Hospitality Marketing Essentials: McDonald's Report Analysis

This report offers a comprehensive analysis of McDonald's marketing strategies, encompassing its role within the hospitality industry. It delves into the interrelation of marketing with other functional units such as human resources, finance, and production. The report provides a comparative analysis of McDonald's and Burger King's marketing mix, examining their product offerings, pricing strategies, placement, promotional activities, processes, people, and physical evidence. Furthermore, it outlines a detailed marketing plan for McDonald's, designed to achieve its objectives of providing high-standard food and increasing sales by 20% by 2021. The plan includes a situational analysis, segmentation, targeting, and positioning strategies, along with an evaluation of the 7Ps marketing mix, including product, price, place, promotion, process, people, and physical evidence. The report leverages PEST and SWOT analyses to inform strategic recommendations, and provides a vision, mission, and objectives for the company.

Hospitality marketing
essential

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
LO 1.................................................................................................................................................1
Role of marketing and its interrelation with different functional units.......................................1
LO 2.................................................................................................................................................4
Comparison of Marketing mix of McDonald's and Burger king................................................4
LO 3.................................................................................................................................................5
Marketing plan for meeting McDonald's marketing objectives..................................................5
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................13

INTRODUCTION
There are different marketing disciplines that organisations take into consideration for
developing an effective relation with its customers(Larson and Draper, 2015). The marketing
basically involves researching, promoting and then distributing the respective products and
services to the potential customers. Present study is based on the company McDonald's that is a
fast food company in America founded in 1940. Report will include different marketing roles
and there interrelation with different functional units in McDonald's. Further report will compare
different ways in which McDonald's and Burger King uses different elements of marketing mix
in order to achieve their business goals. At last report will develop a marketing plan for the
company in order to meet the basic objectives of marketing.
LO 1
Role of marketing and its interrelation with different functional units
Marketing:- Marketing is the process that helps the business to create, communicate and deliver
the products and services to its customers that business wants to offer. This process involve
promotion of business offerings with the help of different advertisement mediums in order to
target the audience(Malhotra, 2015).
Current and future trends in marketing:-
Current marketing trends:-
Current marketing trends includes advertisement with the help of newspaper, magazine,
Radio, Television, Social media marketing. McDonald's is using these marketing strategies in
order to attract the customers and make them aware about the products and services that they are
offering. McDonald's is doing social media marketing, retargeting campaigns, text message
advertisement, targeted emails and internet video advertisements. At present current marketing
trends are effectively working in order to help the organisation and customers(Carver, 2017).
Future marketing trends:-
It is been analysed that though present marketing trends are effective, organisation will
require some other marketing strategies in order to brining competitive advantage to the firm. In
near future there will be many marketing trends that will be fizzle out from the organisations.
Radio, Television and telemarketing will have decrease as many other alternatives will rise for
the same(Tanford, Shoemaker and Dinca, 2016).
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Marketing trends are shifting their focus to individuals and not on scattergun approach.
Rise in social media marketing, mobile marketing and online marketing will be rising as future
marketing trends with decline in TV, Radio mediums of marketing. In near future personal
relationship development with the clients will rise and McDonald's is also working to build
strategies in order to have effective relationship with the customers.
Overview of marketing processes:-
Marketing process generally have four elements that are as follows:- Situational analysis:- It is analysis of the external environment and internal environment
of the business and includes fast, present and future aspects in order to understand
capability of the organisation with respect to its customers and also its business
environment. This includes PEST and SWOT analysis of McDonald's. Marketing strategies:- It is very essential to identify the opportunity for satisfying
customer's needs and a strategic plan is made for the same. McDonald's is doing market
research to have information in hand so that business is able to target different market
segments in order to have positioning in market(Kotler and et.al., 2015). Marketing mix decision:- The marketing mix decision basically includes product
development, different pricing strategies and decisions, different distribution mediums
and promotional campaigns.
 Implementation and control:- At this stage McDonald's is aiming to assess the plan and
policies that they are using in order to guide the organisation with respect to its
predetermined objectives. For the same business strategies are interpreted and monitor
whether they are meeting expectation of the business needs and goals(Jones and
Tadajewski, 2016).
Roles and responsibilities of marketing function in McDonald's:-
Marketing is having different roles and responsibility in McDonald's that are as follows:- Setting Marketing strategy:- Marketing is setting different strategies for McDonald's in
order to meet business objectives. They are making strategies to increase market share,
open new channel of distribution for McDonald's etc. Research and development:- Another role of marketing is to do research in order to
identify market opportunities and understanding needs of the customers. This helps to
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understand the strength and weaknesses of competitors so that action can be taken to
improve the performance of McDonald's(Banerjee, 2017). Internal and external product development:- Marketing is playing an important role to
improve the existing product of McDonald's and to develop new products by identifying
the gaps in range of product.
 Promotional activities:- Marketing is developing communication medium in order to
make the customers aware about the offerings of McDonald's and plan advertising
campaigns, email marketing programs etc.
Interrelation of marketing with other functional departments:-
 Marketing with Human resource management:- Marketing is playing an important role to
attract the top and right talent so that they manage the organisation in an effective
manner. With the help of Marketing McDonald's is able to convince the candidates to
join the organisation.
 Marketing with Finance:- Marketing and finance department works together in order to
ensure that adequate budget is available for McDonald's in order to do research,
promotion and distribution. Marketing is having concentration on sales volume and to
increase market share and they work within the allocated budget set by finance
department(Madhani, 2017).
 Marketing with production department:- They work closely in order to have adequate
research and development so that customers needs are fulfilled. Marketing department in
McDonald's set deadlines in order to stretch the capability of production department.
Value and importance of the marketing role:-
Marketing is having a valuable role for distributing goods and services to the potential
consumers in order to make them satisfy. Marketing is important for McDonald's in following
ways:-
 It helps in transfer of goods and services and is valuable to both the customer's and the
organisation.
 Marketing gives employment to many people and huge amount of population depends on
marketing(Hanssens, 2018).
 Marketing is valuable as it is a source of income for many individuals and organisation as
whole.
 It is source of new ideas and helps to identify the rapid change in taste of the people and
also their preferences.
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LO 2
Comparison of Marketing mix of McDonald's and Burger king
7P's McDonald's Burger king
Product McDonald's is wide range of fast
food breakfast, burgers, fries etc.
Recently they have came up with
new food items like artisan chicken
and sirloin burgers with high
standards globally(Harrington,
Ottenbacher and Fauser, 2017).
Burger king is offering different
snacks to its customers like burgers,
potato's, fries etc. Burger king have
recently focused on dessert category
food that includes(Stead and
Hastings, 2018).
Price McDonald's is having wide range of
pricing techniques in order to attract
both high and low income people.
They are setting price with demand
based methodology and its foods
and drinks are available at a
competitive price.
They are following market oriented
pricing strategies that are
comparable with demand and
behaviour of the market.
Place McDonald's is distributing its
products and services in different
countries and for the same they are
also providing home delivery in
come countries. They also aim to
establish there business in urban
markets.
Company is having a strong supply
chain globally and have set up food
outlets in various metro cities in
order to target demanding
customers(Festa and et.al., 2016).
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Promotion McDonald's is advertising its
products with different mediums
like television, magazine etc.
Company is also giving discount
coupons in order to attract its
customers.
Burger king is promoting its
products with the help of
newspapers, magazines and have to
work on social media marketing.
They are attracting the customers by
giving various discounts and offers.
Process McDonald's is having transparent
food preparation with high standard
of quality that attracts the
customers. The whole process
includes ordering of food product,
waiting for the delivery and the way
customers are been treated by
assistants(Fan, Lau and Zhao,
2015).
Experts have design the whole
process so that business can run
internationally and is having huge
food chain that can work in any
environment(Išoraitė, 2016).
People Company is investing in huge
amount for the training and
development of the employees in
order to make them work
effectively.
They are having focus on both its
customers and employees and give
appraisal to its working staff as best
performer for week so that they
work effectively and get motivated.
Physical evidence McDonald's have design an
attractive interior for the customers
and work on clean and hygienic
interior(Išoraitė, 2016).
Burger king is located in more than
15000 locations and 71 countries.
They are located in such areas that
they easily capture targeted
audiences(Stead and Hastings,
2018).
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LO 3
Marketing plan for meeting McDonald's marketing objectives
Executive summary:-
The present marketing plan have included vision, mission and objectives of the
organisation in order to identify the respective marketing strategies that will help in bringing
competitive advantage for McDonald's and achievement of its objectives. Present study is
conducted in order to identify the strategy for fulling the two objectives of McDonald's that are
to provide high standard food to the customers and to increase its sales up to 20% in 2021. For
the same PEST and SWOT analysis have been done and marketing mix of McDonald's is
conducted in the report.
Vision:- To be a modern organisation and a progressive burger company that is delivering
delicious foods to its potential customers all over the world.
Mission:- To be customer's favourite place where they have their favourite meals to eat and
drink. To enhance customers experience with the continuous improvement in operations of the
business.
Objectives:-
 Providing high standard food to the customers all over the world
 To increase its sales up to 20% in 2021.
Segmentation:-
Segmentation is basically division of population into different groups on bases of
different characteristics. McDonald's is segmenting its market on geographic, demographic,
Behavioural and Psychographic basis so that they are able to achieve its objectives. According to
Geographic segmentation, McDonald's is distributing its high standard food in international
market, urban and rural market so that they are able to increase its sale up to 20%. On bases of
demographic segmentation, company is segmenting its products to both male and female genders
having lower and middle source of income and are either students or working
professionals(DeSarbo, Blanchard and Atalay, 2017). According to Behavioural segmentation,
McDonald's is segmenting its customers as hard core loyals and switchers. On bases of
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Psychographic segmentation, McDonald's is distributing its services on bases of social class that
is lower, working and middle class.
Targeting:-
Targeting is basically identification of different segments to sell the products.
McDonald's is targeting parents of young children, teenagers and also business customers.
Company is targeting people having lower and middle income sources irrespective of male and
female with high standard of food for them. This result in increase in sale of the
business(Schlegelmilch, 2016).
Positioning:-
Positioning is selection of marketing mix that is suitable in order to target the particular
segment of customers. McDonald's is collecting information of the customers and analysing their
behaviour with the help of market research. They are having focus on values and lifestyle of
different segments. McDonald's is creating positioning profile for all its respective offerings and
then they create ads to target potential customers in order to make positioning in market and
rising its sales to 20% with high standard food to the customers
SWOT Analysis:-
Strength:-
 McDonald's is having the most
recognisable brand all over the world.
 Food provided by McDonald's is
having consistency that is same taste
globally(Igliński and et.al., 2016). Company is having diversified income
and have relatively stable cash flow.
Weaknesses:-
 McDonald's is having negative
publicity as there is perception among
the customers that food is unhealthy as
it is having lots of fat, sugar etc.
 Employee turnover is very high in
McDonald's as low skilled and low
paying jobs are there.
Opportunities:-
 McDonald's is having opportunity with
its upgraded menu and planning to
Threats:-
 There are facing tough competition
from different nations, regions and
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offer premium products at different
locations.
 Company have introduced artisan
chicken and sirloin burgers in part of
US and that have brought opportunity
for the organisation. They are having opportunity to expand
its plan and market share in some
underdeveloped nations.
local retailers. They have tough
competition with burger king and
Wendy's.
 There are customers taking health diets
due to rise in popularity of organic
products. Health conscious customers
are threats for the business(Sarsby,
2016).
PEST Analysis:-
Figure:- 1
 Political:- There are different political factors that impacts McDonald's like tax policy,
consumer protection law, competition regulation etc. There are different taxes that
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Illustration 1: Pest analysis

company have to pay and these tax obligations are different in all the respective countries'
in which McDonald's is operating. Company has to face high cost with respect to
different lawsuits and litigations(Perera, 2017). Economic:- There are different economic factors that impacts success of McDonald's like
Economic trends, labor costs, taxation, inflation etc. The sales of McDonald's depends on
the economy of the country in which they are operating as in stable economy, people are
having more disposable income. Company is importing different raw material from
countries so if any fluctuation is there in exchange rate then business operation will get
affected. For the same organisation have to take Social:- The different social factors that affects business are attitude, health, lifestyle of
the people etc. As company is having different outlets in different nations and all are
having different culture. So McDonald's have to make sure that religious barriers are not
affecting the business sales.
 Technological:- Technology affects McDonald's in for the way they distribute and market
their products. The different technological factors are research and innovation, legislation
around technology etc. Company is marketing its products with the help of advertisement
through television, radios, social media etc. It is generally been interpreted that
McDonald's is targetting only children and young age generation. Changing technologies
are strengthening brands of McDonald's as it helps in providing different channels for the
customers to make orders either with self service or online ordering(Duggal and
Alexander, 2018).
Marketing Mix:-
7 Ps Marketing plan
Product McDonald's is the leading food restaurant and is selling breakfast,
burgers, fries etc. In order to achieve its objectives company have came
up with new food items like artisan chicken and sirloin burgers with
high standards globally(Harrington, Ottenbacher and Fauser, 2017).
These products have helped the organisation to increase it sales and till
2022 organisation will be able to increase it sales up to 20%.
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Price Organisation is using wide range of pricing techniques in order to rise its
sale to 20%. Company is aiming to provide its high standard products at
a competitive value with respect to customers expectation. They are
setting price with demand based methodology.
Place McDonald's is using different strategies of distribution in different
countries and for the same they are also providing home delivery in
come countries. They are selling through all possible channels with high
standard food(Festa and et.al., 2016).
Promotion In order to increase the sale of the business, McDonald's advertise it
products with the help of different tactics. They are giving information
about the offerings with different mediums like television, magazine etc.
Company is giving discount coupons in order to attract its customers.
Process McDonald's is conducting different activities in order to deliver the
products to its potential customers(Stead and Hastings, 2018). They are
having transparent food preparation with high standard of quality that
attracts the customers. The whole process includes ordering of food
product, waiting for the delivery and the way customers are been treated
by assistants. There is an effective process that helps to keep its standard
high and increase its sale.
People There are approx 210,000 employees working in McDonald's and
company is investing in huge amount for the training and development
of the employees and they address different issues that customers and
employees are facing(Fan, Lau and Zhao, 2015).
Physical evidence There are different elements related to physical environment and also
with the experience of the customer. For the same McDonald's have
design an attractive interior for the customers and work on clean and
hygienic interior. This sets an high standard and helps in increasing the
sales of the business(Išoraitė, 2016).
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Marketing program:-
Channel Marketing
 Direct marketing With the help of emails, messaging etc.
McDonald's is promoting and attracting its
potential customers.
 Digital marketing McDonald's is using social media marketing
platform to inform the customers about
different offerings. Company have to make its
websites more attractive as tough competition
is there in market.
 Commercial marketing Company is also using Television medium,
Magazines in order to make customers aware
about the product and services.
Marketing Budget:-
Cost
 Digital marketing 10000 US$
 Direct marketing 20000 US$
 Administration cost 40000 US$
 Advertising and promotion cost 15000 US$
Total Cost 85000 US$
Monitoring and evaluation:- Benchmarking:- It is helping the organisation as it empowers it and there are different
instruments that McDonald's uses for the internal measurement in order to unite regions
that are separate. With the help of benchmarking, it becomes easy for McDonald's to keep
eye on its respective competitors.
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 Cost benefit analysis:- This process is used by the company to analyse various decisions,
systems or to analyse value for intangibles. McDonald's uses cost benefit analysis in
order to evaluate associated costs and analysing ratio of benefit over cost involved by the
firm.
CONCLUSION
From the above report it is been concluded that there are different current market trends
that may be fizzle out with respect to future market trends. The marketing process is having
Situational analysis, Marketing strategies, Marketing mix decision and Implementation and
control of various strategies that McDonald's uses. Further report concludes that marketing is
having effective Interrelation with other functional departments in McDonald's and marketing
functions are having various roles and responsibilities that are essential for the business. Report
also concludes that marketing mix of McDonald's is quite different from that of Burger king and
in order to achieve the objectives of the business the prepared marketing plan is helpful for the
business.
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PEST Analysis. 2019. [Online]. Available. Through<https://www.google.com/search?
q=pest+analysis&source=lnms&tbm=isch&sa=X&ved=0ahUKEwjflOnN4KLlAhWs7XMBHTr
gCXMQ_AUIEigB&biw=1712&bih=900#imgrc=81DNhuwEe9aoBM:>
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