Marketing Principles and Strategies: A Case Study of McDonald's

This report provides a comprehensive analysis of McDonald's marketing strategies, examining various aspects of its operations. It begins with an introduction to the marketing process, including situational analysis, strategy development, tactical decisions, and implementation and control. The report then explores the costs and benefits of a marketing orientation for McDonald's. Furthermore, it delves into the micro and macro environmental factors influencing McDonald's marketing decisions, along with market segmentation criteria. A range of McDonald's products and services are discussed, alongside targeting strategies, and an analysis of consumer buying behavior. The report also covers the development of products to sustain competitive advantage, distribution and pricing strategies, promotional activities, and the extended marketing mix. Finally, it examines marketing mixes for different consumer segments, differences in marketing to businesses, and how international marketing differs from domestic marketing in the case of McDonald's. The report concludes with a summary of the key findings and insights.

Marketing Principles

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 The various elements of the marketing process....................................................................1
1.2 The benefits and costs of marketing orientation to McDonald's...........................................2
Costs of marketing orientation to McDonald's............................................................................2
TASK 2............................................................................................................................................3
2.1 Micro and macro environmental factors influencing marketing decisions..........................3
2.2 segmentation criteria to be used for McDonald's products in different markets. .................4
2.3 a range of products and services McDonald’s offer choose a targeting strategy.................4
2.4 buying behavior affecting marketing activities in different buying situations....................4
2.5 new positioning for a selected service or product of McDonald's .......................................5
TASK 3............................................................................................................................................6
3.1 McDonald's products are developed in order to make sure that competitive advantage is
sustained......................................................................................................................................6
3.2 distribution strategies used by McDonald’s.........................................................................6
3.3 pricing strategies used by McDonald's.................................................................................7
3.4 Promotional activity.............................................................................................................7
3.5 Analysis of the additional elements of the extended marketing mix for McDonald's..........8
TASK 4............................................................................................................................................8
4.1 Marketing mixes for two different segments in the consumer markets with reference to
McDonald's.................................................................................................................................8
4.2 Differences in marketing products and services to business rather than consumers............9
4.3 How and why international marketing differs from domestic marketing in the case of
McDonald's...............................................................................................................................10
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11
Illustration Index
Illustration 1: Perpetual Map...........................................................................................................5

INTRODUCTION
Success and development of any organization depends upon the efficiency of the
operations conducted. Among the three fundamental activities carried by organization are
production, operations and finance. These operations create the base of working of the
organization with respect to the establishment of its prominent position in market place.
Encompassing various activities, marketing plays the vital role in the success of organization.
Marketing is the process of communicating company's offerings to the wide range of people in
order to consolidate them. Present report is prepared to elucidate different dimensions of
marketing principles. For the purpose, McDonald's is taken into account. Giving its services in
119 countries across 35000 outlets, it is the world's largest chain of fast food restaurant serving
around 68 million people (Sheth and Sisodia, 2015).
TASK 1
1.1 The various elements of the marketing process
Being a crucial part of operations conducted by an organization, marketing is processed
in the systematic and planned way. It consists of four essential elements, which are combined to
achieve the desired goals and targets.
Situational Analysis
In order to undergo further process, complete analysis of the firm with respect to the
environment is prerequisite. It includes both the internal and external analysis. External analysis
refers to the over-viewing of condition of organization in comparison to the market situation
such as current trend prevailing in the market, consumer's preferences for the product and
services offered by mentioned organization McDonalds, growth opportunities and other related.
Whereas assessment of different components of McDonalds such as factors of production,
resources available, finances, infrastructure and others.
Marketing strategy
In McDonalds, there is a team who frames marketing strategy by inculcation all the
components which are utilized to attract customers in the significant manner. In this process, best
strategy is identified to maximize sales and profits such as lucrative target is identified, potential
customers are targeted and products are efficiently positioned (French, 2010).
Designing tactics

Tactical decisions are taken by the management of the organization to frame the
marketing mix. It is referred at the 4 P's of marketing, referring which the marketing decisions
are taken: Product: Decisions are undertaken by McDonalds to about the specifications, design and
production of products. Prices: Products and services are priced in the optimum manner (Nwankwo and
Gbadamosi, 2010). Distribution: Various channels are used by McDonalds to reach large number of people
such as at stores, outlets, online mediums and telephonic modes. Promotion: Product is promoted by adopting attractive modes and different ways such as
by digital marketing, social media marketing, direct campaign and others.
Implementation and control
After the plan is developed, proper execution is done by using required resources.
Further, after the implementation of marketing strategy, frequent evaluation and monitoring is
done.
1.2 The benefits and costs of marketing orientation to McDonald's
Marketing orientation is the systematic way to deliver the products of organization as per
the desires and requirements of their customers. While implementing the process, McDonald's
experiences certain costs and also avail benefits out of it.
Costs of marketing orientation to McDonald's
With the inclusion of many set of activities conducted by the expertise and specialists in
the field, there incurs huge cost thereby is a very expensive process. Advancement of technology
and development has led to the use of innovative and lucrative means to attract customers. For
that purpose, thorough market research is required which demands intimate knowledge of the
fields and in-depth understanding. Hence, to hire professionals who are acquainted with the
required skills is difficult and cumbersome task. Further, offers and discounts offered by
company affects finances in the significant manner (Henley, Raffin and Caemmerer, 2011).
Benefits of marketing orientation to McDonald's
Along with experiencing certain costs, there are different ways in which marketing
orientation that has benefited McDonald's. It has enabled to consolidate large number of

customers with the organization. Offers and discounts offered by the organization connect the
customers in the more effective manner and for the longer term.
TASK 2
2.1 Micro and macro environmental factors influencing marketing decisions
Micro Environment
Micro environment refers to the factors affecting the organization internally. Some of the
important ones are customers, employees and suppliers: Customers: With the aim to satisfy the customers by providing the outstanding services
and best products, McDonald's caters to seek customer's preferences and choices on the
frequent basis and provide them accordingly. Employees: McDonald's has the efficient team of employees who provide the fast and
precise services to their customers without any delays. Further, certain factors are taken
into consideration such as hygiene, taste and quality. Suppliers: Logistics of the organization play vital role in providing fresh and ethically
sourced raw materials. It has the largest base of suppliers that delivers their products at
every corner of the world (Armstrong and et.al, 2014).
Macro Environment
External factors also affect the marketing decisions undertaken by McDonald's Political factors: Laws and regulations laid by Government and other legislative bodies
along with certain obligations are followed by McDonald's while adopting marketing
principles. Economic factors: Certain economic factors such as inflation, current economic situation
such as recession or boom affects the quantum of investment done on marketing. Social factors: It refers to the preferences and choices of customers. Hence, products are
offered as per their needs and requirements.
 Technological factors: With the advancement in technology, different ways are adopted
for marketing such as digital marketing, display marketing, direct campaigning through
this virtual platform to attract customers towards Mcdonald's.
2.2 segmentation criteria to be used for McDonald's products in different markets.
Market segmentation strategy is adopted by the organization to derive the lucrative
results and avail maximum profitability (Rudd and Mills, 2011). For that purpose, product

Modern china burger is launched I the markets china. It is a burger wit bacon, two pork patties
and topped salad with sichuan pepper ketchup between Grey buns. In this segment marketing
manager has the prime focus o two kinds of segmentation that is psycho-graphic and
demographic. Its established position in the market place has attracted large number of customers
towards the store. Further, promotional discounts and offers has enabled McDonald's to capture
attention of people belonging to all segments (Smith, 2014). Psychographic segmentation refers
to the segmentation according to the attitude and choices whereas demographic segmentation
means division as per the age, occupation, income and other factors.
2.3 a range of products and services McDonald’s offer choose a targeting strategy
Marketing segmentation refers to the breaking of markets into certain subsets as per the
needs and preferences of customers on the basis of different criteria. Focusing on the appropriate
strategy, McDonald's promotes its product that is China Grey Burger in the target market by
adopting different strategies. Pragmatic approach is adopted by the organization McDonald's that
is using different strategies as per the suitability and compatibility with the market place. Differentiated strategy: In this strategy different forms of marketing mixes are adopted
by McDonald's while launching products in different market segments. Undifferentiated strategy: It refers to the process of delivering single marketing methods
indifferent to any differences occurring in market.
 Concentrated strategy: With the focus on showing advantage of product to the market
segment, it is launched in the market.
Further, different sources of advertisement are adopted by McDonald's to promote their products
in the market.
2.4 buying behavior affecting marketing activities in different buying situations
Buying behavior of the consumer is the key determinant of the marketing method used by
the organization with respect to attracting them towards the products and services offered by it.
The major components that affect the marketing methods are: Supply and demand: With the fluctuations in the degree of supply and demand of the
product and services offered by McDonalds, marketing ways also changes. For instance,
when there is low demand, different methods of marketing are adopted to reach people
whereas high demand lessen the quantum (Abdullah and Ahmad, 2010).

 Decision making: Considering the factor of decision making by consumers while
selecting the product of McDonald's, direct campaign method is adopted in which
personal interaction is maintained by employees to fulfill the needs of customers.
 Psychological factors: I food industry customer's get attracted to provocative
advertisements (Donovan and Henley, 2010). Hence, attractive promotions are done with
eye capturing displays. Further, promotional advertisements and attractive displays at
various places such as television, newspapers, and other mediums that are in the reach of
large number of people affects the sales and profit of Mcdonald's.
2.5 new positioning for a selected service or product of McDonald's
Positioning of the product or any service in the market refers to the creation of
acceptability. It is the set of activities in which the systematic and planned approach is adopted to
place the product in the market as well in the choice of customers. It has to undergo different
challenges such as competing with the existing product offered by different organization,
retaining the image of the company so far existed. McDonald's has the established position in the
market place hence a competitive edge is created between the mentioned organization and its
competitors.
Perpetual map is created which states the current situation of the cited organization.
Source: Smith, 2014
Perpetual map has positioned different companies along with McDonald's and its
competitors. They are placed as per the degree of their prices and demands. Referring to the map
Mcdonald's is placed at the fourth quadrant which states that the cited organization has wild
demand that high in degree with low prices (Dann, 2010).
Illustration 1: Perpetual Map

TASK 3
3.1 McDonald's products are developed in order to make sure that competitive advantage is
sustained
With the increased competition in the market and its volatility with the respect to the
choices and preferences of the customers, different strategies are adopted by Mcdonald's.
Launching different products and services in different market segments demands the pragmatic
approach towards it derive the lucrative results (Heidt and Quaz, 2013). In that regard two specific
strategies are adopted that is product differentiation and cost competitive advantage.
Product differentiation
Customers at the present time seek innovative and different products t satiate their needs
and requirements. In that regard McDonald's always caters to establish its prominent position in
market by launching distinguished market. Wide range of products are offered by the
organization with variations in each category. Hence, it is recognized for offering the best quality
food at very economical range without compromising taste and freshness.
Cost competitive advantage
In this strategy organization intends to maximize its profits by reducing the cost incurred
on various operations conducted by it. It is known for preparing food by using basic raw
materials and optimum methods (Alserhan, 201).
3.2 distribution strategies used by McDonald’s
Distribution is the method f transferring products and services from the producer to the
consumer by using different channels. Different approaches are adopted is used to execute the
process to reach maximum number of people. Adopting optimum ways of distribution enables
the organization to maximize its sales and earn profits. Fundamentally different ways are adopted
to distribute the products of McDonalds.
Zero level channel
It refers to the method adopted by McDonald's to reach customers directly. This is
referred as he direct selling. With any fluctuations and deviations, product are reached directly.
This method is adopted at the online platform in which products are sold directly to the
consumers (Lilien, Rangaswamy and De Bruyn, 2013).
One level channel

On contrast with the zero level channel there is no direct selling from producer and
consumer. In this method, one stop exist between the passage of products from producers and
consumers. It is known as distribution through retailers. As the name suggests here in this
method, product is reached to retailer from producer and then provided to the customers. At
stores where products are sold after reaching from the producers to the customer, is the example
of one level channel (Lee and Kotler, 2011).
3.3 pricing strategies used by McDonald's
In order to maximize its sales, the fundamental component that is approached by the
organization McDonalds is approached is its price. It is the central part of all the strategies
framed by the organization. Different strategies adopted by McDonalds are:
Economic conditions: Prices are kept as per the existing economic situation in the market. Such
as when there is the boom in industry process are kept comparatively high whereas at the time of
recession products are placed at low prices.
Regulatory changes: It refers to the fluctuation come in regulations and laws laid down by
Government and other legislative bodies. Such as when subsidies are provided prices also
fluctuates and reduction in it (Shank and Lyberger, 2014).
Responding to competitors: In the fierce competition existing in the market, McDonalds also
alters its prices according to the changes occur in its competitor's prices for the similar kind of
products.
3.4 Promotional activity
Different forms of promotional activity is adopted by the organization McDonalds.
Online Promotion
In this process various tools are adopted on the virtual platforms that promotes the
offerings of the organization. Methods are like digital marketing, search engine optimization,
social media marketing, Adwords etc. it is the lucrative medium to reach large number of people.
Aggressive advertisement
Aggressive Advertisement is the effective method to promote product and services to its
customers (Sandikci, 2011). This method creates high demand of the product from different
sources. Medium such as television, radio, are adopted to showcase about the product launched
by McDonald's.

3.5 Analysis of the additional elements of the extended marketing mix for McDonald's
Marketing mix is one of the most essential strategies of McDonald’s which they require
to adopt at the time of requirement. As per the model of 3P’s it has been founded that there are
basically three marketing mix elements such as:
People: They are the most important element of organization as they are highly
responsible for the development of hygiene food products. There are different people associated
with different work such as suppliers require sending fresh raw material in order to provide
quality products to customers (Sandikci, 2011).
Process: An appropriate and systematic process is being followed by McDonalds in order
to market their products. It includes uniformity in offering as well as appropriate service
consumption. Further, service delivery process of McDonald’s requires being very smooth so
that consumers need not to wait for their order for a longer period of time.
Physical evidence: Company always follows clean and hygienic interiors in all their
physical outlets and serves fresh food to their customers.
TASK 4
4.1 Marketing mixes for two different segments in the consumer markets with reference to
McDonald's
In any organization the whole segmentation is based on the consumer behavior,
physiographic factors as well as demographic and geographic factors. These are the four major
areas on the basis of which McDonald’s can plan their marketing mix for two different segments.
As explained in the previous segment, cited firm will focus on the demographic and
psychographic segmentation for its newly launched china grey burger.
For Demographic Segmentation
In order to make appropriate segmentation it is essential for company to plan up the 4p’s
on the basis of which market can be segmented. Here, company requires keeping its China grey
burger price very genuine so that they are able to attract more number of people from each class.
On the other hand, product of cited firm need to be developed on the basis of needs and desires
of customers (Lee and Kotler, 2011). For the same, McDonalds’s have gone through the proper
market research and introduced china grey burger. However, this product has been made
accordance with the taste and preference of Chinese people. They firstly launch this product on
their different stores within the shopping malls. Further, promotion can be done with the help of

different advertising tools such as newspapers, social media sites etc. It helps them in attracting
huge base of customers.
For Psychographic Segmentation
On the very stage of segmentation psychographic segmentation has been taken into
consideration. In this regard, Product with latest taste and health ingredients will automatically
more number of people. On the other hand, price will be set as per the competitive pricing
strategy for their customers. As per the above demographic segmentation, place will be physical
outlets of McDonalds at shopping malls and promotion through the social media and local
newspapers.
The above given segmentation has been made by McDonald’s for its new products and
more number of guests can easily attracted towards it.
4.2 Differences in marketing products and services to business rather than consumers
There is a huge difference between marketing products to business and marketing it to
consumers. At the time of selling any product customers always use to bargain in order to satisfy
their needs. For the same, it is essential for company to make their consumer loyal by fulfilling
their needs in an appropriate way (French, 2010). At the time of providing any service to
business it is highly task oriented. Workers required completing their tasks on a given deadline
and trying to maintain their work quality with the same. Within the same context, it is essential
for McDonald’s to maintain a healthy relationship with buyer and seller as well.
B2B B2C
Product These are provided as per the
different needs of buyer business.
Customers can get standard products
without any type of alternation.
Price Prices are flexible for business
buyers as per their relations.
Price usually remains same for all
their consumers.
Place
Organization can provide desired
products to their consumers at their
place only. McDonald will deliver
the goods at the place that been
demanded by the business buyers.
Customers require purchasing the
product of McDonald from the
outlet of company. However, it can
be delivered to their home address
as well.
Promotions Promotions can be done through
personal selling and sales
Newspapers, social media etc.

presentation,
4.3 How and why international marketing differs from domestic marketing in the case of
McDonald's
When it comes to any food and Hamburger Company it can be clearly elaborated that their
domestic as well as international marketing differs from each other. In international market the
whole process related to the documentation is complex while in domestic process it is quite
simple or it does not require such so documents.
Further, at the time of international marketing company needs to transfer its products and
services from one country to another while in domestic market goods can only be transferred
within the same country (Rudd and Mills, 2011).
At the time, international marketing company requires developing their products according to
the needs of customers of different countries. Further, McDonald’s offer food products as per the
different culture of country such as: in India they serve vegetarian burger while in American
countries they serve non-vegetarian food.
CONCLUSION
Marketing principles is the systematic way to showcase the offerings of the organization
to the customers and also promote the product to the market segment as per the needs and
requirements of the customers. In the present study, case study of McDonald's is used that
elucidate the different elements of marketing to reach customers. Further, through perpetual map
situation is analyzed.

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