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I have chosen McDonald’s for carrying out its detailed marketing analysis being an assistant to Marketing Manager of the company. McDonald’s is a fast food producing organization based in America having its headquarters in Chicago, Illinois (Area Development, 2018). It is a multinational company having branches in hundreds of countries all over the world. McDonald’s is specifically famous for its hamburgers but they also deal in French fries, beverages, breakfast products, ice creams, and salads etc. This paper will discuss the detailed marketing analysis of McDonald’s which includes key roles and responsibilities of the marketing function of the company. It will explain the ways, how company applies the marketing mix to the marketing planning process and also covers the evaluation of marketing plan for McDonald’s.
Key roles and responsibilities of marketing function at McDonald’s
The marketing department is a very essential part of any organization. It helps in the growth of revenue, enhance the share of the company in the market and increase the profitability of the company. Marketing department consists of a team of a number of people responsible for multiple functions such as publicizing, new announcements, and events organizing etc. McDonald’s has a brand image in the market which is more than just being a food store. McDonald’s invest huge amount in its marketing and promotion activities. It spends over $800 million (McClellan, 2016) every year on its marketing, advertising and promotional events. Some of the most important roles and responsibilities of its marketing functions are explained here.
Senior managers working in the marketing function make marketing strategies after considering the common goal of the organization. These strategies are related to enter a new market, increase distribution channels, and launching new products etc.
McDonald's marketing function also deal with building the marketing strategies for its upcoming and already existing items to always keep it as a preferential food brand among consumers. In the past, McDonald’s image was brought down by calling it as an unhealthy junk food brand. To deal with this issue, McDonald’s started began to provide a nutrition card along with the food. They also started marketing slogans describing the quality of hamburgers and potato rich food. McDonald's also introduced nutritious food such as salad, crisp vegetables (Click Americana, n.d.) etc. in its menu.
Before entering a new market, to launch a new product or to develop any other strategy, the market department needs to conduct a market research which helps the team to recognize new opportunities in the market. Research also helps them to identify consumer needs. By doing a market research, they can also develop a strong strategy to deal with the competition.
McDonalds’s marketing team also conducted enough research to make it a favorite brand for kids and adults. In the United Kingdom McDonald’s targeted the kids from the age of two to eight year. They advertised their brand with the help of a song that children can always remember. This research was made by the company to position the brand in the mind of kids and attach their appetite with McDonald’s. The company also did market research to target youth by offering them discount coupons and other benefits which were extremely liked by the young people.
Marketing team arranges communication stuff to advertise the product through the medium of campaigns, social media, leaflets, and promotional events etc.
As explained earlier in this paper that McDonald’s spend a huge amount on its advertisements and promotional activities. Some of the examples of its famous advertising campaigns are McDonald’s stretched restaurant hours, campaign on you tube to answer questions of people regarding food quality at McDonald’s Canada(Tubular Insights, 2015), Digital happy meal gaming zones and chance to win a free iced smoothie playing games etc.
It is the responsibility of marketing function to take care of various events, seminars, campaigns, and exhibitions etc. to increase the visibility of the product and the company in front of consumers.
McDonald’s marketing team always actively participates in the local events to increase its visibility among consumers. Moreover, it has also been participating in the global events such as world cup, Olympic Games, and other local sports club events to increase its market presence.
Managing dealers and agency businesses
Marketing function manages the dealers, vendors and agencies responsible for supplying all the stuff and materials related to marketing and promotional activities.
In McDonald’s, Marketing managers have the responsibility for establishing the personality of the company as a brand in front of consumers. They consider various methods for its promotion and make this company a recognizable brand in the market. They also keep a track of the dealers and agencies accountable for supplying materials related to marketing, advertising and other promotional activities. They coordinate with different agencies for sponsoring various local and global events.
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How key roles of marketing function relate to the wider organizational Context
Marketing function surrounds the complete business and it looks at the business from consumer’s point of view. Marketing function works after considering all the areas of businesses and derive its strategies considering the company’s main objective. Marketing function works closely with different areas of business and its key responsibilities areas interrelate with other functional units. In McDonald’s, marketing team works closely with operations department, finance department, human resource department, sales department, and various other departments to ensure a smooth and effective working and to avoid any conflict between various functional units before implementing any marketing plan.
Production and Operations unit
The marketing department at McDonald’s work with production and operations division to make sure that
- Enough research has been conducted to fulfill existing and forecasted needs of consumers
- Number of orders initiated by the marketing team are completed within the scheduled time
- Deliveries are made in stipulated time in all the outlets to cater to the expected number of consumers
- Replace the discarded items to meet the health and safety needs.
The finance department is a unit that allocates specified budget to all the units of an organization. The marketing department at McDonald’s work with finance department to meet the budgetary requirements of market research activities, promotional activities, distribution activities, advertising and campaigning etc. It also works with Finance department for increase or decrease in its budget of promotional activities in order to take advantage of the new profitable opportunities.
The marketing team at McDonald's also need to work closely with Human resource team to ensure that right candidate is recruited to
- Research and establish new product plan
- Fulfill targets of production
- Work towards company goals
- Develop a competent sales team
- Understand customer requirements
- Ensure quality of food etc.
The marketing team at McDonald’s work with sales department to analyze the sales of the company and build strategies to improve them. Sales team forecast the sales of existing and new products and Marketing team invest in technology, promotions, digital innovations and other activities to meet those sales.
Moreover, the marketing department at McDonald’s also works with procurement and supply chain department for managing the timely movement of products and its distribution to various outlets to serve the optimum number of consumers. It also works with the managers at restaurant chains to ensure world-class services and feedback from customers so that future strategies could be derived based on consumers suggestions. McDonald also works on loyalty programs (Fobes.com, 2016) to enhance the customer service and to enhance its brand image among consumers.
Evaluation of the ways how McDonald’s apply Marketing mix to the marketing planning process to achieve business objectives
The marketing mix is a functional model of marketing. It consists of all the tactics that an organization considers for promoting itself in the market. The 7Ps of marketing mix consist of product, place, price, promotion, people, process and physical evidence. After doing a market research, every company evaluates the strategies and come up with the solutions to develop a marketing plan. McDonald’s also evaluates its various tactics and apply 7Ps to the marketing planning process to achieve its business objectives.
Product describes the features and taste that should be included as per the customer’s requirements. It should also be manufactured in a way that leaves a long-lasting impact on the consumer. Its design and services associated with the product should be according to the convenience of the customer. McDonald's consider various aspects of designing its products, packaging, and appearance etc keeping customer’s need in mind. It has customized its burgers differently for consumers of different countries keeping their preferences and tastes in mind. McDonald’s conducts a market research, understands the behavior of consumers of a particular country and then develop its products. For example, it includes pork, beef, and mutton burgers etc in its menu in western countries where maximum people are non vegetarian while in various other countries like India, it does not include these burgers in its menu as Indians don’t prefer these food items and most of them are vegetarian consumers. McDonald’s also keep improving items in its menu as per the changing preferences of consumers. Design and packaging of its burgers are designed in such a way that is easily carried by consumers anywhere. It also ensures to bring the awesome quality of its products as per the demand of customers.
The place should be selected by the company in a way that is easily accessible to the consumer and it consists of the stores or outlets of the organization. The place should be nicely located and its appearance should be liked by the consumers.
McDonald's has also developed its outlets based on the needs and accessibility of the customers. It provides clean and hygienic outlets and good ambience which is mostly liked by the consumers. It provides Wi-Fi facilities and good music that is loved by young people. It also provides fun areas for kids and space for kids parties (McDonald's, n.d.).
Product’s price should be represented as a fair value of money. It should not be too less or high and should be according to the worth of the product. Sometimes, very less priced products are disliked by the customers as they may consider them as low-quality products. Strategies related to price should be made in a way that attracts consumers. Companies should always build discount strategies which are preferred by consumers. Price of the product should also be decided considering the price of competitor’s product. Price is an aspect that determines the revenue of a firm so it should be given immense importance. McDonald’s design its product after considering requirements of different income group of consumers and it also provides combo meal offers to them such as happy meal (McDonald's, n.d.), family meal, and other combo deals to attract them.
Promotional activities convey the message of the company to the consumers. The ways to represent promotional activities are advertising, campaigning, personal selling, public relations and sales promotion etc. Promotional activities should be chosen in such a way that could be able to nicely position the product in front of the target group. McDonald's spend a good sum of money on its promotional activities and position its product very well to the target customers. Some of the successful advertising campaigns of McDonalds are “I am lovin it”, “Food folks and fun” and “every time a good time” etc. Promotional strategies adopted by McDonald’s help it to easily transfer its communications to the target group such as kids, youth, and other people. By adopting these successful promotional tools, it has managed to become one of the largest burger food chains in the world having thousands of successfully running outlets. Mcdonald’s set its promotional tools in front of consumers in following ways:
- Advertising: McDonald’s make those kind of advertisements which are remembered by
the target customers. It focuses on advertisement which makes consumers aware of the product and leaves a long-lasting impact on their minds.
- Personal Selling: McDonald’s employees working in various outlets create a delightful
experience for customers by providing good services and effective communication.
- Sales promotion: McDonald’s arrange various sales promotional activities to enhance
sales of its products such as discount coupons, combo meal offers etc.
- Public relations: Employees working in McDonald’s outlets always try to build good
customer relations and try their best to stand apart from their competitors. They make the customers feel a happy and delighted customer.
- Direct Marketing: McDonald’s provide home services to consumers by delivering the
products at their doorsteps(McDonald's, n.d.). It also keeps updating its websites with new products and offers, and also provides the list and contact details of nearest available outlets.
McDonald's is known to focus on internal as well as external marketing. It trains and motivates its employees in an effective way so that they could provide a delightful experience to its customers which ultimately results in victorious external marketing.
The process describes the ways in which a product or service is delivered to its customers. McDonald’s has designed its processes to serve various types of customers and it has trained the staff at its outlets to serve the customer in an effective way. McDonald's have various outlets that operate late night as well. It has drive-thru option (McDonald's, n.d.) in most of its outlets where consumers need not come to the outlet to order their stuff while they can collect the same from the drive-thru while sitting in their vehicles if they don’t have enough time to visit the outlet.
Physical evidence is the intangible services that a company offers to its customers which make the customers visit again in their outlets or stores. McDonald's provide clean and hygiene outlets to its customers and ambience in its stores are also liked by the customers. McDonald's have designed various fun and gaming zones in its outlets for kids which attract the kids and make them visit repeatedly in McDonald's outlets. Its burgers are also packed in a way that is easily carried away by the consumers.
Development and evaluation of a marketing plan for McDonald’s
Although McDonald’s is considered one of the most preferred food outlets for consumers and have its market presence in a number of countries, it needs to expand itself more to sustain its image and deal with the competition. There are a number of competitors available in the market such as Subway, Dominos, pizza hut, KFC, and burger king (Downie, 2018) etc. The market for McDonald's has become saturated and its expansion is becoming difficult. It is also slow in terms of innovating new items in its menu. Due to the presence of other food brands, its market share is also declining. Change in the prices of various currencies is also affecting the revenue and growth of McDonald’s. It needs to develop an effective market plan for its expansion and sustainability in the market.
- Product: As explained earlier, McDonald’s is slow in terms of innovation, it should add
more variety of food items in its menu and try to target all age and income groups of people. Its food items should not just be limited to kids and youth. McDonald’s should inculcate healthier items in its menu. It should also include fruit-based items and juices, which can attract older age group of people as well.
- Place: Company should expand its reach by opening its stores in small places also. It
should cover malls, big cities, highways and small cities etc. It should also develop its outlets near competitor outlets and try to attract their customers as well.
- Price: McDonald’s should develop sufficient strategies to price its products in
comparison to the competitor’s products. It should include more products with different prices to target every income group of customers. It should provide more discount offers to attract more customers.
- Promotion: McDonald’s should develop promotional strategies to target non-buying
customer groups. McDonald's should use all the promotional mediums to target customers such as social media, print media, telephone, mobile apps, brochures and digital marketing etc. McDonald's should engage more untapped consumers through its effective advertising strategies. It should expand its delivery services in all the countries.
- People: As explained earlier, McDonald’s focuses on internal as well as external market
strategies. It should also include Customer relationship management and data base management to more effectively serve its customers. Mc Donald’s should make an alliance with other companies and agencies to increase its reach and sustain its presence in the market. It should tie up with railways, flights, and cruise etc for supplying its food items for their customers.
- Process: McDonald's should put efforts to make processes that reduce costs and focus on
customer delight. It can be done by introducing technology, convenience in making payments and delivery of products. It should try to retain existing target group of people and make comfortable processes to target older generations as well. In the past, McDonald’s have faced various satisfaction issues as it was put across as unhealthy food producing brands. So, McDonald’s should build more feedback strategies and customize its foods to target every kind of customer. It should try to increase more satisfied consumers groups.
- Physical evidence: McDonald’s should try to redecorate its outlets according to modern
services. It should develop self-serve options across its outlets. It may also try to offer conventional dining by offering table services to its customers. It may also try to offer candlelight dinner or other special dining offers on special occasions and festivals. All these innovating services may attract more consumers and company may sustain itself for long years even in the presence of competitors in the market.
Hence, the paper has discussed the key roles and responsibilities of marketing function at McDonald’s. It has further explained the applications of seven P’s of marketing by the company. Lastly, it explained the development and evaluation of marketing plan for McDonald’s after considering all the Ps of the marketing mix. Today, in the era of huge competition in the food industry, every company is adopting different marketing strategies to expand its reach and to create a better brand image among consumers. McDonald’s should also use effective business strategies as explained in this paper to improve its Global viability. It can also reduce threats of competition by introducing more items in its menu and targeting more consumer groups.
- Area Development. (13 Feb 2018). McDonald’s Relocates Headquarters to Chicago’s west loop.
- Click Americana. (n.d.). McDonald’s salads: It’s a good time for the great taste(1987)-Click Americana.
- Downie, R. (30 April 2018). Who are McDonald’s Main Competitors?.
- Forbes.com. (24 March 2016). Why Mcdonald’s is working on a loyalty program?.