|


 

        

An Arthur Page Society case study in

issues management
 
= a esity is a pervasive pro
em in America, and
as peop
e increasing
y ecome overweight, their
hea
th suffers
= 64% of a

Americans overweight and 30% are o ese;
the percentage of chi
dren age 6 to 19 that are
overweight has dou
ed in the
ast two decades
= Hea
th risks: heart disease, Type II dia etes,
high cho
estero
, high
ood pressure
  |

= The nutritiona
content of fast food--high in fat,
sugar, and ca
ories--is
inked to weight gain and
consequent hea
th pro
ems. McDona
d¶s ears
the runt of criticism ecause:
= McDona
d¶s is a powerfu
mu
tinationa

corporation and the fast food industry
eader
= McD¶s has more than 31,000 restaurants in 119
countries
= McD¶s feeds more than 46 mi

ion customers per day
= McD¶s emp
oys more than 1.5 mi

ion peop
e
  
= There are organizations,
associations, government
agencies, consumer groups,
activists,
oggers, etc. critica

of McDona
d¶s on the issue of
hea
th and nutrition
= This case study focuses on
major attacks occurring
from 1994 to 2006
|  
= McDona
d¶s sued two protestors for a

eged
y
i e
ous
statements made in a pamph
et, ³What¶s Wrong with
McDona
d¶s´
= PR disaster that made McDona
d¶s
ook
ike a u

y
= Bui
t the media agenda on issues unfavora
e to McDona
d¶s
= Appe

ate court ru
ed that the defendants were justified in c
aiming
that regu
ar customers of McDona
d¶s did face a heightened risk of
heart trou
e
= Pamph
et
ater reproduced on the Internet to massive internationa

audience
= Court case cost McDona
d¶s over a mi

ion do

ars
= Court case provided the materia
for a fu


ength documentary
re
eased in 2005, |

|   !""!!""#
= A group of o ese teenagers who ate at McDona
d¶s 3-5 times per
week sued McDona
d¶s for causing their weight pro
ems. They
a

eged that:
= McDona
d¶s advertising and promotiona
representations create
a fa
se impression that its food products are part of a hea
thy

ifesty
e
= McDona
d¶s said it wou
d have nutritiona
information avai
a
e
to customers ut it wasn¶t

= The court ru
ed in favor of McDona
d¶s ut the resu
ting press

coverage put the issue once again in the forefront. This case was
what gave Spur
ock the idea for ë
ë|.

= 2002 first time McDona
d¶s posted a quarter
oss in its history.


  !""$ !""%
= A ook high
y critica
of the fast food industry
= ! 
  est se

er
= Aersion directed to chi
dren 11-15 years o
d,
   pu
ished in 2006
=  ! re
eased as a movie in
Novem er, 2006
= Movie tag
ine: The Truth is Hard to Swa

ow
ë
ë 
$ !""
= ³ane man¶s journey into the wor
d of weight gain,
hea
th pro
ems, and fast food.´
= Morgan Spur
ock¶s documentary account of his
persona
experience over a 30-day period of
eating nothing ut McDona
d¶s food. He gained
25 pounds and suffered physica
ai
ments.
= Spur
ock ca

ed for e
iminating super size option
and providing nutritiona
information.
= Educationa
versions for midd
e and high schoo

students now avai
a
e.
 & '  (  
 |)
= Corporations must work to so
ve pro
ems when
confronted y peop
e and organizations that may
e against what the corporation says, offers, or
does
= Corporations must strive to repair re
ationships
with externa
pu
ics and enhance its corporate
reputation
McDona
d¶s must adopt strategic communication
responses to those who disapprove of what they
see as McDona
d¶s ro
e in promoting o esity and
hea
th pro
ems.
'    
|)
= Acquiescence
= Stop doing what is othering critics
= Negotiation (Two-way)
= Work co

a orative
y for consensus and compromise
= Confrontation (ane-way)
= Discredit the opposition
= Argue your side
= Take
ega
action
|
 ' *  +
= ane-way, asymmetrica
communication
= McD¶s has avoided dia
ogica
, or two-way, communication with
critics.
= McD¶s dec
ined invitation to appear with Sch
osser on NBC¶s
Today Show and instead sent a statement of facts and to
d
them to visit the we site.
= Denia
of any concern or compromise with critics
= McD¶s insists it did nothing in response to the fi
m ë
ë
| and has stated it had no need to p
an proactive
y for the
re
ease of the fi
m  ! .
= Main message is one-way: ³More aggressive in te

ing our
side of the story´
= Denia
of investigative reports
Ë  ,-)
= ³We don¶t se

nutrition and peop
e don¶t come to McDona
d¶s
for nutrition. Rather than fight a defensive war of attrition y
responding to constant nutrition attacks,
et¶s not even dea

with it.´ (1986, PR executive hand
ing McD account)
= ³We have media days and fact sheets that are avai
a
e
through our we site, as we

as p
atforms that wi

afford us
any opportunity to ta
k a out what¶s important to McDona
d¶s.
We cannot e over
y concerned a out anyone e
se.´ (2006,
Wa
t Riker, McDona
d¶s AP of Corporate Communication and
Media Re
ations, regarding the re
ease of the movie Fast
Food Nation)
 . '/ &)
    .   
= McDona
d¶s promised in 2002 to change its trans
fat cooking oi
to a hea
thier a
ternative.
= Customers¶ comp
aints
ed McDona
d¶s to cance

that action
= Legis
ation has een proposed in 2006 to an
trans fat cooking oi
s in restaurants
= ather fast food chains have vo
untari
y instituted
the change
(Questions for discussion next s
ide)
Ë  
 
= How can the impact of changing the taste
of their French fries e weighed against the
hea
th harms of trans fat cooking oi

= How is credi i
ity affected y promising
actions ut not de
ivering on them
= Are there occasions when a company may
take a hit on an immediate action in order
to ui
d etter re
ationships for the future
|
 ' *  0
= Corporate socia
responsi i
ity
og
= Contains section ³Engaging in the G
o a
a esity
Dia
ogue´
= A

ows feed ack and discussion
= The a
anced, active
ifesty
es initiative
= Adding more menu choice
= Providing nutrition education
= Supporting physica
activity
= Theme: ³It¶s what I eat and what I do«I¶m
ovin¶
it´
|1   
= Menu choice: premium sa
ads, ott
ed water,
ow fat/skim
mi
k, white meat chicken
= Go Active! Happy Mea
s for adu
ts
= Wa
king program and free pedometers
= Get Moving with Rona
d McDona
d and McMunchright
= Ce
e rity rand am assadors
= Nutritiona

a e
ing on products (in most restaurants within
one year period)
= Co

a oration with Scripps Research Institute for fighting
chi
dhood o esity and Type 2 dia etes
= U iquitous advertising campaign emphasizing physica

activity
)
= By 1986 Aware of Issue
= 1994 McLi e
± McDona
d¶s food can e harmfu
to hea
th
= 2001  ! 
= 2002-2003 McLawsuit± Need for nutritiona
information; food harmfu
to
hea
th
= McD¶s posts first quarter
oss in corporate history
= Per share stock price p
umments
= McD¶s promises to rep
ace trans fat oi

= McD¶s introduces hea
thy options in 2003
= 2004 ë
ë| ± Shou
d cance
super size option, need for nutritiona

information
= McD¶s cance
s super size option
= McD¶s introduces Ba
anced, Active Lifesty
es initiative
= 2006 FDA introduces proposa
an trans fat oi
in restaurants
= 2006  ! , the movie and    , chi
dren¶s ook
= McD¶s starts putting nutritiona
information on packaging
= McD¶s sti

hasn¶t rep
aced trans fat oi
s
( 2   , . 
|)
= Listen for threats through
issue/environmenta
scanning
= Determine whether the issue wi

affect the
organization/corporation
= If yes, give the issue priority in proactive,
time
y strategizing
&  
  * )
= Effective issues management ca

s for
monitoring and identifying emerging issues
ear
y in order to p
an proactive
y.
McDona
d¶s knew of the issue for years, yet
de
ayed taking actions unti
it was
defensive rather than proactive.

(Questions for discussion next s
ide)

Ë  
 
= With advance know
edge of the rewing
issue, what proactive steps cou
d
McDona
d¶s have taken
= Why is it advantageous to take action
proactive
y rather than defensive
y
& & /    
= Denied ë
ë| had anything to do with
cance

ation of the super size option even though
McDona
d¶s withdrew the option just six weeks
after ë
ë| premiered
= Denied any concern or need to p
an proactive
y
for the premiere of  ! 
= Denied investigative reports regarding an interna

memo sent to franchisees to discredit Eric
Sch
osser
= C
aimed to have nutritiona
information avai
a
e
for 30 years
& & /      )
= McDona
d¶s has experienced moderate and
continuous growth in sa
es and per share
stock price 2003-2005
= However, fast food companies such as
Chipot
e, Buffa
o Wi
d Wings, Panera Breat,
Panda Express, Quiznos, Star ucks, and
Jason¶s De
i are the ones reaching highest
growth in the fast food industry
& & / |  )
= Positive: McDona
d¶s has instituted severa

marketing programs addressing the need
for a
anced, active
ifesty
es
= Positive: McDona
d¶s has expanded hea
thy
menu choices
= Negative: McDona
d¶s has refused to
engage in the de ate over nutrition and
hea
th with its critics
& & /
   
    )3   
= Emphasis is p
aced on marketing, rather
than pu
ic re
ations
= McDona
d¶s needs to focus on pu
ic
re
ations reputation ui
ding through
increased transparency and dia
og
& & /  )3 
   - 3   
= Top management acknow
edges a one-way
message strategy of emphasizing their
need to ³do a etter jo of te

ing their story´
= Top managements¶ statements tend to
project a position of power rather than a
more concerned and open viewpoint
& & / ') )$   $
 )
= McDona
d¶s has done an exce

ent jo of
remaining ca
m and patient
= However, McDona
d¶s has not shown a sense of
humor in the face of targeted criticisms
= Question for discussion: What wou
d e the est
way for McDona
d¶s to maintain a sense of humor
in regard to the issue of hea
th and nutrition

 / |


= The main question facing McDona
d¶s is whether they can
continue their wor
d dominance in the fast food industry y
promoting active, hea
thy
ifesty
es when their mainstay
products continue to e
inked to o esity and re
ated hea
th
pro
ems. McDona
d¶s has done a
auda
e jo in marketing
the concept of consumer choice and in esta
ishing a
generous corporate socia
responsi i
ity program. However,
in the U.S. at
east, McDona
d¶s has not reduced advertising
to chi
dren, reformu
ated its trans fat cooking oi
, or
owered
fat, sa
t, and/or ca
orie counts on its core products. Rather
than diminishing, the issue of hea
th and nutrition continues
to esca
ate and McDona
d¶s remains a key target in 2006.