• by Masha Geller , April 11, 2003

The online senate is abuzz with the recent announcement from McDonald's SVP of U.S. marketing, Bill Lamar Jr., who recently said the company will be doing less TV and more digital media.

"The days of spending hundreds of millions of dollars on TV advertising are over," he said at the 85th annual AAAA management conference. "Reaching consumers is no longer TV driven." Lamar said that in 6 months, McDonald's will move away from its current 'mostly TV' marketing strategy toward more digital media, saying that the company is already doing the most of any other company to reach customers on the Web.

I'm somewhat split on how I feel about this. Unfortunately, Lamar didn't quantify anything. I like numbers (as do most people in our industry) and it would have been nice to know what percentage of McDonald's TV budget is being shifted to the web. Considering that McDonald's is one of the participants of the IAB Cross Media Optimization Studies (XMOS), I'm hoping (in vain, no doubt) that the answer to the percentage question is in the neighborhood of 10-15%.

The findings from the October 2002 XMOS, which examined online media's place in the overall marketing mix for McDonald's Grilled Chicken Flatbread Sandwich, indicate the potential for an increase in branding metrics when online advertising's share of the overall campaign budget is increased via reallocation of dollars. What researchers found is that while McDonald's TV and Radio advertising works well (branding lift over pre-campaign levels is 187%), if online plays a larger role in the mix, and the percentage of online advertising is increased to 13% of the same budget, the projected lift would be 232%.

Additionally, offline media misses or under-delivers to a segment of consumers who are more prone to be reached online. Television doesn't reach or only lightly covers 27% of the 18 - 49 target market with online access. Seventy-six percents of these consumers used the Internet one or more hours the day before, so using the Internet to reach these somewhat elusive consumers provides better coverage of the overall target audience.

Is McDonald's shifting that much of its budget online? I sincerely doubt it. Is this a really good sign for the online industry at large? You bet.