Marketing Strategies of McDonald's

The report examines the seven marketing functions of McDonald's, including segmentation, targeting, positioning, product development, pricing, distribution, and promotion. It analyzes the company's strategies, target customers, and competitors, as well as its market position and plans. The report also compares McDonald's with Burger King and provides a detailed market plan for McDonald's, highlighting its strengths and weaknesses.

Marketing Essentials

INTRODUCTION
Marketing is the process by which exchange of goods, products, communication and
other relationships takes place. Marketing essential is used to increase the productivity,
effectiveness and benefits by providing sales solution. It is used to analyse customer needs,
priorities, which directly makes impact on the market. McDonald is an American multinational
company which is also known as fast food restaurant. It provides its services in 120 countries of
the world and it is world's largest restaurant with 68 million customers (Baker, 2014). In this
report, the main task is to define responsibilities of marketing function and their relation with the
organisation. Further, it defines the different methods in which McDonald's use elements of
marketing mix in order to achieve their long-term objectives. Moreover, negative and positive
impact of macro environment on business are assessed in this report.
P1 Different roles and responsibilities of marketing function
Marketing is an important function by which McDonald achieve their task to make
revenue and profits. The main role of marketing is to develop satisfactory relationships with the
customers. It helps in lowering the costs of products by creating competitive environment. It is
beneficial for the organisation as it assists them to increase the product demand by providing the
best quality of services and products.
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There are seven major marketing functions which are essential for McDonald to follow in order
to achieve their long-term goals and profits. These are defining as below:
 Marketing information management:
The information is gathered by McDonald to analyse the requirements of the customer.
The marketing information management is collected to take feedbacks and make research reports
determining the customer’s choice, taste and fashion so that organisation can fulfil demands of
their consumers on time. McDonald can take help of its websites and social media websites to
check the review and comments of their customers (Black, 2013). Regular visit and research will
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Illustration 1: Seven marketing functions
(Source: Majaro, 2013)

help them to take appropriate actions so that they can determine the areas in which improvement
is required.
 Distribution:
McDonald has adopted various distribution strategy to examine the best methods for the
customers so that they can easily locate and access the products of the company. The
organisation has to set up different shops in the area where target customers are easily found
which helps in making distribution easy. The main role of distribution strategy is to decide that
how company will obtain products and services to sell the customers who actually want to
purchase them (Cornelissen and Cornelissen, 2017). Distribution of goods can be done through
internet by giving proper details of the area where the goods are available.
 Product\Service management:
Service management is used to design, improve and develop services so that customers
demands can be met on time. Research program on customers helps to determine the new
features which needs to be added in their products so that they can upgrade their existing
products and services according to their demands. Marketing essential principles assist in
determining new opportunities to extend the goods and products.
 Pricing:
Pricing marketing function of McDonald sets and communicate the price of goods. Main
responsibility of pricing is to set and decide the cost of products in proper manner. Marketing
strategies helps to determine the price of the product and service development for the customers.
Role of pricing is very helpful in analysing the growth and success rate of McDonald in the
business market. McDonald can improve its position in competitive market by offering the
products at lower prices so that they can make profits as well as gain customer satisfaction.
 Promotion:
McDonald promote its products by communicating more with its customers. This
communication can be done by advertising, selling, publicising its products and services.
Publicity of the products can be done by making effective relationships with the customers.
Promotion of new product helps the customer to know more about company's services and
offerings. Publicity of goods and services can be done with the help of social marketing, direct
marketing, or company can communicate new features of goods and explaining their benefits
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directly to the customers (Czinkota and Ronkainen, 2013). Social websites like twitter, facebook
etc. are the best medium by which products may gain more publicity in the market.
 Financing:
In order to make more revenue, McDonald has adopted financing strategy to provide
continuous flow of revenue to pay. It provides various offers to their consumers like loans,
leasing and other extended terms to ensure their success in the business market. Role of
marketing strategies is to provide plans for securing long-term profits and revenue. Mac Donald
prepares budgets for fulfilling the marketing activities and giving financial help to their
consumers. These financial strategy helps the customers as with the help of money they can buy
the firm's services and products. The main role of McDonald is to make money, provide loans
and personal income to finance the promotion and manufacturing of the products.
 Selling:
Selling is an important feature for marketing the products. It involves direct
communication with the customers to fulfil their demands and requirements. McDonald has
made various selling team to promote their product in the market so that they can increase their
sale and make profits. Marketing principle helps the firm by making more awareness of the
product features and offerings so that customers can attract towards their product and they can
increase their sale profit.
Therefore, the roles and responsibilities of the marketing functions are very necessary for
enhancing the firm's productivity. These seven marketing functions assist McDonald's to achieve
their long-term marketing goals and win customers satisfaction. Marketing helps the firm to
increase its revenue by meeting customers’ needs. It is the duty of all employees of the
organisation to understand their clients’ requirements so that they can provide the best quality of
services to them (Ghosh, Ostry and Chamon, 2016). These function helps the company to know
the customers’ needs and wants so that they can improve their lacking areas and make effective
products for their consumers.
P2 Interrelation of roles and responsibilities of marketing function with the organisation
Marketing functions can be linked to other activities by analysing closely to the
marketing functions and product development efforts of McDonald. There are different
departments by which the link between marketing functions and these departments can be linked.
 Fulfilment of social responsibilities:
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McDonald has to meet the requirements of their customers without breaking the rules and
regulations of the government. It has to fulfil the requirements of their customers in legal and
ethical manner. They have to launch their product which is feasible and affordable by the local
people. The organisation has to make sure that their new product does not affect the life of the
people. The company has to take care the welfare of the society. The social responsibility of
McDonald is to promote their product with loyalty which helps them to find the solution of their
daily life problems.
 Optimum use of resources:
McDonald has made various strategies to use resources effectively. It is very crucial for the
company to organise and monitor the resources for manufacturing effective products.
Availability of resources on proper time for the activities is proved to be very useful for the
company to develop new projects and products. Human resource manager plays highly
significant place in providing as well as meeting the needs and resources to the firm and
employees. Optimum use of resources helps McDonald to lower the price of the products which
increases the sell of their products (Grönroos and Gummerus, 2014).
 Increase in satisfaction level of customers:
Satisfying to the users or consumers is highly pivotal for the company as it provides the
idea of managing and improving their business. McDonald has won customer's confidence and
satisfaction by increasing their productivity and quality of the product.
 Expansion in scope of business:
By making market research, McDonald can increase the scope of the organisation. This will
help the company to diversify its business and increase its profit and market share as well.
Functional areas of marketing functions:
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Illustration 2: Five functional areas
(Source: Baker, 2014)
 Human resource:
Human resource’s main responsibility is to hire workers and provide them better training. Proper
training and development plans helps the workers to enhance their performance. Personal
management of McDonald includes motivation, recruitment, performance appraisal etc. The
main objective of human resource is to enhance team spirit of the employees as well as managers
and leaders.
 Production:
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Production management includes planning, coordination and organization of production
function. Aim of production management is that all the products shall be produced in enough
quantity with appropriate cost and on right time. It includes product development and planning,
its maintenance and production system and machines to monitor the manufacturing of effective
goods.
 Marketing:
Marketing manager conducts marketing surveys to determine the needs and requirements of the
customers. This surveys and research helps McDonald to enhance their marketing strategies and
development plans. Marketing department of the company examine different ways to promote
the product. They decide different methods like advertising through internet, social media to
publicise their products in the market (Kerzner, 2013). McDonald has made separate department
which handles all the activities related to the product promotion.
 Accounting:
Accounting is crucial in measuring different factors like company's debts, loans, investment etc.
The main role of account professional is to look after all these activities for better functioning of
the company. It also maintains the budget and other revenue related activities.
 Customer service:
Customer service manager of McDonald sorts out the queries of their customers. The main role
of customer service manager is to provide services like caching, accept payments, cheques etc.
This manager of the company has given proper information regarding the price and cost of the
product so that they can make better choice for their products.
 Sales:
McDonald has increased its sale by making different strategies regarding production
sale. It increases its sale by making effective public relations, communicating directly the
benefits of the products etc. Another method is to decrease the price of the product in
critical market situations so that it can withstand in competitive market.
 Research and development area:
Research and development areas helps McDonald to increase its productivity. R & D helps in
making it successful by inventing innovative products. It can be linked to the marketing and
product development efforts of the firm.
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P3 Comparison of methods which different organisation has applied on marketing mix to the
marketing planning
Marketing mix is the process used by McDonald to reach their target customers. There
are various approaches which are taken by McDonald's to meet their objectives. It uses print
media for promoting their products as this media is very popular in UK (Kilian and Murphy,
2014). Effective implementation of marketing mix helps the company to lead in international
restaurants. There are seven P's of marketing mix which McDonald has adopted to achieve its
target goals are defined as follows:
Product Mix:
McDonald is mainly selling food and beverages. The organisation has provided different
components to target their customers. The company is specialized in selling burgers, sandwiches,
desserts, shakes etc. However, it is famous for selling burgers. It gives more focus on enhancing
the menu according to the taste of the customers (Clark, 2017). It diversifies its product mix with
appropriate time. It also sells other products with the best quality which shows that the
organisation invents new food products to diversify its business as well as increase the attraction
of customers towards it.
Price:
Pricing strategy of the company involves cost of the meals which it offers to the customers.
Further, it involves various discounts and other offers. It always offers feasible price so that local
people can afford it. Lower price and discounts on the food products motivates customers to buy
more products. McDonald has adopted penetration pricing strategy which focuses on creating
awareness and let more people to use and try several delicious dishes of the restaurant (Richards,
2017). This strategy also provides lower price of the food products in the competitive market to
attract more customers. Sometimes lower price of the product creates wrong impression on the
consumers as they think that lower price will provide the worst quality of food. It may be
dangerous for McDonald as it will create situation like financial crises for the company.
Promotion:
Promotion strategy of McDonald includes various marketing communication of the product.
McDonald promote its food meal by giving advertisements on TV, radio, through their website,
poster etc. Door drops, direct email, sales promotion, merchandise are different methods which
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McDonald uses to publicise its products. The focus of the cited firm is to target children. It
provides various schemes like lucky draws and big sale on food meals.
Place:
Place involves physical location as well as management of products to bring it to the consumers.
The main places where it gives its services are restaurants, McDonald's mobile app and kikos.
Restaurants are the basic place where the firm creates its most of its sales revenue. Kiosks are not
used frequently as they involve seasonal and sports events (Leeflang and et.al., 2014). McDonald
outlets are spread in many cities which helps people to easily access them.
People:
McDonald focuses on publicising its various services by creating friendly environment. The
employees in this company are given dress code and are trained. This training helps them to
behave properly and keeping the customers happy. These trainings are beneficial for the
employees which have newly joined the company. It proves to be helpful while handling
negative responses of the customers and guides them how to behave when there is high pressure
on the company.
Process:
McDonald has used the best food manufacturing arrangements. It has transparent structure for
manufacturing food. It allows its customers to view and check the process and ingredients used
in making different fast food dishes (MacInnis Park and Priester, 2014). This is the extraordinary
feature of this company which helps it to win customers confidence.
Physical evidence:
McDonald has clean and hygienic interiors as well as attractive exteriors. It is maintaining well
managed process for fast food manufacturing. This helps the organisation to attract more
customers towards it.
Seven P's of Burger King:
Seven P's of Burger King are defined as follows:
Product:
Burger King is specialised in selling hamburgers, salads, Hash browns, onion rings etc. It keeps
itself away from the competition of have it way in which every customer with different options.
It offers various products with innovative ways to attract the customers. It has signed contract
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with ConAgra Lamb Weston to diversify its business and provide wide variety of dishes to the
other countries.
Price:
Burger King provides its different dishes at high price. It believes that higher price and best
quality will increase its image before customers. It has adopted premium pricing strategy which
sets higher price than other competitors in the market. This strategy is used by the company
when it has unique product to launch (Mathur, 2010). It has also planned to sell slushy drinks in
summer so that it can compete with McDonald. The company is selling its burger to continue the
taste and increase the demands of the customer as it is most favourite disk among all the fast
food dishes.
Place:
The company runs its business by leasing the land and other buildings so that customer will
easily access their products. Burger king makes it revenues from restaurants, franchise fees and
royalties. It has opened its chain in various places of the city so that customers can easily access
their products.
People:
Burger King provides the best customer service by giving fast and best quality of services. For
these, they hire skilled candidates so that they can provide their best services to the consumers.
They do not provide any training to their employees as they have skilled and highly qualified
team of workers which know how to handle customers (Majaro, 2013).
Promotion:
In every month, children and women visit 10 times for fast food chains so the organisation
strategy gives more concentration on investing money on the restaurants. It uses newspaper and
traditional marketing media to promote its business. It has spent more on soft drinks and French
fries. It is focusing more on increasing the number of restaurants, for that they have added 400
restaurants. Various marketing strategies are adopted by the organisation to grow more in the
future.
Physical Evidence:
Burger king has 11,900 restaurants in all over the world. It has made its website where user can
view the history, stock information, videos of the organisation. The organisation is continuously
making changes for providing new things to their user. This helps in making great reputation in
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the market. Its new restaurants include box like architecture lines and wonderful interior design
which is sufficient for attracting the customers.
The marketing mix strategies of McDonald is better than that of Burger King because
McDonald provides low price and offer various discounts, lucky draws like offers which attracts
the customer's more. Additionally, McDonald has adopted penetration pricing strategy while
Burger King has adopted penetration pricing strategy to achieve its business objectives. It makes
use of social media and internet to promote its product while Burger King uses traditional
marketing media to publicise its food products in the market (Rogers and Davidson, 2015).
Therefore, promotion strategy of McDonald is better than Burger King. Furthermore, McDonald
focuses on providing training timely to their employees so that they can behave and handle their
users properly and happily. Whereas Burger King employees skilled candidates which have their
experience with them which sometimes fails as customer needs changes regularly which requires
proper training to sort out the problems of them. Providing proper training will help customers to
increase their productivity and performance.
P4 Evaluation of basic marketing plan
Marketing plays an important role as it helps in promoting various products in the
market. Marketing plan of McDonald involves following components which are defined as
follows:
Company overview:
McDonald is fast food restaurant where 4 million employees are working. It has 35,000
restaurants in the world and providing its services to 70 million consumers every day. It provides
various local and international menus to fulfil demands of every people. It has used many
strategies to make distinct and unique position from other fast food restaurants. It has the largest
share of providing fast food services in US. It has impressed its customer by providing quality,
service, value and cleanliness food to them. It has developed many other food products with the
best quality to fulfil the customer's needs and demands.
Competitors:
Competitor analysis involves the position of competitors of McDonald in the industry. Key
purpose this specified aspect is to determine the current nature and capacity of the company. The
organisation identifies, assess its customers and estimate its future initiatives of the customers
(Ross, 2013).
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Situational analysis:
Situational analysis includes different methods that manager of McDonald has adopted to clearly
understand the organisation's business, customers and potentiality. Situational analysis includes
different method analysis including SWOT analysis, marketing objectives, strategies, targets and
positioning analysis.
SWOT:
McDonald is famous for its burgers which is not miss by anyone. SWOT analysis id done to
determine the reasons behind its fame and why all people prefer McDonald for their breakfast,
dinner and lunch.
Strengths:
 It has brand equity in the world. It is famous for providing the best quality of food in the
world.
 It consists of 42 percent of hamburgers business in US only which is increasing its
revenue and profits exponentially.
 Overseas market and got success in publishing happy meal, Egg Mc Muffin etc.
Weaknesses:
 McDonald has given minimal attention on giving organic food.
 It has faced large loss due to franchise operations which has affected their quality also.
 It has given more attention on providing pizza and burgers and not given importance to
the nutritional foods.
Opportunities:
 The organisation has given more importance on opening joint ventures with many
retailers.
 It has provided wifi internet facilities in different restaurants which helps in attracting
more customers.
 It has opened various shops in different countries so that customers can easily access the
compnay's product.
 Promoting different products rather than pizza and burgers.
Threats:
 Various number of fast food restaurant are opened which are giving more competition to
McDonald.
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 Focus of customers is shifted to the nutritional diet which is one of the major threat for it. Fluctuation in economy and foreign exchange pricing.
Marketing objectives:
The main objective of McDonald is to serve good food by creating friendly and fun atmosphere.
It also aims to provide best returns to the shareholders of the company. It has created Plan to win
strategy which is based on providing better experience to the customers. It gives more attention
to its customers as well as employees (Rundh and Rundh, 2016). It has analysed that needs of
company's owners, workers and food suppliers must be fulfilled on time as they are important
tool for soft running of the company.
Strategies:
McDonald has adopted product development strategies to grow its business. They have adopted
permanent and temporary product development strategies. Permanent strategy involves that
menu they have offered will exist for the whole year. Temporary product strategy involves menu
for seasonal changes. Big ocean burger is an example of temporary product development strategy
which was served in only few months of the year.
Targeting and positioning:
McDonald has targeted the young generation and children the most as their target for their
business development. Positioning involves the selection of various marketing mix strategy
which is appropriate for the target customers (McDonalds’ segmentation, targeting and
positioning strategy, 2016). The organisation uses different kind of product positioning strategy
and it re-position the products and services according to the modification of segment. It has
created the environment like family by providing lower price restaurant in the fast food industry.
Budget:
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Action plan:
Action plan helps to monitor the progress of the group members and thereby maintain project
efficiency. It helps in setting goals and objectives of the company. It provides different discounts
like free shipping, lucky draws etc. to sell their products in the market (Webster and Lusch,
2013). Action plan includes management of risk, guidance for setting long and short term
objectives.
Monitoring and controlling:
McDonald has executed various steps to control and monitor its employees. Controlling will be
better when employees were given the best equipments and facilities to manufacture food. It has
adopted bureaucratic control approach in which managers control their workers by rewarding or
punishing them. Further, hierarchical control structure also helps to ensure that all employees are
allocated in proper position of production chain (Wheelen and Hunger, 2017). Every individual
is motivated such that it is ready to serve the customers in effective way. McDonald monitor and
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control the project work by keeping informed to the stakeholders and analysing team
performance by taking their reports and feedbacks. This will help company to achieve its
business goals.
CONCLUSION
It can be articulated from the above stated analysis that, marketing essential is very
necessary for McDonald to promote its business. The roles and responsibilities of marketing
functions are explained with the help of seven marketing functions. These seven marketing
functions helped the company to know about their lacking areas. McDonald has analysed the
areas in which it has to improve its performance. Further this report has assessed the comparison
of different ways which McDonald and Burger King has applied to achieve their goals.
Moreover, the market plan for McDonald is made in which its competitors, strategies, its target,
position, objectives, action plan, monitoring and controlling system are analysed. This plan has
helped the company to achieve its long-term goals and objectives. It also helps in determining its
position in the competitive market. McDonald has gained success in winning the customer's
confidence and satisfaction.
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