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McDonalds (Marketing Plan)

McDonalds (Marketing Plan)

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Published by Kamran Azam

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Published by: Kamran Azam on Sep 25, 2011
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Presented To :
Sir Mannan khan

Presented By :
Brain Hackers

Group Members :
Somia Iqbal Irum Ajmal Fahad Sattar Ather Waqas Hammad Lodhi 10 36 15 18 05


We are grateful to our teacher MR.Mannan Khan for teaching us curriculum of marketing. His versatile knowledge in marketing field and unique teaching style has developed our knowledge and cleared many marketing concepts.We are all the most grateful to him for assigning this project, which has further helped us in evaluating many interrelated dimensions of marketing. We are also thankful to all other members Hammad Lodhi, Ather Waqas, Fahad, Irum Ajmal,and Somia Iqbal who have rendered their whole hearted support at all times for successful completion of this project. The basic resource of information for our project was internet and most of
the Information was gathered from McDonald’s site.

On 15 May 1940 the first McDonald’s inaugurated in United States. “The smile known around the world” . It has now a total of more than 31.000 outlets worldwide. Since August 2003.Introduction McDonald's is the largest chain of fast food restaurants in the world. and Ronald is instead shown interacting with normal kids in their everyday lives. Ronald McDonald is a clown character used as the primary mascot of the McDonald. McDonald opened its doors in September 1998 at Lahore and now operating in seven major cities having network of 20 restaurants. visiting children in hospitals. The clown inhabits a fantasy world called McDonaldland. McDonald has been officially recognized as the "Chief Happiness Officer" of the McDonald's Corporation. Many people work full-time making appearances in the Ronald McDonald costume. In recent years McDonaldland has been largely phased out.

. most of which involved trademark disputes. However.09 billion compared to $1. April sales figures for McDonald's were 7 percent more in 2009 compared to 2. In 2001 the company was fined £12.Ronald McDonald Environmental analysis • External environmental analysis • Political and legal McDonald's has been involved in a number of lawsuits and other legal cases. McDonalds are the market leaders in fast food.19 billion one year ago. the magazine decided not to grant them the award due to animal welfare issues and concerns. McDonalds have high incomes but low cost. • Economical The Wall Street Journal reported in the July 24. The target markets are high. In 1999 McDonald’s was nominated by Business Ethics Magazine for its prestigious Business Ethics Award.400 by British magistrates for illegally employing and over-working child labor in one of its London restaurants. According to the same article. McDonald's has defended itself in several cases involving workers' rights. 2009 that sales for McDonald’s fell below expectations. Although that income number is still substantial but it is also a $10 billion drop in sales. Profits came in at $1. The company has threatened many food businesses with legal action unless they drop the Mc or Mac from their trading name.6 percent in June. The decline is recent.

energy efficiency. • Environmental “We believe the choice of refrigerant must be evaluated on an applicationby-application basis.• Social As a prominent example of the rapid globalization of the American fast food industry. This enables the company to engage in discussion and dialogue to find solutions to common challenges. health and safety. McDonald’s also asked its partners that the appliances to be supplied should be equal or better in efficiency that they hold cost at maximum five percent extra capital cost of their standard equipment. In response to public pressure. McDonald’s has long-term relationship with all suppliers. life cycle cost and local codes”. It runs more playgrounds than any other private entity in the world are the issues that McDonald's did not deal with in the report on Corporate Social Responsibility • Technological McDonald keeps on focus on improving the pieces of equipments that have the highest environmental and greatest energy-saving impact. By McDonalds . and its business practices. considering all relevant factors such as environmental protection. McDonald's is often the target of criticism for its menu. and Canada they will be introducing cooking oil for its french fries that contains no fats. “McDonald's spends more on advertising than any other brand in the world. McDonald's has sought to include more healthy choices in its menu and has introduced a new slogan to its recruitment posters: "Not bad for a McJob". McDonald's announced on May 22. 2008 that in the U. built up over many years of shared growth and development.S. its expansion.

327 (6%) Canada .343 (6%) • Resources (people) "McDonald's approach” as McDonald's has thousands of restaurants in all over the world. $6...072 (35% of total company revenues) United States ..2 million with an average margin of 6%-8%. McDonald's revenues by geographic segment in 2005       Europe . or is that the fault of the customer who drops it. $7....815 (14%) Latin America . What environmental effect does the production and disposal of all this? Are they responsible for litter on the streets.. used for just a few minutes before being discarded.. the corporate savings is significant when multiplied by all the sites worldwide. $948 (5%) Other .. .. and each one is essentially the same. 1) Internal environmental analysis • Resources (Capital) McDonald’s average franchise has yearly revenues of $2.. $1. $1. $2.955 (34%) Australia/Asia-Pacific .. If employees in one location find a way to make their processes more efficient that can save even a small amount of money.Issues against McDonalds are such as they annually produce over a million tons of packaging.

or "on-the-job" training or classroom-based training sessions. • Product Development McDonald is developing its products by taking customer in confidence through  Healthier Foods  Food Quality and Nutrition  Larger Menus  Kids • Training Welcome Meetings are the first stage of training that also set out the company's standards. including workshop designed to help managers that they have full advantage of what everybody brings & also want to ensure that people at all levels of McDonald’s bring their energy and creativity into the work environment. The majority of training is floor based. McDonald’s offers its mangers the solid diversity training program.That is the beauty of common processes as Blakeslee explains. Training competencies are also extend to McDonald’s QUALITY MANGEMNT programs. • Organizational structure and culture Cultural Differences Offers managers solid diversity training. McDonald’s also has its own “HAMBURGER UNIVERSITY”."When you consolidate everything. you begin to leverage resources". .

family size. Customer Segmentation and Market Analysis • CUSTOMER SEGMENTATION There is no single way to segment a market. Different segmentation variables have to be tried. marital status.• System and processes Employees are the key ingredient in any organization that’s play a vital role each day in shaping our over all image through their performance. and psychographic. to find the variables that most accurately reflect the market’s structure (who will/will not buy). • Demographic Segmentation: “It is based on age. By realizing our people strength we provide the best employment experience to our employees in order to achieve the goal of giving the world’s best quickservice restaurant experience to our valued customers by using latest technology. geographic segmentation. . sex. The segmentation of McDonald outlets and its products is base on demographic segmentation.

occupation. There is wide band of their loyal customers. Pindi. 1020k. People of different areas in a city can get the same quality and price from different sales outlets. religion. In Pakistan. education. Most of the deals offer in McDonald are according to normal family size of four or five. As in Lahore.per sq Km). Multan etc. population density (rural- suburbanUrban). community size (under 5k. climate. They have more then one outlet in single city.” The offerings are according to the lifestyle and social classes of people.” The marketers have done segmentation on demographic basis. The taste and quality is according to the people of region in which it is offered.” There are at least 31. Islamabad.. Nationality…. students. for small parties and celebrations… • Geographic segmentation “State or regional. race. it is economically reasonable for upper middle class and also for upper class families. distance from a point. so it is best match for their style.000 McDonald can be found in 120 countries and territories around the world serving nearly 54 million customers each day. like in Lahore. 5-10k. . on geographic bases marketers have targeted big cities.. Like in Lahore.Income. or opinion of a product. • Psychographic segmentation “Segmentation on the basis of the market’s Knowledge of. there is trend of eating out. Karachi. attitude to.. Besides these deals it also offers different meals fit for youngsters.

by correctly analysing. this is the main business strategy that makes it one of the most successful international fast food chains.• MARKET ANALYSIS “Ask an experienced marketer what will determine the success or failure of a promotion and they’ll often quote an age old industry rule: 70% audience. In United States they expand their business introducing product variety and renovation in the already opened restaurant instead of opening new restaurant. due to increase in demands. In Pakistan they are opening their outlets in more cities. They offer the host country’s culture rather imposing their home country’s culture there. and segmenting your customer database to ensure that the right offer reaches the right people. Or. Their market in Asia as well as in Pakistan is growing rapidly. . you have a 90% chance of success before you even start work on the creative. to express it another way. 10% creativity. 20 % offer.” Since 2003 McDonald is practicing two types of strategies to maintain with rapid change comes in consumer preference as well as coping with changes in demographic and spending styles. Whereas in Asia they expand their business by exploring new markets.

000 restaurants in more than 80 countries around the world. PepsiCo acquired KFC in 1986 along with Pizza Hut and Taco Bell shortly after. KFC had established 2.450 franchises and 600 company-owned restaurants in48 countries.• Competitor Analysis The emergence of food chain has pressured industry participants to continually add features and cut prices. KFC was stabilized in the US and the owners turned their focus to international markets. By 1971. Following are the major McDonald’s hamburger’s Competitors. It has to continuously update the business strategies to compete with young new comers. Today KFC is severing about 8 million customers globally. They have more than 11. Although McDonald’s is a market leader in its food and beverages industry but it is now facing tough competition from the new entrants. • KFC In the late 1960s. KFC is biggest competitor of McDonald in chain of fast food. .

STRENGTHS By strength we mean internal potential of company. • YUM!brands YUM!brands Includes KFC. . Inc. Although as compared to McDonald’s it has more number of franchised restaurants but revenues are low due to McDonald’s big size. It serves as a biggest competitor while entering into the china market. While evaluating strengths of McDonald’s we will deal with company’s micro environment. • SWOT Analysis SWOT analysis is the main ingredient of management as well as marketing functional analysis. Then in 2002 Tricon acquired Long John Silver and A&W All-American Food Restaurants where they. Pizza Hut. YUM! Has splits its resources into variety of brands generating high revenue. China market is dominated by YUM! brands.• Pizza Hut PepsiCo decided to spin off two restaurants into an independent. Inc. Taco Bell. weakness (S) and prevailing opportunities (O) and threats (T) in the company’s competitive environment. While McDonald’s run its business under one flag. shortly after. and Long John Silver’s American Food Restaurants. changed their Tricon name to Yum! Brands. McDonald’s micro environment is consisting of the following elements. publicly held company called Tricon Global Restaurants. Now we will conduct McDonald’s SWOT analysis in Pakistan. It is process of overall evaluation of company’s strengths (S).

IT IS A NUMBER BRAND OF THE HALF OF THE WORLD. WEAKNESS . CUSTOMERS ARE AMUSED BY THEIR CLEANINGS. They believe that to build strong employee-customer relationship they have to keep their employee satisfied and happy with different incentives other than pay roll. To fulfill customers expectation when they walk in their franchise becomes their strongest marketing element in Pakistan.1234- Image Full filling Customer’s Expectation Innovation Human Resource Satisfaction IMAGE MCDONALD’S IS THE FASTEST GROWING FOOD CHAIN OF THE WORLD. People get used to of experiencing new taste and variety HUMAN RESOURCE SATISFACTION They give importance to the employees’ satisfaction. INNOVATION McDonald’s keeps on bringing innovation with quality in its products. FULL FILLING CUSTOMER’S EXPECTATION Another greatest strength of McDonald’s is its product value. IT HAS CREATED A POSITIVE STRONG IMAGE IN ITS CUSTOMER MINDS. HIGH SPEED SERVICE DELIVERY AND CUSTOMER FRIENDLY ATTITUDE.

Customer trends c. This over exposure may become boring for certain class of people in Pakistan. Following diagram shows that company’s external environment . Over exposure b. This over exposure induce customer to move on to something new which is not as crowdie as McDonald’s. you can find its outlets everywhere in in big cities of Pakistan. External Environment OVER EXPOSURE People of Pakistan always want something new or that is different from others. when customer sees no further advancement or innovation in company’s product they move on to some other brand.By weakness we mean prevailing internal system weakness of the company and negative factors in environment that affect badly the company’s core business. CUSTOMER TRENDS Customer trends changes rapidly. a. McDonald’s has lost the element of uniqueness by opening so much franchise. But in McDonald’s scenario. EXTERNAL ENVIRONMENT Threats and opportunities prevail in any company’s external environment.

As the market is very saturated so it is hard to grow more with the same product line. Politics: politics plays vital role in effecting organization repute. Another threat would be lack of growth opportunities available. OPPORTUNITIES: There are a lot of unexplored market niche available in Pakistan. .• • • Technology. Law: every organization need to work under state regulation. Earlier they used kids as their brand ambassadors. Marketing objectives Some of the marketing objectives are as follows: • To make reasonable profit. Another concern can be a treat which is of health conscious people who thinks McDonald’s products make them fatty. no one can work beyond the legal boundaries of business limited by state legal authority THREATS With so much franchise dealers a threat of bond collapse exist. They should expand their target market by targeting health conscious adults. technology works as a benchmark for organization success. men and women. All they need to do proper marketing of their product.

To make at least 20% profit every year and keep on improving the sales and percentage of profit in preceding0 years. McDonalds has a wide distribution network retailer and Franchise system through out many countries.• • • McDonald’s main objective is to provide quality-oriented food and high customer satisfaction. General Marketing Strategy .

10.  Population – Over 170 million • Psychological factor:  Occupation – Executives.and above Gender – Male and Female • Geographic factor:  Country – Pakistan  City – Karachi. Social workers. Income – Rs.TARGET MARKET Demographic Factor: • • • • Age – from 18-50 Years Social Class – Middle. Lahore.000/. Students. Islamabad etc.  Profession--. MARKETING STRATEGY .Cooks. Hotel Managers. Delivery Services. Upper middle & Upper Class.

it also has psychological connotations for the customer. and will continue to do so. Product: Price must match the customers' idea of what the product is worth.The marketing mix is the combination of price. This means also the profit margin has been reduced without increasing the sales. Some of McDonald’s options are growing in popularity while arguably the Big Mac is at the ‘maturity’ stage. promotion and place that successfully markets a product to focus of McDonalds. Care is taken not to adversely affect the sales of an existing option by introducing a new option which will cannibalize its sales. McDonald’s has introduced new products and phased out old ones over time. The danger of using low price as a marketing tool is that the customer may feel that a low price is indicative of compromised quality. A product is more than a physical item. The important thing to remember when offering menu items to potential customers is that there is a huge amount of choice available to those potential customers with regard to how and where they spend their money. 1. product. 3. Promotions: .But the Price of McDonalds is high enough that a person feels free to purchase the quality by paying extra as goodwill. Price: Customers draw their own mental picture of what a product is worth. 2. Therefore McDonald’s places considerable emphasis on developing a menu which customers want.

One of the methods employed by McDonalds is advertising accompanied by the sales promotion and also by delivering the brochures to the consumers who came for purchase. PROMOTIONAL OBJECTIVES .The promotions aspect of the marketing mix covers all types of marketing communications.

To develop a positive image of company. To enhance the brand name and proceeds sales. Bill boards etc. The Dawn. . Scotch print.• • • • To use push strategy. point of purchase and banners for introductory phase. PROMOTIONAL STRATEGY: Promotional Device: Magazines: Out Door Media: Websites. The News & Sunday Magazines. To design a promotional campaign in such effective manner so that consumer can switch over to use our brand from their present brand. PROMOTIONAL INCENTIVES: Consumer Distributor Deals of minimum costs More sales commission will be given to franchise.

but now it has turned into cash cows. Product Strategy ANALYZING CURRENT BUSINESS PRODUCT PORTFOLIO BCG MATRIX: Growth share matrix which is a planning method used for portfolio and company’s strategic business evaluation. Cash cows is that strategic business unit in which has low growth rate and but it is enjoying high business share or product. cash cows. . question marks or dogs. McDonald’s as a single business unit was a star that has high growth rate along with high market share. Strategic business units are classified as stars.DOOR-TO-DOOR SELLING: It is compulsory for all the franchises of McDonalds that they must give the free home delivery of their product with minimum time. McDonald’s Zinger Burger is an established fast food unit that now needs less investment to garb its market share as compared to other emerging business units. That’s Why McDonald and his some competitors have now large competition among services along with the primary objective of fast food selling.

RELATIVE SHARE High Low Growth of market Low High ? CASH COW Dog McDonald’s Zinger Burger .

I. salads. pulse. 1600 calories. desserts. Features. Fastest Delivery: McDonald’s run the fastest delivery system worldwide .  It is enough large to fulfill the need of a person in hunger with vegetables n chicken. Rice etc. And now as every country has its unique food like Pakistan has “Roti. Later on it established as a common food in USA. drinks and sandwiches variety. Some benefits of this burger are that  It has perfect calories that a normal person should get in a day. The McDonald’s core competencies which make it stand ahead among its competitors in industry:- McDonald’s Play Area: McDonald’s introduced the fun play area for kids. Now they should develop a product quality research and development to grab more market share. till now no competitor operate a play area up to its standards Product Variety: McDonald’s keeps on changing a bringing innovation in to burger.e.” same as USA has zinger burger as their common food and McDonalds introduced it in 1960s and now cashing it in different parts of world.Product Concept and History Zinger burger was first introduced in 16th century in Latin America. Functions. & Benefits The immense growth of McDonald’s makes it loose the quality of R&D and quality maintenance department.

adults and teenagers. The segments of the demography are. McDonald's has based its segmentation on demographic variables (this is why demographic forces are so important to monitor).Happy Meals for Children: toy with every happy meal is their unique features and attracts the children the most. Some of the sub-groups they market to are:  Children  Parents of Small Children  Teens  Business People (Free WiFi in some restaurants) Estimated annual Sales: Estimated profitability: Market Growth Rate: McDonald's Corporation reported a 23% increase in profit for the fourth quarter. age. Nationality. Most of the segments McDonald's targets are broken-down into age and lifestyle stage. McDonald's primary target markets are seniors. gender. family life-cycles. but the most heavily targeted segment is children. Generation. Income. . Race etc. A Target Market(s): McDonald's target market is every segment of the demography. this is probably because they are easily identifiable and consumer needs and wants vary closely with demographic variables. on strong global comparable sales growth driven by higher demand.

. up 23% from $0.22 billion.99 billion in the same quarter last year.McDonald's net income for the quarter was $1.

Pizza Hut. It has a lower operating margin that McDonald’s. Burger King Franchise revenues trail behind that of its competitor.COMPETITION Although McDonald's is the clear leader of the fast food industry in terms of revenues generated and restaurants established. and A&W All-American Food Restaurants. Yum! Brands are dominating the China market. Taco Bell. so it is likely to be more negatively impacted during a recession. Major direct competitors in the (hamburger-based) fast food industry include: Burger King Holdings is the second largest hamburger fast food chain. Long John Silver’s. it faces competition from other fast food chains. Wendy's is the third largest hamburger fast food chain. Currently. mainly due to the McDonald’s size advantage. posing a challenge to McDonald's attempts . Although more of Burger King’s restaurants are franchised than McDonald’s restaurants. Yum! Brands run Kentucky Fried Chicken. which are introducing new products themselves.

expanding menu options and extending store hours. and Latin America.S. Geographical Scope With over 32. While McDonald’s Corporation focuses on its flagship brand. Yum! splits its resources among a wide variety of restaurants. driven by a two-pronged strategy. particularly in emerging markets like China.have produced strong comparable sales and profit growth. At the same time. opting to franchise rather than operate its new locations. McDonald's operates its own restaurants and franchises its brand to local businesspeople (about 70% of the world's McDonald's restaurants are franchised. McDonald's focused on increasing sales at existing locations by renovating stores. The company experienced a dramatic turnaround in 2003. Domestically. international operations are driving profit growth.. McDonald's International Revenues Geographic Region Percent of Total Revenues US 35%[8] . In the U. sales have grown by a third since 2003.000 locations in over 110 countries. providing new income with little overhead.to enter the market. represents a massive opportunity for McDonald's. India. Internationally.despite its size.most notably at the 2008 Beijing Summer Olympics . McDonald's expanded aggressively. McDonald's aggressive efforts to expand its global presence . Both strategies have paid dividends . A growing global middle class. McDonald's continues to perform well despite a pullback in consumer spending and is even benefiting as consumers trade down from more expensive eating options. McDonald’s (NYSE: MCD) is the world's largest fast food restaurant chain.

• Competitive Products . They scanned through their preferences and select McDonald’s as a medium to suffice their need They have three options to get the desired product  Go in the nearby restaurant and order your meal eat there!  Take away your meal home by drive through option  Call and get your meal home delivered. with the fastest delivery system ever offered. Africa 8%[12 Consumer buying process: McDonald’s creates a frame work in peoples mind that McDonald’s is a place to get speedy and quality food to suffice the instant hunger. China. UK 21%[9] Rest of Europe 14%[10] Australia. the Middle East. Germany. Japan 8%[11] Rest of Asia.France.

or design. And the competitors of McDonald’s zinger burger are zinger burger of kfc..There are many products as a competitor of McDonald’s zinger burger. burger king.and what you stand for. yum burgers etc. Brand Strategy Brand: A name. sign. symbol. or a combination of these. • Direct Competitors Direct competitors of McDonalds are KFC. Importance: . just like KFC also a well established brand providing a healthy burger with a competitive price.. big daddy of kfc etc. What is brand? It’s who you are. intended to identify the goods or services of one seller or group of sellers and to differentiate them from those competitors. term.

As we have example of line extension. It also determines a set of associations and feelings. After eating both dishes he will feel that McDonalds dish was better than the other in taste. Branding Strategy: McDonalds use the line extension and brand extension strategies. Logo of McDonalds: It creates a clear identity in the consumer mind. when McDonalds introduces a new dish or deal for their customers. we have a very strong example here: If we take two dishes of McDonalds and give it to a same person to eat.A strong brand is a heart and soul of an organization. It is just due to brand name. no negative imagery which is important for making good impact. And example of brand extension. . easy to spell. And one is in McDonalds packing and other is simple packing. such as ice-cream. Brand name selection: McDonalds brand name is short and simple. when McDonalds introduces something new.

because it produces the good quality that support high prices.Pricing Price is the only one elements in marketing mix that produce revenue. all other elements represent cost. McDonald's spend over two billion d McDonald's argue that their . 1-skimming 2-Penetration McDonalds use the skimming strategy. when setting price: McDonald concentrate on value based pricing. McDonald concentrates factors. they also using the value adding prices.5% profit improvements”. by attaching a differentiate features and services. Integrated Marketing Communication plan 1-Advertising Activity: McDonalds advertises through print media in Pakistan and also use mass media in some other countries and also pay high cost for mass media advertising. There are two main types of setting price. According to expert ‘’1% price improvements generates a 12. they set the prices of their deals with buyer perceptions. they create beat image of their brand then set prices.

as noted on www. In fact. And sometimes they also offer. Which is very attractive for consumer and it is a tool for them by which they enhance their sales ratio. basant festivals. with more than 30. Events activities like consorts. place (distribution) determines where the product will be sold and how it will get there.000 local restaurants serving nearly 46 million people each day in 121 different countries.advertising is no worse than anyone else's and that they hold to all the advertising codes in each country. 3-Events activity: Time to time McDonalds held’s events activity in which they have stalls of their dishes. In the theory of the Marketing Mix. Approximately 80 percent of all McDonald's restaurants worldwide are owned and operated by independent franchisers.com. Distribution strategy The aim is to discuss McDonald's distribution channel and the way in which this fast-food restaurant chain gets its products to the market. buy one get one free. 2-Sales promotion activity: McDonalds use sales promotion activity by giving some toys for children along their special package deals.mcdonalds. . McDonald's is the leading global foodservice retailer.

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