Marketing Principles Report: McDonald's Marketing Strategies

This report provides a comprehensive analysis of marketing principles, using McDonald's as a case study. It begins with an introduction to marketing principles and the elements of the marketing process, followed by an examination of the advantages and costs of a marketing orientation. The report then delves into the macro and micro environmental factors affecting marketing decisions, proposing segmentation criteria, and outlining targeting strategies. Customer behavior's influence on marketing activities is discussed, and new positioning strategies are suggested. Further, the report examines product development, distribution arrangements, pricing strategies, and promotional activities. It concludes with an evaluation of the extended marketing mix, marketing mix plans for different segments, and a comparison of marketing products and services to businesses versus consumers. Finally, the report explores the differences between global and domestic marketing, offering a holistic view of McDonald's marketing approach.

Marketing Principles

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK1.............................................................................................................................................1
1.1 elements of the marketing process........................................................................................1
1.2 Advantages and costs of marketing orientation....................................................................3
TASK 2............................................................................................................................................4
2.1 Component of macro and micro environmental that affect marketing decisions.................4
2.2 Propose segmentation criteria utilized for products..............................................................5
2.3 Targeting strategy..................................................................................................................6
2.4 Customer behaviour influence on marketing activities.........................................................7
2.5 Suggest new positioning.......................................................................................................7
TASK 3............................................................................................................................................8
3.1 Products development to sustain competitive advantage......................................................8
3.2 Distribution arrangement to supply customer convenience..................................................9
3.3 Explain how prices are set to reflect organisation’s objectives and market conditions........9
3.4 Promotional activity integration to attain marketing goals.................................................10
3.5 Evaluate components of extended marketing mix..............................................................11
TASK 4..........................................................................................................................................13
4.1 Marketing Mix plan for two different segments.................................................................13
4.2 Differences in marketing products and services to businesses despite customer...............14
4.3 Causes why global marketing differs from domestic marketing........................................14
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................16

INTRODUCTION
Marketing principle is a concept which establish the broadly agreed term upon core of
major production promotion planning (Tanner and Raymond, 2012). Various enterprises utilize
this technique to modify business performance of current product in market and to successfully
launch new services and product in the industry. It is a practical process of marketing which
lessons and help in achieving goals and objectives of marketing through using marketing
principal technique. Marketing principles carry main elements of marketing such as product,
price, place and promotion that to expose business in market effectively. McDonald have
monopoly in food chain of restaurants that is leading market from more than decades.
McDonald is one of most leading and largest food chain around the world which is
serving more than 68 million consumers in everyday routine in approx 120 countries. McDonald
is popular for selling variety of food and beverages along with salads and ice creams.
In this report, the study of process and concept of marketing principles and its benefit to
enterprise would be done. Report will study macro and micro environment of company and
analyse idea and procedure of segmentation, targetting and positioning technique. Also it will
study extended promotion mix elements and its utilization in different context.
TASK1
1.1 elements of the marketing process
After the process of production, the process of marketing is being analysed. Marketing is
an essential process in order to launch product properly and attract targeted consumer and inform
them about the features and facilities of product and services (Wood, 2012). This is significant to
attract attention of consumers and aware and educate them about company and new strategies
properly and make them purchase product through utilizing various marketing mix tools. In order
to attract them and inform them about product and influence consumers to purchase the product,
proper use of marketing principles and marketing mix is necessary. Marketing mix are used for
executing process of marketing process widely. Here are few marketing mix elements are
mentioned for marketing process:
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Source 1: Elements of Marketing, 2017
 Strategy – It is essential to build a proper strategies in order to make a proper marketing
plans to make an impact of product among public. Organisation can make a proper
marketing of services and goods through building creative and innovative strategy for
marketing of existing or new product launch.
 Research – It is important for an organisation to build a definite marketing research of
marketing environment and product launching strategies to have a concept and idea of
customer perception and climate of business industry and other that help in determining
sources and whole modes and techniques which should be utilizes in process of marketing
of a specific product that would help in conveying message of company to targeted
customer (Brunswick, 2014).
 Planning – This is an essential element of marketing principle. Making proper strategy
for marketing goods and services that will assist company in acquiring the proper
implication of plans and strategies is required for McDonald.
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1.2 Advantages and costs of marketing orientation
Consumer orientation refer to the visual aspect to consumer relation and sales of product,
McDonald employee concentrate upon serving and satisfying consumer in order to achieve long
term relationship with consumers and their requirements and needs. This is important for
McDonald to concentrate upon requirement and desires of potential customer which will assist
company in filling requirement of consumer and satisfying their wants.
Marketing orientation is a structure or framework of an enterprise that focus on
distributing and delivering services and commodity which is being designed according consumer
requirement and desires (Rollins, 2013). Here are some major elements of marketing orientation
which are explained below:
 Benefit
 Team management
 Consumers
 Relationship Target market
Advantage of marketing orientation in McDonald -
This is significant for a company to be strong during process of marketing orientation.
Worker of McDonald can take assistance from marketing orientation which could help whole
worker to concentrate organisation customers. McDonald change their irregular buyers into
potential customers and earn loyalty of buyer of food. Potential buyers are strength of an
organisation as hey are quick purchaser of product and commodity and buy services in high
amount and stay stick with same company after all varies in market and industry (Kotler and
Armstrong, 2013).
Marketing Orientation Cost
Marketing Orientation cost is generally depend upon the place and location where is
marketing research is being performed. McDonald is in need of a wide quantity of compared to
local industry that is utilize to be require an reasonable amount. Here are some techniques of
marketing orientation mentioned below:
 Cost positive pricing.
 Break- even pricing.
 Target pricing.
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 Mark- up pricing.
TASK 2
2.1 Component of macro and micro environmental that affect marketing decisions
Marketing environment include two kinds of environment that include macro and micro
environment of organisation:
Marketing environment
Macro environment Micro environment
Macro Environment -
Macro environment include external factors of organisation such as political, technical,
social, legal and environmental and study their impact. McDonald macro environment consist all
forces that form possibilities and threats. Here are all macro environment factors:
1. Economical Factor -
McDonald faces various scale of tax and revenue measurements in various nations and
problems in fluctuation of foreign currency (Lefebvre, 2011). Local climate is main cause of
fluctuation issues in McDonald that influence their management Operation.
2. Social Factor –
Demand and lifestyle of society changes thus, McDonald culture changes according
social Vary. Public demand for high quality services and products in general cost from
hospitality organisation. To control social factor, market analysis is best key.
3. Political Factors –
McDonald is highly influenced by Govt. and their policies and laws. McDonald have
their restaurants in many countries as their laws and regulation affect McD in various process
which are food licence, taxation and employment acts. McDonald lead all policies and foreign
investment laws of nations.
4. Technological Factors –
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This affect customer expectation as well as help in competing rivals such as KFC, Pizza
Hut etc. McDonald uses easy access of technologies, modern modes of distribution, quick
payment channel and Wi-Fi facilities at their restaurants (Wymer, 2011 ).
5. Environment Factor -
McDonald avoid dangerous components as non-biodegradable matter in disposal cups.
Environmentalist criticise McDonald because of use of polystyrene in food packaging process.
McDonald is participating in social issues in order to impress society and environmentalist.
6. Legal Factor -
This is compulsory to manage their operations and management through guiding some
rules such as taxes, food licence, safety rules etc. McDonald maintain all legal process of a
country and its culture in order to sustain in market and achieve customer loyalty.
Micro Environment -
Micro environment is study internal environment and the factor impact which are
suppliers, customers, public, competitors etc. McDonald internal factors are below:
1. Supplier -
McDonald believes in strong relationship with suppliers which they have divide into two
parts one is direct who produce the food and another is indirect who supply ingredients in order
to understand and maintain them wisely (Lefebvre, 2012).
2. Consumer -
Understanding the needs of customers McDonald give priority to customer satisfaction.
McDonald serves more than approx328 million consumer in United Kingdom.
3. Public -
Public includes all people who are directly and indirectly include in process and
achievement of company including employee too. McDonald reach their public through media,
gov., pressure group. And many other channels.
2.2 Propose segmentation criteria utilized for products
Marketing segmentation is a process of segmenting market and consumers into various
segments according different categories that includes factors such as income, demographic and
other elements. McDonald marketing staff go through research process to understand marketing
preferences and product needs. This criteria is being separate into various parts to understand
factors and needs clearly and attract specific consumer for particular product for example Mc
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Egg for adults and children. This techniques help in understanding preferences and wants of a
particular segment as well their choices. Major goal of segmenting market is to determine target
of company. This can be evaluated through split market into various parts and segments that can
help McDonald to make specific demand of consumer and market (Donovan, 2011.).
There are many methods in which market can be separate such as through business to
consumer, business to business and understanding major concept of attributes etc. Facility of
marketing segmentation would also assist in understanding which is beneficial with needs and
buying power of a consumer of McDonald. These section would be determined on criteria of
annual income, customer behaviour, their demographers and age, taste, gender and requirements
of customers. McDonald can utilize this techniques of marketing segmentation in order to
increase their revenues, compete with their rivals and to gain company;s market efficiency. This
is a significant process for McDonald which would help in considering different parts of market
and target consumer of a specific product through easy method.
2.3 Targeting strategy
Targetting techniques is helpful in organisation planning and availability of product in
different environment and target market. After segmentation of market and consumer it is
essential to set some business elements in order to facilitate their product and services in a
particular place for a specific audience. Targetting of market and consumer make work easy for
producer and employee and determines the product and their distribution strategy in a certain
area of consumer to attract and influence them to purchase product.
McDonald use effective segmentation technique for a certain targeted group in order to
attract a particular segment of group toward a specific product in a competitive cost. One of best
segmentation and targetting strategies is Happy Meal which is made to attract students and
specially children that offer a combo of food along with a choice of beverage and a little toy of
cartoon characters trending in market (Sandıkçı, 2011). This is most effective targetting
techniques of McDonald and food restaurants that is still effective among consumer.
This is better to select a service of their choice in low cost and a gift that is attractive to
deny for children as well as students. Therefore, McDonald understands demands of consumer
and target them into segments according their wants, desires and needs and their purchasing
power and manufacture products according these component and try to meet their requirement
along with revenues as much as they can.
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2.4 Customer behaviour influence on marketing activities
An organisation use their consumer behaviour in their decision-making process. Also
behaviour of a buyer help in determining needs and requirement of their consumer in order to
modify and amend their product and its quality. Purchasing power of buyer influence an
organisation market and marketing strategies as well as their principles. Keeping in all this
aspects in mind, McDonald can overview their facilities and services that they are providing to
their consumers.
Customer behaviour toward purchasing products and services are depend upon many
factors such as micro and macro elements including legal, social , cultural, environment factors
and many other. McDonald maintain their policies and also concentrate upon micro as well as
macro factors of organisation at the same time. Consumer behaviour affect marketing activities
and decision-making process of organisation for example McDonald pricing techniques for
keeping products at a competitive cost in order to attract elite as well as normal people in order to
widen their target consumers. There are many techniques that McDonald uses to satisfy
consumer such as customer priority in order to AFFECT market activities that are customer
satisfaction, pricing, brand image, food quality and hygiene levels and many others.
2.5 Suggest new positioning
Building a market position and influencing target customers for a specific product is a
complex task and require a good deal of marketing mix in order to compete competitors in
industry. McDonald carry out various different strategies in order to attain consumer that include
innovative and creative ideas of targetting and positioning consumer for a specific product and
services in UK. In segmenting food products. McDonald is facing heavy competition in market
such as Burger King, Pizza Hut, Burger Farm and many others. For that, McDonald go through
market analysis and consumer feedback analysis for modification of products and meet
competitive objectives of organisation (Shani and Chalasani, 2013). Customer satisfaction can be
attain through understanding consumer needs and requirement toward a specific product of
McDonald. McDonald have a strong brand image in food industry from decades and have
emerged their stores in various countries from last few years by giving franchise option to
restaurants.
To meet position of 'Happy Meal' in market and in sight of children McDonald can use
promotion mix tools and advertise there product through many comics, cartoon channel
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advertisement and play magazines also through promoting their brochures at play zones, kids
game areas etc. Also to earn credibility of children, students and parents McDonald can assure
consumer about hygiene and safety of health by using product. McDonald can offer different
packages such as buy 2 get one, special offer on Christmas and many other to attain valuable
consumer so they would recommand their friends thus, how McDonald can increase their sales as
well as make a new positioning of Happy Meal among consumers. This positioning process can
only be made through marketing mix and marketing principle utilization in proper way. Through
this, McDonald can meet their targetted consumer and their perception and achieve success in
market.
TASK 3
3.1 Products development to sustain competitive advantage
In present, organisation imply various marketing strategies to meet competitive
objectives. McDonald has many competitors in industry such as Burger King, Dominoes, Pizza
Hut, Burger Farm and many others. To attain sustainable competitive advantage, product
development is an effective techniques that organisation can use to maximize their revenues.
McDonald can improve their existing services and goods and also reintroduced or launch
a fresh product to customer (Sheth, 2015). It has insubstantial and practical advantages. It can be
reached through using two techniques which are conducting a market research and other is
generation of concept, engineering details and design a service. Product development on a
regular basis is necessary to sustain consumer and constant competitive advantages. Here are
some essential steps of product development process:
 Generating Idea
 Presenting idea
 Testing and development of concept
 Market Analysis
 Market testing and Beta testing
 Technical implication
 Commercialization
 Pricing of product
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McDonald proceed these steps of product development in order to produce their own products
and services and modify them with time.
3.2 Distribution arrangement to supply customer convenience
McDonald have their own services and products that they provide to their consumer.
Usually distribution channels have three types but McDonald only utilize few techniques of
distribution channels . The first technique is production of products and services by their ow
which they provide their consumers at restaurants. This technique is very effective as well as
efficient. Here are few steps of distribution of McDonald:
 Company should render easy service system to their consumers.
 They should form beneficial policies for organisation.
 McDonald should utilize better mode of production and supply in order to attain
consumer.
 McDonald facilitate take away system in their restaurants in order to assist those
consumer who wanna take food.
In the advanced technological era, there are various methods and technologies that have
been made in order provide products and services to consumers at their place through online
booking services which McDonald can use for their consumer convenience. For distributing
products and services to consumers, McDonald provide quick services and at the spot
manufacture of food s and beverages at their restaurants. Also McDonald provide good facility of
Dine-in in their restaurants among countries. Major reason of potential consumer is their cost
effective prices at different places that mostly attract people. This is important to build important
strategies for distribution and production which assist them in identifying target consumer and
sources that provide policies of organisation to consumers in best manner.
3.3 Explain how prices are set to reflect organisation’s objectives and market conditions
Price is most important element of an organisation that is major reason that attract and
build consumers (Johnson, 2013). Pricing strategies are made after analysis of target customer
which are divided into several parts such as product life cycle pricing, discount pricing,
skimming price and penetration price etc. McDonald provide their services and products on a
cost effective prices which is set according various segment of customers. Here are methods by
which prices are set that reflect organisation goals and marketing tactics of a McDonald:
Price Skimming –
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In this process, company keep high prices of products. The cost of product decrease
according supply and demand of products.
Economy Pricing –
In Economy pricing cost of product are kept low but they keep product and service
quality down. This is also known as Minimum costing process (Foxall, 2014).
Premium Costing –
In this, company offer product quality high and value added but the pricing is also higher.
This pricing techniques is effective for new entrance of brand or company. In this, enterprise add
extra charges with rendering good quality of product.
Penetration Costing –
In this, organisation try to influence buyers to purchase product through effective
promotion techniques and they keep prices rates down in the beginning but later they penetrate
the prices.
McDonald utilize premium price technique while enter new product and services and also
use penetrate price technique to attract buyer and sustain the market. McDonald purchase raw
material at low cost and keep production process cheaper and technical to provide convenience to
consumers.
3.4 Promotional activity integration to attain marketing goals
Promotional activities are mainly used to attain consumer attention through using
different kind of promotional tools and techniques such as advertising, personal selling, product
promotion and public relation etc. An organisation uses various promotional techniques for
promotion and advertising of product and services in order to meet a specific group of consumer.
Promotional activities not only build customer but also make a brand image and goodwill in
society. It help organisation to increase their revenues and competitive advantages and build
brand on a global level ( Dann, 2010).
McDonald use various promotion mix to meet their consumer. This tools include
advertising through Television, newspaper, magazines, brochures, template and Souvenir
advertising. Also company promote itself by participating in various global activities such as
FIFA world-cup, Olympic games and advertise their product and attain consumer. This not only
attract specific or local customer but also attract various demographics and geographic consumer
to try their food at least once.
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