Marketing and Markets in a Digital World: McDonald's Case Study

This report examines McDonald's marketing strategies in a digital world, focusing on addressing declining sales. It begins by providing background information on McDonald's, including its franchising model and brand image. The report then analyzes the situation at the start of the case, highlighting the challenge of declining sales due to health-conscious consumers and franchisee concerns over remodel investments. Porter's Five Forces are applied to assess the competitive landscape, revealing high competitive rivalry, buyer power, threat of substitution, and threat of new entry. The marketing mix (product, price, place, promotion) is analyzed to identify potential solutions, such as introducing new products, adjusting pricing strategies, strategically expanding locations, and enhancing promotional activities. The report suggests focusing on digital marketing strategies to reach customers effectively and improve overall profitability. Desklib offers similar solved assignments and resources for students.

Marketing and Markets
in a Digital World

Executive Summary
Marketing and Markets in a Digital World refers to the use of marketing and strategies
and techniques in such a way so a large number of customers can be reached and they can be
satisfied by fulfilling their needs and requirements. Digital marketing strategies and techniques
are also recommended to be used because in a Digital World they are helpful for the purpose of
reaching the customers and ensuring that the identification of the way in which their satisfaction
level can be raised can be done so that the company is able to make sure that the enhancement in
its overall profitability level can be carried out.

Table of Contents
INTRODUCTION...........................................................................................................................1
PART A...........................................................................................................................................1
Background..................................................................................................................................1
Situation at the start of the case...................................................................................................2
Porter's five forces ......................................................................................................................3
Marketing Mix.............................................................................................................................4
The solution ................................................................................................................................6
PART B............................................................................................................................................8
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................14

INTRODUCTION
Marketing and Markets in a Digital World means using the wide variety of methods and
techniques through which the management of a wide range of activities can be carried out so that
the products of the organization can reach the customers in market. Therefore, it is quite
important and essential that the use of the right methods and techniques can be made for
attaining the future goals and objectives (Camilleri, 2020). It is necessary for the managers that
they are able to make the use of the appropriate strategies and techniques. This report is based on
McDonald's. It is an American Fast Food Company which provides a wide range of food
products to its customers in the market so that their satisfaction can be ensured. In this report, a
detailed and specific discussion will be made on the Background, Situation at the start of the
case, Analysis of Porter's five forces, Marketing Mix. Additionally, The Solution will also be
discussed as a part of this assignment.
PART A
Background
A main Marketing challenge which is being faced by McDonald's is the Declining Sales.
It is quite an important challenge because it is directly linked with the overall level of
profitability of the organization (Cavlak and Cop, 2021). Therefore, it can be stated that due to
this particular challenge an impact is created on the overall level of sales as well as profitability
level of the organization.
McDonald's is a U.S. Based organization. It has a wide range of food products which it
can provide to the customers. Thus, it is a company which has expanded in the different
countries all across the globe through making the use of Franchising Model.
The company is able to make sure that the fulfilment of the needs and requirements can
be carried out in a proper way (Cochoy and et.al., 2020). Thus, the attainment of the goals and
objectives can be done quite effectively and efficiently.
The company operates its business through various franchises in the world in different
countries. In this way, the company is able to make sure that it can help in managing the wide
range of business needs and requirements in quite a proper way. The company has been able to
make sure that it has created a strong Brand Image and Goodwill in the market for the purpose of
the attainment of the goals and objectives in the future.
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The company is quite famous among the young people because of the tasty food products
which are offered by it and the catchy slogans which it uses. Therefore, in this way it can be
stated that the company is able to make sure that it can enhance its sales revenues and
profitability in an appropriate way by targeting the young customers. This will be helpful for it in
ensuring that it makes a right progress in the market quite effectively and efficiently (Confetto
and et.al., 2020).
It is quite important and necessary for the managers of the company that they are able to
make sure that the management of the needs and requirements of the organization can be done by
introducing new products and services (Dash, Kiefer and Paul, 2021). Therefore, McDonald's has
been ahead in the use of Innovation and has made sure that the customers can be attracted in this
way.
Situation at the start of the case
McDonald's has been facing a particular problem of Declining Sales. This is creating an impact
on the organization because due to decrease in the level of sales the overall level of profits of the
company will be affected.
The Declining Sales of the company was due to the fact that the customers are nowadays
becoming quite health-conscious which has therefore reduced their tendency to frequently go out
for eating Fast Food. Therefore, in this way it has become the reason that there are lower number
of customers which is therefore impacting the company a lot (Fatin and Rahman, 2020).
Also, In the year 2018, the company faced significant headwinds from operators over
Experience of Future remodels, which franchises claimed were not resulting in significant
returns for the money which was put by them for redesign. Thus it was a major challenge which
was faced by the company because the investments which were made by the franchises were not
generating satisfactory returns (4 Challenges McDonald's new CEO must overcome, 2019).
Thus, in this way it can be stated that due to this particular reason the profits of the
company are reducing which is therefore creating a particular level of impact on the operations
of the company. It is therefore quite important for the organization that the corrective steps can
be taken so that the level of sales revenues can be enhanced thereby increasing the profitability in
a proper manner.
Therefore, it is required that the right steps are taken for the purpose of making progress
and thus it will therefore lead towards ensuring that the situation of the company is able to
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improve so that the company can get ahead of the different types of competitors in the market
quite effectively and efficiently.
Porter's five forces
This is a particular model through which the deriving of conclusions and
recommendations about the market can be done (Giunta, 2020). The analysis of these forces can
be done in the following manner-
 Competitive rivalry- This means the competition level prevailing in the market.
McDonald's faces a very high level of competition in the market because there are a large
number of competitors which are present in the market. Thus, it can be stated that this
force has a high power for the company in the market.
 Supplier power- This means the power of the suppliers in the market. McDonald's has
contacts with the different types of suppliers in the market and therefore in this way it can
be stated that the company can make sure that it can get its supplies from any supplier
which it wants. Thus, it can be stated that this particular force has a low power for the
company in the market.
 Buyer power- This means the power of buyers in the market. Therefore, it can be stated
that the various types of buyers can create an influence on the level of sales of the
organization in the market. McDonald's has a wide base of customers in the market and
therefore in this way it can be stated that the company can make sure that the different
types of buyers in the market are satisfied with its products. The customers of the
company can help it to be able to make the right progress in the market. Therefore, it can
be stated that this force has a high power for the company.
 Threat of Substitution- This refers to the power of substitute products in the market.
McDonald's has various substitutes in the market and therefore they can be preferred by
the customers because of the cheaper price. Therefore, in this way it can be stated that
this particular force has a high power for the company.
 Threat of New Entry- This refers to the power of the new entrants in the market. In the
context of McDonald's, it can be stated that the new players can enter into its market and
therefore can create a particular level of influence on its level of operations. Thus, in this
way it can be stated that this particular force has a high power for the company.
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Justification- 4 out of 5 forces have a high power for the company and the remaining 1 force has
a low power. Thus, in this way it can be stated that the company has to reframe its strategy to be
able to obtain a strategic and competitive advantage in the market so that it can make a right
progress quite effectively and efficiently in a proper way in the future. Thus, it is necessary for
the organization that it properly analyses the influence of these particular factors on the level of
operations effectively and efficiently in a proper manner. This will be helpful in ensuring that the
situation of low sales can be managed quite appropriately. Therefore, in this way the right and
appropriate steps can be taken for the purpose of attainment of the goals and objectives in the
future in a right and proper way. This will be helpful in effectively and efficiently dealing with
this situation and taking the corrective steps in a proper and right manner.
Marketing Mix
The Marketing Mix is quite important for the organizations and thus it is highly necessary that its
analysis is carried out so that the right conclusions and recommendations are drawn in a proper
manner (Hulland and Houston, 2020). Therefore, for an organization like McDonald's it is
necessary that the analysis of the 4 P's of marketing can be carried out. The analysis of these 4
P's can be done as follows-
 Product- It refers to the product of the organization which it is offering to the different
types of customers in the market. McDonald's offers different types of products to the
customers and therefore in this way it can be stated that it is able to make sure that these
products can help in the enhancement of the overall satisfaction level of these customers.
Thus, it can be stated that for finding a solution to the problem of declining sales, the
company must bring in a new range of products which can suit the needs and
requirements of the customers.
 Price- It refers to the price of products which is required to be paid by the customers of
the organization. In the context of McDonald's, it can be stated that the company is
required to change its pricing strategy in the future so that it can make sure that it is able
to manage its needs and requirements quite appropriately in the future. The managers of
company should be able to make the use of Competitive Pricing Strategy so that the
prices are set according to the prices charged by the competitors in the market which will
therefore help the company to be able to take the necessary actions to solve the problem
of declining sales.
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 Place- It refers to the location of the Business where it carries out its activities.
Therefore, for an organization like McDonald's it becomes quite important that the
company is able to make sure that it can identify the way in which it can strategically
target the wide range of customers in the market. This will help it to be able to attain the
necessary goals and objectives in the future. The management of the company should be
able to identify the strategic places of expansion where it can expand so that the profits
can be enhanced thereby solving the problem of declining sales.
 Promotion- It refers to the wide range of promotional activities through which the
Businesses can make sure that they are able to attain the goals and objectives in the
future. For McDonald's, it is absolutely necessary that it makes the use of these particular
activities for the particular purpose of identifying the needs and requirements to be
fulfilled in the future and taking the right decision in a proper way. The managers of the
company should identify the aggressive promotional strategies to be used so that the
customers can be targeted which will therefore help in dealing with the needs and
requirements of the customers. This will be useful in solving the problem of declining
sales.
The reason due to which 4P's model is being used is that through making its use the organization
can identify the way in which the different types of customers can be targeted which will
therefore be quite helpful in ensuring that the right methods and techniques of enhancing the
profits can be used in a right way. Thus, through making its use it can be ensured that the
problem of declining sales can be solved because using appropriate marketing strategy will allow
McDonald's to be able to identify the way in which the sales can be enhanced so that the
revenues can increase which will therefore help it a lot in attaining its future goals and objectives
in the market.
Thus, in this way it can be stated that the management of McDonald's has to make sure
that the use of the Marketing Mix has to be done appropriately so that it can be ensured that the
company is able to take a strategic and tactical approach for the particular purpose of enhancing
the level of sales in the market which will thus help in increasing the overall level of profits quite
effectively and efficiently (Kumar and et.al., 2020).
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The solution
It is quite necessary that the right solutions are developed by McDonald's which can help
it to be able to solve the issue of Declining Sales (Mogaji, Soetan and Kieu, 2020). Some of
these solutions are explained as follows-
 The management of McDonald's became innovative and brought new products in the
market to attract the customers who were shifting to the competitors. In this way, the
company was able to make sure that it solved the issue of Declining Sales because the use
of Innovation helped it to be able to bring back the customers which increased the sales
and ultimately helped in enhancing the revenues.
 The managers of McDonald's identified the way in which the Market Segmentation had
to be done. This helped in creating better segments of the market which can be targeted
and therefore in this way this helped in generating of more revenues and solved the
problem of Declining Sales.
 The management of McDonald's made sure that it was able to bring attractive offers for
the customers so that the revenue generation enhanced thereby leading towards more
profits. Therefore, in this way it can be stated that for the company solved the problem of
lack of returns to its franchises.
 The managers of McDonald's identified the areas where the chances of getting returns
was higher. Expanding to such areas was helpful for the company to be able to make sure
that it solved the problem of lack of returns to its franchises.
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PART B
Technological changes are those changes which are important for an organization
because the changes in technology are required to be quickly accepted and implemented for
ensuring the satisfaction level of the customers in the future (Özoğlu and Topal, 2020).
McDonald's therefore has to make sure that it accepts and implements these particular changes so
that it is able to make sure that the management of the needs and requirements can be carried out
in a proper manner. Thus, it is quite important from the point of view of the managers of the
organization that they can effectively and efficiently help in the attainment of the goals and
objectives.
There are various types of technological changes which can happen in the market. Thus,
it becomes quite necessary that the implementation of these changes can be done in a right way
(Pucihar, 2020). The way in which these technological changes can impact the Markets and
Marketing activities of McDonald's are as follows-
 There has been an increase in the online orders which are being received at the
restaurants. This is the latest trend which has developed within the market in the recent
few years. In this way, it can be stated that the technological changes are quite important
for the managers of McDonald's here so that the adjustments can be made appropriately
and thus the increase in the level of sales can be carried out in quite a proper manner.
 Advanced Promotional Techniques are being used nowadays which are therefore helpful
in ensuring that the promotion of the products and services can be done in quite an
appropriate manner quite effectively and efficiently. Therefore, the mangers of
McDonald's have to ensure that the use of these particular promotional techniques can be
carried out for attaining the goals and objectives in the future.
Further, there is an importance of making the use of technology in the organizations so that they
can identify the way in which the different types of changes can be implemented in a right way
so that the attainment of the marketing goals and objectives can be done (Purwanti, 2021). The
explanation of the importance of technology can be done as follows-
 Through making the use of technology the marketing activities can be tracked in a better
manner (Rashid and Ratten, 2020). Therefore, in this way it can be stated that through
making its proper use the organizations can make sure that they are able to make the
required level of improvements quite effectively and efficiently in a right way. This will
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help McDonald's to be able to ensure that the marketing activities can be tracked quite
appropriately.
 The use of technology can help the firms to be able to ensure that they can identify the
steps to be taken to improve the sales revenues and thus this can help in enhancement of
the overall profitability level (Ribeiro, Fernandes and Lopes, 2020). Thus, in this way it
can be stated that this will be quite helpful and useful for the management of the needs
and requirements in a better way. For a company like McDonald's it is quite important
that the appropriate steps can be taken for the particular purpose of bringing the essential
technological improvements quite effectively and efficiently.
 The technological changes are required to be identified quite quickly and their
implementation should be made in a better way for ensuring that the attainment of the
goals and objectives can be done. This will help in bringing the required improvements in
the marketing activities of the firm. In the context of McDonald's it is quite necessary that
the implementation of these technological changes is done for bringing the required level
of improvements in the marketing activities of the organization.
 It is quite crucial that an appropriate budget can be framed for the purpose of
implementing the technological changes. Therefore, in this way this will be quite helpful
and useful for the organization to be able to ensure that the management of the marketing
needs and requirements can be carried out. Thus, this becomes quite important for an
organization like McDonald's.
 It is quite important to make sure that the identification of the way in which the
attainment of the technological goals and objectives can be done should be done
(Sampson and Chase, 2020). In this way, the organizations will be able to make sure that
the implementation of the technology in the marketing activities can be done in a better
way. Therefore, in this way it can be stated that this will be important for an organization
like McDonald's.
 There can be a change in the strategy which is being used by the competitors and
therefore in this way an impact can be created on the organizations (Shaheer, Li and
Priem, 2020). This will therefore help the organizations to be able to make sure that they
can make the appropriate and desired improvements for the particular purpose of
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progressing ahead of the different types of competitors in the market. Therefore, in this
way it can create a particular level of impact on an organization like McDonald's.
 Regular analysis is required to be carried out by the organizations so that the appropriate
conclusions and recommendations regarding the use of technology in the organizations
can be made (Sharma and Mittal, 2020). Therefore, in this way it can be stated that this
will help in ensuring that the right level of improvements can be made quite effectively
and efficiently so that the attainment of the necessary goals and objectives can be done in
a proper manner. For an organization like McDonald's, it is therefore quite essential and
should be done.
 The enhancement in the efficiency and effectiveness in the marketing activities of the
organizations should be made using technology so that the appropriate management of
the marketing tasks can be made in a right way (Sümer, 2020). Therefore, in this way it
can be stated that the organizations will be able to make sure that the attainment of the
marketing goals and objectives can be done quite appropriately. This becomes essential
for McDonald's to make sure that it is able to attain its goals and objectives in quite a
proper and appropriate manner.
 It is quite necessary and important that the identification of the scope of improvements in
the marketing activities of the organization should be made quite appropriately (Wang,
2021). Therefore, in this way the managers of the organizations will be able to make sure
that they can help in the attainment of the goals and objectives in the future. Therefore,
for an organization like McDonald's it becomes necessary to identify this particular scope
for the purpose of making the right progress in the future.
 There is an importance of making the appropriate use of the technology for the purpose
of tracking of performance of the marketing activities of a particular organization. Thus,
it is necessary for the McDonald's that it uses it in the right way for tracking the
performance and ensuring that the improvements can be made in the performance level if
it is necessary.
PESTEL analysis-
The use of PESTEL analysis recommended for McDonald's so that it is able to analyse the
impact of these macro factors and take the right decisions accordingly. Therefore, it can be stated
that the analysis is done in the following manner-
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Political factors- These are the factors which are important to be considered by the company
because the political changes take place quickly and thus it becomes quite important for the
company to make sure that these changes are implemented appropriately.
Economic factors- These are the factors which are necessary because through considering them
the company can make sure that the enhancement in the overall profits can be made.
Social factors- These are important factors because through considering them the company can
ensure that the social changes are implemented in its products.
Technological factors- The technology keeps on changing quickly which makes these factors
quite important to be considered by the company.
Environmental factors- The customers are conscious towards the environment and therefore it
is essential that the products are provided accordingly.
Legal factors- The legal forces create an impact on the organization and therefore it is highly
necessary that the impact of these factors is considered there.
SWOT analysis- The use of SWOT analysis is recommended for McDonald's so that the
company is able to ensure that it can work in an appropriate manner on its Strengths,
Weaknesses, Opportunities and Threats which will be highly useful for it to bring the
improvements if they are required.
Strengths Weaknesses
 Big Brand Name in the market which
allows it to make its presence.
 Strong customer base due to which its
profitability level is higher.
 Lack of innovation in the market which
is making it behind its competitors in
the market.
 Lack of use of appropriate strategies
and methods which is creating an
impact on its operations.
Opportunities Threats
 Identification of the strategic locations
where expansion can be done to
enhance profits.
 Innovation to be used so that the new
products are introduced.
 Rising tax rates are a threat for the
organization as it lowers the profits.
 Increasing level of competition creates
an impact on the organization.
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Recommendations-
 The use of Porter's five forces is recommended to the managers of McDonald's. This is so
because through making its use the organization will be able to assess the market and the
situation which is prevailing there. Therefore, in this way it can be stated that this will be
helpful for the company so that it will be able to take the necessary actions here.
 The use of Marketing Mix is recommended to the management of McDonald's. The
reason for this is that through making its use the company will be able to ensure that it is
able to take the necessary actions to be able to improve its situation in the market.
Thus, In this way it can be stated that the current technological changes are creating a particular
level of impact on the Markets and Marketing Activities of the organization. The attainment of
the necessary goals and objectives in the future can be done in this way in a proper manner.
CONCLUSION
From the above discussion, it can be concluded that the Marketing and Markets in a
Digital World refers to the using methods and techniques to make the products reach to the
customers in the market. The key learning points from this Case Study can be that it is important
for the Brands to make sure that they are able to constantly innovate and change so that they are
able to ensure that the right progress can be made by them in the market. Therefore, this can be
highly helpful for the companies so that they can make sure that through the use of these
methods and techniques the progress can be made in a proper manner.
It can also be summarized from this Case Study that nowadays the customers prefer that
they should be provided with the appropriate value in their products which will therefore help in
ensuring that they make a frequent purchase of these products so that the future goals and
objectives are attained.
Also, it is quite necessary for the organization that it is able to find out segments in the
market where the expansion can be made. Therefore, this will be helpful in ensuring that through
these particular segments the managers are able to make sure that the level of growth can be
enhanced. This is so because in these segments there are various types of customers who can be
targeted and thus in this way the appropriate level of efficiency and effectiveness can be
enhanced which will be useful for the company in making progress in the future.
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Further, it can also be summarized that the application of the marketing strategy has to be
done in a right way so that the products are able to reach the customers in a proper way. Thus, it
is necessary that the managers of the organization are able to frame the marketing strategy
properly for ensuring that the goals and objectives are attained in the future. If there are certain
improvements which are required to be made in the marketing strategy then they should be made
which will be quite helpful in targeting more customers in the future and thus increasing the level
of sales which will thereby result in the enhancement of the overall level of profits in the future.
Thus, it is quite necessary and important that the efficiency and effectiveness can be enhanced in
a right way. For this, it is important that the right efforts are made which will help in making the
organization successful in the market so that it can get ahead of the competitors in the market.
It can be concluded that Marketing and Markets in a Digital World refers to the various
types of methods and techniques which can be used by the organizations for the particular
purpose of enhancing the overall efficiency and effectiveness in a better way. Thus, it is required
for the organizations that they are able to quickly identify the scope through which the
appropriate level of improvements can be made so that the attainment of the goals and objectives
in the future can be done quite effectively and efficiently. This will help the organizations in
attaining a strategic and competitive edge in the market.
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Online
4 Challenges McDonald's new CEO must overcome. 2019. [Online]. Available through:
<https://www.restaurantdive.com/news/4-challenges-mcdonalds-new-ceo-must-
overcome/567117/>
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