Analysis of McDonald's Marketing Strategies and Functions

This report provides a detailed analysis of McDonald's marketing strategies, exploring its marketing functions, roles, and responsibilities within the wider organization. The report examines the application of the 7Ps marketing mix (Product, Price, Place, Promotion, People, Process, and Physical Evidence) within McDonald's, evaluating its effectiveness in achieving organizational goals. It also delves into the roles of various departments like Finance, Marketing, Sales, and Human Resources in contributing to McDonald's overall marketing success. Furthermore, the report assesses McDonald's pricing strategies, promotional activities, and product development, highlighting how the company adapts to consumer needs and market trends. The analysis includes insights into McDonald's global presence and its efforts to maintain a strong brand image, emphasizing the importance of market information, branding, and innovation in its operations. The report concludes with an evaluation of the marketing plan and its impact on McDonald's market competencies.

Marketing
Essentials

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
P 1. Roles and responsibilities of marketing functions..........................................................1
P 2. Marketing roles and responsibilities related to wider organisations...............................4
P 3. McDonald's 7P's of marketing mix.................................................................................5
P 4. Evaluation of marketing plan of McDonald's.................................................................9
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Mainly this research aid in analyzing marketing functions that are adopted by
McDonald's in enhancing its market competencies. Effective measures need to be adopted by
assistant marketing manager to analyze the consumer needs and preferences. Likewise, they
should adopt technologies in fulfilling those requirements. However, McDonald's is one of the
largest food chain in the world who aids in serving quality products at reasonable prices. Further,
the cited firms main purpose it to analyze its competitors and preferences of potential consumers
to establish quality products for more expansion and higher revenues. Further, it assesses in
generating livelihood of its potential buyers.
P 1. Roles and responsibilities of marketing functions.
Intuitively and simple appealing philosophy is considered as marketing concept. It helps
in determining the wants and needs of targeted consumers and likewise formulates plan for
achieving organisational goals (Yee and et.al., 2017). This concept further focuses on
understanding that sales of the manufactured products and services. Production is depending on
the needs and wills of consumers.
McDonald is one of the leading franchise in the world who generally adopts marketing
concept while undertaking its operational activities. This firm consists of highly valuable assets
and brand of this company is world’s famous. Further, it consists of 30000 stores globally in 100
countries by serving 47 million customers. Mainly the biggest merit of this organization lies in
providing high quality food, clean ambiance and value to its buyers (Harzing and et.al., 2016).
Similarly, this organization adopts several effective technologies so as to provide innovative
products and services to their costumers which enhances their morale and loyalty towards cited
firm.
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Some marketing functions of McDonald's are: - Pricing: - It is the most crucial function that has
to performed effectively by the marketing manager of McDonald's. Product prices are basically
affected by competing product price, rate of profit, government policy etc. however, pricing also
influence the demand of potential buyers. Therefore, this organization has adopted low or
affordable pricing strategy to attract more buyers (Keszey and et.al., 2017).
Physical Distribution: - This function of marketing is applied to carry produced products or
services from one place to another where-ever needed. Warehousing, inventory, transportation
and order processing are some factors that need to be determined in order to fulfill the assigned
target or goals of McDonald. Further, this company distributes its manufactured products and
services from its stores globally.
Promotion: - It is the crucial aspect that has to be determined by every organization. Promoting
the produced products and services effectively creates awareness among consumers whereas
attracts new buyers towards them. Promotional presentations can be developed it through 4
factors including- personal selling, publicity, advertising and sales promotion (). Therefore,
every marketer has to formulate effective ideas to enhance its selling techniques. Similarly,
McDonald company enhances its selling activities by putting hoardings or posters during
Olympics, NFL and likewise generates commercial ads on TV.
Gathering and analyzing market information: - Under this function, marketers thoroughly
analyses the demands and needs of consumers including- their preferences, income status their
channel of distribution etc. therefore, marketing opportunity may increase by applying proper
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strategy of production and selling. company should have produced good quality of product so
that livinag standrad of consumer may increased.Branding: - Every owner or producers aims to
create a brand name of its manufactured products or services at the targeted market. Therefore,
they provide effective name to its product which is useful in creating a specific image and buyers
can easily differentiate it from its substitutes (Murfield and et.al., 2016). Thus, cited company
has created its brand image among large number of buyers by producing high quality products at
affordable price. Financing: - It is the key factor among other marketing functions. finance is the
heart of every organisation. If the company has no minimum fund for the production of product
than it is difficult to survive for long term in business world. The financing strategy of
McDonald's is that it generates revenue from everything which is owned by them and likewise
from them it deducts the expenses incurred while production. After that they generate their
desired product.
Market information and management: - It is the duty of marketer to chalk out the demands and
needs of its potential buyers. They further develop plans under which marketing strategies need
to be formulated (Dauphinee and Vercio, 2016). McDonald's marketing manager calculates the
selling price of products so that profit can be estimated. And it may possible to identifies
capability and failing of planning and management. proper planing is done again to overcome
the problems and generate new opportunities for company.. Create innovative products to fulfill
needs and demands of its potential buyers.
Products and service management: - Every organization aims in providing best services to its
consumers in order to generate brand loyalty. However, marketing manager need to adopt the
latest technologies in regard to provide high quality food and services to its consumers.
Similarly, this firm has generated innovative food items including chicken Mc grill and breakfast
bowl which has attracted many consumers.
Standardization and grading: - Another important factor that has to be determined by marketing
manager is to formulate standards of the produced products. Such standards refer to design, size,
quality, color, weight, raw materials etc. Peculiarities would be developed under the designed
products by adopting such factors (Liu, Liu and Yin, 2010). Grading means providing rating to
the manufactured products and services. According to the grades marketers can easily understand
the levels at which improvement needs to be done.
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Packaging and labeling: - This is the most crucial factor that provides information about the
product quality to its buyers. Effective packaging and labeling creates product differentiation and
attracts consumers because they will be well aware about the goods and services which they are
consuming. Therefore, McDonald's provide attractive and innovative packaging to its products
and even provides extra gifts with the meals so that consumers of small group or children's like
to purchase their product.
Product designing and development: - Another major aspect of marketer is to determine the
business environment to adopt the latest technology. However, by adoption of several
techniques, business firm can formulate creative and innovative ideas by producing new products
or by improving the existing one (Mootee, 2013). Thus, such strategies attract more potential
buyers and helps the cited organization to expand its market globally which will enhance its
productivity as well as profits.
P 2. Marketing roles and responsibilities related to wider organisations.
McDonald's is the leading food chain sector all over the globe. Consisting of efficient
skilled staff members, senior administration and moreover its branches are spread in all over the
world. It has effective organisational structure which consists of hard working staff from top to
bottom of the hierarchy. Such departmental structure is discussed below: -
FINANCE DEPARTMENT
Finance department of McDonald is one of the most essential department for its smooth working.
This is the department which is responsible for all the money McDonald have. finance
department is the one who suggest to company that how to manage the fund by arising questions
that what to invest, how and which investment can lead to better result or can yield more profit
in the future (Routledge. Regnault-Roger, Vincent and Arnason, 2012). It's also the
responsibility of finance department to check that fund is utilizing in correct way or not.
Decision which are related to funding and investiong is taken by finance department.
MARKETING DEPARTMENT
As the word suggest marketing department deals with the market of McDonald. It’s their
responsibility to promote McDonald and make it more appealing to their customer and able to
keep its position and, image at the apex, it is there job to attract more and more customer. They
have one strategy where they should open their new store so that it can attract more customer or
create big business. for example, McDonald in India brought veg n spicy food in their menu card
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because it was demand of people. so, all the plans made which are related to keep McDonald
successfully and it can compete against their rivals in market its marketing department job (Koo
and et.al., 2016).
SALES DEPARTMENTSales department make assure organisation that company is
progressing in market or not. They keep track of company sales mean how much company was
able to sale this is year and how much profit they have gain. They also plan strategies for better
sales and development in future. This is the department which record all sales and also predict
the turnover of future and how much profit they will make, it not only keeps continuous watch
on their customer but also their rivals and report back to company (Grönroos, and Ravald, 2011).
As McDonald have many stores all over the world they all have their own sales department but
in end of year every department sales are brought together to know how many profits are made
and which store is flourishing and which store is losing its strength this all are analysed by sales
department. They maintain close relationship with marketing department as they both have to
work together for better sales.
HUMAN RESOURCE DEPARTMENT
Human Resource department of McDonald work as bridge between employer and employee it is
this department which see that its employees are provided with healthy and safe work
environment so that they can perform better. It is also HR department which is responsible for
the new recruits and also for their training. They are also responsible for the employee job
satisfaction and involvement providing them with incentives (Srinivasan, Rutz and Pauwels,
2016), appraisal and benefits also to see that there are no work conflicts if there is any, then
resolves that immediately. They also see to it that there are no unfair practices both by employee
and employer. HR department to see their employee health conditions and try to solve so that
they can work efficiently in company.
P 3. McDonald's 7P's of marketing mix
Marketing is a core function of every business organization. However, it is the
responsibility of McDonald's marketing manager to formulate strategies in regard to achieve
their organizational goals and objectives. Similarly, seven elements that are adopted by this
company includes: -
Place: - there are 30000 physical stores of this company established in 100 countries and has
adopted aggressive marketing strategy to expand its business all around the globe. Thus,
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company has generated its brand name within urban as well as rural areas. On the other hand,
company states that “McDonald focuses in establishing its set up within best locations to create
an easy access for the consumers” (Parlan, Kusumawati and Mawardi, 2016).
Price: - Determination of the price is the most crucial factor that need to be focused by
marketing managers. McDonald's is among the leading food sectors which produces effective
price products which are basically affordable by every potential consumer. These firm aids in
developing cost-effective products which creates a huge fraction of differentiation among its
substitutes.
Product: - This firm produces wide range of products and services including – big mac, chicken
McNuggets, filet-o-fish, cheeseburgers, hamburgers, quarter pounder with cheese, several
varieties of cheese sandwiches and many more. Not only this, it also provides with different
salads, shakes, ice creams, McFlurry deserts, sundaes, oatmeal, softy cones, coffee, soft drinks,
pies and many other beverages. However, this brand has taken a pledge of generating quality
products at affordable prices to attract more number of potential buyers and also aims in
eradicating unhealthy environment (Telang and Deshpande, 2016).
Promotion: - Promotional activities plays a significant role among every business organization.
Effective promotional activities aids in generating awareness among people related to the
products manufactured and also enhances its sales which encourages its revenue and sales. Every
business firms want to develop market recognition separate from its competitors, similarly
McDonalds follows different strategies to formulate its unique brand image which aids in
attracting the existing as well as new costumers. Differentiation among its substitutes is they key
factor that has been encouraged by this cited company.
Process: - This factor initiates the balance among standardization and customization. However,
specific attention is required to be given for a successful accomplishment of this stage that
together comply by their undertaken operations. On the other hand, service provider should
clearly define the processes to ensure the level of services provided to the customer (Wisuttisak
and Binh, 2016). This step further helps in defining the areas where potential consumers are can
easily experience unique services of McDonald’s. Thus, McDonald's undertake effective
processes to enhance the quality and productivity of the manufactured product and services
which will enhance its revenues and growth among its competitors.
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People: - The most crucial element of marketing mix is to focus upon its targeted set of buyers in
an effective manner. However, organizations must deliver effective as well as unique services to
their consumers to enhance competitiveness among business environment. For example, if the
stewards appointed in restaurants are subjected to provision harsh services to its consumers, then
this will reduce the loyalty and trust of the buyers towards their services. Similarly, cited
organization aims in providing consumer oriented facilities to develop their entire experiences
and also results in attracting more consumers towards them. However, it has been identified that
to generate productivity and enhancement business organizations must hire skilled workers and
should provide them with effective training and development sessions, seminars, conferences etc.
which enhances their skills and abilities. This further develops their self-confidence and
communication skills which are crucial to deal in a respectful manner where the customers are
required to be served respectfully. It has been noticed that more consumers are attracted towards
those organizations who provide effective services and behaves politely among their consumers.
Physical evidence: - Many consumers significantly believes that location is the major aspect
which encourages the buyers and is a direct influential mean to attract them in great numbers. All
persons want to achieve sustainability and comfort under their lifestyle (Anaf and et.al., 2017).
Moreover, they are basically diverted towards those firms which provide calm and soothing
location as well as ambiance. This further, creates a sense of security and safety among them.
Thus, McDonalds main aim is to develop its stores at reputed locations which attracts every type
of consumers and is convenient for their reach.
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Figure 1 7P's of marketing.
(Sources: The 7Ps of Marketing Mix, 2014)
In contrary, Burger King is the major rival firm of the McDonald's company. They face a
huge amount of market competition from them. However, Burger King has adopted several
strategies and policies under marketing mix functions to generate more competition between its
substitutes. Further, these efforts are made by them in order to achieve long term benefits and to
generate more competencies for McDonald's. Thus, marketing mix strategies applied by Burger
King are as follows: -
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Place: - Products of Burger king is easily accessible to the consumers all over the globe. This
factor is highly concerned regarding the venue at which the stores are located. It also creates a
huge state of competition with McDonald's where its stores are mostly situated in nearby
locations which generates more threat of substitution. Burger King also focus on its distribution
channels such as mobile apps, website or home deliveries as well as restaurants. This attracts
more consumers because they can easily consume the desired products without roaming here and
there.
Price: - Strategies formulated by this company mainly reflects cost leadership that aims at
minimizing the cost of their offered products to attract more number of consumers. Further, to
expand its business Burger king follows- bundle pricing strategy and market oriented pricing
strategy. Thus, it encourages more competency and may affects the sales of McDonald's.
Promotion: - it is the crucial factor which has to be adopted by every marketing manager to
generate awareness among its buyers. Burger King focuses on promotional skills such as sales
promotion, public relations, advertising and personal selling. Such techniques are useful in
encouraging more number of buyers that in turn leads to develop more competition with
McDonalds. McDonald’s (Chandler and Cox, 2016).
Product: - This organization manufactures variety of products to attract more consumers such as
chicken and fish, burgers, salads and veggies, sweets and deserts, sides etc. further, it aims in
providing high quality products at affordable prices which attracts more buyers and develops
more competitiveness between its substitutes.
P 4. Evaluation of marketing plan of McDonald's.
PESTEL Analysis of McDonald's
Political Factors
McDonald's serves its product in more than 100 countries. So, it is exposed to all over the
worlds political factors. Like all other leading food ventures McDonald's has to abide with the
rules and regulations of the governing bodies regarding hygiene and health factors. As fast food
is seen as junk food' which lead to many cardiovascular problems and cholesterol difficulties so
the governing bodies are pressuring the food industries.
Economic Factors
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As McDonald's severs in more than 100 countries the economic factors are of much
importance They have to take many important decisions regarding its supply chain of importing
raw material, whether they should import it or go for the local market (Shah and Mujtaba, 2016).
The tax rates and tariffs are much higher on the imported goods-Culture Factors
Socio – Culture factors are quite different all over the world. Peoples may be affected by
sales performance because it increases their lifestyles or living standard. Moreover, people in
United states enjoy hamburger whereas people in Asian countries have different taste.
Technological Factors
As the truth lies in the food industry that this industry cannot use more technologies
programs because taste of foods cannot change by machines Whereas, the usage of technology
in the organizations improve the productivity and management rates by reducing the time and
resources (McDonald’s PESTEL/PESTLE Analysis & Recommendations, 2017). Technology can
be used in the marketing and advertising process so that consumers can know about the product
of this company.
Environmental Factors
In this emerging environment people are becoming more careful regarding the
environment and are becoming more aware of the natural resources. While McDonald's is
serving more than 60 million people daily they are also taking that into consideration and instead
of using polystyrene waste packing they are using paper based packing (Daymon and Holloway,
2010).
Legal Factors
In the food industry rules and regulations or boundation by government is always the
biggest concern. As one of the leading food chain McDonald's has to be aware of the legal
requirements or follow the rules which are related to employment and labor laws, tax rules of
different countries.
SWOT Analysis of McDonald's
STRENGTHS
McDonald's is one of the leading food suppliers in the market. The company operates in
more than 100 countries with more than 36,000 franchisees in the food industry. They share a
fixed cost over many restaurants which shows its brand image all over the world. The food
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