McDonald’s Marketing Strategy, 5 Reasons Why it’s Working

How do you wake a sleeping giant? You hire BTS. After 2013 McDonald’s sales started to decline, from $28 billion in 2013 down to $19 billion in 2020 (pre-pandemic sales were $21 billion in 2019). With fast food chains like Chick-fil-A hot on McDonald’s heels it had to do something different or risk an ongoing decline.

One of the major marketing initiatives McDonald’s launched in 2020 which helped turn around revenues was a promotion called “Famous Orders” where it promoted McDonald’s meals celebrities like Travis Scott and BTS enjoy eating. The promotion first launched in the fall of 2020, featuring different celebrities every few months. The promotion was so successful it helped boost McDonald’s sales not only in 2020 but in 2021 it helped McDonald’s to reverse its declining sales trend with revenues for the year coming in at $23 billion.

The Famous Orders promotion has been a huge success, but why? Not all celebrity endorsements go viral but this one did. If you are curious about why McDonald’s marketing strategy worked in this instance then consider these five factors.

1. It used authenticity to lure you in. We live in a time where everyone talks about being authentic yet most of what we see, especially on social media isn’t authentic at all. When is the last time you made oatmeal for breakfast that looked like it could grace the pages of House & Home magazine?

When McDonald’s entered into a partnership with Scott for its Famous Orders promotion it released a limited time offer of Scott’s favourite meal on September 8, 2020, a Quarter Pounder with cheese, fries with barbecue sauce and a Sprite. Sounds pretty basic doesn’t it? It doesn’t even have any special ingredients. I am sure that before the promotion was launched someone at McDonald’s was secretly thinking, that’s not going to work, there isn’t anything to it.

But that level of simplicity made it seem like maybe that’s what he actually likes to order from McDonald’s. Scott’s backstory is that he grew up in Houston eating that very meal at McDonald’s and long before the partnership took place he talked about his love for McDonald’s and posted about it on social media. “Travis is a true McDonald’s fan having grown up visiting our restaurants in Houston, not to mention [he’s] one of the biggest musical acts and cultural icons in the world,” said Morgan Flatley, McDonald’s Chief Marketing Officer.

Any doubters were quickly silenced once the meal became so popular McDonald’s ran out of its ingredients within eight days after launch. McDonald’s traffic and app downloads in the United States were also also up by 9% and 11% respectively the week of the launch and posts made about Scott on McDonald’s Instagram page generated five times as much the normal engagement. Now why would Gen Z storm McDonald’s to get a meal that already exists, something they could buy at any time? Consumers, especially younger consumers are obsessed with celebrity culture. People like the idea of having a taste of the lifestyle of those they seek to emulate. How many times has a celebrity skin care or workout routine gone viral when it isn’t even unique? You can almost see someone buying the Travis Scott meal and thinking…so this is what he likes? This is kind of what it’s like to be like him? I want to be like Travis Scott, so maybe I’ll start by eating what he eats.

So why did McDonald’s, who is big enough to work with anyone, choose to launch this promotion with Scott?. “We look for artists who are true fans of our food. That authenticity is key. But we also want to partner with celebrities our customers and crew members love. As a restaurant owner/operator, I’ve seen firsthand the excitement these Famous Orders create around our brand,” said McDonald’s U.S. franchisee marketing committee chair Vicki Chancellor. “From customers blasting Travis Scott’s and J Balvin’s songs in the drive-thru last year, to sharing their own go-to McDonald’s orders and other unique content on social, it’s been incredible to see.”

2. It tapped into another brand’s platform to elevate its own. This is one of the oldest tricks in the book, if you want to boost your sales then collaborate with someone else who has an audience you want. How can you go bigger than McDonald’s? Just call BTS, the biggest pop act in the world.

The BTS Famous Orders promotion which launched on May 26th, 2021 had classic McDonald’s menu items including 10-pieces of chicken McNuggets, medium fries, a medium Coke, and, for the first time in the United States, sweet chili and cajun dipping sauces inspired by McDonald’s South Korean menu. To say that the BTS ARMY of super fans were excited about this collaboration is an understatement. The promotion was so popular the moment it was announced, before it was even available, it was trending on Twitter worldwide.

When a brand has been around for 68 years like McDonald’s it’s easy to look stale especially when so many people are obsessed with the latest hot thing. What McDonald’s did with its Famous Orders promotion is it made what is old new again without having to drastically change its menu. It was a clever way to get consumers excited about McDonald’s core menu offering again.

Flatley says that these partnerships have been helpful in staying relevant with consumers under the age of 34 since they are "becoming more and more challenging for brands to reach." "How they engage with media is different," says Flatley. "They look to recommendations much more than any other generation has. They're very reliant on social media. They're very reliant on their friends." “ We always want to make sure that we stay relevant and current with our younger fans, and this program has helped us connect with a new generation and insert the McDonald’s brand in culture,” says Flatley. Traffic was up 12% in the first week the BTS promotion was offered.

3. It tapped into our fear of missing out. Hundreds of millions of dollars of merchandise move because consumers have a fear of missing out. Take a look at brands like Supreme and Adidas who are masterminds in creating hype with limited time merchandise drops. These drops create a buying frenzy with people desperately trying to get their hands on coveted merchandise before it sells out.

McDonald’s Famous Order promotion is no different, the meals were only available for a limited time typically several weeks. Limited time offerings work because they create a sense of urgency. If you are a big BTS fan you don’t have forever to try the BTS meal at McDonald’s, you have to try it before it’s gone prompting you to eat at McDonald’s as soon as the promotion is available. This was the mindset consumers had even though you could technically have the meal at any time, well except for the dipping sauce in North America. But that shows how much people value being part of something. Getting in on something most people can’t access also makes people feel special, like they have status. You can see this when someone is showing off on social media their hard to find Jordans. Being able to say you were able to eat like BTS for a day or even just for lunch can go a long way for fans and their credibility with others.

With everyone talking about the BTS promotion excited customers around the world tried to get their hands on the BTS meal at McDonald’s as soon as it launched. Because of the frenzy several stores in Indonesia had to close down because they were overwhelmed with orders. "We temporarily closed four of six McDonald's stores here in Semarang for a couple of days," said Fajar Purwoto, the Indonesian city's public order agency head. “I don't want Semarang to be in the Covid-19 red zone again."

Delivery drivers packed this McDonald's outlet in Bogor, getting orders for the new McDonald’s BTS meal — Delivery drivers packed this McDonald's outlet in Bogor Indonesia, getting orders for the new McDonald’s BTS meal

4. It focused on diversity and inclusion. When Scott’s partnership with McDonald’s was announced many of McDonald’s franchisees were opposed to it. In a survey of McDonald’s National Operators Association 65% of operators surveyed were against the partnership. One of the primary reasons cited was that Scott’s lyrics are explicit and not reflective of a family friendly brand. Comments like that are steeped in racist undertones. The irony of those types of statements is that it is McDonald’s very own customers who are the ones listening to Scott’s music. Scott has sold over 45 million records in the United States many of which are sold to Generation Z and Millennials. No one sells that volume of records without appealing to people from many different demographics. As the New York Times writes: “despite hip-hop’s complete dominance of pop culture, there is still a bit of a lag when it comes to the willingness of large mainstream brands to work with hip-hop stars.”

For franchisees to have that sentiment it means there is a fundamental lack of understanding of their own customer base as well as a lack of courage to try something new. Businesses that are not inclusive in their products or marketing messages are leaving money on the table. Take Fenty Beauty. The brand made 500 million euros in its first year on the back of a completely inclusive line of foundation. Fenty Beauty’s partner, LVMH, benefited enormously from its partnership with Rihanna. The success of McDonald’s Travis Scott partnership is a wakeup call to its own franchisees as well as the broader retail industry.

Approximately 48% of Generation Z in the United States is nonwhite making this generation the most racially and ethnically diverse generation in American history. 25% of Generation Z in the United States are Hispanic, 14% are African American and 6% are Asian. Focusing on diversity and inculcation isn’t just right it makes good business sense.

Considerable buying power exists within the hands of people of colour. Buying power within the Hispanic community is expected to reach $1.9 billion by this year. The communities where buying power has grown the fastest over the past two decades belongs to Multi-Racial and Asian Americans whose buying power has grown by 389.7% and 382.3% respectively. The group with the lowest growth rate is White Americans who saw their buying power grow by 116.7% over the same time period.

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There are 125 million minorities in the United States representing 40% of the United States population. By 2045 today’s minority populations will be the majority. With McDonald’s Famous Orders promotion it leaned into diversity instead of shying away from it. From South Korean band BTS to Black American female rapper Saweetie to Columbian singer J Balvin the celebrities McDonald’s choose for the Famous Orders promotion felt representative of the young and diverse consumer group it is trying to reach. The success of the program was likely eye opening for McDonald’s, demonstrating the power of being more inclusive in its marketing efforts. “We thought Travis would be really big, and it was much bigger than we expected,” said Flatley.

5. It did not forgot about the importance of merch. While some are still wondering why you would buy a quirky looking onesie from a fast food chain like Dunkin’ others are busy snapping it up. A perhaps unlikely pairing has taken place with great success, fast food and fashion. Who would have thought? But fast food collaborations in the fashion world have been met with success. Take Dunkin’, a popular place to go to for a coffee and a donut, it often sees its merchandise drops sell out quickly.

When McDonald’s launched its Favourite Orders promotion it did not miss the opportunity to get into merch. Merch for the BTS promotion included t-shirts, hoodies, flip-flops, robes, cushions, pajama pants and umbrellas. Quickly after the BTS merch went on sale it was resold on marketplaces like Etsy for multiple times the initial price. Scott’s merchandise was also widely popular.

Why all the hype? Merchandise is a way of expressing yourself and showing your affinity to a brand or a person you love. If the merchandise is exclusive, you get bragging rights if you are lucky enough to get your hands on it. Social media just takes everything to the next level with fans creating marketing for McDonald’s for free by showing off the merch they got their hands on before it was gone. But credit goes to McDonald’s and its celebrity partners as one can’t deny that the merch looks great.