Marketing strategy of McDonald's. SWOT Analysis, 4 P's , market segmentation , distribution channels and recommendation

2.  Submitted by : Tabeer, Amna, Maheen, Ramiya
 Submitted to: Mam Rabia

3. Marketing strategy is very much important for
developing any of the businesses. Without it
the effect of the business to attract
customers is random and is very inefficient .
The main focus of your strategy must make
sure that your product should fulfill the
demands of the consumers and as well as
maintain long term relationships with those
consumers.

5.  McDonald's is
American hamburger
And fast-food restaurant
It was founded in 1940
as Barbecue restaurant
Operated by Richard and
Maurice Mcdonald .

6.  In 1948, they reorganized their business as a hamburger
stand, using production line principles. The first
McDonald's franchise using the arches logo opened
in Phoenix, Arizona in 1953. Businessman Ray
Kroc joined the company as a franchise agent in 1955
and subsequently purchased the chain from the
McDonald brothers. Based in Oak Brook Illinois,
McDonald's confirmed plans to move its global
headquarters to Chicago by early 2018.
 Today, McDonald's is one of the world's largest restaurant
chains, serving approximately 68 million customers daily
in 119 countries across approximately 36,615
outlets. McDonald's primarily sells
hamburgers, cheeseburgers, chicken products, French
fries, breakfast items, soft drinks milkshakes, and
desserts

8. The story of McDonald's started in 1940 as a
fast food restaurant by two brothers named
Richard and Maurice Mcdonald in San
Bernardino , California USA. The name of the
restaurant was McDonald hamburgers, by mid
1950’s their restaurant revenues had reached
$350,000. Raymond Kroc the distributor of
milkshake machines expressed interest in their
business and finalized the deal for franchising
with both the brothers. He established the
franchising company called McDonald’s systems
incorporation. In 1955 he become the founder
of McDonald’s and brought out the McDonald's
brothers share for $2.7 million and changed the

9. the name of the company to McDonald’s
corporation . Kroc proved himself as a pioneer
who revolutionized the American restaurant
industry . Today McDonald is the California’s
world’s largest fast food chain. McDonald's is
now one of the most valuable brands globally ,
worth more than $25 billion. Though the
company has roots in the US , McDonald today
has become an accepted citizen of the world.

10. Strengths ..
 Strong brand
 Customer intimacy
 Product innovation
 Supplier integration
Weakness
 low depth and width of product

11. Opportunity
 Expand into Tier 2 and Tier 3 cities
 Entry into breakfast category
Threat
 Changing customer lifestyle and taste
 Increased competition from local fast food
outlets like jumbo king

12. Present Scenario
 Comparable sales for 2013 remain flat as a
result of lower guest count. The year was a
sign that changes needed to be made for the
company survival.
 The company is targeting the breakfast
market in order to gain a significant share.
New introduction such a pastries could give
the company a much needed boost.
 The company still doesn’t understand that it
is healthier offerings free of GMO that are
attracting more and more consumers to
competitors.

13. Marketing Strategy
As per franchise model of McDonalds only 15 %
of the total numbers of the restaurants are
owned by the company the remaining 85% is
operated by franchises. The company follows
all the frame work of training and monitoring
of its franchises to ensure that they achieve
good quality service, cleanliness and value for
the money offered by the company to its
customers.
 The product consistency
 Act like retailer and think like a brand

14. Strategy as per Pakistani market
 Reengineering the menu
 Pakistan preference
 Vegetarian customers

15.  McDonalds uses demographic segmentation
strategy with age as the parameter. The main
target segments are children, youth and the
young urban family. If they take children into
consideration, children are more attracted
towards toys and delicious meals including
today’s youth prefer such places for their
entertainment and urban families select
McDonalds on various occasions like birthday
party, treat to their children etc.

16.  As shown in above diagram, kids are on the
top most level in FMCG purchase related to
food products. So to attract children
McDonalds has happy meal in which they gift
one toy on each happy meal, there are toys

17.  Ranging from hot wheels to various Walt
Disney characters. Example of the latest
range is the toys of the movie Madagascar.
 For this they have a tie up with Walt Disney.
At several outlets, it also provides special
facilities like PLAYING PLACE where children
can play arcade games, air hockey , etc .
 This strategy is targeting in making
MacDonald's a fun place where you can enjoy
both playing and eating.

18. After analyzing the market, finding the key
factors, target segments and understanding
the market demand, every company needs to
come up with an offer or such type of plan,
that speed up the growth of the company.
For which McDonalds uses 4p’s of marketing
mix which are as follows
1. Product
2. Place
3. Price
4. Promotion

19.  Product includes that how company should
design, manufactured the product so that it
enhances the customer experience.

20.  Macdonald has purposely kept its product
depth and product width limited. McDonalds
had first studied the behavior of Pakistani
customer and provided a totally different
menu as compare to its menu offered in
international market. For example it removed
pork from its menu.

21.  The place mainly consist of distribution
channel and outlet of the company. It is
considered that as very important because
the product must be available to the
customer at the right place at the right time
in the right quantity . In the USA nearly 50%
of outlets a situated within the distance of 3
minutes.

22.  Price strategy is most important aspect of marketing
mix it includes price list, if any discount available or
payment facility available. It should also take
consideration the possible reaction from its
competitors regarding the pricing. Pricing is very
much necessary because it is this part, which decides
revenue for the business unit.
 McDonalds came up with a very grasping punch line “
Ap ke zamane mein , Baap ke zamane ke daam “ This
pricing strategy was founded to attract middle class
and lower class people and the effect can clearly be
seen in the consumer base that McDonalds has now.
 McDonalds has certain value pricing and bundling
strategies such as family meal , happy meal, combo
meal , happy price menu etc to increase overall sales
of the product .

23. The promotional activity adopted by McDonald
helps to communicate efficiently with the target
customers. The diagram gives the idea about
the promotion strategy of McDonalds .
Applications of the above mentioned
communication mix describes the cost that is
feasible as per the consumers .

24.  Some of the most famous marketing
campaigns of McDonalds are :
 “You deserve a break today , so get up and
get away to McDonalds “
 “Food , folks and Fun”
 “I am loving it “

25. An advertisement is targeted to attract masses
it reaches to lager number of people at a time.
Advertising is one of the most important tool for
promotion which has various ways of
advertisement through billboards and media are
often used by any of the business enterprise .
Consumers mostly perceive goods which are
advertised goods , as they assume they are more
rightful. There are three goals of advertising.
 Inform
 Persuade and
 Remind

26.  Sales promotion activity consists of
promoting the business unit through
organizing various contest , programs ,
functions , distribution of free discount ,
coupons etc that attracts attention of the
customers, also offers strong purchase
incentives dramatizes offers , boost sagging
sales . Stimulates , short lived not effected at
building long term brand preferences.

27. Co-branding strategy is also one of the beneficial
instrument for boosting the business and providing
different the same things in different manner. In
fact co-branding means having a tie-ups with
another firm and serving the customer with both
the products. It helps in making profit for both the
business enterprise as well as to increase their sales
and growth of organization.
The two different brands enter into co-brand
through certain contracts or agreement and as per
the agreement they bifurcates their earnings from
their brands. Like
 Coca-cola
 Walt Disney
 Cadbury
 Hot wheels

28.  Let’s eat out !
 The closet thing to home
 You deserve a break today
 We do it all for you
 Nobody can do it like McDonald’s can
 McDonald’s and you
 It’s Mac tonight
 There’s nothing quite like a McDonald’s
 I’m loving it

29. When you see the golden arches, what is the
thing that comes to your mind? Or what about
when you see Ronald the clown? .
One of things that McDonald’s has proved is
that they are good at building its brand loyalty.
Even young children know that when you see the
golden arches that you are close to a
McDonald's. A couple of things that has helped
to build McDonald’s brand is their constantly
changing menu and brand packaging that meets
the needs of their consumers.

30. McDonald’s has an internal communications to
all of our staff, and stakeholders. A number of
different communication channels are used such
as the intranet and weekly newsletter for staff to
stay connected.
Externally they run number of different
advertising campaigns throughout the year to
ensure our customers are aware of the great
products on offer as well as informing them
about other areas of the business such as our
training and education opportunities.

31. The most prominent place McDonald’s products
can be found are at its restaurants. Other places
where the company uses to sell its products are
:
 Kiosks
 Postmates website and app
 McDonald’s mobile app
Hence, the company is using the selective
distribution channel maintaining a push-and-
pull marketing communication.

32. McDonald’s business model is based on the
“Three-legged stool” model created by Ray
Kroc. In order for McDonald’s to manage
ensures that McDonald’s , suppliers and
franchises all work together . Furthermore, the
fast food giant implements the 5 vested
outsourcing rules which is mutually successful
to McDonald’s and its suppliers.

33. 1. Service Differentiation: McDonald’s needs to focus on
service differentiation strategy in order to position the
restaurant as a superior service restaurant in the minds of
the target consumers. The service differentiation strategy
implies that McDonald’s shall offer superior services at
each step of the customer touch points right from the
placement of order through the delivery of the products.
2. Personnel Differentiation: The availability of well-
trained staff is essential for delivery of high quality
service to the customers. McDonald's should continue
to invest in the training and development of its
employees to ensure high service quality. Well-
structured training programs shall ensure the long
term growth of the organization.

34. 3. Integrated Promotional Mix: McDonald’s can
implement an integrated promotion mix that has a
balance of both traditional and modern digital media
for brand promotions. McDonald’s must recognize
the importance of digital media in the promotional
mix for organizations, and should devise digital
marketing strategies to engage with the online
customer base.
4. Product Augmentation: McDonald’s can offer additional
product and service features such as food on demand
and home delivery so as to provide convenience to
customers. Product quality can be further enhanced
with fresh ingredients. McDonald’s should continue to
invest in menu customization and menu
standardization strategies to attract and connect with
target customers in diverse geographical markets.

35. McDonald's restaurant is operated by either
a franchisee, an affiliate, or the corporation itself.
The McDonald's Corporation revenues come from
the rent, royalties, and fees paid by the
franchisees, as well as sales in company-operated
restaurants. According to a BBC report published in
2012, McDonald's is the world's second largest
private employer (behind Wal-Mart with 1.9 million
employees), 1.5 million of whom work for
franchises.

36. Thank You