McDonald's Dillon Splits Up Advertising to Make Shops Say 'I'm Lovin' It'

Competitors Collaborate on Strategy, Messaging While the CMO Holds Occasional Pitches to Pick Up Best Ideas

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CHICAGO ( -- What's it take to get cut-throat agency competitors to play nice? A $2 billion global budget doesn't hurt. It's at least one reason McDonald's can get its agencies to collaborate on strategy and major messaging before releasing them to develop their own spins.

But McDonald's doesn't pit them against each other in winner-take-all shoot-outs; rather, it asks clients for their best work and often goes with multiple agencies contributing to the campaign, as it did with the recent "I'm Lovin' It" update. The company sees that collaboration as crucial to its advertising success.

"I really fundamentally believe that our advertising wouldn't be where it was today if our agencies didn't collaborate," McDonald's Global CMO Mary Dillon said in an interview. And while it's not always easy, she said, "They know that's what the expectation is."

Ms. Dillon orchestrated a revamp of the chain's now-iconic "I'm Lovin' It" campaign, unveiled last week at the chain's biennial global conference of 15,000 operators, marketers and suppliers.

To retool the advertising, Ms. Dillon asked her lead agencies -- Omnicom's DDB Worldwide and TBWA and Publicis Groupe's Leo Burnett Worldwide -- nearly 18 months ago to start thinking about how "I'm Lovin' It" could work better for McDonald's. Ms. Dillon said Cossette, an independent agency from Canada, and Brazil's Taterka, of which Publicis owns a 5% stake, also played integral roles.

Marketplace of ideas
After a few group meetings, including one at Versailles before Cannes last summer, the agencies disbanded to develop their own ideas. Later, each pitched McDonald's separately, and the marketer placed orders with each shop. This way each agency gets some -- but never all -- of the business from a particular pitch.

This is the second big overhaul for the campaign. In 2006, Ms. Dillon, then a relatively new McDonald's CMO, asked agencies to make "I'm Lovin' It" more than a tagline; at the time, Advertising Age reported that Leo Burnett appeared to have won the pitch because the agency was presenting at the convention.

This time neither McDonald's nor any of its agencies are declaring victory, per se. Each major agency had TV spots shown in Ms. Dillon's presentation last week. Of those screened at the convention, three were from DDB, two were by Leo Burnett, and two were from TBWA. Ms. Dillon also presented outdoor work from DDB.

"This was never about a shootout," Ms. Dillon said. "You could never operate with a single agency with a brand this big. Let's get lead agency partners in the room together -- there was never any question that this was the right thing to do."

Of course, that doesn't keep shops from wanting more, but that's part of the point. "You'd prefer to have it all, but that's not the way it works," said one executive familiar with the process. "They like to have everybody be a winner."

Executives admit it wasn't always this way, and the process has become more amicable and effective under Ms. Dillon.

"There have been refinements," the executive said. "Previous management groups did it more like jump ball. Then there would be winners and losers and even when you won, you felt like a loser because you're constantly pitching."

It doesn't hurt that McDonald's creative business is relatively stable, in sharp contrast to other fast-feeders. DDB, a 38-year partner, has business in 34 countries. Leo Burnett, which has worked for McDonald's since 1981, has McDonald's work in 24 countries. TBWA works for McDonald's in 15 countries.

"Working with multiple agency relationships can be difficult," said Don Hoffman, exec VP-managing director accounts, DDB, but Ms. Dillon is "really a champion for a team effort that fosters a collaborative environment."

Not just marketing
Analysts are hesitant to credit marketing for McDonald's sales and market-share gains over the last seven years. The chain is now serving 60 million consumers each day, compared with 50 million in 2006. David Palmer of UBS pointed to the chain's operational improvements and increasing variety of better-for-you products that have overcome veto votes, particularly from women.

He did acknowledge, though, that the chain does some of the industry's most-effective marketing, and the idea of it getting better is "a little scary." Stumbles from rivals Burger King and Wendy's in recent years, he said, demonstrate just how easy it is to make big mistakes.

McDonald's also seems committed to including as many voices as possible, opening the door more and more in recent years to ethnic agencies, even for general-market TV spots. A breakfast dollar-menu ad that ran in the U.S. last winter, for instance, was from Burrell Communications.

"McDonald's is receptive to great creativity," said Mark Tutssel, global chief creative officer, Leo Burnett. "And when you have a client demanding great creativity, demanding the bar is raised higher, of course it attracts the finest talent."

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