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McDonald's Corporation Advertising Missteps Continue

By Leo Sun – Jan 15, 2015 at 2:56PM

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Are McDonald’s marketing campaigns damaging the company’s image?

McDonald's (MCD 0.63%) is no stranger to marketing blunders. Three years ago, its #McDStories hashtag on Twitter -- meant to inspire warm and fuzzy memories about the restaurant -- was hijacked by stories about diabetes, food poisoning, and comparisons to dog food.

But since McDonald's hired Deborah Wahl -- an industry outsider who spent most of her career at automakers -- as its Chief Marketing Officer last January, the fast-food giant has racked up a streak of marketing missteps. Let's take a look at McDonald's worst marketing moves since Wahl took over, how they could impact sales, and why it needs to quickly get its marketing act together.

Reminding consumers about pink slime
Last October, McDonald's launched a YouTube campaign which followed former MythBusters co-host Grant Imahara as he visited McDonald's restaurants and suppliers to disprove claims that its meat was made of "pink slime," that its burgers contained worms, and that its burgers don't rot for years.

As part of Wahl's plan to pivot McDonald's mantra from "billions served" to "billions heard," McDonald's also responded to user questions about its food over social media.

The problem with that campaign, which was clearly scripted, was that it merely reminded customers about the company's past problems and prompted people to do their own homework on "pink slime" and hormone injections. Meanwhile, taking people on a tour of its meat packing plants simply wasn't an appetizing way for McDonald's to market its food.

Mocking vegetarians and foodies
McDonald's comparable-store sales have declined for four consecutive quarters in the U.S., and the company is on track to report its first year of negative global comparable sales since 2002.

One reason for that decline in the U.S. is that many Americans now favor "healthier" bistro-like fast food restaurants, like Panera Bread and Chipotle(CMG 0.42%), over traditional fast-food chains like McDonald's and Burger King(BKW.DL). To compete, McDonald's expanded its menu with healthier choices, but that strategy also clogged up its service with harder-to-make items. Meanwhile, smaller fast-food competitors like Chick-fil-A and In-N-Out sold fewer items, which were well-received and could be quickly made.

That's why McDonald's recent Big Mac ad -- which inexplicably mocks "vegetarians, foodies, and gastronauts" while bragging that its Big Macs (obviously) don't contain Greek yogurt, quinoa, or kale -- seems to miss the mark.

The ad -- which McDonald's calls the start of its sweeping "brand transformation" -- embraces its traditional image as an unhealthy fast-food chain, while lashing out at the healthy eating movement which is eating into its sales.

Tragedies and fast food don't mix
McDonald's recently launched a new commercial, "Signs", which displays signs at its restaurants throughout turbulent times in America -- including the September 11th attacks and the Boston Marathon bombing.

The commercial was met with a mixed reaction, with many Twitter users criticizing McDonald's for trying to profit from national tragedies. "Remember when all those people died? Buy a Happy Meal!" responded one user. Other users called it "hokey and melodramatic" and called it a "desperate attempt" to save its image.

Wahl defended the commercial against critics, telling BBC that "good advertising creates emotion." While the campaign certainly invoked some strong emotions, it probably won't convince people to visit their local McDonald's.

As CMO, Wahl should have known that these kinds of ad campaigns often backfire. For example, AT&T had to delete a controversial Twitter ad last September that showed a smartphone taking pictures of two beams of light representing the World Trade Center.

So what should McDonald's marketing team do?
Wahl has a very tough job, and McDonald's problems run far deeper than a few misguided ad campaigns. The fast-food giant needs well-thought-out ads to enhance, not undermine, its core business if it wants to win back its lost customers.

McDonald's needs to develop and promote better burgers; its were ranked as the worst in America by Consumer Reports last July. It needs to keep streamlining its menu, a process which started this month, while promoting more creative menu items and marketing those changes to consumers.

What McDonald's doesn't need is a marketing campaign that reminds consumers about its past controversies, mocks healthier food choices, and believes that an emotional music video about McDonald's signs during national tragedies will improve comparable sales. 

Leo Sun has no position in any stocks mentioned. The Motley Fool recommends Chipotle Mexican Grill, McDonald's, Panera Bread, and Twitter. The Motley Fool owns shares of Chipotle Mexican Grill, Panera Bread, and Twitter. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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