Aug 25, 2014
TOPICS: Change; Competitive Positioning
SUMMARY: McDonald's is losing its luster with younger consumers. Customers in their 20s and 30s are defecting to competitors, in particular so-called fast-casual restaurants like Chipotle Mexican Grill and gourmet-burger chain Five Guys. Younger diners are seeking out fresher, healthier food and chains that offer customizable menu options for little more than the price of a combo meal.
TERM PAPER APPLICATION: In analyzing the predicament, it is vital to cite facts and numbers, not just subjective impressions. To start with, Consumer Reports magazine said that in a survey of more than 32,000 subscribers, readers rated McDonald's burgers as the worst-tasting of 20 rival burger chains. A decade ago, there were 9,000 fast-casual restaurants in the US, versus nearly 14,000 McDonald's. Now, fast-casual restaurants number more than 21,000, while McDonald's US restaurant count has risen only slightly.
QUESTIONS:
1. Why is it that you are probably not eating at McDonald's? How would you define the 'Millennial' Challenge?
2. For your generation, what is the main problem with McDonald's? Are you tired of hamburgers generally? Or are you just tired of hamburgers at McDonald's?
3. Beyond just your own impression, what FACTS are cited in the article about the competitive position of McDonald's? Which of these facts does McDonald's most need to focus on?
4. In terms of the organizational life cycle, is McDonald's now starting to decline? Or is this setback just a dip in a much more open-ended process?
Reviewed By: Mark Lehrer, Suffolk University
McDonald's faces 'millennial' challenge
Customers in their 20s and 30s are defecting to fast-casual restaurants like Chipotle, Five Guys
By Julie Jargon August 25, 2014 9:10 AM
Behind McDonald's Corp.'s worst slump in a decade is a trend that may auger even tougher times
The world's largest restaurant company by revenue