't think, but it has it's charm when that is what I really want. (And don't even ask about White Castles!)
64 posted on 05/11/2006 11:18:03 AM PDT by 50sDad (ST3d: Real Star Trek 3d Chess: http://my.ohio.voyager.net/~abartmes/tactical.htm)
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To: 50sDad
Burger Chef was the bomb! The "Big Shef" was a great tasting burger and the chocolate shakes were to die for. Back in '75 or '76, Burger Chef passed out scratch-out trivia game cards...the workers would always give you extra cards. The game was so easy that I didn't pay for food all summer. Maybe that's why they went out of business? Hasty Tasty was another great restaurant in the Dayton,OH area that went out of business...best fried chicken I ever had. I was in Dayton a couple of weeks ago and ate a sausage pizza at Marion's. Nothing like it!
65 posted on 05/11/2006 11:24:53 AM PDT by doctor noe
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To: Recovering Hermit
You can't polish a turd.

On the contrary. They sell polished elk turds to gullible tourists in Yellowstone. Coat 'em with resin and sell 'em as jewelry.

66 posted on 05/11/2006 11:25:08 AM PDT by LexBaird (Tyrannosaurus Lex, unapologetic carnivore)
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To: Fester Chugabrew

I miss Burger Chef n' Jeff.


67 posted on 05/11/2006 11:26:55 AM PDT by relictele
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To: Fester Chugabrew

Been decades since I ate at a Burger Chef but their stuff was good.


68 posted on 05/11/2006 11:27:54 AM PDT by mafree
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To: snowrip
This is along time coming. I believe they need to do this or MickyD's will be a thing of the past very soon. People want ambiance...even when they are buying fast food.

I am not entirely sure of why this is considered PC in your mind...but ok.

69 posted on 05/11/2006 11:30:49 AM PDT by pollyannaish
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To: TightyRighty

"Where is your God now?"

-That has got to be the funniest post I have seen on here in 2006. Bravo! I nearly pissed my pants on that one.


70 posted on 05/11/2006 11:31:32 AM PDT by johnnycap
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To: doctor noe
What is it about "Memory Food"? The best pizza I ever had was at Pisanello Pizza in Bowling Green, Ohio, my old college town. They tried expanding into Toledo and other places, survived for a while, and finally sank back to the one location in Bowling Green. We always grab a pizza and a couple of subs when we go through there.

I forget the name, but I know there are a couple of sites out there dedicated to food you once knew, both in restaurants that may be long gone and individual snacks/candy that you can't get anymore.

Absolute WORST candy in the history of the universe? "French Chews", a flat piece of vanilla or chocolate flavored linoleum that they made in Cincinnati around the 60's. Ugh! That was what was left at the bottom of your Halloween candy bowl come Christmas!

71 posted on 05/11/2006 11:32:10 AM PDT by 50sDad (ST3d: Real Star Trek 3d Chess: http://my.ohio.voyager.net/~abartmes/tactical.htm)
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To: snowrip

Every move listed here sounds like a winner.


72 posted on 05/11/2006 11:34:29 AM PDT by Aquinasfan (When you find "Sola Scriptura" in the Bible, let me know)
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To: snowrip

This will fail as bad of the McLobster Roll.


73 posted on 05/11/2006 11:35:22 AM PDT by Semper Paratus
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To: RabidBartender
I've been going to Burger King ever since McDonald's decided to "pimp" my burger.

Agreed. I can't see how you attract more customers - especially families by pushing the Hip-Hop, Gangsta, Ghetto theme.

74 posted on 05/11/2006 11:36:13 AM PDT by Cowboy Bob (Liberalism in a parasite that ALWAYS kills its host.)
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To: PBRSTREETGANG

That's a Ronni McDonald I could go for.


75 posted on 05/11/2006 11:47:11 AM PDT by AFreeBird (your mileage may vary)
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To: Tijeras_Slim

yes,a Korova Milk Bar theme would be nice,with drencrom and synthamesc...

hey,the last time I went into my local McBarffles,to get a coffee, I was somewhat put off by the raw sewage smell,and the little gnats from the drink machine and the flies buzzing about....well,when I got to the counter,I saw an employee,an "urban youth", having a good scratch at his groin area.I started laughing as I headed out the door.

I too,miss Burger Chef and Jeff...


76 posted on 05/11/2006 11:47:40 AM PDT by mediawatcher44
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To: Semper Paratus

Ever seen the McLamb?


77 posted on 05/11/2006 11:47:51 AM PDT by 50sDad (ST3d: Real Star Trek 3d Chess: http://my.ohio.voyager.net/~abartmes/tactical.htm)
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To: 50sDad
Ever seen the McLamb?

No. Does it come with McMint Sauce?

78 posted on 05/11/2006 11:48:58 AM PDT by Semper Paratus
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To: johnnycap
Could you post a link to that picture? LOL!

And now for something completely different...Larry "Burger" King:


79 posted on 05/11/2006 11:49:29 AM PDT by 50sDad (ST3d: Real Star Trek 3d Chess: http://my.ohio.voyager.net/~abartmes/tactical.htm)
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To: Fester Chugabrew

I miss Burger Chef too! I remember the works bar where you could go and put our own toppings on. If I remember right, Burger Chef's in Indiana were taken over by Hardees. I also remember Wendy's having salad bars, but now everyone gives you a pre-made salad.


80 posted on 05/11/2006 12:05:32 PM PDT by mrevets
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