Task 1
Introduction
This section of the report focuses on the marketing strategy implemented by Macdonald’s in the workplace to maximise the sales of various products are services. The section allows us to identify and analyse the various concepts of marketing process, impact of the marketing environment, relevance of the consumer market and market segmentation in relation to the business model of Macdonald’s (Werner, 2013).
1.1 discuss concepts of marketing for a relevant services industry
McDonalds has been a popular brand name in the food and services industry from quite a long time. The gain and maintenance of the brand image of the organisation has been possible due to the development and implementation of various marketing strategies.
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All of these marketing concepts allow the management of the organisation to have an efficient and effective marketing strategy implemented in the workplace, which in turn allows McDonalds to maximise the sales and profits. The quality of the products of McDonalds is also based on the capabilities of the marketing strategy to identify and understand the needs of the customers in the market. This allows McDonalds to maintain its brand image in the market (Schwartzm, 2013).
1.2 assess the impact of the marketing environment on the industry
This section talks about the impact of the marketing environment on the operations of McDonalds in the market and its business model.
PEST analysis
The PEST analysis of McDonalds allows us to identify, analyse and understand the various environmental factors affecting the business of the organisation.
Political factors
There are a number of laws and regulations established by the government and other regulatory bodies in the countries in which McDonalds is operating across the globe. Some of the regulations and laws followed by the management of the organisation are the health and safety act, employee equality act etc. All of these regulations affect the business operations of the organisation in a number of ways (Paul, 2014).
Economic
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The economic condition of the countries of McDonalds’ operation is the basis of the various marketing operations to maximise the sales and profits of the organisation. The investment of the financial resources from the environment of the operating countries allows the organisation to strengthen its brand image.
Social factors
The business operations of McDonalds are affected by various social customs and beliefs in the countries of operation. The individuals in the societies across the world have different belief systems and values associated with their daily lives. This affects the operations of McDonalds.
Technological factors
The technological factors are associated with the various technological advances in the country of operation of McDonalds, which in turn affects the business operations of McDonalds in terms of the usage of various technologies in the business model.
SWOT analysis
The SWOT analysis of McDonalds allows us to identify and understand the strengths, weaknesses, opportunities and threats to the business operations of McDonalds.
Strengths
• Strong brand image across the
McDonald’s Corporation has held a prominent position in the fast-food market for much of its existence. A person would be hard pressed to find consumers who would not readily recognize the famous golden arches, as the company has expanded its market globally. However, as global consumer tastes shift to a more heath-conscious public which cares less about “super sizing” and more about “slenderizing” the popular burger chain has been experiencing a drop in sales. McDonald’s strategy for its globalization plan has included the concept of localizing their product (to a degree) for an international market; for example, local managers in British versions of the restaurant are able to make their own decisions that pertain to adapting to the current market. A difficult challenge for the corporation’s marketing team is how to reposition this wildly successful brand in a stagnant British market.
In the movie McDonalds changes the market from lounging teenagers to families. Ray Kroc sees an opportunity to franchise the business, although they had tried franchising before and failed Ray Kroc convinced them to try again and he will be their franchising manager, the McDonalds brothers agreed and entered a contract with him to be their head of franchising, a move that pays off but not for everyone. Although McDonalds have shown that they are able to expand, one of the challenges they face in other countries is that their sales are weak, for example in Japan McDonalds are facing strong competition from Mos Burger. Another challenge McDonalds is facing is replacing humans with machinery.
McDonald’s, a franchise known world-wide started out as a little burger stand in San Bernardino, California. It was started by brothers Mac and Dick McDonald, and Ray Kroc visited their restaurant in 1954. A year later he founded the McDonald’s Corporation, which was based on the successful burger stand run by the McDonald brothers. Three years after the McDonald’s franchise was founded, it had sold its 100 millionth hamburger. What factors led to McDonalds’ national and international success during the 1970s? McDonalds' national and international success in the 1970s was caused by its menu options, the cleanliness, and its spread around the world.
• Choosing the socio-cultural and global segments of the general environment and explaining which segment would rank highest in the influence on McDonald’s Corporation and also assessing how those segments affect McDonald’s Corporation.
"The Marketing Process A McDonald's Restaurants Case Study." Business Case Studies. N.p., n.d. Web. 21 Apr. 2014.
McDonald's strengths are that is ranked as the ninth most valuable brand name in the world, it has experienced management, site development expertise, advanced operational systems, and unique global infrastructure. They want to use these strengths to break into the hotel industry.
In order to understand McDonald's structure and culture and why they continue to be the world's largest restaurant chain we conducted a SWOT analysis that allowed us to consider every dimension involved in the business level and corporate level strategies.
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).
Analysing McDonalds (fast food outlets) using Porters 5 Forces model – sometimes called the Competitive Forces model. Introduction McDonalds Canada opened in 1967, thirteen years after McDonalds had taken the United States by storm. This was the first restaurant to be opened outside of the United States. It was in 1965 that McDonalds went public and offered shares on Wall Street. Since then, it has been important for McDonalds to continually monitor its performance, to make sure it is competitive and profitable while also being aware of its immediate community responsibilities.
The purpose of this project is to know how operations management contributes to the competitive advantage of McDonald's. In this project I have also discussed the theoretical stand point of inventory, capacity management, lean synchronization and quality management and how they impacted on the organization. For this purpose I have selected McDonalds to obtain necessary data and its analysis.
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.
McDonald’s has proven over time that the business practices they utilize work well and have led them to obtaining the title of the largest food retailer in the world. The founder of the company made a tactical decision in franchising the idea of providing fast food at a cheap price. Today, fast food has become a staple of not only American life but a viable food option all over the world. For McDonald’s a critical factor in them reaching the level of growth they currently experience has been franchising. It can be assured that McDonald’s will continue to grow through the usage of the franchising techniques as new food markets continue to develop all over the world.
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.
Marketing at McDonald's n.d., McDonald's Corporation, accessed 23 August 2011, http://www.mcdonalds.co.uk/static/pdf/aboutus/education/mcd_marketing.pdf>.