McDonald's targets millennials

26 March 2013

OAK BROOK: McDonald's, the fast-food chain, is aiming to attract the millennial generation back into its restaurants with a strategic focus on customisable products. 

An internal company memorandum, seen by Advertising Age, stated that "McDonald's is currently not in the top 10 of millennials' favorite restaurants" and says its new McWrap product "offers us the perfect food offering to address the needs of this very important customer".

The addition of the McWrap to the McDonald's menu has been seen as a direct response to the challenge posed by the likes of Subway, a sandwich chain which allows customers to specify their own fillings.

The memo confirms that the McWrap is indeed a "Subway buster" and that it "affords us the platform for customization and variety that our millennial customer is expecting of us". While millennials are at the forefront of this trend, it adds, other demographics are also seeking "to be able to personalize their food experience". 

The extent to which McDonalds' move was necessary becomes clear as the memo goes on to state: "They have told us that if we did not offer McWrap, 22% of these incremental customers would have gone to Subway."

Millennials are still going to burger chains, but less often than before. NPD Group, the market research business, reports that traffic from this group has declined 16% between 2007 and 2012.

A survey late last year by the Boston Consulting Group found that that Millennials eat out 3.4 times per week, compared with 2.8 times for older shoppers, and that restaurant meals and drinks ranked above electronics, apparel, footwear, accessories and cosmetics when young consumers discussed things they liked to spend money on.

A move upmarket was also evident. Applebee's, Chili's, The Cheesecake Factory and Olive Garden were the chains that this audience frequently attended, although the most desirable destinations were Chipotle, Panera Bread and Pei Wei Asian Diner.

Data sourced from Advertising Age; additional content by Warc staff