The Very, Very Rich and How They Got That Way (31 page)

To see that units stick with it, the company maintains a staff of “field consultants” (“We don’t like to call them inspectors,” an official explains). Each consultant is responsible for 30 units on which he pays regular visits – some announced, some unannounced. Occasionally several consultants get together and “blitz” a unit – buying hamburgers, shakes and fries by the hundreds and then confronting an owner with the facts (“Look, Gene, 200 of the burgers were cold”). Most owners comply quickly with the consultants’ reports; only rarely has the company been forced to cancel a recalcitrant owner’s franchise. (This doesn’t include the 35 to 40 owners in the company’s history who have forfeited their franchises because they didn’t keep up with their monthly payments or just “walked away from the business.” In such cases, an owner receives his $15,000 security deposit and the depreciated value of his equipment – minus, of course, what he owes the company). The most notable cases in which owners were forced to give up their franchises involved two Californians. One refused to serve the fish fillet when it was added to the menu, and the other was not making hamburgers according to specifications and refused to let his field consultant into the restaurant.

A few small variations are permitted to suit regional tastes: On Long Island no mustard is served on regular hamburgers; in Memphis more mustard is served and less catsup; in Texas, even more mustard and less catsup. In parts of New England a coffee milk shake is added to the regular line up of chocolate, vanilla and strawberry. In parts of the South Dr. Pepper is served as a fourth soft drink.

Over the years the company has expanded the original burger-shake-and-fries menu, but only after exhaustive testing in its own labs and in the field. The double hamburger and double cheeseburger were added in 1963, the fish sandwich in 1964, apple pie in 1967, and in 1968, after months of secret experiments, came the “Big Mac” (two hamburger patties, interspersed with three sesame-bun sections and covered with shredded lettuce, cheese, pickle slices and a “special sauce”). The company is testing fried chicken in Dayton and a big quarter-pound hamburger on the West Coast. When a test fails, McDonald’s is quick to admit it. A roast-beef sandwich and fish ‘n’ chips have recently been abandoned, as have a chain of Jane Dobbins pie shops (named after Mrs. Kroc) and Raymond’s, a luxury hamburger chain named after the chairman himself.

McDonald’s also sets strict standards for the grooming, dress and behavior of its employees. The manual decrees, “Your windowmen and outside order takers must impress customers as being ‘all-American’ boys. They must display such desirable traits as sincerity, enthusiasm, confidence and a sense of humor. . . At McDonald’s personal appearance is something we watch every day. A man should shave every day, clean his fingernails every day, keep his teeth and breath fresh and clean all the time, bathe often to prevent underarm and other body odors and use a deodorant. He should have dark pants, black shining shoes, a neat haircut and a clear complexion. Personnel with bad teeth, severe skin blemishes or tattoos should not be stationed at service windows.”

These standards, framed in the Fifties, have created some problems of late. McDonald’s relies heavily on teenage boys for its crews because they are available for part-time work after school or on weekends and because they will work for the minimum wage (keeping labor costs low is one of the keys to McDonald’s success). For years McDonald’s refused to hire females, particularly teenage girls, because as Ray Kroc put it, “they attract the wrong kind of boys.” But federal legislation forced the company to drop any discrimination by sex. Now the youth culture is slowly forcing it to relax some of its hair and dress codes.

Ray Kroc still insists the company “will not tolerate moustaches, beards, goatees or sideburns below the ear.” But at McDonald’s stands in several college towns and black communities I noticed that this rule was not infrequently violated. One official explained, “Look, Ray is out of another era on this thing. He just doesn’t understand today’s young people. And he’d be prepared to go down with the ship on the hair issue. I don’t think Fred Turner and some of the others see it that way. They’re trying to be a little more ‘with it’. ”

Fred Turner does try. The onetime grillman of Ray Kroc’s first McDonald’s is only 38, wears faintly Mod suits with patch pockets and has recently let his hair grow down to graze his collar. He is largely responsible for the new “think tank” at McDonald’s Oak Brook headquarters, which boasts as its centrepiece a circular water bed with burgundy suede headrests.

Under Turner’s leadership the company has recently put out a brochure telling owners in college towns how to deal with today’s youth. “Talk to the students in a direct manner,” it says. “They call it ‘talking straight.’ Don’t attempt to imitate what you think is their language and don’t ‘put them on.’ They would say, ‘Tell it like it is.’ Be aware of local problems, especially campus problems, but avoid taking sides and steer clear of controversial areas. Don’t jeopardize your restaurant’s position as ‘neutral ground.’ ”

This is often a hard line to trade. The day after the killings at Kent State, students from Southern Illinois University marched into the McDonald’s in Carbondale, Illinois, and demanded that the flag flying above the restaurant be lowered to half-staff. The operator complied, but a neighbor who happened to know Ray Kroc called him and complained. Kroc – a superpatriot who insists that McDonald’s outlets fly the flag 24 hours a day if possible – called Carbondale and ordered the flag up again. This brought the students back, now threatening to burn the restaurant down unless the flag was lowered. This time the operator called Fred Turner. McDonald’s president thought a moment and said, “Tell you what you do. The next delivery truck that arrives, have him back in to the flag pole and knock it down.” That’s just what happened.

But McDonald’s new drive for a youthful clientele has its limits. It stops well short of the dreaded “teenager.” In the Fifties fast-food operations were largely drive-ins catering to teenagers who wheeled up in their hot rods to ogle the short-skirted carhops, trade gossip and lounge for hours in the parking lot necking or listening to the radio.

From the start McDonald’s has sought to discourage the teenage crowd. The manual states unequivocally, “McDonald’s units shall not have jukeboxes, pinball machines, newspaper racks, gambling devices, phone booths, nor shall they dispense cigarettes, candy, gum, etc.” – all regarded as attractions for teenagers.

But even such precautions have not prevented teenagers from claiming some McDonald’s stands as their own. A notorious case was Vero Beach, Florida, where young people, banned by police from a favorite park, virtually took over the McDonald’s every night. In a recent class on “the teenage problem” at Hamburger University, Professor Doug Moreland distributed a case history of the Vero Beach situation and then warned, “Watch out for teenagers. They can definitely affect your profit picture by driving away adults. They are extremely noisy and messy. They’ll use profanity and that can never be allowed at any McDonald’s. They’ll neck on your lot – and you better nip necking right in the bud. Be particularly careful on the night of a sporting event. The losing team always wants to come to McDonald’s and prove they’re better than the winner. It can be a really terrifying experience if you have three or four hundred people descend on you for a rumble. We’ve had managers injured, many of them badly, although I don’t recall any being killed.”

The teenager is a particular threat to McDonald’s because the company strives so hard for the family trade. Executives like to say that when they pick a new McDonald’s site “we count church steeples, not cars.” This is hyperbole, of course; McDonald’s makes a careful traffic analysis of any prospective site. But it also looks carefully for signs of substantial family life – churches, schools, playgrounds, shopping centers, tree-lined residential streets. One official explains, “You could say our prime target is a family in which the father is 27, the mother 25, with two children and another on the way, making over $10,000 and living in the suburb of a major city.”

McDonald’s advertising – a massive campaign that cost $14,500,000 in 1969 – is aimed largely at such families. Under Fred Turner the company’s ads have become somewhat more sophisticated. Last year it got rid of its old agency, D’Arcy, because – as Turner put it – “they thought every kid in a McDonald’s ad had to have freckles and a space between his two incisors.”

The new agency – Needham Harper and Steers – has almost completely redesigned the campaign this season. Starting with a recent study, which showed that in three out of four cases children decide where a family will eat out, the agency had devoted much of its energy to an imaginative new series of TV commercials aimed at children and set in a lush fantasy world called “McDonaldland.” The central figure is Ronald McDonald, the clown figure who has long been a fixture on TV (the Fourth Annual Ronald McDonald Awareness Study showed recently that 96% of American children can identify him by name, making Ronald a close second to Santa Claus in recognizability). But there is also a whole range of new characters, including Captain Crook (who lives on fillet-of-fish sandwiches), the Goblins (who gobble french fries), the Hamburglar (who steals you know what), Mayor McCheese and Big Mac, the police chief.

Needham has also scrapped McDonald’s old slogan, “Your kind of Place,” and come up with a new one, “You Deserve a Break.” Peter Nelson, the senior account supervisor, says the new slogan is designed to stress “the McDonald’s experience” rather than the food. “The message we’re trying to get across,” he says, “is that going to McDonald’s can be a fun experience for an American family. For the housewife it is a minibreak in the day’s routine. For dad it is an opportunity to be a hero to the kids, but in a way that won’t cost much money. For the children it’s just plain fun. For all of them it’s a family-oriented thing.”

The payoff from mass family-oriented eating can be staggering. A prime example is the McDonald’s at 8040 Nicollet Avenue, Bloomington, Minnesota. Last year the unit, which is owned and operated by the company, grossed $1,100,000; it was the first time any unit had gone over $1,000,000. Of course, the Bloomington location is ideal. It is less than a mile from the sports complex in which the Minnesota Twins, the Vikings and the North Stars play baseball, football and hockey, and sports fans are proved McDonald’s eaters. Moreover, it is just off a major freeway, near several drive-in theatres, two large shopping centers and several major industries.

But, according to Jim Duval, its manager, the bulk of the unit’s customers are the young, prolific, relatively affluent families who live in the rapidly growing suburb of Bloomington. “These people are so loyal it’s hard to believe,” he says. “Look at it this way: We’re number one in the country not only averaged over the year but just about every month, including the winter months, when it gets cold as hell up here. Even when it’s five below and a foot of snow on the ground, we get families lined up here for food to take back to their cars and eat huddled up over the heaters.”

To build loyalty like that, McDonald’s outlets throughout the country spend a lot of time, energy and money showing that they are “part of the community.” This is the major theme in McDonald’s public-relations campaign. The means – most of them devised by Cooper and Golin – are varied and imaginative. In Saratoga, California, one McDonald’s donated free refreshments to women participating in a “Ladies Litter Pick-Up.” In Johnson City, Tennessee, Rick Fulton won a free meal at McDonald’s when he was selected as a “safe and courteous driver” by the local police. In Brea, California, McDonald’s supplied free hamburgers and soft drinks to men fighting a forest fire. In Fort Worth McDonald’s donated a free hamburger to each child who put free reflective tape on his bicycle under the “Lite-A-Bike” program sponsored by the Veterans of Foreign Wars. In Frederick, Maryland, Ronald McDonald – or one of several hundred actors and drama students who impersonate him around the country – led the annual Halloween parade.

McDonald’s is not beloved in every community. In Braintree, Massachusetts, civic groups protested plans to erect the giant Golden Arches over the restaurant’s new location on Pearl Street. Other towns around the country have complained that the arches, towering signs and red-and-white tile are garish and ill suited to their aesthetic standards. In some cases architectural review boards have forced major changes in design. Fred Turner dismisses many of these critics as “a bunch of old ladies who don’t know what they’re doing.” But McDonald’s has recently adopted a muted new design and remodelled some of its old outlets accordingly. The new design had a double mansard roof accented by metal beams, plate-glass windows set in a brick facing, a small McDonald’s logo on the wall – all in currently fashionable brown, olive and beige tones.

McDonald’s may soon face a new wave of criticism. As the consumer movement continues to burgeon, some activists have begun to examine the fast-food industry from a nutritional stand point. There is little serious question about the purity of McDonald’s meat. New York City’s commissioner of consumer affairs, Bess Myerson, says McDonald’s came out well during a recent crackdown on excess fat in hamburgers. (McDonald’s specifications call for a fat content between 16 and 18.9%. The specifications also require that the patties be made from only two cuts of beef – chuck and steer short plates – and that there be no hearts, lungs, tripe, cheek or head meat, suet, flavour boosters, preservatives, protein additives, fillers or cereals.)

But how much nourishment do you get from a meal at McDonald’s? Jean Mayer, professor of nutrition at Harvard University’s School of Public Health, answers this way:

“The typical McDonald’s meal – hamburgers, french fries and a malted – doesn’t give you much nutrition. It’s very low in vitamins B and C but very high in saturated fats. It’s typical of the diet that raises the cholesterol count and leads to heart disease. Don’t make me sound like a fanatic. Once in a while I like to have a meal of hamburgers and french fries myself. But not as a steady diet.”