Day 300 - 14 Nov 96 - Page 20


     
     1        be the primary vehicle used to communicate the McDonald's
     2        message.  In 1980 prime time and sports accounted for 93
     3        percent of McDonald's total adult national advertising
     4        spending, and obviously, that would, it is just that...  I
     5        do not know whether anyone is going to rely on the how much
     6        McDonald's spend on adults versus children point, but
     7        obviously, if you are spending all your money on prime time
     8        television, then in terms of the number of advertisements
     9        you are going to get for that amount of money there will
    10        not be that many.
    11
    12        On page 409, you see that the national advertising
    13        expenditure for advertising to children on television by
    14        McDonald's was $22,000,865 in 1990, and $22,227,000 in
    15        1989, which were the two years that we are mainly concerned
    16        with.  So that is a massive advertising budget for
    17        targeting children with endless advertisements trying to
    18        persuade them to come and eat at McDonald's, or enjoy the
    19        fun experience of McDonald's.  That was just for
    20        television.
    21
    22        I think this is the last.  In tab 20, page 414, this is the
    23        1991 OPNAD Annual Report.  This is the Chairman's letter.
    24        In the third paragraph, it says: "The future is going to
    25        demand more from us.  Customers are saying they will
    26        continue to come to us but we need to bring back the level
    27        of service they want."  I mean, this is really a nutrition
    28        point.
    29
    30        The fourth line up from the bottom, it says "The additional
    31        visits are out there for us to take.  We can get more from
    32        our current customers.  We can get more from those heavy
    33        hamburger quick service restaurant users out there.  Some
    34        already are our customers pretty exclusively, we share
    35        others with our competitors and we..."-----
    36
    37   MR. JUSTICE BELL:   Just where are you now?   I have only
    38        managed to just turn it up.  Whereabouts in the Chairman's
    39        letter?
    40
    41   MS. STEEL:   The third paragraph.  "... and we can get some from
    42        those who have not been our customers recently.  When we
    43        take the visits, we will grow our business and become more
    44        successful and profitable."
    45
    46        So it is all about increasing the number of customer
    47        visits.  The figures that I gave a moment ago were the
    48        national advertising expenditure figures for 1989 and 1990
    49        in the USA for television, just television.  In tab 21,
    50        there is the annual dollars for local spot advertising,
    51        which says that in 1989 there was a further $20,814,857
    52        spent on local spot advertising, and in 1990 -- this was
    53        just for children -- $19,909,253 spent on children's local
    54        spot advertising.
    55
    56   MR. JUSTICE BELL:   So you say they have got to be added, do
    57        you, to the national television?
    58
    59   MS. STEEL:   Yes.  No doubt there are other figures as well, but
    60        that is like the minimum.  That does not include things

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