Categories: Case StudiesLaura

McDonald’s Goes Above & Beyond

seems that no brand is safe these days. From Toyota, the world’s largest car
maker. To Tylenol, the country’s largest over-the-counter drug. To McDonald’s,
the world’s largest fast-food chain.

of these three brands has suffered massive recalls with the potential for
massive brand damage.

said, even if its response to a disaster is less than perfect, a leading brand
has an amazing ability to survive. Consumers believe the leader is better and
runs a better company than its competition. As a result, consumers are willing
to give the leader the benefit of the doubt. Consumers will almost always give
a leader a second (or even a third) chance to make things right.

catastrophe won’t normally bring down a leading brand. The only thing that will
bring down a leading brand is continuous and escalating catastrophes. Something
we haven’t yet seen. (Remember, way before the current Gulf spill, BP wasn’t
the leading oil company and also had a poor reputation for safety.)

though a leading brand has more damage-control leeway doesn’t mean a leader
should sit on its laurels when disaster strikes. A leading brand can reinforce
its dominance by responding above and beyond what is expected.

is exactly what McDonald’s is doing.

Friday, McDonald’s moved at lightning speed and initiated a voluntary recall of
its popular Shrek glasses that contained trace amounts of a toxic metal in the
paint. The tainted glasses were first discovered by a band of Moms with heavy-metal
home-tests and then reported to California Congresswoman Jackie Speier and to
the Consumer Products Safety Commission (CPSC.)

the spread of the tainted-glassware story certainly posed a problem for
McDonald’s, the glassware itself wasn’t all that dangerous. Chief spokesperson
for the Consumer Product Safety Commission told Fortune magazine that “the
product was not toxic and does not pose an acute risk to children,” adding that
“the risk to consumers was very low.”

companies would have used this evidence to counter-attack critics. Many
companies would have also shifted the blame to a supplier. (McDonald’s didn’t
make the glasses and the supplier was a U.S. company. McDonald’s didn’t buy the
glasses from a shady Chinese factory.)

did neither. In its response, McDonald’s went above and beyond. It quickly
recalled all the glasses. And it is paying consumers a premium for returning
them. McDonald’s will pay a whopping $3 in cash per glass. (They had been
selling the glasses for $1.99 with a food purchase and $2.49 without food.)

a company to pay above the purchase price for a recall is almost unheard of.
But in McDonald’s case, the extra money is being well spent.

above the price of the glasses does two things. First, it gets more of the
unsafe products out of the marketplace. In a typical recall, only 10 to 30
percent of consumers respond. I imagine McDonald’s numbers will be much

it shows that McDonald’s doesn’t just care about the recall, it also cares
about its customers. It is compensating them for the recall and making sure it
gets as many glasses out of the hands of children as possible.

Toyota and Tylenol underestimated their problems and delayed responding to
them, McDonald’s has done just the opposite.

went above and beyond. They overestimated and overcompensated. I’m lovin’ it.

Laura Ries :

View Comments (6)

  • Speed is key when stopping a crisis. McDonald's is doing the right thing. If the BP crisis was only that easy. BP probably could use any distraction at this point.
    Although I love the response I'm not lovin' the tag line at McDonald's.
    Erik Johnson

  • I agree that McDonald really put a great effort on building its Corporate Social Responsible image. However, as the smart consumers, we do concern more about the quality of food offered by McDonald rather than the little tricky things. Did McDonald improve the ingredient of hamburgers? To make it more fresh and healthy rather than just offering low quality fast food. Did you all realize that the size of hamburger is smaller year by year? It is my observation in Hong Kong. Let all consumers get the real benefits. WE NEED HEALTHY FAST FOOD. NOT THE LOW QUALITY FAST FOOD. SMALL IN SIZE AND NO IMPROVEMENT AT ALL :(

  • It was very admirable what McDonalds did. But yeah, their food isn't very healthy either. :) Hrm, healthy and fast food don't go together in a sentence. LoL. Anyway, if you want healthy food, you won't find it in McDonalds.
    And yeah, some crisis may be too hard to get out of.
    But the good thing about all of these is that we can learn from their mistakes. I guess McDonalds hasn't learned from the "dangerous toys made from China fiasco"
    PS...Sharing useful tips on how survive on the tough times: http://sn.im/w6rw2

  • Yes, but isn't "response" just the surface? Everyone feels or perceives that hollow response and desires that McDonald's peel back another layer of the onion. Are these glasses made in China? Are they made by the same organization that tainted Mattel's toy's with lead paint? When someone tampered with Tylenol capsules we created Tylenol Gelcaps, the first gelatin enrobed tamper proof capsue. Now everyone has a gel or liqi cap. But Tylenol was first and that "product based" response recaptured the 92% of capsule segment sales lost to cyanide tampering. So why do we applaud companies like McDonald's for just putting a PR Band Aid on it. Why don't they really do something? Personally, I couldn't care less if McDonald's doesn't have the best burgers. In their minds they do ... CQCQ ... Consistency, Quality, Confidence, Quantity ... ergo about a trillion burgers served. They just consistently have the same burger no matter when you get it or where. That's quality to McDonald's. I also managed the account during my Leo Burnett Days. Anyway, great post but that PR Balm most companies apply to every consumer bruise ... is it really that effective? I know 70% of America eats at McDonald's at least once a month, but with their new healthier menus, why doesn't 70% of America go to McDonald's at least two or three times a month. Having called on McDonald's for years I know that's one question no one asks inside and that the answer is not one anyone wants to find ... because if they do, that person should be made President. Thanks for another great thought provoking post Laura!