McDonalds: All up in Burger King's Grill?
Last Friday, Retail Wire ran our article on McDonald's multi-faceted "Simple, Easy, Enjoyment" brand overhaul which is transforming everything from packaging, to store architecture, to menu boards in over 32,000 McDonald's spanning 118 countries. McDonald's has done a great job of maintaining gender balance and reaching out to new customers through its introduction of salads, smoothies and fancy coffee drinks; as the comprehensive brand re-visioning gains critical mass, all of that will be kicked up a notch.
. . . And then there's Burger King, holding fast to its positioning as a testosterone-fueled anti-McDonald's even as it remains a very distant number two player (12,150 restaurants). Burger King has steadfastly focused on a demographic sliver that it calls "super fans" (males aged 18 to 24) with marketing campaigns centered around a wacky (if obedient) chicken and a kitschy ceramic king that, depending on who you ask, is either hilarious or beyond creepy. In the midst of all of these shenanigans, the restaurants themselves have been neglected; the chain's ousted CEO stated in August that 85% of Burger King's restaurants are due for a facelift. If that weren't enough, the King's subjects have been mightily pissed off. Franchisees (which run 90% of the King's castles) brought a lawsuit on the company late last year over pricing cram-downs and menu choices.
Last month, Burger King announced that it will be acquired by 3G Capital for $4 billion. Based on the investment firm's history, cost-cutting measures and global expansion will follow; however, without ponying up the estimated $500K per restaurant required for remodels, the chain would seem to be stuck in a self-perpetuating cycle that would thwart best laid plans. It will be fascinating to see whether 3G will continue to leave the rest of the burger base out in the cold and how they will go about cleaning up the un-pretty mess, even as McDonald's attempts to widen the distance on a global scale!