Following Starbucks and McDonald’s announcement that it will end all of its operations and branding in Russia;

Ramsey Baghdadi, Consumer Analyst at GlobalData, a leading data and analytics company, offers his view:

“The fast-food giants Starbucks and McDonald’s have clearly recognized the negative impact that continued affiliations with Russia could have on their businesses. With 72%* of purchases globally driven by a brand’s ethics or support shown toward a social cause, these companies have shown dedication to balance consumer expectations and their operational needs – a bold move that is sure to pay off.

“Pulling out of Russia is ultimately a low-risk gambit for global mega-chains such as Starbucks and McDonalds. Russia represents a minimal share of their sales, and so it is more important to limit losses from those 72%* of people who may be inclined to boycott, as well as mitigate damage to the brands reputation.

“The next challenge is in finding new high potential markets that can offset the losses from Russia. McDonald’s for example should take advantage of its presence in other markets such as Japan and France and Starbucks has seen strong growth in Thailand and Indonesia. After leaving Russia, both brands have the opportunity to rapidly expand their outlets in Asia.”

* GlobalData’s 2022 Q1 Global Consumer Survey, March 2022, ‘Essential’ and ‘Nice to have’ responses combined, 22,727 respondents