AMERICAN MULTINATIONAL FOOD FIRMS LOSE CONSUMERS AT HOME

The traditional American way of life has to deal with transformations in American society. Marketing strategies are inefficient in attracting the 73 million consumers from 18 to 34 years old due to many factors that must be taken into consideration. These consumers expect more than a standardised product: firms must innovate, propose a better service and customise their products if they want to increase market share thanks to the significant purchasing power of 180 billion dollars of these consumers. Moreover, cultural diversity has brought new consumption habits which impact on these American multinational firms. Furthermore, American people have become more and more concerned by health issues which are another reason of American multinational firms’ decline at home.

MC DONALD'S DECLINE

The famous fast food chain is not as attractive anymore and hundreds of restaurants closed last year in the United States with a 4.6% drop in sales as people are becoming aware of health and environmental issues that Mc Donald's neglect. In contrast, Chipotle, a Mexican restaurant chain has used these issues as a business strategy and has become the main competitor of Mc Donald's. Consequently, Chipotle attracts Mexican immigrants and people who care about organic food production and respect for animals. Besides, Chipotle introduced the concept of a 'fast casual dining establishment' which guarantees good quality food by limiting the use of frozen or processed ingredients providing better tasting food. Chipotle has proposed an alternative to Mc Donald's, which is innovative, respects the environment and attracts immigrants. Mc Donald's must review all its food production to adapt its supply to the latest trends.

COCA COLA COMPANY THREATENED

In the United States, Coca Cola consumption has declined and profits dropped by 14% last year owing to the negative health effects of this drink, for example diabetes and weight gain. Obesity concerns have become more publicised therefore consumers do not want to consume too much anymore and are more interested in healthier or natural ingredients that the Coca Cola brand does not reflect. In addition, the government implemented a campaign in order to limit soda consumption and prohibited the sale of soda in schools. Coca Cola has to face other competitors which have become more important and increase market share selling drinks corresponding to health trends: sport drinks, iced teas and flavoured waters. It has been forecasted that in 2017 water consumption will increase more and more and surpass all other drinks. Coca Cola must consider wellness and health as its priority, using more natural ingredients and decreasing the quantity of sugar in its products.

KELLOGG'S EXCLUDED FROM BREAKFAST

Among changing consumer habits, Kellogg’s is another victim with a 3% decrease in its sales in the second quarter of 2015. Young people prefer to eat fresh smoothies, yoghurt, toast and eggs. Smoothies have become the new healthy trend over the last few years and in North America, the consumption of smoothies has increased by 80% in only five years. In addition, Kellogg's has also had to deal with the cultural diversity because immigrants are not used to eating cereal. Given that Americans are buying healthier food, Kellogg's will remove artificial flavours and colours from its products by 2018 and introduce a new range of cereals including gluten-free cereals.

American multinational food firms have to deal with a new era in North America: an era in which people pay attention to what they buy, what they eat and what they drink in order to remain healthy and be more aware of companies’ activities. These 73 million consumers have a great potential for changing companies’ behavior as they are demanding more respect of the environment, the food production and the nutritional composition. The explanations of this new trend can be a reconsideration of these firms' model with a better understanding of these firms’ practices. As a result, firms must adapt their products to attract the purchasing power of these consumers and innovate healthier products. However, American multinational food companies have found other dynamic markets abroad in developing countries where people want to consume globalised products and are not regarding of nutritional composition or environmental practices as they desire to take part in the globalised world. These new markets ensure economic growth for these firms which will continue to increase their turnover and invest in new products for the North American market.

Audrey D.