McDonald’s Advertising Account Up For Grabs In Winner-Take-All Agency Showdown
The McDonald’s slogan may be “I’m lovin’ it,” but about half of their current advertising team will certainly hate the consequences of the company’s latest corporate decision. In a move that sounds more like something out of the script of the television series “Mad Men” than real-life, everyone’s favorite burger joint has issued a gladiator-style showdown between Leo Burnett and DDB Chicago.
According to the Chicago Tribune, these are the two advertising agencies that currently share McDonald’s marketing and advertising efforts, but that split will be coming to an end soon. The fast food giant decided a couple of months ago they were consolidating their efforts under one roof and issued a request for proposals from both companies.
The winner gets the McDonald’s account and the approximately $1 billion in annual advertising revenue that entails. The loser?Not even a Happy Meal on the way out the door.
McDonald’s hired a new CEO, Steve Easterbrook, last March. Since taking over he’s already done a lot to improve the efficiency of the burger machine while also increasing performance and creating new momentum with things like the “all day breakfast” menu.
“Clearly it’s been one of (Easterbrook’s) chief mandates to get the entire system aligned, having one vision, streamlining and simplifying,” Morningstar analyst R.J. Hottovy said. “A lot of the most important things the company needed to remedy have been improved. Now the key is sustaining that process.”
The belief is that having one consistent voice throughout all of their marketing and advertising efforts will help to promote this new vision.
In the U.S., advertising is one of the largest markets monetarily. For example, companies spent an estimated $44.5 billion on direct mail marketing in 2014 alone.
According to Kantar Media, McDonald’s spent about $196 million on print, broadcast, and digital advertising in the first three months of this year alone. Last year, they spent a grand total of $824 million.
Although the final decision could lead to some pretty nice bonuses for whichever company ends up winning this billion-dollar sweepstakes, the loser could end up with layoffs instead.