Day 043 - 01 Nov 94 - Page 58


     
     1        up with the film Lion King?
     2        A.  Here in the United Kingdom?
     3
     4   Q.   Here in the United Kingdom?
     5        A.  Yes.
     6
     7   Q.   I will ask the question just so that you can tell us.  Did
     8        it have the same association in the United States?
     9        A.  No, it did not.  They were affiliated with Burger King
    10         -- quite a successful promotion, I might say.
    11
    12   Q.   Was that a painful occurrence for you?
    13        A.  Yes, it was.
    14
    15   Q.   What I want to know more seriously is this, Mr. Green:  How
    16        did those associations work, first of all, what is the
    17        benefit to each side?
    18        A.  Well, again if can I start a bit back, it comes from
    19        the idea that our customers enjoy entertainment and enjoy
    20        going out to the movies, for example, in this case.  And
    21        they feel that it is a very, you know, relevant thing in
    22        their lifestyle, and they want to try to participate in
    23        those kinds of activities.  So, it is in our best interests
    24        to also associate with those things that they like to
    25        participate in, movies being one of them.
    26
    27        So, usually once or twice a year we will have a tie in with
    28        what will be the hottest or the most relevant movie for the
    29        summer-time period.  We will negotiate with the studio who
    30        has that movie for the rights to run a promotion in our
    31        restaurants using either characters or other aspects of the
    32        film.
    33
    34   Q.   So that is where the studio gets its mutual benefit?
    35        A.  That is correct.  In fact, most of these arrangements,
    36        the studio gets a significant amount of benefit because,
    37        obviously, McDonald's is spending advertising money and
    38        awareness for the movie that they do not have to spend on
    39        their own.  Plus we are involving, which is what we are
    40        trying to do, our customers and they can, sort of, touch or
    41        participate in that particular activity by coming to
    42        McDonald's restaurants.
    43
    44   Q.   A bit like those Looney Tune characters?
    45        A.  Sure.  For kids, it is the same way.  Children, that
    46        association is the same for children.
    47
    48   Q.   So is this, effectively, you promote each other?
    49        A.  Yes, I would say that but I think that, from a
    50        promotion point of view, the benefit of the publicity is in 
    51        the favour of the film company; the benefit of getting 
    52        increased sales in our stores is in our benefit. 
    53
    54   Q.   Yes.  Do the financial arrangements of these, what I call,
    55        copromotions -- it may be the wrong word -- vary?
    56        A.  Yes, they vary.  In my tenure I have known times when
    57        each party pays for its own costs and, therefore, there are
    58        no dollars that are exchanged.  There have been times when
    59        actually the movie companies have helped offset our costs
    60        and paid us dollars.  There have also been times, which is

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