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Let Them Eat McDonald’s

Jan 27, 2012 • Behavioral Economics, Businesses, Demand, Supply, and Markets, International Trade and Finance • 243 Views    No Comments

By Elizabeth Chrystal, guest blogger.

France has long been known as a country of gourmets; it’s famous for its 2-hour lunches, picture-perfect pastries, and dizzying variety of cheeses. But the country that gave us succulent dishes like coq au vin and boeuf bourguignon has a new gastronomic passion, and one that might surprise you: McDonald’s. As a recent NPR story points out, France is McDonald’s second largest market, and the chain is poised to open even more restaurants in the country this year. France is already home to more than 1,200 of the franchises, many clustered around urban centers like Paris and Strasbourg.

Why is there so much enthusiasm for eating “chez MacDo,” as it’s called in France? The most obvious reason is the food. McDonald’s has been very clever in adapting to French tastes and creating their own versions of traditional French dishes. This means that the menu of a McDonald’s in Paris, France will be strikingly different from one in Paris, Texas. In France, diners can buy such items as “Le Croque McDo,” a riff on the classic French ham-and-cheese sandwich. “Le Charolais,” which is made up of a celebrated kind of French beef, and even a “Mouseee aux Trois Chocolats,” McDonald’s version of a classic French chocolate mousse. During the time I was studying in Paris last fall, they introduced “Le McWrap Chevre” to great fanfare-think larger-than-life billboards and ads in every metro station. This sandwich features small rounds of fried goat cheese, one of France’s most popular cheeses, with vegetables and cheese sauce in a wrap. Last summer, the “McBaguette” was introduced, as reported by the French newspaper, LeFigaro. The item appeared on the chain’s breakfast menu in September, and has been such a success that a baguette sandwich is set to be added to the lunch and dinner menu this summer.

McDonald’s has also taken steps to adapt to French eating habits. Since French consumers generally spend much more time lingering over meals than their Anglo-Saxon counterparts, McDonald’s has worked hard to make their stores inviting and tastefully decorated. Like the neighborhood cafes that surround them, many McDonald’s restaurants in France feature plush chairs, wood flooring, and subdued lighting. Some outlets even have fireplaces, flat-screen TVs and stone accents. These “luxe” restaurants stand in sharp contrast to the majority of McDonald’s U.S. restaurants, which seek to maximize customer turnover and minimize the amount of time customers are inside.

McDonald’s has also taken steps to silence French critics who complain that the chain’s food is too unhealthy. Not only has McDonald’s France added new packets of fresh fruit and vegetables to its menu and begun offering whole-wheat buns for its Big Macs, it has also introduced a whole new restaurant concept: the McSalad. Located in the massive French office park, La Defense, on the outskirts of Paris, visitors to this restaurant won’t find any of McDonald’s traditional burgers or fries. Instead, as the name suggests, the McSalad is an all-salad restaurant targeting health-conscious business people and office workers who eat their lunch in the area. This allows them to reach a new consumer demographic without changing the traditional menu.

The Economic Lesson

We might expect a well-known chain like McDonald’s to offer nothing more than a “slice of America” abroad, serving up the same fare in India as it does in Indiana. This would significantly simplify production and distribution challenges, not to mention avoiding the difficulty of creating new menu items that please local palates. However, as we’ve just seen, McDonald’s has achieved success not by following the same business strategies that it uses in the U.S., but by significantly adapting to local tastes. In a recent paper about McDonald’s in France, written by graduates of the Wharton School of Business, the authors even raise the question, “Can McDonald’s still be considered an American company? The golden arches remain a worldwide symbol of the U.S., but the food–and even the restaurants themselves–have come a long way.

An Economic Question: Which other American companies have achieved global success by rebranding themselves overseas?

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