IT WAS the American equivalent of the Royal seal of approval. On Christmas Day, movie stars Brad Pitt and Angelina Jolie took their children out for lunch, not to a smart restaurant – but to McDonald's. As the glamorous couple and their brood picked up Happy Meals at a branch in New Orleans, the fast food chain's board must have been doing cartwheels.
But then, they may well have been already. Just this week, it was announced that in Britain alone there were 88 million visits to the golden arches last month, up nearly 10 million on the previous year' s figure and equivalent to about 320,000 more e
ach day. Meanwhile in the US, the company upped its assault on coffee chain Starbucks by announcing it was to open coffee bars in 14,000 of its American restaurants complete with baristas, lattes, mochas and anything else to muscle in on the coffee giant's territory.
For while the sun is undoubtedly shining upon Maccy Ds in 2008, Starbucks, once the pinnacle of high-street takeaway sophistication with its chic white cups and choose-it-yourself coffees, is faltering. On Monday the company axed its chief executive, Jim Donald, and brought back its former chairman and CEO Howard Schulz in an attempt to resurrect its fortunes. The firm's share price has dropped 42 per cent in the past year, and has come under fire for expanding too quickly. As the economic slowdown has started to pinch, expensive morning coffees – or expensive morning coffees from Starbucks at least, appear to have gone by the wayside. "We created this problem, we will fix it," Schulz vowed.
It's a phrase that could have been uttered by any member of the McDonald's management team just a few years ago. After a wave of negative press culminating in the 2003 film Supersize Me, where documentary maker Morgan Spurlock lived on McDonald's food for a month and recorded the shocking impact it had on his weight and health, McDonald's embarked on a radical rebranding – introducing salads and healthier alternatives to its fat-laden burgers, laying bare the nutritional value of its foods and opening McCafes offering coffees and muffins.
"A few years ago the writing was on the wall for McDonald's," says Paul Freathy, professor of retail studies at Stirling University. "They knew they needed to shift their product image and they have, by introducing healthier options and changing their message. They've looked at the marketplace and their customers and realised that they want something new. Now they've introduced the McCafes, which again is a result of looking at their customers' lifestyles."
The coffee, or McCafe notion, is a central plank in the latest evolution of McDonald's. It has introduced a new Premium Roast Coffee' range, and also now provides free wi-fi in many of its restaurants – something Starbucks has been doing for years – which is helping pull in a different customer base to those in need of a fast food fix. A taste test by influential US magazine Consumer Reports last year even declared McDonald's Premium Roast to be better than the coffee at Starbucks.
Brand expert Jonathan Gabay points out: "What McDonald's have done is play Starbucks at their own game. Starbucks completely changed the consumer experience when they first arrived on the scene by saying to customers 'come in, have a coffee, tell us what you want and how you like it.'
"Meanwhile McDonald's was saying, 'come in, have a hamburger'. Now McDonald's has realised that what the consumer wants is choice, so they've given them that, and in the process also made Starbucks look a bit jaded."
The irony, of course, is that each company is trying to become more like the other. While McDonald's creeps upmarket, installing leather booths, dark wood flooring and free wi-fi, Starbucks has slid downhill, cutting back on its comfy seating and upping the amount of sweet drinks available.
But can McDonald's really become the new Starbucks? It's unlikely. With a core fanbase still hungry for burgers and some still unconvinced by its healthy eating message, it still has many detractors.
Colin Waine, chairman of the National Obesity Forum, was unhappy with the latest McDonald's figures. "My reaction is one of despair. There's been enough publicity about the relentless rise and impact of obesity, but from the figures it seems the public are choosing to ignore them."
As for Starbucks? Perhaps they should give Brangelina a call.
STARBUCKS: THE FACTSFounded: 1971 in Seattle, Washington State
Employees: 147,436
Chief executive: Howard Schultz
Number of branches: 15,011
Countries brand is available in: 42
Revenue in 2006: $7.78 billion (£3.97 billion)
Wi-fi access: For a fee
Most calorific item on the menu: Venti White Chocolate Frappuccino with whipped cream – it has 760 calories
Slogan: There isn't one, but the company's ethos is "you call it"
High point: Acquiring Hear Music in 1999, allowing it to launch its own record label
Low point: Axing its chief executive this week after seeing almost half its value on the stock market wiped out
Celebrity fans: Britney Spears, Jennifer Aniston, Lindsay Lohan
MCDONALDS: THE FACTSFounded: 1940 in San Bernardino, California
Employees: 465,000
Chief executive: Jim Skinner
Number of restaurants: 31,000
Countries brand is available in: 118
Revenue in 2006: $21.58 billion (£11 billion)
Most calorific item on the menu: A cheese and bacon Big Mac is 850 calories
Slogan: I'm Loving It
Wi-fi access: Free where available
Low point: The release of documentary Supersize Me, which exposed the poor nutritional values of some of its products
High point: Cutting salt, sugar and trans fats, offering healthier alternatives and seeing the profits roll in
Celebrity fans: Brad Pitt and Angelina Jolie
The full article contains 969 words and appears in The Scotsman newspaper.
