The Golden Arches of McDonald's Corp. have been turning a little green with envy.
Rival Burger King is enticing hordes of McDonald's younger customers to defect by offering plastic figures and hand puppets based on characters in the new Walt Disney Pictures hit film, "Toy Story."Now McDonald's is out to replace Burger King as Walt Disney Co.'s primary ally in hamburger-land. The showdown could come soon, when the studio selects a fast-food partner for "Hercules," a full-length animated feature it will release in 1997. Both chains are well aware of the multiplier effect that can result from a successful tie-in: Children in search of a toy typically are accompanied to a restaurant by a parent, who also usually orders something. Burger King executives say the average check that includes a $1.99 Kid's Meal is $7.
Burger King's partnership with Disney was launched five years ago, after a longtime arrangement between the studio and McDonald's fizzled. At the time, McDonald's was more enthusiastic about "value pricing" than promotional tie-ins and had turned down several prospective tie-ins with Disney movies, including what became a box-office bonanza, "Beauty and the Beast."
Disney and Burger King don't have a long-term contract but "go one property at a time," says John Cywinski, Burger King's vice president of U.S. marketing. The chain already has tie-in rights to two more forthcoming Disney films, "Oliver & Co." (a rerelease) and "The Hunchback of Notre Dame," both due out next year.
But the McDonald's pitch has been compelling, people close to Disney say, and Big Mac could well win either "Hercules" or rights to a future animated movie, perhaps "Tarzan" or "The Legend of Mulaan." A principal reason is Big Mac's size: It has nearly twice the restaurants and three times the marketing budget of Burger King, and its international dominance gives Disney a global stage.
Burger King is selling "Toy Story" puppets for $1.99 each, but they can't be purchased without a Value Meal, which can cost another $2.49 or more. Kid's Meals come with free small plastic figures based on the movie.
The allure of these figures for kids isn't lost on parents. Don Edwards, a painter in Utah, says that when he heard that a Burger King in a nearby town had puppets of Woody, the cowboy hero of "Toy Story," "I jumped in my van, drove right over there and ordered four Kid's Meals." Edwards says that he ate the burgers and fries himself so he could get the toys for his children.
Although McDonald's is out in the cold with "Toy Story," a McDonald's spokesman notes that the company still has ties to Disney. For example, McDonald's recently co-sponsored the American Teachers awards on Disney's cable channel. Moreover, the chain has promotion rights to Disney's movie version of the Roald Dahl classic, "James and the Giant Peach," coming next spring, and later in the year to a remake of "101 Dalmatians." But neither film features traditional animation, which has proved such a winner for Burger King.
Burger King didn't bid for "Peach," partly because "we had limited resources," one company executive says. "We tend to focus on the big potential blockbusters." Hollywood sources believe Burger King budgeted $45 million for its "Toy Story" promotion. The chain will say only that its commitment is "unprecedented."
The question is how committed Disney is to Burger King. Before Burger King came on the scene, Disney and McDonald's had worked in harmony for years.