McDonald's Marketing Plan: Analysis of Opportunities and Strategies

This report provides a comprehensive analysis of McDonald's marketing plan, encompassing internal and external audits. The internal audit delves into McDonald's history, core values, and target market, while the external audit examines political, economic, social, technological, legal, and environmental factors influencing the company. The report highlights McDonald's strategies in response to market changes and consumer demands, including adapting menus, embracing technology like self-service kiosks and McDelivery, and addressing environmental concerns. Furthermore, the report discusses the competitive landscape, market structure, and legal considerations, offering a holistic view of McDonald's marketing approaches and challenges.

MK487 mcdonalds mARKETING PLAN
Vidya Jeyanathan Student Number -
21813633

Executive Summary
This report will consist of extensive research into the corporation of McDonalds including
their marketing and financial objectives, marketing opportunities and strategies. According
to McDonalds’ present-day performance in the market, they are currently maintaining
approaches which invests in both online and offline marketing strategies so their company
can be promoted in clear messages to keep their audience broad. They have also have their
mobile app which retains loyal customers and educates them on current and app exclusive
offers.

Table Of Contents

Internal Audit
McDonalds is an American fast-food restaurant originating in California by Dick and Mac
McDonald in 1940s. It has become one of the most recognized brands in the world
establishing more than 35000 stores in over 120 countries and serving at least a minimum of
70 million people every day. McDonald’s iconic foods that they serve are the Big Mac,
Quarter Pounder, and the French fries, alongside their chicken sandwiches, hamburgers,
salads, wraps, desserts, beverages. McDonald’s motto is ‘to provide a fun and safe
environment where our customers can enjoy good food made with quality ingredients at
affordable prices’ (McDonalds, 2021) They want to give value to their customers so a food
relationship is established between the customers and themselves which will results in
higher revenue and goodwill.
Increase in time poor consumers as delivery services have been embraced with food chains
– pandemic has allowed easier ordering and delivery and encouraged use of it
Their target market includes people between the age of 8 and 45, targeting the children
through happy meals and the sweet treats and the adults with free Wi-Fi and the app which
gives exclusive offers to the app users.
External Audit
Political factors can produce both opportunities and threats for companies, especially in the
way a company can operate as well. McDonalds has branches in over 120 territories,
meaning according to the country they are in they must follow each country’s trade
agreements and regulations. Trade agreements can make it easier or harder for
organisations to undertake business activities in certain areas, such as when there are
differences in food standards between markets within which the organisation is operating,
for example, the USA and Europe (McDonalds 2017a). In places like the United Kingdom
and United States of America, where health and hygiene regulations are established for
food organisations who must follow them. If these regulations are breached, then the
company is in risk of losing revenue and damage to their reputation. McDonald’s external
political factors also include health concerns and government issues. An ongoing issue in the
fast-food industry, more specifically McDonalds is the high sodium and sugar content in
their food as overconsumption of this can lead to issues such as diabetes and hypertension
(mbaskool, 2021). Health issues make business activities more expensive due to taxes that
may be placed, like the sugar tax or the ban of certain ingredients (McDonalds 2017a). This
is all resulting in them adding healthy options in their menu. The idea of westernised food
isn’t favoured by many countries, resulting in no western corporations being available for
consumption. Iran, due to the relations between the United States and Middle East, hasn’t
had a set of stores since 1979. Iceland used to have a McDonalds before 2009 but as it is
health-conscious country. McDonalds believes that having branches in Yemen would not be
economically viable. (Readers Digest, 2021)
Economic factors which can affect McDonalds include international, national and local
conditions as it is an international brand (McDonalds 2017a), which means that the 2008
economic recession would have impacted the company as a whole due to the negative

effect it had on Europe and United States as disposable income fell and unemployment
increased. This shows that McDonalds relies on a strong economy with low rates of
unemployment for economic success. Falling sales can also be attributable to changing
tastes and increased competition in the industry (McDonalds 2017a). Maidenberg (2020)
reports that the restaurant’s global sales fell by 22% due to economic shut down around the
world as people preferred to eat at home. McDonald’s has itself positioned well to resist off
economic challenges due to its value and affordable pricing strategies. The prices of
materials is constantly changing due to the change in currency exchange rates as the
materials are sourced internationally. Another economic issue McDonalds face is their high
employment turnover rate, they are constantly having to hire as their employees do stay for
long, so money and time is wasted for the hiring and training process of new people. The
company's McDelivery service is run by UberEats in the United Kingdom, and accounts for
10% of all UK orders. (IBIS, 2021)
Even though McDonalds initially opened with the idea of making everyone aware of
‘American way of life’ but then McDonald's began to serve to different countries according
to its local consumer demands. Like in India, most of the Hindu population is against beef, so
chicken was used as a replacement. The menu is tweaked to give the local flavour to their
customers. The changing tastes of consumers can impact their sales. A McCafe menu was
developed to provide an alternative to Starbucks due to the growth of the coffee industry
(McDonalds 2017b). The increased focus on health have required brands such as McDonalds
to cater to these so these changes in demographic mean that McDonalds needs to meet the
health and price conscious nature. They will need to adapt their menu choices accordingly
to include low fat choices (McDonalds 2017b). The continued concerns regarding obesity
has also meant that McDonalds has needed to provide healthier choices for all of its
customers, and particularly children. Though McDonald’s has been trying hard to address
these demands, its menu is a less desirable option for many healthy eaters.
As today’s world is fast paced with its technological changes, McDonalds has changed its
instore processes available too. There are now self-service kiosks, so customers do not need
to stand in line at the order counter and they may add more items to their order as they can
select it on their own. These changes also allow McDonalds to strengthen its brand as it
provides different channels for ordering by customers, such as in-store self-service and
collection or online ordering (McDonalds 2017c). They have also begun using electric menus
in branches as it can show different items dependant on the weather, time of day, offers or
regional preferences. The development of McDelivery is allowing high levels of convience
for customers. Apprente is an acquisition that McDonalds must replace human servers with
voice-based technology in its drive-throughs which means it may render many of
McDonald’s employees redundant (TechCrunch, 2019) Through its app, people can order
their favourite items and add-ons and get the food delivered at their home and receive
exclusive offers. Changing technology not only allows McDonalds to improve business
process such as re-ordering and reducing waste, but also allows it to develop greater
connections with its customers. (McDonalds 2017c).
A large interest in environmental issues is due to the focus on long term resource protection
and how businesses need to consider their impacts by developing corporate social
responsibility policies and reporting through Global Reporting Initiative (McDonalds 2017a).

Their supply chain should be environmentally friendly and have ethical supply chain
agreements. Issues are deforestation and food miles. One of the ways in which McDonalds
addresses this is to buy beef and milk from UK farmers (McDonalds 2017b). Over 1000
McDonalds restaurants have recycling units installed so consumers can separate their
recycling as well as their measures in place reduce its greenhouse gas emissions, and the
amount of paper and plastic packaging it uses daily. They have a target set to have 100% of
its packaging material come from renewable or recycled sources and for every restaurant to
recycle by 2025. Only 50% of packaging comes from sustainable sources while only its 10%
restaurants are doing recycling now. McDonald's now instead of shipping orange juice in
ready to serve container, shipping frozen concentrate which helps in reducing orange juice
packaging by 75 percent.
The governing situation of where a restaurant is based can have major impacts on how
successful businesses can be. As higher levels of regulation can limit business growth, whilst
lower levels may enable businesses to make more profit. Employment law with Issues like
minimum wage, holiday pay and sick pay may increase the costs of a business but reduce
recruitment costs if the staff feel as if they are being treated right. There has been an
increased use of zero-hour contracts so they can gain a more flexible working force in the
UK. This can be useful for McDonalds as their drive thru operates 24 hours per day but there
has been criticisms of this as they prevent workers from receiving holiday and sick pay
(Ruddick 2016). The fast-food industry especially McDonalds all hold a legal accountability
for obesity as they engage in deceptive advertising, sales and promotion whilst also
producing unreasonably unsafe food and failed to warn the consumers of the dangers of its
products. (MICHELle M 2003)

References
https://corporate.mcdonalds.com/corpmcd/our-company/who-we-are/our-history.html
McDonalds Corporation (2017a) 'Annual Report 2016' [online] Available
from http://corporate.mcdonalds.com/content/dam/AboutMcDonalds/Inves
tors/2016%20Annual%20Report.pdf
https://www.mbaskool.com/pestle-analysis/companies/17958-
mcdonalds.html
https://www.rd.com/list/countries-banned-mcdonalds/
McDonalds (2017b) 'Our company' [online] Available
from http://corporate.mcdonalds.com/mcd/our_company/our-
ambition.html
https://techcrunch.com/2019/09/10/mcdonalds-acquires-apprente/?
guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&gu
ce_referrer_sig=AQAAAMep2AA2KMQXhaxNcHJHSlOebRCO-
BzfSeXipujInDWIP1layeBFTCIqJ35ox7_wJFLD7boyfnokvC8IOrXo6A1TjF8wcv
8z8aPDYySs6hjtSF416GxelUK_ifdWLKyCcu6wBrYv62Asb1DG8uwKa7V6Hg
0CmD2BS_JDEIxRS42m
McDonalds (2017c) 'Click and Collect' [online] Available
from https://www.mcdonalds.com/gb/en-gb.html
Ruddick, G. (2016) 'McDonald's offer staff the chance to get off zero-hours
contracts' Guardian, April 15 [online] Available
from https://www.theguardian.com/business/2016/apr/15/mcdonalds-offer-
staff-the-chance-to-get-off-zero-hours-contracts
Mello, M.M., Rimm, E.B. and Studdert, D.M., 2003. The McLawsuit: the fast-food industry and legal
accountability for obesity. Health Affairs, 22(6), pp.207-216.

The Market
McDonalds is part of the Monopolistic Competition Market structure; industry in which
many firms offer products or services that are similar substitutes (INVESTOPEDIA).
McDonalds belongs to the fast-food industry as well as the real estate market due to their
franchising scheme.