Marketing Essentials: A Case Study Analysis of McDonald's

This case study examines McDonald's marketing strategies, focusing on the roles of marketing and its interrelation with other organizational functions. It explores the application of the marketing mix (7Ps: Product, Price, Place, Promotion, People, Process, and Physical Evidence) to achieve business objectives, comparing McDonald's approach with other organizations. The analysis includes an evaluation of McDonald's marketing plan and the development of a basic marketing plan. The study highlights how McDonald's adapts its offerings and marketing strategies to local cultures and consumer preferences, emphasizing the importance of brand recognition, customer relationships, and adapting to market changes while maintaining a balance between demand and sales. The case study also discusses the integration of marketing with other departments like finance and operations.

Unit 2. Marketing Essentials
A Case Study on McDonalds
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Table of Contents
Introduction ....................................................................................................................................3
Task 1..............................................................................................................................................3
LO1 – Understanding the roles of marketing and its interrelation with other functional units of
an organisation ............................................................................................................................3
P1 – Explanation of the major roles of the marketing function ..............................................3
P2: Explanation of how roles and responsibilities of marketing relate to the wider
organisational context for the chosen organisation or the scenario ...........................................5
Task 2..............................................................................................................................................7
LO2: Comparison of the ways in which organisations use elements of the marketing mix (7Ps)
in order to achieve the overall business objectives......................................................................7
Task 3............................................................................................................................................11
LO3: Developing and evaluating a basic marketing plan..........................................................11
P4: Produce and evaluate a basic marketing plan for the chosen organisation.....................11
Conclusion.....................................................................................................................................18
References.....................................................................................................................................19
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Introduction
Marketing is the function of a country ton which much depends on about the brand
awareness of the product and services and also the attaining of revenues to acquire the
profitability. This again has a direct linkage with the aspirations of the shareholders – one of the
main stakeholders of the company (Steckstor, 2011). In this context and in order to explore the
other roles of marketing as a function, the present study has considered the internationally
reputed fast food restaurant chain McDonald’s as the subject company.
At the very outset, the roles and responsibilities of marketing are assessed. This is
followed by ascertaining the integration and interrelation of the marketing function with the
other functions of the organisation. This is succeeded by a discussion on the marketing plan of
the company which is again followed by devising a suitable marketing plan of the subject
organisation.
Task 1
LO1 – Understanding the roles of marketing and its interrelation with
other functional units of an organisation
P1 – Explanation of the major roles of the marketing function
There are different aspects of the marketing function. The marketing itself as a function
has positive intended relation to the organisation in the sense that one of the objectives of
marketing is to increase the revenues and the profitability of the organisation.
The elements of marketing are such constructs that they are capable of attracting a large
number of customers for the company. Marketing also goes on to augment the awareness of the
consumers to the name of the brand. One of the major role and responsibility of the marketing
function of the internationally reputed McDonald’s is to arrange for delivering quality service
(Boone & Kurtz, 2014). Having done that McDonald’s marketing function is supposed to
monitor the process of fulfilling the responsibility of fulfilling the target of sales for each year
and if possible to perform even beyond that. In order to accomplish obtaining the marketing
objectives, the marketing wing of McDonald’s develops communication and also a collaboration
with the consumers. This is to establish a good relationship.
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There is tremendous pressure on the marketing wing of the company as both in the home
turf of the country of origin as well as in the overseas locations; the company has to face
tremendous competition from other reputed international and local fast food restaurant and
majors. Thus different modes of the above communication in the form of advertisement, event
management and public relation messages and sales promotion are designed and broadcast by
proper selection of media by the marketing wing (Kroc, 2016). The objective here is to increase
the brand recall, brand recognition and the brand image. There should be an idea about the roles
and responsibilities of the marketing functions
With regards to the social culture of the country of operation (which is part of the
marketing environment) the company always serves meals and menu based on that country or
place’s social culture and thinking of the political interference. For instance, beef is never served
in Indian menu (Rappa, 2011).
The company builds up a good relation with the local people. Added to this there is
excellent market research. The company can assess the technological factor like the ability of
people to order food from local vendors by the internet. In response to that, the company builds
attractive interactive websites and franchise’s or own restaurant at strategically important places
of the town or city.
McDonald’s intended to introduce new products and services which are tailor made to
the need of the customer. Even when there has been a furore by social activists regarding the oily
substances in food, McDonald’s introduced dishes which consisted of vegetable and much less
oil. Thus the company focused on the marketing mix strategy. This also comprised of an
identification of the proper place to sell and hand over the product to the consumers. Along with
this, it also comprised of the company developing a suitable promotional strategy for the
product. Hence with this marketing mix strategy the company intends to come closer to the
customers and create more consumers out of the potential ones.
The balance between demand and sales is maintained. The manager in the marketing
wing if the company is responsible for this. The manager takes the responsibility of specifying
the job roles of all in the marketing team. The job responsibility is divided based on the different
roles that different individuals in the can take. The performance of the team is checked for
accomplishing to obtain the target.
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M1 Marketing is important for every organisation. it play a very important role for the
organisation function. marketing help the company to grow and earn higher profits. Mc Donald
use the marketing function to deliver the quality of products. And they advertise product by
advertising and public relation. To get the advantage of the core competence the brings new
products every time.
P2: Explanation of how roles and responsibilities of marketing relate to
the wider organisational context for the chosen organisation or the
scenario
The basic objectives of marketing are that the brand recollection and recognition should
be strong, and also the sales of the products will be increased. This is achieved with the proper
implementation of marketing strategy in a justified way. The marketing head and the managers
have to focus on the proper execution of the plan. The marketing wing thus undertakes various
promotional activities and event management and sales promotion activities for retaining the
dedicated customers and also for acquiring new consumers.
In McDonald’s the principle in marketing in the context of the international scenario is to
act locally but think globally (McDonald's UK, 2016). It is similar to that of Pepsi. The thing is
that the company always tries to suit the meals and menu to the local culture. It also always
thinks of the marketing objectives and the company goals and objectives. The company uses the
local language to spread information about the brand.
The marketing Vice President of the regional heads need to work in tandem with the
other functions and departments more with persuasion than with authority. The other
departments like Finance sometimes resist the customer-centric ways of spending for promotion
and for research and development of food suited for local taste (Brady, 2010). Conflict of
interest is inevitable. The persuasion from the marketing head with sufficient logic is required
there.
The purchasing department often thinks that with experiment for food for local taste
certain ingredients have to be sourced in smaller quantities than by lesser ingredients at
economically beneficial larger or bulk quantities. Thus this has a base for conflict. Financial
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people suspect at the marketing forecasts are self –serving. They feel that the marketing wing of
the company is often too quick to slash prices to stay afloat in the market during the local
economy’s time of recession.
The shareholders depend a lot on the success of marketing to return sumptuous revenue
and expect higher dividends from profits. The marketing people expect that the finance people
will be prudent enough to pay the taxes, depreciation and interest in time and wisely to make the
profit from the revenues the largest. In reality in McDonald’s the rule is that each department
should comprehend the operating logic of the other ones and should work in tandem with all
relevant departments to pursue the organisational goals.
Marketing endeavours should include the financial information about both the new and
existing products like the salads and the veg products with low oil etc . that McDoanld’s has
brought about for the health conscious people. In this way marketing will support the finance for
taking investment decisions.
Marketing strategies can also stimulate a certain kind of response from the markets for
influencing the demand of services or products in a certain way and in this way the operational
efficiencies can be matched.
M2
the basic role of the marketing is to brand recognition and brand recall. It also help to
increase the sale of the product. The marketing function is interlinked with the other organisation
department such as finance, human resources, operations. If this function of the organisation run
smoothly the marketing activities can executed in proper manner. In context to the MC Donald
the marketing team take the decision to bring the new products in the market and finance team
set the budget and other decision to launch the product in market.
D1
In above question I discus about the important role of the organisation how marketing
help the customers to understand the consumer needs and demands. The marketing team do the
research and find what customers exceptions from the company . MC Donald have the research
and development department which help them to launch the new product and also advertise it
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among the customer. When marketing team is analyse the demand in the market the finance
department make the frame work of all the activities used to launch the product in the market.
And operation department start producing the product. Where the human resources department
recruit the people for the production so every department is interlinked with each other.
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Task 2
LO2: Comparison of the ways in which organisations use elements of
the marketing mix (7Ps) in order to achieve the overall business
objectives
P3: Comparison of the ways in which the chosen organisation applies the marketing mix
to the marketing, planning, process in order to achieve business objectives. How does that differ
from other organisations or cold do better compared to the other organisations (with examples)
Figure 1: 7Ps Marketing Mix
Source: (Dibb, et al., 2014)
Product
The product or service is the item or object or service deliverables which fulfil the need
of the consumer. It can be tangible or can be intangible. The deliverables in the fast food
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restaurant chain McDonald’s are food items and also the quick and prompt service of cooking,
finishing, garnishing and serving of the food in time. The food menu offers a wide variety for
people of various demographics to select and have a taste. There are chicken sandwiches,
Chicken McMuffin with Egg, Hotcakes, Oats, Sausage McMuffin and a plethora of vegetable
and non-vegetable dishes along with low oil low calorie vegetable food for the health conscious
people and of course the beverages (McDonald'scoza, 2015). There is also soft drinks and coffee
for customers. The menu is built based on the local culture and the taste and preference of the
customers. However, the company has to focus more on the recent waves of advocating for
healthy low oil low-calorie food and also the voicing for the scrapping of carbonated and aerated
drinks.
Price
Price is the marketing mix elements which often lures or repels customers, and this is
also the element which decides the revenues and profitability of the company. The demand and
sales of the products depend on the price to a large extent. Hence the correct pricing strategy
should be applied to the array of products. The cost leadership pricing strategy was adopted by
the subject company McDonald’s. (Dibb, et al., 2014) The cost of procuring the raw material,
the cost incurred by the cooking fuel and arrangements and the cost of the labour for making the
food was kept at a low level without relenting to the demand of variety, taste and quality and
thereby low but competitive price was offered to the consumers. In this way, consumers are
lured by the company along with many other ways. Along with the standalone and reputed items,
the combo meal is offered at a very competitive price. This smothers much of the pocket pinch
of the consumers, and they are rendered to be satisfied. Quality is never compromised, and there
is never any instance of the outright offering of discount from the listed prices as the company
believes that the best offer is being given for cost leadership strategy.
Place
The third element Place assumes importance by being situated or located nearest or in the
heart of the target market for prompt distribution. An aggressive kind of expansion strategy has
been unloaded by the subject company. The target is different locations all over the globe.
Almost 35000 stores have been started by the company either on own or by the franchise spread
across the world (Nandini, 2014). The plan is to expand their business also in the rural areas
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apart from the urban belts. There are outlets of the company at important congregation points
like the airports and the multiplexes and malls. The customer base is being uplifted, and also the
product is getting distributed on time.
Promotion
Promotion is the way by which communication can be made, and brand awareness can be
augmented with higher revenues and sales. Different modes of promotion are there like
advertising, using social media, the internet, event management, sales promotion, maintenance
of public relations, etc. (DeFranco, 2014). The subject company uses traditional strategies of
advertising and promotion on the one hand and also the modern and innovative style of
advertising and promotion on the other. There are also sponsorships of different crucial and
popular events.
In the contemporary type of promotion, the subject company uses the social media on the
internet. They share the people’s experiences about the services and items there. This is to
achieve a sense of fan following. In some cases, direct mail is also resorted to. Thus the appeal is
made to be personal.
People
Even in this age of internet, McDonald’s believes that the freshness of the food is to be
experienced by the clientele. Hence stores also require the customer facing service by well-
trained floor people of the store outlets. This increases the relationship between the customers
and markets with the business. The floor and serving people always take care of the hygiene of
the customers (Rohn, et al., 2014). This is reviewed by the management representatives as well.
The training is imparted to these serving floor people about the hygiene of the health conscious
customers.
Process
The important thing about the process is how it has an effect on the mind of the
customer. The franchise process is used mostly by McDonald’s to expand the business as much
as possible in the world. The same business process is to be introduced at all the outlets of the
company for the purpose of a standardised service by the company. The process is such that the
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customer is sure that the identical process will be found in all stores of the company anywhere.
This added with the distinct kitchen in every outlet for the freshness of the food increases the
trust of the company. This is one of the cases for more sale in the market.
Physical Evidence
The clown character Roland McDonald is used as the mascot in the brand name
exhibition of the company. It is s charismatic that there are often the similarly dressed dummies
which are used to spread a speck of happiness among children who are otherwise not well
(James, 2010). This is by far the most visible physical evidence of the company. Apart from that,
the outlets of the company have an identical style and décor. Even by seeing an image of the
McDonald’s clown the people can understand the location of a store is nearby. This serves as the
factor for brand recognition and awareness.
In this context and as a standard for comparison, the marketing mix of Cadbury’s brand
is being considered. Cadbury’s unlike McDonald’s has taken a competitive pricing strategy. The
price is set according to the competition in the milk chocolate industry. The reason being that the
product is in the maturity stage of the product life cycle and the company is doing well to put an
alert watch on the competitors and not interested to unnecessarily keep the price below the level
of that of the nearest competitors (Bradley, 2011).
Cadbury’s has kept the distribution channel outlets near the places having largest
congregations on the nursery and primary level school children. This is sole to attract the
children the most.
McDonald’s product life cycle cannot be considered to have reached a maturity and
saturation level. In that case, it is still not time ripe for McDonald’s to adopt a competitive
pricing strategy. However, apart from the cost leadership, the differentiating strategy may work
out well for McDonald’s with some more variations in the food items. The distribution is apt for
both the companies and their McDonald’s is in an appropriate state.
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The product portfolio should adapt to the local culture as is being done now. However,
some more variations are required in the food menu to make the company sell a member of the
development state where it an experiment with pricing. Also, there should be more food with the
only vegetable and aiding low calorie and low carbohydrate and oil. The price can be a little
more considering the variety of options given. There can be more exposure on the internet and
capacity for delivery at home - to mix with the present trends. The promotion is well directed,
but it can try 360 degrees exposure in the festival seasons of the different locations of the world
(Shimp, 2008). The people are well trained and will keep up to the reputation, and nothing more
is required for the physical evidence. In the case of the process, the cooking stage can be made
little faster so that fresh food can be delivered to the elderly population after booking from the
internet.
There could also have been more variations in the reginal advertisements albeit by eeping the
central theme standardised like the central belief – as is the culture in McDonald’s
M3
Company choose different tactics to achieve the organisation goals. The strategies is
prepare by the organisation by keeping in mind the marketing mix such as product, people,
place, promotion, physical evidence, process etc. these 7ps of marketing help the company to
formulated the strategies. Mc Donald launch new products and they have the different variation
of the products according the different countries. It also use different kind of advertisement in
different countries. Mc Donald use differentiating and cost leadership strategy to gain the core
competence advantage.
Task 3
LO3: Developing and evaluating a basic marketing plan.
P4: Produce and evaluate a basic marketing plan for the chosen
organisation.
In this particular section, an effective marketing plan has been established with respect to
McDonald's in order to attain the marketing objectives.
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