Can new McDonald's CEO bring fresh ideas to fast food?

McRib sandwich, a limited-time menu item that's a cult favourite in UK and US markets

Under Steve Easterbrook as CEO, McDonald's UK has reinforced a more local brand positioning and tested new products and promotions for the changing customer profile.

Now Easterbrook is moving to America to become CEO of the entire McDonald's business, which faces significant challenges such as intense competitive pressure, overall sales declines and increased customer interest in healthy eating.

Many of the innovations that helped McDonald's build sales in the UK may be implemented across multiple markets. For example:

• Crowdsourcing new products. McDonald's asked customers to build their ultimate beef burger, and then featured the 5 winning "My Burger" product ideas during autumn of 2014.
• Increasing transparency about food sourcing. To help customers understand what's in McDonald's meals, it established a special section on its website called 'What Makes McDonald's?' In addition to posting videos about agriculture and other sources of production, McDonald's invited questions from the public. This is also being done at McDonald's Canada.
• Healthier eating. McDonald's UK encourages healthier eating with 'Free Fruit Fridays'. Once a month, children get a free bag of fruit with the purchase of a Happy Meal.

Easterbrook sees potential in marketing meals customised for each customer: 'People’s desires are changing. They want to be treated as individuals, not as numbers'.

Cadbury changes its Creme Egg

Cadbury UK--which enjoys 609,000 likes on its FB page--is making headlines, but not in a positive way.

The company's iconic Creme Eggs, a sweet Easter tradition for four decades, are undergoing two key changes.

The first is a packaging change that affects pricing. Now the number of eggs in each package is now 5 instead of 6. Cadbury explains that this change, which effectively increases the product's price, is due to rising costs (of chocolate, among other ingredients).

The second change, which is just as controversial, is to the recipe for the chocolate shell, which was similar to Dairy Milk. Cadbury in Canada will still offer the standard Dairy Milk shell, but Creme Eggs sold in the UK will have a different chocolate shell.

One change not under Cadbury's control is that its products made in the UK will no longer be imported to the US. Why? Because Hershey legally has use of the Cadbury brand and product names in the US market. Cadbury and Hershey use different recipes for products that carry the same name (such as Creme Eggs and Kit Kat bars). Therefore, Hershey says consumers will be confused by the dueling UK-made and US-made products.

After some legal back-and-forth, the importer that had been distributing UK-made Cadbury products in US markets must halt its importing. US fans are unhappy because many prefer the taste of UK-made Cadbury (made by Cadbury) to the taste of US-made Cadbury (made by Hershey).

From Millennium Wheel to Coca-Cola London Eye

The London Eye was originally branded as 'Millennium Wheel' in 2000, part of the city's celebration of the turn of the century. After being sponsored by British Airways and then by EDF Energy, the London Eye (a Merlin Entertainments attraction) is now sponsored by Coca-Cola.

This change in corporate sponsorship means the Coca-Cola London Eye (as it's being called) glows red at night--the color of the soft drink marketer's iconic label. The sponsorship includes Coca-Cola branding inside each pod and on staff uniforms, ticket kiosks, etc.

Some critics are outraged about Coca-Cola sponsoring such a popular family attraction, worried about encouraging children to consume sugary beverages. Health advocates distributed free toothbrushes at the Eye's reopening on Saturday to call attention to nutrition issues and the ethics of this sponsorship, which runs for two years. What then?

Glossary of marketing terms

The online glossary for my Essential Guide to Marketing Planning defines dozens of important marketing terms. Take a look for definitions such as:

• Buzz marketing    More intense form of word of mouth in which the organization targets opinion leaders, with the aim of having them spread information to other people.
• Cause-related marketing    Marketing a brand or product through a connection to benefit a social cause or non-profit organization.
• Ethnographic research    Observing customer behaviour in real-world situations. 
• Field marketing    Working (often with outside agencies) on sales promotions that take place in stores, shopping districts and office locations.
• Multibrand strategy    Using two or more brand names in an existing product line or category.
• Relationship marketing    Marketing designed to build ongoing relationships with customers rather than stimulate isolated purchase transactions.
  
  
  

Among UK New Product Winners: Ella's Kitchen

The Grocer presents new product awards every year, for the best food and for non-food products introduced during the previous year. Entries for 2015 are now open. Categories include coffee and chocolate drinks, dairy drinks, fish products, frozen desserts, laundry products, infants' products, soups, and teas and infusions, among others.

Who were the winners in 2014? Both large and small marketers entered and won. Cadbury was a winner in the chocolate confectionery category; Persil won in the laundry category.

Among the smaller companies to win in 2014 was Ella's Kitchen (winner in the infants' category). Named after a real baby named Ella, the company markets a range of organic baby food.

Paul Lindley is the founder of Ella's Kitchen and also Ella's father. He had an idea for marketing nutritious, all-organic baby food products to delight 'tiny taste buds' and tempt even finicky babies to eat. He also knew he needed colourful packaging to 'sell from the shelf'. Once Sainsbury's began to stock his products, the company gained national distribution.

Lindley had worked for Nickelodeon before becoming an entrepreneur, and this connection enabled him to arrange for free TV promotion in exchange for some of the firm's profits. As a result, Ella's Kitchen gained brand recognition and established itself nationally.

When Ella's Kitchen undertook global expansion, however, Lindley experienced considerably more competitive pressure in the US market. He sold Ella's Kitchen to Hain Celestial, known for its all-natural food products, and remained as the division head, using the parent's marketing muscle to boost Ella's Kitchen.

Today, nearly a decade after its founding, Ella's Kitchen is active on social media to educate and inform parents about nutrition and, of course, explain how its products are good for baby. On YouTube, for instance, the company posts videos about feeding babies, weaning babies and other topics of interest to families with infants. It offers Q&A with experts on its Facebook page and its Twitter page.

Tesco's turnaround for higher turnover

Tesco is making major changes to position itself for higher turnover in 2015, after a challenging year in which it faced accounting woes, profit-sapping price wars, intense competition and disappointing sales results.

Now the top UK grocery retailer is taking a fresh look at its business units and its store network. The goal is to cut costs so Tesco can prepare for revenue and profit improvement.

Not surprisingly, Tesco will close 43 unprofitable stores and halt plans for 49 new stores--which would have been giant stores not favoured by today's busy shoppers. The company is reducing its workforce, consolidating headquarters and making other changes to slash expenses. And, not surprisingly, it's selling Blinkbox, Tesco Broadband and other non-store ventures, which makes sense.

It is surprising that Tesco would arrange to sell Dunnhumby, its Big Data division, given how vital the data-driven Clubcard scheme has been to the company's long-term increase in turnover. Here's what the Tesco site says about Dunnhumby:

dunnhumby helps Tesco and our suppliers around the world to put the customer at the heart of decision making and thereby earn their lifetime loyalty. Their insights help us stock the right products, optimise prices, run relevant promotions and communicate personalised offers for customers across all contact channels.

Tesco will, of course, continue as a Dunnhumby client.

Facebook's powerful opinion leader

Facebook says it has 864 million daily active users--that's a significant share of the world's ever-growing population (about 7.3 billion). And it's very likely that readers like you can identify the Facebook CEO shown above.

Yes, he's Mark Zuckerberg, who founded Facebook in February, 2004 and now presides over a global empire of services.

He's also a powerful opinion leader, someone whose preferences and comments exert considerable influence on what people think and do. So when Zuckerberg started his own Facebook-based book club--part of his new year's resolution to consume more printed media--the FB book club page zoomed to 165,000 likes in only a few days.

The FB page for the first book choice (The End of Power) is linked to an Amazon listing, of course, so it didn't take long for the paperback version to sell out. As of this moment, the book is 12th on the Amazon best-seller list (with an upward arrow).

An interesting case of social media marketing meeting old-fashioned print media through the intervention of a young and well-known opinion leader.

Private brands continue strong

Even as the economy recovers, private brands (also known as private label, brands owned/marketed by retailers and/or wholesalers) are thriving.

Market research by Nielsen confirms that private brands account for 54% of UK grocery purchases.

Why? Because consumers perceive these as being good quality and good value. Retailers have carefully marketed their private brands as the equal of any manufacturer's brand--and maybe even superior. At one time, many shoppers believed that by buying private brands they were 'trading down'--but today, more shoppers buy these brands even when they can afford nationally-advertised brands, because of the quality and value.

Marketing plans for private brands place great emphasis on in-store visibility because that's where buying decisions are made. Thus, the packages for Tesco's private-brand bird seed and feeders (shown above) were recently redesigned for eye-catching attractiveness, targeting young families.

Yet the store brands are also doing well because their owners are investing in new varieties and new features that meet customer needs. 'As with manufacturer brands, retailers have, over time, successfully built equity into their own-brand products by investing in product innovation, further developing ranges and increasing marketing activity' says a Nielsen exec.