Principles of Marketing Report: McDonald's New Dessert Pizza

This report delves into the marketing principles applied to McDonald's, specifically examining the introduction of a new dessert pizza. It begins with an introduction to marketing principles and the context of McDonald's as a case study. The main body of the report provides a product/service description, detailing the features and benefits of the dessert pizza. A thorough market analysis is conducted, evaluating current market trends, key competitors such as Wendy's, Subway, Burger King, and Starbucks, and consumer attitudes and behaviors, including psychological, social, and personal factors. The report identifies key issues and opportunities for McDonald's, such as food safety concerns and legal disputes. It then outlines the target market segmentation, targeting strategies, and positioning. Finally, the report suggests a recommended marketing mix to effectively launch and promote the dessert pizza. The report concludes with a summary of the findings and provides references to support the analysis. This report is a valuable resource for students seeking to understand marketing principles and strategies through a real-world case study.

Principles of
Marketing

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Product/Service Description........................................................................................................1
Market Analysis..........................................................................................................................1
Target Market..............................................................................................................................5
Recommended Marketing Mix...................................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................9

INTRODUCTION
Marketing principles refers to the norms and regulations of market which should be
followed by organisations in order to effectively run and operate business in dynamic business
environment. It is considered as the primary principles which is helpful in order to identify and
provide products in market by analysing the suitable tools, process and principles (Cummins,
Loe and Peltier, 2016). In order to carry forward this report McDonald's is considered which is
an American fast food company established in 1940 in California. Along with this, company
offer wide range of products and services and McDonald's does not deal in pizza. Currently,
company come with its new product which is “Pizza as dessert” which is sweet in taste and made
with fruit base. Hence, report covers the primary and brief description of product and effective
analysis of market undertaking the current trends, competitors and other opportunities. At last,
marketing mix is conducted for the barrier free flow of the offerings of products.
MAIN BODY
Product/Service Description
McDonald's make effective development in its offered services considering the
organisation and its decision making regarding the needs of customers. Along with this,
McDonald's also identifies the needs of customers in terms of offering innovative services and
delivery ways. Besides this, McDonald's also make effective improvement in its offered products
as currently company does not deal in pizza and due to this customers goes to other restaurants.
In terms of this, company add pizza in their menu in dessert section as its base is sweet
and filled with different fruits undertaking the proper research and perspective of people. Besides
this, in terms of making effective changes, good relations with customers are helpful in order to
know their requirements. Away with this, it is performed by relationship manager of by conduct
regular events and other fun activities. Therefore, undertaking the above findings it is identified
that development of new products and services is useful in improving the overall image of
company as it is beneficial for developing the brand image and earning effective profits and sales
for company.
Market Analysis
Brief analysis of the market
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Market analysis is both quantitative and qualitative determination of market which is
helpful in the business plan. It also include market size, customer segment, volume, buying
behaviour, competition and several behaviour that exist within the market (Bowie and et. al.,
2016). In terms of this the primary objective of market identification represent their investors and
the organisation which significantly knows about the market and shows the positive side in terms
of developing sustainable business. In terms of this, market analysis consider the different steps
in terms of conducting prominent research of market including demographic and segmentation
market which need proper competition regarding legal laws and norms to target market.
Besides this, all of these factors are useful for McDonald's in terms of identifying the
effective market conditions which is useful in examining the significant risk factor for company.
In terms of this, there has been the use of various frameworks which is useful in terms of
identifying the market conditions including, SWOT, porter's five forces and PESTLE analysis.
Along with this, the significant frameworks include analysis of prominent area in terms of
expanding business and risk factor which is related with the overall expansion of McDonald's.
Besides this, company also face various barriers in terms of taking effective entry in market and
the current barriers become the major concern for the capital investors of respective company.
Furthermore, they are significantly concerned about various factors such as technology, brand
name, accessible resources, distribution channel, rules and norms.
Key market trends
Increase complexity in consumer purchasing: It depicts the challenges which company
face considering the analysis of effective decisions of customer purchasing. Moreover, in present
times customers use several ways to purchase products and it will also become complex for
company to analyze the prominent online platform in terms of providing effective delivery
services (Bonaparte, 2019). Hence, the marketing manager of McDonald's use every food
delivery app in terms offering their products to customers and also start take away services that
tends to eliminate crowd from the restaurant and in modern times take away is famous in market.
Customization in product design: There are many restaurants which offer customization
services in their products including the demand of customers which is not prominently offered by
respective company as it becomes the biggest threat in bid to increase sales and profitability of
company. Hence, the marketing manager of McDonald's has significant opportunity to improve
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their market by providing customized products to their customers as per their needs. This trend is
getting more famous in terms of attracting large number of customers.
Digital transformation: It is considered as the new trend and kind of change that is faced
by various companies considering the overall transformation of marketing and also become the
effective challenge for organization. The problem included with this the lack of focus towards
the integrated strategies considering the structural issues and improvement of various skills
(French and Gordon, 2019). For this, the marketing manager of McDonald's need to opt effective
digital transformation in terms of becoming more trendy in market as it objective is to develop
essential road-map in terms of developing digital capabilities and skills of an organization.
Key competitors
Competition depicts the concept in the market which depicts the rivals that exist within
company in terms of selling various products in which some of them are similar, substitute and
unique with the aim of prominently use profits and market share (Moravcikova and et. al., 2017).
Furthermore, the competition in market leads to motivate McDonald's in terms of developing
their sales and volume for several competitors of McDonald's that are discussed as below: Wendy's: It is considered as the fast food restaurant company that offer its services
approximately in 6700 locations and also put emphasis on classic American food burgers
and fries. Company has the market share of around 4.1 billion and its stock dealings were
around $18 per share. Subway: It is the biggest restaurant chain in world considering the size and it offer its
services in around 41000 locations across the world and its every location is operated by
franchisees which is more than 21000. Along with this, company reported sale of around
10.4 billion and it is the privately owned company. Burger King: Burger King is the largest direct competitor of McDonald's which has
recorded approximately 1.65 billion revenues and also offer its services in more than
17000 locations across the world. Starbucks: It is considered as the largest coffee chain that has more than 31000 stores
within around 76 countries. For this, Starbucks reported revenues of approximately of 27
billion and market share was of 87.8 billion.
Summarise the current customer attitudes/behaviours
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There are numerous elements and features which influences the purchasing decisions
made by customers and reflects upon the attitudes, attributes and behaviours of consumers. In
order to understand the impacts of these factors customers behaviour over marketing actions
taken by organisation the manages are to evaluate these factors and understood them:
Psychological factor: Consumers and their decision making in relation to purchase are
separate from one another as the mentality and experiences of people are unique. These factors
includes perspective of people, their requirements and their ability to understand the provided
relevant information (Eastman, 2017). Every customer or potential buyer will react and
understand the marketing communication of McDonald's in different manner according to their
understanding and attributes. Thus, it is essential for marketing managers of McDonald's requires
to gain knowledge about the psychological factors in relation with the campaign for making sure
that targeted audience is attracted towards it.
Social factor: This elements refers to the behaviors of consumers and their social impacts
which are dynamic. Social interactions of families and communities also impacts the purchasing
decisions of people as well. The social factor involves living standards, social status, education
etc. which has a diverse but potential impacts and very difficult to identify but essential
therefore, marketers of McDonald's have to consider these features developing marketing plans
and campaign.
Personal factor: As the name suggest this factor is person specific rather than
concentrating on the group. The marketing team of McDonald's needs to identify opinions of
people, their interest and habits in order to understand their decision making and reactions to the
marketing campaigns (Tontuș, 2018). Generation gap analysis is the most significant example of
personal factor as older and younger people have different choices and their needs are satisfied
by separate products which leads to their purchasing decisions and expenditures.
Identify the main issues / opportunities
There are various issues which McDonald's currently face regarding the operation of its
business and many of them are discussed below:
Food safety concerns undermine brand: Food safety is a huge concern for consumers
nowadays. McDonald's offers all junk food, burgers, fires McPuff's and many more which hold
several calories and fat. In case of Junk food hygiene and suitable safety standards while
preparing food and serving customers is very crucial aspects. McDonald's have been facing
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problems and bad review in relation to their food safety and quality standards. Scandal of
Melamine is the recent in infant milk caused death of six babies. Currently the Government of
Shanghai responded to the media to expose black closing down the affected factory of Shanghai.
Figure 1: McDonald’s and its challenges worldwide: a market-by-market looks
Legal dispute eats away early advantage: The brand McDonald's has an appropriate
position in market in relation to their profitability from raising demand in Indian market due to
convenient, clean and affordable offerings. In India McDonald's operates from many years to
overcomes with a very long issue of serving beef burgers which is a Taboo in several locations in
India. After such consequences and problems of moving from their core offering now the
company have found the recipe to attract customers by ample chicken and vegetarian burgers and
wraps. But the company engaged into a legal dispute with their partners which led them to
stymied the expansion (McDonald’s and its challenges worldwide: a market-by-market look,
2020).
Target Market
 Segmentation:
It depicts that McDonald's undertake the population on the basis of income, age and
various other factors. In terms of this, it is important of the company to satisfy the needs of each
and every kind of customer in terms of enhancing the image, sales and profitability which is
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useful in further growth and expansion (DeLong and Elbeck, 2018). McDonald's also consider
the behaviour of customers for their survey as it is more competent to develop loyal customer
base including the behavioural area of people which is divided under various concept on the
basis of preferences and taste.
 Targeting:
Respective company target the whole category rather than particular customer base
considering the taste and income level. In terms of this, organisation leads to increase their sales
and profitability in terms of wide acceptability in market for their product. For this, McDonald's
target various families in terms of sending approval regarding their promotional message of new
pizza which is provided by the company and also depicts its essential features (Keegan, 2017).
Besides this, McDonald's also target adults by positing effective advertisement through
magazines and offer them prominent discount cards. McDonald's also leads to promote its
dessert pizza in terms of targeting adults to publish advertisement with the help of newspapers.
 Positioning:
This factor depicts the price which include low to high as the demand of customers and
also include other ingredients including income group by which people can enjoy eating pizza in
restaurant and bought food according to their budget. Hence, McDonald's position their products
on the basis of income level of people and prices. Hence, considering the positioning area map
for respective company, it comes under the fourth quadrant in terms of offering high quality
products and services at low prices that tends of enhance the brand image of company which is
helpful in terms of attracting most of the customers.
Recommended Marketing Mix
 Product:
Currently, McDonald's deals in various types of customers considering the income level
and taste of customers. In terms of this, McDonald's work according to the needs and demand of
people. Respective company also made their product considering the quality and price factor and
also consider various types of formulation considering the core competency of company which
include unique selling proposition (Resnick and et. al., 2016). Moreover, company also have
effective brand value which is provided towards the large number of customer base as it helps in
developing trust of customers. Therefore, undertaking the new product McDonald's offer Pizza
as dessert which is sweet in taste and healthy as it include various types of fruits.
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 Price:
The product is developed considering the significant price factor that are value for money
in terms of McDonald's, they should understand the viewpoint and also make it available
regarding the quality of product considering the affordable prices (Fine, 2017). Hence, because
of this factor various products are personalized undertaking the consumption of customers across
the world. For this, company currently use penetration pricing policy in terms of taking effective
entry in market and earn prominent market share. Along with this, the idea of company is to
offer new and unique product and also spread awareness among people.
 Promotion:
McDonald's use several promotional strategy considering the types of research regarding
the development of market and other promotional activities. For this, company time to time
conduct various events in terms of developing relationship with customers and leads to attract lot
of people. Hence, it is considered that sales promotion leads to improve maximum number of
sales for new product of McDonald's. Overall promotion is developed considering the brand
image and also tends to attract people that are useful in terms of increasing sales and
profitability. Moreover, company also tends to promote their products with the help of social
media and also advertise their products with the help of billboards that are visible to each and
every person.
 Distribution:
McDonald's use franchising in terms of offering their products and also open restaurant at
vary short distance. Undertaking this model, other people take franchise of the restaurant in
terms of offering products exclusively for the sale of food. This strategy is effective in terms of
opening stores in terms of offering effective brand image within the people (Migliore, Howard
and Gray, 2018). Hence, it is identified that distribution model is useful in terms of making
company more famous and popular undertaking the distribution channel. For this, respective
company use direct channel of distribution as they manufacture their products and offer it in their
own restaurant and directly to customers.
CONCLUSION
By undertaking the above discussion, it is identified that marketing principles are useful
in terms of identifying and examining the overall procedure of marketing with several factors.
Despite from this, it is helpful in order to identify the market undertaking different trends and
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competitors of an organisation considering the behaviour of customers. Moreover, it leads to
include prominent challenges and issues which company face at the present time and also
demonstrate segmentation, targeting and positioning of company considering their new product
which is useful in maintaining the effective reputation of company including effective
promotional techniques which is useful in creating awareness among people.
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REFERENCES
Books and Journals
Bonaparte, Y.L., 2019. Sustainable outcomes of an experiential learning project in a principles
of marketing course. Journal of Global Scholars of Marketing Science, 29(1), pp.7-14.
Bowie, D and et. al., 2016. Hospitality marketing. Taylor & Francis.
Cummins, S., Loe, T. and Peltier, J.W., 2016. Using sales competition videos in a principles of
marketing class to improve interest in a sales career. Journal for Advancement of
Marketing Education, 24(Special Issue on Sales Education), p.16.
DeLong, D. and Elbeck, M., 2018. An exploratory study of the influence of soft and hard skills
on entry level marketing position interviews. Marketing Education Review, 28(3),
pp.159-169.
Eastman, M.L., 2017. The Brand Project: Reinvention of a Principles of Marketing Course for
the Digital Age. Journal of Higher Education Theory and Practice, 17(6).
Fine, S.H., 2017. Marketing the public sector: Promoting the causes of public and nonprofit
agencies. Routledge.
French, J. and Gordon, R., 2019. Strategic Social Marketing: For Behaviour and Social Change.
SAGE Publications Limited.
Keegan, W.J., 2017. Global marketing management. Pearson India.
Migliore, R.H., Howard, N.C. and Gray, D.M., 2018. Contemporary marketing evolves. Journal
of Marketing Development and Competitiveness, 12(2).
Moravcikova, D and et. al., 2017. Green Marketing as the Source of the Competitive Advantage
of the Business. Sustainability, 9(12), p.2218.
Resnick, S.M and et. al., 2016. Marketing in SMEs: a “4Ps” self-branding model. International
Journal of Entrepreneurial Behavior & Research.
Tontuș, H.Ö., 2018. Promotion of health tourism and evaluation of the principles of marketing of
health services. Journal of Multidisciplinary Academic Tourism, 3(1), pp.67-88.
Online
McDonald’s and its challenges worldwide: a market-by-market look. 2020. [Online] Available
through < https://www.ft.com/content/f8ac22fc-a7c1-11e4-8e78-00144feab7de >./
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