Ch. 4 - The Marketing Environment

Worldwide, Ronald McDonald is one of the most recognizable characters to Generation Y by selling cheap eats and constantly updating its menu with popular items such as fruit smoothies and snack wraps... This success did not happen overnight. McDonald's is running business over 119 countries that also means they have been facing vast of problem about the legislation, culture, religion, values, ethnicity of those countries.

In Dearborn, McDonald's falsely advertised its food as being prepared according to Islamic dietary law. They paid $700,000 to members of the Muslim community to settle allegations. In United Kingdom, McDonald's was sued for employing child labor. In china, McDonald's was also accused of not using Chinese in their menus and advertisements , which violates the consumers' right to know.

McDonalds is sensitive in cultural differences in order to predict and control its relationships and operations. They find out the adjustments that are necessary for operating business in a society and make it efficiently. As for example, in India, McDonald's introduces non-vegetarian menu with chicken and fish items only. As most of people of India are Hindu and beef is prohibited for them McDonald's do not offer any beef item there. Strategies in global business are not different than the central strategy but they can vary country to country for getting cope with the society and culture.

Cultural diversity in Asian market complicates McDonald's, however, they went for product diversification to spread out in the Asian market. Because the food habit of Asian peoples are totally different. On the other hand population increase rate is very high in Asia. As a result there is huge potentiality for McDonalds for spreading the market and increase the profit. But for this McDonalds must offer foods as per the demand of the people of those regions. Moreover people always eat local food in their house as a result while they come to a restaurant they want something different like international items. So McDonald has to offer some foreign items beside local items. As a result, McDonald's made a big hit. Now, they owns more than 1,400 restaurants in China, which is the company's third-largest market.

Ch. 3 - Ethics & Social Responsibility

Colorful ads, toys in there "happy meals" and Ronald Mc Donald's showing skinny happy "cool" kids eating a Mc Donald's hamburgers in commercials.

"Ronald McDonald is the 'Joe Camel' of the 21st century," said Dr. Mark Donohoe, "and material which is inherently deceptive to our young people buys customers from cradle to grave."
About 16,000 health professionals from around the country signed the open letter, including 50 from Portland. McDonald's spends $400 million a year marketing to children.

Arguably no children's meal product has been more successful than the Happy Meal. Ever since the first Happy Meal was sold in 1979, McDonald’s has released thousands of varieties of toys, making them a treasured collector’s item.  The toy is an ingenious promotion tool since advertisers pick up the tab to include them in the meal, and it the main reason why over 2.5 million Happy Meals are sold each year accounting for nearly 40 percent of McDonald’s profits.

Recently, McDonald's has pledged to distribute 15 million books in England over the next two years. In its Happy Meals. Instead of toys. They focus on encouraging children to read, and to read anything they can, whether that's menus in restaurants, non-fiction books or magazines – anything which spreads children's enjoyment of reading. The British book giveaway organization head Conal Presho told The Guardian. With books replacing toys in British Happy Meals, one thing kids won't be reading are assembly instructions for brightly-colored plastic gee-gaws.

Ch. 2 - Strategic Planning for Competitive Advantage -WI Students Begin Marketing Plan

"McDoanlds' brand mission is to be our customers' favorite place and way to eat."  This statement is more clearly define that McDonalds overall strategic plan and its geographical strategic plan. In the U.S., McDonald’s strategic plan continues to focus on breakfast, chicken, beverages and convenience. These are the core areas in the United States. McDonald’s has launched the Southern Style Chicken Biscuit for breakfast and the Southern Style Chicken Sandwich for lunch and dinner. In the beverage business, McDonald’s starting introducing new hot specialty coffee offerings on a market-by-market basis. In Europe, McDonald’s uses a tiered menu approach. This menu features premium selections, classic menu, and everyday affordable offerings. They also “complement these with new products and limited-time food promotions”. In the Asia-Pacific, Middle East, and Africa markets, McDonald’s strategic plan is focused around convenience, breakfast, core menu extensions and value.

The five key facets of that McDonald's experience are people, products, place, price, and promotion.

(1)    Product

Product is the physical product or service offered to the consumer. Product includes certain aspects such as packaging, guarantee, looks etc. This includes both the tangible and the non- tangible aspects of the product and service.

(2)    Place

McDonald's the most important Marketing Plan is that the buyer has a number of McDonalds in the area he/she could probably go to.

A McDonald's restaurant is operated by either a franchisee, an affiliate, or the corporation itself. The corporation's revenues come from the rent, royalties and fees paid by the franchisees, as well as sales in company-operated restaurants.

(3)    Price

Pricing includes the list price, the discount functions available, the financing options available etc.

The price must take into consideration the appropriate demand-supply equation. McDonalds has certain value pricing and bundling strategies such as happy meal,combo meal, family meal etc to increase overall sales volumes.

(4)    Promotion
McDonald’s does its promotion through television, hoardings and bus shelters. They use print ads and the television programmes are also an important marketing medium for promotion. Some of the most famous marketing campaigns of McDonald’s are: “You Deserve a break today, so get up and get away- To McDonald’s”, “Food, Folks, and Fun”, “I’m loving it”.

(5)    People
To attract children McDonalds has Happy Meal with which toys ranging from hot wheels to various Walt Disney characters are given. For this, they have a tie-up with Walt Disney. At several outlets, it also provides special facilities like ‘Play Place’ where children can play arcade games, air hockey, etc. This strategy is aimed at making McDonald’s a fun place to eat. This also helps McDonald’s to attract the young urban families wanting to spend some quality time while their children have fun at the outlet. To target the teenagers, McDonald’s has priced several products aggressively, keeping in mind the price sensitivity of this target customer. In addition, facilities like Wi-Fi are also provided to attract students to the outlets. The outlet ambience and mild background music highlight the comfort that McDonald’s promises in slogans like“You deserve a Break Today” & “Feed your inner child”. This commitment of quality of food and service in a clean, hygienic and relaxing atmosphere has ensured that McDonald’s maintains a positive relationship with the customers.

Target Market

McDonalds mostly target adults/teens looing for a quich meal and families with young children.

SWOT Analysis

[Strength]

ㅡ McDonalds is the market leader in fast food franchise with huge customer base around the world.

ㅡ McDonalds earns a good reputation to be a socially responsible firm in the market due to their projects they do to help people.

ㅡ McDonald’s marketing has successfully created a brand image of fast food delivery speed, cleanliness and customer care in the minds of millions of consumers.

It is said that McDonalds was the first food outlet to provide its customers with nutritional facts

ㅡ McDonalds is widely established on geographical scale.

ㅡ McDonalds' affordable price is able to captivate children and youth society, also the low and mid-range income community

[Weakness]

ㅡ The market segment is too focusing on kids. 

ㅡ Hamburger, french fries. Little has been done by McDonald’s are often related to unhealthy food and obesity.

ㅡ High employee turnover rate leads to more money spent on recruitment and training.

[Opportunities]

ㅡ McDonalds can open up online services for their customers so that they can easily order their desired meals sitting at home

ㅡ Since McDonalds is well spread across the whole world, it can diversify into other types of foods by introducing Chinese, Italian or Indian foods in its menu.

ㅡ They can introduce healthy hamburgers and healthy drinks for the people who are health conscious

ㅡ In order to be environment friendly, they can use packing material which can be recycled later or material that does not create pollution

[Threats]

ㅡ Emerging competition of similar outlets is becoming a problem for McDonalds.

ㅡ Health issue also becomes a pr,oblem when it comes to food. People facing heart problems and obesity accuse McDonalds for not providing them with the healthy food.

ㅡ As it is a multinational food outlet, fluctuations in the currency of other countries becomes a problem for such companies

Competitive advantage 

McDonalds has been in the fast food business longer than the vast majority of competitors and their brand is known globally.  McDonalds is a front running company because they have great advertising and they are consistent.  They are innovators in their industry by creating revolutionary ideas such as the $1 menu and introducing healthier lines of food such as salads and wraps to appeal to the changing tastes of consumers.  McDonalds came out with a new premium coffee line that is taking business from Starbucks because it is much cheaper.  McDonalds is a powerful company that consumers have come to know and trust and they have the power to chang as tastes change.  This keeps their competitive advantage alive.

 

Ch. 1 Overview of Marketing (Brief History and Mission Statement)

Brief History of Mc Donald's

McDonald's Corporation (NYSE: MCD) is the world's largest fast food chain, selling primarily hamburgers, cheeseburgers, chicken, french fries, breakfast items, soft drinks, milkshakes and desserts and more recently its menu include salads, fish, wraps, smoothies and fruit.
 

The business was founded in 1940 with a barbecue restaurant opened by siblings Dick and Mac McDonald. It was their introduction of the "Speedee Service System" in 1948 that established the principles of the fast-food restaurant. However, the company today dates its "founding" to the opening of CEO Ray Kroc's first franchised restaurant, the company's ninth, in 1955. The Mc Donald's cooperation was created. He later purchased all rights to the McDonald's concept from the McDonald's brothers for $2.7 million and oversaw its worldwide growth.

In 1970, Mc Donald's restaurant were found in every US states; up to now, McDonald's restaurants are found in 119 countries and territories around the world and serve 68 million customers each day. The company also operates other restaurant brands, such as Aroma Café and Boston Market, and has a minority stake in Pret a Manger.

McDonald basic philosophy includes the good relation with the supplier. because if the relationship with the supplier is not good they can't improve quality and increase value. McDonald has to apply this philosophy in any environment without any discrimination for better performance and provide fresh food to customer. McDonald's has become emblematic of globalization, sometimes referred as the "McDonaldization" of society. The Economist magazine uses the "Big Mac index": the comparison of a Big Mac's cost in various world currencies can be used to informally judge these currencies' purchasing power parity.

 

 

Mc Donald's Mission Statement

 

 

In 1957, Quality, Service, Cleanliness and Value (Q.S.C. & V.) became the company motto. The five key facets of that McDonald's experience are people, products, place, price, and promotion. "McDonald's brand mission is to be our customers' favorite place and way to eat." This statement is more clearly defined that customers can expect when walking into a McDonald's fast food restaurant no matter where it is located... Currently McDonald's is implementing a global strategy that it calls "Play to Win," which is designed to create a consistently excellent customer experience in McDonald's restaurants.


 

Hello~ World! :)

Hello, world!
This is my blog about the art of marketing, with an emphasis on Mc Donald's Cooperation. I will post the recent news and articles on the company. I look forward to posting.