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Mcdonald's summary background and history
Introduction to global marketing McDonald's expands globally while
Introduction of McDonalds
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1. Introduction
The first McDonald's was built in 1940 by the McDonald brothers (Dick and Mac). McDonald’s is a large corporation in the fast food industry. It has been around since 1955 when Ray Kroc started the chain of McDonalds. It consists of over 3200 restaurants in over 119 countries. McDonald's start global expansion in 1971 they opened in different parts of Asia and European nations. McDonalds has many competitors like Burger King, Wendy’s, Hardees and many others. It is one of the popular companies of fast food industry over the world. One of fast and quick service restaurant in the world. They have many kinds of fast food meals that customer prefers with cheap prices. In addition, McDonalds innovate its products according to the
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If the sales in particular region such as Asia are slumping, it’s possible that they could be strong in Europe or South America. McDonald’s does not rely on one key source of income which is a significant strength for the company.
5. Successful Advertisement :
McDonald's care about the advertisements because they know the advertising can affect the sales by attracting consumers to buy. McDonald's spends on advertising more than other food company which mean McDonald's spent more than 2.6 billion dollars on advertising in 2011.
6. Partnership with best brands :
McDonald's offers only the most popular brands in its restaurant such as Coca-Cola. McDonald’s started partnered with Coca-Cola since 1955 when McDonald’s opened its first restaurants and required a supplier for drinks. McDonald's and Coca-Cola helped each other grow and expand around the world.
Weakness:
1. Core product line is out of healthy trend food :
The food menu of McDonald’s is mainly created of unhealthy meals and drinks. Even McDonald’s try to add healthier choices in its food menu, but it still mainly focus on burgers and fried
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Situational environment
5. Growth opportunities
ANSOFF matrix for McDonalds:
Market Penetration:
• Hamburgers, cheeseburgers, chicken products.
• French fries.
• Breakfast items.
• Soft drinks.
• Milkshakes and desserts.
McDonald’s is always considered as one of the most successful brands in the world. The market penetration strategy is selling the existing product to existing market. McDonald’s use the market penetration strategy to increase usage by existing customer and persuade existing customers to use product more frequently. The example of existing products are hamburgers, cheeseburgers, chicken products, French fries, breakfast items, soft drinks. Milkshakes and desserts.
Product Development:
• McSpaghetti.
• McPizza.
• Masala Grill.
• McAloo Tikki.
• Royal Paneer.
• McArabia.
McDonald’s has always provided new products and new innovations to its customers. McDonald’s introduces new products into existing markets to grow and differentiate itself from other competitor in the market. There are many example about products such as McSpaghetti, McPizza, Masala Grill, McAloo Tikki, and Royal Paneer.All these in India since people do not eat beef. Also McDonald’s provided McArabia to take care to the Arab
The first McDonald’s opened in 1948. The franchising operations soon became McDonald’s Corporation in 1955.
Everyone has heard of McDonald’s, but where did this familiar name come from? When people think of American food, it is not uncommon for two golden arches to appear in their minds. This story began with two brothers Dick and Mac McDonald who owned and ran a small restaurant in San Bernardino, California during the 1940s. In 1954 a man named Ray Kroc came across these two brothers while selling multi-mixers and was impressed with the business they were running. The menu was compact, listing options for only a few burgers, fries and beverages, but the restaurant was effective in its operation. Ray Kroc pitched the idea of spreading McDonald’s restaurants across the United States and in 1955 he founded the McDonald’s Corporation. By 1960 he bought the exclusive rights to the name. Kroc was able to expand substantially on this small business so that by 1958 McDonald’s sold its 100 millionth hamburger. (“McDonald’s.com”)
With strength ultimately comes weakness and McDonald's has its fair share, especially in the last few years. Many weaknesses are due to the external environment which includes market saturation, increased price competition, and food and labor costs. These weaknesses affect many firms in the fast food industry so McDonald's is trying to effectively combat these forces using a differentiation strategy. Developing new products such
McDonalds also uses diversification in its global marketing. McDonalds recognizes that different countries have different values, customs, and tastes. Therefore, McDonalds satisfies these diverse global tastes by diversifying the menu according to each country’s unique preferences. This added diversification tactic, allows McDonalds to stay competitive in a global market. Examples of McDonalds globally diversified menu would be that McDonalds offers an exclusive beefless menu to its customers who live in India. This is because eating beef in India is sacrilegious. To meet the tastes of customers in India, McDonalds created new offerings such as the “Pizza McPuff” and the “McVeggie.” McDonalds considers the cultural tastes in every country it opens its doors
According to Royle (1999) McDonald’s is a very large multinational enterprise (MNE) and the largest food service operation in the world. Currently the company has 1.5 million workers with 23,500 stores in over 110 countries with the United Kingdom and Germany amongst the corporation’s six biggest markets, and over 12,000 restaurants in the United States. In 1974 the United Kingdom corporation was established and in 1971 the Germany corporation was established, currently the combined corporation has over 900 restaurants and close to 50,000 employees in each of these countries (Royle, 1999).
Their constant changes are more directed at customer satisfaction than keeping in line with their competitors. New market entrants, although small and initially insignificant, are exerting the most force over McDonalds Canada. They are able to cater to individuals a lot easier than a multinational company is and it should be these that McDonalds model any future changes on. As mentioned above, the introduction of organic products and the presentation of ‘greener’ images are essential for McDonalds to compete in a changing consumer environment.
As a company, McDonald’s was first introduced in Des Plaines, Illinois in 1955. This was the very first McDonald’s restaurant, which all started in San Bernardino, California in 1954 when Ray Kroc approached the McDonald brothers with a business proposition to start a new company. In 1965 McDonald’s went public and was later, in 1985 added to the Dow Jones Industrial Average. (www.mcdonalds.com) The company has gone through quite a few changes with its changing CEO’s over the years, but the company seems to be on track with CEO Jim Skinner, named in 2004. Skinner was named the new CEO just in time to clean up after McDonald’s first ever quarterly loss. He succeeded by showing that McDonald’s revenue had climbed 11% during 2006 and net profits had climbed 36%. (Dess, Case 40 Pg. 1)
The menu at McDonald's typically consists of hamburgers, chicken sandwiches, salads, drinks, shakes, and a recent influx of healthier alternatives. McDonald's also is widely known for their breakfast menu, which consists of sandwiches, pancakes, French toast, hash browns, and breakfast drinks. Since McDonald's appeals to such a wide audience, it must constantly re-evaluate its menu depending on feedback and market research. McDonald's expends considerable resources to update its menu and introduce new products in order to be more in tune with its target audience (The Times 100).
McDonald’s was the first company to try to export America’s fast food and changes in eating habits to other nations. McDonald’s has over
McDonald’s currently operates in 121 countries in the world. McDonald’s is also America’s fourth largest retailer, and McDonald’s surpassed Sears as the world’s largest leader of retail estate. McDonald’s spends about $600 million on advertising each year. About 96% of American consumers have eaten at McDonald’s. It has been open for about 64 year and has sold over 300 billion burgers.
The McDonald's Corporation is the largest chain of fast food restaurants in the world. It is franchised in over 119 countries and serves an average of 68 million customers daily. The company started in 1940 as a barbecue restaurant operated by Richard and Maurice McDonald in the United States. They reorganized their business as a hamburger stand in 1948. In 1955, Businessman Ray Kroc joined the company as a franchise agent. He purchased the chain from the McDonald brothers and oversaw its global-wide growth (McDonald’s 2014).
Have you ever wondered how the business empire of McDonalds was started? With over ninety nine billion served, it was started in 1940 in San Bernardino, California. It was started off as just a Bar-B-Q that served just twenty items. Its first mascot was named “Speedee” They eventually realized that by setting up their kitchen like an assembly line that they could be much more productive and get their food done faster, with every employee doing a specified job; the restaurants production rate became much higher. A milkshake machine vendor came into their small restaurant one day, his name was Ray Kroc. He saw how much potential the restaurant has, so he bought it out and opened one of the first franchises. Within the first year of Ray Kroc buying it, there were one hundred and two locations all around the world. McDonalds currently is one of the largest fast food restaurants in the world and currently has served over sixty four million customers through one of their thirty two thousand sites. It has almost become a way of life for America. Though, McDonalds started off as a small business between two brothers, it grew into one of the largest restaurant franchises in the world and greatly affects our society and how we eat our food.
In today’s market, McDonalds faces numerous challenges such as fierce competition, a more health conscious customer, and the continual need for improved customer satisfaction and menu. McDonalds needs to go through some changes in order to remain ahead in the fast-food industry.
Focusing on local produce – if McDonalds focuses on local produce, it has been shown that consumers favour this and trust produce from New Zealand, which may lead to an increase in profits.
McDonalds provide high quality products, such as burgers, fries, drinks, muffins, etc, which are safe and reliable that it does what it is supposed to do, but not only does the quality of the products matter, the good value for money affects the business. E.g. buy one extra value meal and get one free with a food voucher that represents the offer only. They ensure that a high standard of the product is carried out at all times and they try to compete very competitively with other fast food businesses with their good value for money. Also a customer would know if the product is good value for money by checking in another food outlet like KFC for their services and products.