Russia is building a ‘fun and tasty’ McDonald’s replacement

Cindy Apt
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Less than two weeks after McDonald’s struck a deal to sell hundreds of its Russian restaurants to a local buyer, a picture is starting to emerge of how the discarded burger joints will be run without American involvement.

“The only way,” “fun and tasty,” “the same one” and “free checkout” are among the phrases turning up in Russian trademark filings, which the state-owned newswire, RBC, described as applications for a new name.

It’s unclear whether the filings reflect possible new restaurant names as opposed to marketing slogans. Representatives of the fast-food chain did not comment on the filings. Nor was it clear whether the filings were submitted by the Siberian-based buyer of 850 local stores or some other entity altogether.

In a Telegram post, RBC cited a statement to the press service of McDonald’s Russia: “At the moment, we are working on creating a new brand and have already sent applications for the registration of several names. In the future, one of all registered names will be selected.”

Still, the filings suggest Russia is taking steps to forge a new identity for the restaurants in the ashes of the Chicago-based company’s decades-long partnership with McDonald’s, experts say.

“Russia is trying to play the story up as ‘we can do better in our own way, and the big bad Western capitalists aren’t needed,’ ” said Christine Farley, an American University professor specializing in intellectual property.

In leaving Russia, McDonald’s dismantles a 30-year relationship

Hundreds of companies have cut ties with Russia in the wake of Moscow’s Feb. 24 invasion of neighboring Ukraine. Some, like energy giants BP and Shell, have written off massive investments there. A Google subsidiary filed for bankruptcy after its bank accounts were seized. McDonald’s opted to sell its Russian assets to a local buyer in the hopes of an orderly transition that would protect jobs and minimize the collateral damage to its business.

In a May 16 letter to the “McFamily” of franchisees, employees and suppliers, McDonald’s President and CEO Chris Kempczinski framed the decision to leave as a rebuke of war in Ukraine and the humanitarian crisis it has created. He also pointed to an “untenable” business climate that has rendered some basic transactions impossible amid a barrage of Western sanctions. It is the first time that McDonald’s, which has a presence in more than 100 countries, has abandoned a major international market, he said.

It’s “impossible to ignore the humanitarian crisis caused by the war in Ukraine,” Kempczinski wrote.

Days later, the company said in a statement that it had entered into a sale and purchase agreement with a Russian licensee, Alexander Govor. Under the agreement, Govor will acquire the entire McDonald’s restaurant portfolio and operate the restaurants under a new brand. He previously operated 25 McDonald’s restaurants in Siberia.

The agreement remains subject to regulatory approval. McDonald’s Russia said last week that it plans to reopen restaurants to the public as soon as June 12 under a new name that will be introduced separately, according to Reuters.

A month into the war, these companies still wrestle with exiting Russia

It remains to be seen whether the new business will bear the hallmarks of the brand known for Big Macs and Chicken McNuggets.

Kempczinski made clear that no Russian businesses can use the McDonald’s name, its logo, branding or menu as the “de-Arching” of its restaurants gets underway. But attorneys familiar with Russia’s government and legal system are skeptical that authorities there will respect U.S. companies’ intellectual property rights.

The trademark documents, reviewed by The Washington Post, were registered by a business entity called “McDonalds OOO,” a business classification similar to LLC. Several of them seem to reference various unique aspects of how McDonald’s has functioned in Russia, but with a very Russian take on it, D.C.-based trademark attorney Josh Gerben said.

One trademarked phrase translates roughly to “free checkout,” a Russian saying that cashiers use to indicate they are ready to take a customer’s order, Gerben said Tuesday. Another translates roughly to “the same one.”

“It shows that the successor to McDonald’s in Russia is looking to have a clean start,” Gerben said. “It does not appear that they’re trying to use the McDonald’s brand going forward, but they might be doing something that has a nod to the past.”

The first McDonald’s in Russia opened in January 1990 when it was still the Soviet Union. The restaurant was an instant hit with Russians, and thousands stood in line to get their first taste of a “Big Mak” in Moscow’s Pushkin Square.

In his letter, Kempczinski did not rule out a return to Russia, nor did he specify what would have to change for McDonald’s to come back.

Annabelle Chapman contributed to this report.

https://www.washingtonpost.com/business/2022/05/31/mcdonalds-russia-brand-name/

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