Mc donalds danielaschmirler

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  • Thanks for the link. What I also remember is that McDonald's intended to get more 'Green Restaurants'. The company already has got a prototype of one environmental friendly restaurant. You can find more information on the following link: http://www.environmentalleader.com/2009/04/08/mcdonalds-green-restaurant-uses-25-percent-less-energy/
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  • Great work! I just read an interesting piece about McDonalds current branding efforts related to restaurant design: http://www.fastcompany.com/magazine/149/super-style-me.html?page=0%2C1 Thomas
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  • Thanks for your feedback! Yes, this diagram really is big. But I just wanted to show the 'listeners' where the company's image is positioned in theory and wanted to combine it with the pracitcal example! Maybe I should have divided it intow two slides.
    Oh thank you, I am really interested in this field of marketing so if you need help at anytime feel free to contact be (but do not forget, I am just a student and do not have a lot of experience). But anyway, if I am able to help you, I would be glad to do it ;)

    And Charlie, you brought up an intersting point! I just mentioned that the image in fields of health does not fit to the company's wishes. This topic about Happy Meals, I did not know about it. Maybe because I am from Germany and there are fruits in happy meals. But this is an intersting point. Especially because Happy Meal is for children. There, even more, it is important to offer healthy things to protect our children. Word of mouth can have a strong postive but also negative impact and maybe McDonald's has to more concentrate on this field in order to create an overall coherent image.

    Daniela
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  • Daniela, you did an outstanding job on your marketing strategy analysis presentation. Your research covered virtually all the points required. I'm not a marketing major, but it looks as though you may be. I especially liked your Vision and Goals and Strategic Plan diagrams. They were easy to follow and concise. I'm quite jealous as I know my presentation is no where near the quality yours is.

    Though the 3.2 Positive Image diagram had a lot of data, with the space constraints I know it was probably hard for you to position all the information on one slide. One of my slides was hard to read, as well. Charlie brought a good suggestion about the Happy Meals ban, but I don't know how publicized this bit of news was across the country. Here in the San Francisco Bay Area it was big news. All in all, I thought your presentation was very well done. P.S. do you tutor? :o)

    -- F. Ming
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  • Daniela, well done! You did great research on this and the presentation was very detailed with graphs to help easily explain concepts, including aspects of marketing discussed in class; very thorough.

    One thing I think you could have covered more is the impact of negative word of mouth or publicity on image or sales, such as the recent banning in San Francisco of Happy Meals with over 600 calories and requiring fruits and vegetables.

    -Charlie Chai
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Mc donalds danielaschmirler

  1. 1. “I’m lovin’ it!” – Critical evaluation of McDonald’s marketing strategy By Daniela Schmirler – Marketing Strategy for Managers – Dr. Kohler
  2. 2. Executive Summary McDonald‘s as one of the largest fast food chains in the world, additionally is a strong brand. Nowadays, almost everyone worldwide knows about McDonald’s or has at least heard about it. So why is McDonald’s that successful? One factor is its overall marketing strategy. The company raised strong brand awareness and always seems to be one step ahead in comparison to its competitors. Furthermore, McDonald’s was able to create a strong brand by using franchising as a business model and creating a marketing strategy that is superior to its competitors. This presentation should give an overview of McDonald’s, its marketing strategy, and the seven years running campaign “I’m loving it”. This successful campaign runs since 2003 and always orientates on new trends. McDonald’s tries to combine community issues (Corporate Social Responsibility) with its overall communication. By providing different topics, and being modern, funny, and innovative, McDonald’s is able to create high brand awareness. Furthermore, there will be a short overlook of its two main competitors Burger King and Pizza Hut (which is part of the umbrella brand Yum!). In comparison to McDonald’s these two companies lack in their overall marketing strategy. By contrary, McDonald’s always seems to be one step ahead, and also having always the right topics included. But, what has to be mentioned is that there are also differences concerning the companies’ target groups and overall appearance (e.g. Burger Kind tries to attract men, Pizza Hut is for all, and McDonald’s attracts families, children, young urban, and recently also older people). Lastly, there will be an evaluation of McDonald’s marketing strategy and measurements of success, which will lead to an overall conclusion by developing principles for marketing. The company is successful in comparison to its competition, which is shown in fitting brand associations, numbers, and its competitive advantage, but McDonald’s has to react in order to stay competitive. Finally, all this leads to several principles for successful marketing. But although these principles are success factors for McDonald’s it will never be sure that they will also work for other countries. They more are some kind of framework.
  3. 3. Agenda 1. Facts about McDonald’s 2. Marketing strategy McDonald‘s 2.1 Vision and goals 2.2 Segmentation and positioning 2.3 Marketing mix 2.4 Strategic Plan: “Plan to win” 2.5 Current campaign: I‘m loving it 2.6 Competitor Analysis 3. Measures of success and recommendation 3.1 Competitive Advantage 3.2 Positive Image 3.3 Numbers 3.4 Downside: Current decline 3.5 Recommendations 4. Principles for marketing analysis
  4. 4. 1. FACTS ABOUT MCDONALD‘S Business model Numbers
  5. 5. 1. Presenting the company  Fast food chain, known by almost every citizen of the world  Founded in 1948 by Dick and Mac McDonald in San Bernadino  Today, more than 31,000 restaurants worldwide  Business model – Franchise system (15% of restaurants owned by company) – Product consistency (products are similar all over the world) – “Act like a retailer - think like a brand” (long term brand reputation is important for the company
  6. 6. 2. MARKETING STRATEGY OF MCDONALD‘S Vision and goals Segmentation and positioning Marketing mix Strategic Plan: “Plan to win” Current campaign: I‘m loving it Competitor Analysis
  7. 7. 2.1 Vision and goals of McDonald’s Vision and goals Place the customer experience at the core of organization Commitment to people and customers Operate the business ethically Giving back to communities Strive continually to improve
  8. 8. 2.2 Segmentation and positioning  Main target segment: young urban family, youth, and children – Concentrates on environment for children (playing grounds) – But also tries to be modern and cool (for youth) – Keeps in mind price sensitivity of targets (low price)  New ways to address urban and young people – McCafé – Wi-Fi access – Modern marketing campaigns Demographic segmentation: according to age
  9. 9. 2.3 Marketing-mix: Think global, act local  Product: – Little product depth and width – Standardized products worldwide, but there are national different products to apply to the different customer wishes – Continuous innovation to adapt to changing preferences – Quality Assurance teams (monitoring restaurants, products, and suppliers)  Place: at the right place, at right time, in the right quantity – Especially in the USA: you need almost less than 3 Minutes to get to an McDonald’s restaurant – In almost all big cities, and important places (airports, shopping malls, etc.) – Restaurants: hygienic environment, good ambience, great services, and areas for children
  10. 10. 2.3 Marketing-mix  Price: Low price and value pricing – Attracts middle and lower class (also seen in consumer base) – Sort of “value pricing” (Happy meal) – Different prices in different countries (see table of Big Mac)  Promotion: Use of “Marketing Communication Mix” – Advertising: wide range in different countries (localization) – Personal selling: Employees at counter serve customers best – Public relations: tries to interact with customers, stays in media, community relations (addresses community problems: like “Ronald McDonald Houses”) – Direct Marketing: Person – Sales promotion: sport sponsoring (to get healthy image)
  11. 11. 2.3 Marketing-mix  People: Value of employees and customer – If employees are motivated and work well, customers will be satisfied – Internal Marketing: hiring, training, motivation – External Marketing: current campaign (I’m loving it) – Adaption to different laws, conditions in different countries to serve its employees best  Process: – Identical processes for food worldwide (even size of meat balls, or French fries) – Suppliers have to meet specifications to meet standards – Also point of purchase is standardized  Physicals: – Message worldwide: Family environment, cleanliness, and service
  12. 12. 2.4 Strategic Plan: “Plan to win” Service Marketing Brand Transparency Ethnic Insights Social Media Strategy Customer and supplier integration Different products for different life cycles McDonaldizing of suppliers “Moments of Truth”: each process of interaction between McDonald’s and customers Be transparent to get trust and influence marketing efforts Also concentration on minorities and differences. Can become trendsetters for white America Presence in social media to raise awareness Integrating in product development to create relationship, satisfaction, and loyalty To increase profits (e.g. French Fries at decline stage – Shake Fries (spicy) at maturity stage) To get a huge AND controlled network for guaranteeing McDonald’s standards
  13. 13. 2.5 Current campaign: I‘m loving it  Press releases: Many press releases about different topics (new campaigns, events, economical performance, job offers, awards, product information, health, engagement (environment, Ronald McDonald Houses, special offers). McDonald’s tries to be strongly present in the media to keep brand awareness  Annual report: About corporate strategy, business facts, jobs, franchise system, product origin, health, children’s donation, sports, employees. Seems to be very professional and transparent  Internet presence: about food, health, promotions, company, and links to different websites (e.g. CRM, children’s donation). Concentrates on McDonald’s engagement an health issues Public Relations:
  14. 14. 2.5 Current campaign: I‘m loving it Image campaigns  Several image campaigns  Main: I’m loving it (started in 2003)  Additional campaign: “corporate responsibility” (company’s engagement in community and other critical issues like environmental protection , which shows new trend of customer demands for responsible companies)  Seasonal campaigns: relate to special seasonal conditions (e.g. “Hüttngaudi” in Germany with skiing environment in winter)
  15. 15. 2.5 Current campaign: I‘m loving it Classical Advertising: Banners, clips, etc.  Different issues from campaigns  New: Animated spots, attracts gay men, “There is a McDonald’s for everyone”  Combines: (1) Responsible Citizen; (2) Health consciousness, (3) “We buy local”, (4) Families, (5) Be modern (Wi-Fi), (6) Be humorous, (7) Testimonials (e.g. Heidi Klum), (8) Promotion of products, (9) Including minorities (e.g. offers low prices for African-Americans & Hispanics) „We buy local“ banner Spot: Animated Spot: For everyone Spot: Gay customers
  16. 16. 2.5 Current campaign: I‘m loving it Product Placement  To raise brand awareness  1988 restaurant as setting for scene in “Mac and Me”  Movies like “Spider Man”, “Bridget Jones”, “The day the earth stood still”, “Spy Kids”, “The fifth element”  Other formats like “American Idol”, late night shows, reality shows, and even news formats (serious coffee cubs) “Mac and me” News format “The fifth element” Videogame
  17. 17. 2.5 Current campaign: I‘m loving it Sales Promotion  Games: additionally to campaigns, well-known “Monopoly”  Coupons: in newspapers, backside of cinema tickets Sponsoring  Many sports: Olympic games, German Football Association  Other events like Fashion Week New York  Local franchise companies: local clubs and events CONCLUSION Much information about community issues – McDonald‘s as a responsible citizen pared with funny and lovable company Continuously tries to raise brand awareness
  18. 18. 2.6 Competitor analysis Main rivals: Burger King, Pizza Hut (and many others like KFC, Denny, Wendy’s, etc.) – but also restaurants, supermarkets, etc. Positioning of the three main companies High value Low value High price Low price
  19. 19. 2.6 Competitor analysis Target group: family, youth, urban people Main topic: products Characteristic: fun . Media activity: little in comparison, reserved Corporate Responsibility: Umbrella brand Yum! but little activity and little information Target group: men Main topic: products Characteristics: Macho, playful Media activity: aggressive, more on mass channels Corporate Responsibility: Tries to follow McDonald‘s but is in its beginnings Target group: family, youth, children, urban, health conscious women Main topic: stories Characteristics: Mix of humor, responsibility, and children Media activity: strong, but not disturbing Corporate Responsibility: McDonald‘s as good citizen
  20. 20. 3. MEASUREMENTS OF SUCCESS AND RECOMMENDATION Competitive Advantage Image Numbers Current decline Recommendations
  21. 21. 3.1 Competitive Advantage Measurement of Competitive Advantage: Strength of McDonald’s  For people with little time to (fast, quality, clean, service for satisfied customers)  Strong in its structure, technology , marketing, and finance  No overexposure: Advertising stays fresh, modern, etc. Strengths Financial resources Market leadership Buyer supplier relation- ships Strong image Company logo and campaigns Product value Emphasis on HR to
  22. 22. 3.2 Positive Image Measurement of image: Fits to self-image except “healthy image” Brand Knowledge Brand Awareness Brand Awareness Easy Brand Recognition Easy Brand Recall Types of associations Favorable, strong, unique associations Attributes Benefits Evaluation (attitude) Non-product related (cheap, bags & boxes, families, fast food) Product-related (yellow & red, golden arch, Ronald McDonald) Functional (eat fast, save time, good food) Symbolic (smell of burgers and fries, childhood) Experiential (remember earlier times with families, fun with friends) (Shimp, 2008, p. 39) “loving it”, fast food, not that healthy, good, easy,
  23. 23. 3.3 Numbers Own design: http://businessmodelinstitute.com/wp- content/uploads/2010/05/Fast_Food_Industry_Market s.jpg http://brandautopsy.typepad.com/brandautopsy/images/sbux _adage_chain.jpg
  24. 24. 3.3 Numbers http://retailsails.com/2009/07/
  25. 25. 3.4 Downside: current decline There is current decline in sales and services  Customer trends and their decisions change  People could get tired of the same brands (people see McDonalds everywhere  If one restaurant lacks in its actions, it effects the whole brand  Difficulties in choosing target audience (kids, health conscious women and senior citizen comprise the major population but kids soon grow out to become adults)  Choice of distributors, wholesalers and jobbers is extremely important (to guarantee time aspect, quality, health standards, etc.)  Discussion about issue of gay men (conservative vs. progressive)
  26. 26. 3.5 Recommendations Should it stay with: I‘m Loving it?“ – yes!  People trust brand and know slogan  Change is expensive (e.g. for all countries and languages)  Only if market research shows new trends and demands of customers Adaptation to customer trends as another factor of success  Loyalty program  Customer integration  Social media  Direct marketing
  27. 27. 4. PRICIPLES FOR MARKETING ANALYSIS
  28. 28. Principles for marketing analysis This is just a framework! Ask Look at the long term Be open to feedback Look at competition Corporate Social Responsibility Be flexible and adapt to customer trends Integrate customers If you should do something new, or how you could improve your appearance Develop the right strategy for your brand Listen to complains and feedback – it can improve your brand, products, and performance Always be one step ahead by creating a USP Engagement in this field gets more and more important to also win customers Always watch out for new trends (e.g. use social communities, etc. if appropriate To create relationship, satisfaction, and loyalty. Even more, to get new insights Adapt to new customer trends To gain and win customers Do not overexposure Too much could lead to switch of customers Use networking Creating networks makes your “life” more easier (e.g. having right suppliers, big customers, etc.)
  29. 29. Bibliography  Burger King Corp (2008): Annual report  Burger King corporate Homepage (2010): http://www.bk.com  Helm, B. (2010): “Ethnic Marketing: McDonald’s Is Lovin’ it”, Business Week, online available at: http://www.businessweek.com/magazine/content/10_29/b4187022876832.htm [accessed 30 October 2010]  Hlavinka, K. (2010): Lovin‘ it, Journal of Marketing, Colloquy, online available at: http://www.cgarena.com/archives/news/mcdonald_campaign.php [accessed 29 October 2010]  http://www.marketingpower.com/ResourceLibrary/Pages/Content%20Partner%20Article%2 0Pages/COLLOQUY/2010/lovin_it.aspx [accessed 29 October 2010]  McDonald‘s corporate Homepage (2010): http://www.mcdonalds.com  McDonald‘s Corpt (2008): Annual report  Metekohv, M. (2009): “McDonald’s Social Media Marketing Strategy”, online available at: http://www.viralblog.com/social-media/mcdonalds-social-media-marketing-strategy/ [accessed 29 October 2010]  N.n. (2010): “New McDonald’s Campaign”, online available at  N.n (2009): ”There’s a McDonald’s for everyone”, online available at: http://www.funnycommercialsworld.com/mcdonalds-campaign-favourites-theres-a- mcdonalds-for-everyone-2367.html [accessed 30 October 2010]
  30. 30. Bibliography  N.n (2010): “Lovely McDonald’s campaign”, online available at: http://almostalwaysthinking.com/2010/10/14/lovely-mcdonalds-campaign/ [accessed 28 October 2010]  Peter, J. P., Donnelly, J. H.Jr. (2007): Marketing Management (8th ed.). New York: McGraw- Hill Irwin  Pizza Hut corporate Homepage (2010): http://pizzahut.com  Shimp, T.A. (2008): “Advertising Promotion, and other aspects of Integrated Marketing”, 8th edition, 2008  Sparks, I. (2010): “McDonald’s launches TV ad campaign targeting gay men”, Daily Mail, online available at: http://www.dailymail.co.uk/news/worldnews/article- 1283148/McDonalds-launches-TV-advertising-campaign-targeting-gay-men.html [accessed 29 October 2010]  Tice, C. (2010): “Why McDonald’s New “We-buy-local” ad campaign could backfire, online available at: http://www.bnet.com/blog/retail-stores/why-mcdonald-8217s-new-8220we- buy-local-8221-ad-campaign-could-backfire/932 [accessed 29 October 2010]  Vignali, C. (2010): McDonald‘s: Think global, act local – the marketing mix“, British Food Journal, Volume 103, Nr. 2, 2001, pp. 97-111  York, E. B. (2010): “McDonald’s unveils “I’m Lovin’ it 2.0”, online available at: http://adage.com/article?article_id=143453 [accessed 28 October 2010]  Yum Corp. (2008): Annual report

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