Nothing Will Solve McDonald's Millennial Problem

It’s well known that McDonald’s has an image problem. In recent years, the brand has become the poster child for obesity inducing fare. But given that McDonald’s is still the number one fast food chain in the U.S. in terms of sales, who really cares? Apparently millennials do. According to an internal company memo obtained by AdAge, McDonald’s does not even crack the top ten of the millennial generation’s favorite restaurants. Craving fresher, healthier on-the-go food, millennials are increasingly opting out of McDonald’s and patronizing other franchises that more closely align with their needs and wants.

Though it’s doubtful that McDonald’s will suffer much in the near future because of its millennial problem, they have still rolled out a new product to try and woo the generation. The McWrap is designed to compete directly with Subway, which recently became the world’s largest fast food chain and is the biggest competitor with the Golden Arches among millennials. In fact, that internal McDonald’s memo states that 22% of millennials would choose Subway over McDonald’s if they didn’t launch the McWrap.

McDonald’s seems to be targeting the emerging preferences of millennials with its new offering. Millennial emphasis on health is emphasized by including romaine lettuce and cucumbers. Of course the health effect is ruined with the addition of fried chicken tenders. It’s true that the McWrap is in addition to a number of other “healthy” options added over the years, but the majority of McDonald’s menu is still laden with salt and fat in copious amounts.  Additionally, the chain is looking to capture the millennial imagination by making its new wrap customizable, meaning, there are three different sauce offerings. Such a small number of options don’t say much for McDonald’s thoughts on customization.

McDonald’s efforts seem meager when compared to their problem. Eventually the millennial generation will be the dominant consumer group. If other chains, which offer options that are more in line with millennial values, capture that group’s palates now, it is unlikely that even drastic future changes will be able to pull this crucial generation back in. Even given the notorious lack of brand loyalty millennials exhibit, McDonald’s will be hard-pressed to regain lost ground as the group ages. If McDonald’s wants reclaim the attention of this crucial set of customers the company will have to do something more drastic than introduce a few lower calorie items like the McWrap into its already uninspiring menu. If McDonald’s can’t evolve to meet the needs of millennials, those “Billions Served” just might drop by a few million.

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Nate Abrams

I'm a systems guy, which means that I look at almost everything in terms of interconnections, feedback loops, architecture and scale. In other words, I look for the big picture and the deeply buried reasons for why things are the way they are.

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