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McDonalds

Marketing Strategy of McDonald’s
BusinessManagementMarketing

McDonald’s Marketing Strategy | McDonald’s Brand Power

by Shamsul February 4, 2021

 

McDonald’s Marketing Strategy

 

McDonald’s is a renowned fast-food chain and has a strong presence in 100+ countries. Its 80 percent outlets based on a contract model. With more than 36,000 stores globally, McDonald’s is capable to magnetize consumers and leading the fast-food industry. Even though they face stiff competition from their rivals that stagnant its growth, but they are still doing good. This success is due to an effective McDonald’s Marketing Strategy and understanding of changing consumer needs. They are very innovative in their offerings, taste, and supply chain network. Scroll down to find the marketing strategies of McDonald’s.

 

Marketing Strategy of McDonald’s (Segmentation, Targeting, and Positioning):

McDonald’s utilizes different segments such as psychographic, geographic, and demographic to market the products. Plus, they also understand the changing taste and needs of consumers of different nations and these marketing segments helped them a lot. The main target of McDonald’s is to identify the consumer evolving needs and requirements. This is due to the change in customer buying behavior, increase in income level, and consumption pattern. That’s why they target the customers of different regions to recognize their taste requirements. Its value-based positioning policy also helps them to evolve as a global brand. These are some major marketing strategies of McDonald’s. The main tagline of McDonald’s is ‘’I’m Lovin’ It’’. Its vision is to sell fresh and healthy products to customers with a positive attitude.

 

McDonald’s Marketing Strategy

Competitive Advantage:

The main competitive advantage that makes McDonald’s highly competitive over its rivals is supplier input process outputs customer (SIPOC). This thing helps the company to improve its service quality and taste. Its franchise-based model is also very successful and helps the company to earn more profits. Its Glo-cal policy is also proved beneficial for the success of the company. Moreover, its geographic and demographic strategy also assists the company to get the lead over its competitors. All these factors have contributed to the success of the company, that’s why it is a well-known fast-food chain across the world with a powerful consumer base.

 

McDonald’s Marketing Strategy

BCG Matrix in the Marketing Policy of McDonald’s:

Even though McDonald’s offers a huge variety of products, but its Hamburger, French Fries, and MacAloo Tikki are very famous among customers that’s why they fall in the star category. The non-menu and dessert are not so popular, that’s why it is a question mark on the strategy of McDonald’s. They are struggling to target customers in this segment so they need to improve this portfolio for better results.

 

McDonald’s Marketing Strategy

Distribution Strategy:

McDonald’s has various franchises and outlets in the world to fulfill the rising needs of the different customers and this thing helps them to compete in the competitive market. Its takeaways or drive-thru service is also very popular among users. Its McDrive feature is very popular in some countries. In order to target the young customers, they set up Macafee which is based on a café format where you can enjoy an outing with your friends. They also owned quality centers in different locations and its supply chain network is also very effective because of the involvement of third-party logistics. These companies ensure the availability of products in specific outlets and franchises so that consumers can enjoy their meals without any interruption. There are several types of set-ups that play an important role in the success of the distribution strategy practiced by McDonald’s.

 

McDonald’s Marketing Strategy

Brand Equity:

McDonald’s branding strategy is very powerful and they sponsor different popular entities such as the Olympics and FIFA. These entities helped the company to create its visibility and footprint globally. In addition, they also use different marketing channels to promote their offerings and brand that also help the company to generate revenues and profits. In 2014, McDonald’s has been mentioned in Forbes 500 companies. All these branding and marketing strategies boost the company’s image and reputation in the competitive environment.

 

McDonald’s Marketing Strategy

Competitive Analysis:

Several fast-food companies are giving severe competition. McDonald’s focused marketing policies that highlight its offerings, taste, health benefits, menu, and other nutritional advantages help the company to sustain its position and image. Thus, this kind of branding helps them to fight with competitors in terms of market reach, market share, profitability, and popularity.

 

McDonald’s Marketing Strategy

Market Analysis:

As we know that, the fast-food industry is loaded with multinational companies and local food points. These companies trying to threaten the market shares of each other and also can affect the profitability of McDonald’s. The main competitors or heavyweights in this industry are KFC, Dominos, Subway, and many more. It is really important for McDonald’s to introduce innovation in its offerings to reduce the risk of market loss.

 

McDonald’s Marketing Strategy

Customer Analysis:

McDonald’s have strong consumer base; however, its customer based on young people mostly. They love to do parties and outings in McDonald’s outlets with their family, friends, or loved ones. McDonald’s has a big opportunity to attract more young people by diversifying their portfolio. They can also target schools and college students in order to increase their revenue game.

 

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February 4, 2021 21 comments
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SWOT Analysis of McDonald's
BusinessManagementMarketingSWOT & PESTLE Writing

McDonald’s SWOT || SWOT Analysis of McDonalds

by Shamsul November 17, 2020

 

McDonald’s SWOT || SWOT Analysis of McDonald’s

 

McDonald’s is a renowned fast-food chain in the world. This American-based brand was established in 1940 by Maurice and Richard. After a few years, it was transformed into a quick-growing fast-food chain. Today, McDonald’s is operating with thousands of outlets across the world. It is also considered the biggest provider of toys because they give striking toys with every meal. In this editorial, we will talk about McDonald’s SWOT (strengths, weaknesses, opportunities, and threats). In this way, you can understand its working and competitive advantages. Let’s begin.

 

Company Name: McDonald’s

Founded by: Maurice and Richard McDonald

 CEO:  Chris Kempczinski (Nov 4, 2019–)

 Year established:  April 15, 1955, San Bernardino, California, United States

 Headquarter:  Chicago, Illinois, United States

Industry: Fast food restaurant

Products: Hamburgers | Chicken Coffee | French fries | Breakfast | Soft drinks | Salads | Desserts | Milkshakes | Pancake | Wraps

Number of location: (2019) 38,695 restaurants

Served Area: Worldwide

Number of Employees (2019):  205,000

Type: Public

Annual Revenue (2019): US$ 21.08 Billion

Profit (Net income) (2019): US$ 6.00 Billion

 

Subsidiaries: McCafé, McDonald’s France, McDonald’s Canada, MORE

 

Products & Services:   Coffee | Handcrafted Beverages | Fresh food | Non-food items | Packed foods | Mugs and accessories | Gifts

 

McDonald’s SWOT | SWOT Analysis of McDonald’s

Strengths of McDonald’s:

 

To understand the strengths of McDonald’s, you need to look at some factors that ensured the company’s development and success.

  • Most Effective Brand:

McDonald’s holds a prominent position in the world’s ten valuable fast-food brands. That’s why it is among the most favorite and profitable brands in the world. This thing has increased its brand worth and reputation.

  • Delicious Food:

The main strength of McDonald’s is its delicious and high-quality products. Its French fries are one of the tastiest fries in the food industry.

  • Real Estate Company:

Most people don’t know about McDonald’s real estate business. They offer not only fast food but also premium locations around the world. It has a total of 37855 outlets in 120 nations. 35085 are franchises and the remaining are corporation-operated restaurants. Their working style is slightly different from other companies as they won’t provide their name, recipes, ingredients, and act as a landlord when they work in the form of a franchise.

  • Innovative Steps:

McDonald’s is investing in technology in order to meet with future aspects. They also introduce self-service with kiosks and phone orders. These kinds of services are very advantageous for McDonald’s.

  • Technology Acquirements:

McDonald’s recent acquirement of Dynamic Field is a new step to technological advancement. This acquisition helps McDonald’s to enhance their consumer experience with personalized offerings.

  • Maximum Brand Worth:

In 2018, the total brand worth of McDonald’s was 126 billion dollars. This figure was very insane and no one was even closer to this figure. With this statistic, it is the major strength of McDonald’s in the fast-food industry.

  • Enhanced Health Practices and Quality Control:

As we talk about the quality and taste of McDonald’s products, but its quality measures are its major strength point. The company ensures full safety measures and quality control before purchasing ingredients from the third-party. They also decrease the use of antibiotics that are harmful to users. This strategy is appreciated by users and health experts.

  • Leading QSR (Quick-Service Restaurant):

McDonald’s is also considered as QSR (Quick-Service Restaurants) in the US. They also lead the chart in this matter with 38 billion dollars.

 

McDonald’s SWOT | SWOT Analysis of McDonald’s

Weaknesses of McDonald’s:

 

To understand the weaknesses or shortcomings of McDonald’s, we have mentioned some important factors as the following:

  • Franchising Model:

As we know, McDonald’s has the best worldwide franchising mode. But with a wide range of franchising, this thing also causes some specific risks. These risks are mismanagement, consumer dissatisfaction, and financial disability. The heavy dependence on the franchise model can affect the brand name and fan-following.

  • Supply Chain Disruptions:

McDonald’s is one of the leading and busiest food brands in the world. But it also faces supply chain issues and interruptions. This thing can cause the unavailability of the products that are dangerous for its working and operations. This thing can lead to a decrease in the company’s revenue and profitability.

  • Lack of Worker Happiness:

In recent times, McDonald’s has experienced severe criticism from its workers. They were demanding in the increment of their wages. These protests and backlash damaged the company’s repute.

  • Loss of Breakfast Menu Charm:

It is a fact that the company’s breakfast sales were unbeatable in 2018. But after that, the company reported a massive fall down in their breakfast sales. This is due to the stiff competition from the competitors as they provide better products and services.

  • CEO Got Fired:

1n 2019, Steve Easterbrook was got fired from the CEO seat due to a consensual relationship with a worker. As it is a violation of the company’s policy, but it affects the brand name.

 

McDonald’s SWOT | SWOT Analysis of McDonald’s

Opportunities for McDonald’s:

 

In this section, you will learn about the changes and opportunities of McDonald’s. These factors really help the brand to enhance its working, performance, and growth structure.

  • Affordable Deals:

McDonald’s introduced its 1,2, and 3 dollar deal in 2018 which was appreciated by the customers. These deals are worth-conscious and resulting in the sales and revenues of McDonald’s.

  • New Products:

McDonald’s should focus on further technological advancement and innovative products. They need to introduce new products and items on their menu to attract customers instead of establishing new restaurants or outlets. McDonald’s was also served exclusive beverages to their customers in 2018 which is quite interesting and valuable for users. This thing goes viral and resulting in more profits for the company. They should continue this kind of deals and offers in different regions according to their cultural and geographical conditions.

  • Worldwide Extension:

McDonald’s is effectively working in all sectors of the US, but it faces difficulty in its international operations. In addition, it has the ability to grow its working and outlets in different regions of the world. These markets can be useful for McDonald’s in terms of market share and profits.

  • Reconstructing The Brand Reputation:

As most people are following a healthy lifestyle and reducing the consumption of junk food, but McDonald’s can use this for its favor by providing customized and healthy products to their loyal customers.

  • McDelivery and Online Orders:

McDonald’s is working with UberEats and Door dash to provide online delivery in the US. This kind of approach can increase its sales and reach every corner of the world.

 

McDonald’s SWOT | SWOT Analysis of McDonald’s

Threats of McDonald’s:

 

In this sector, we will discuss McDonald’s competitors and threats that can decrease its brand worth and profitability. That’s why it is imperative to tackle these threats.

  • Uncertain Ventures on Technology Programs:

Technological advancement has proven beneficial for McDonald’s, but this kind of investment in innovation can be risky. As most people don’t have enough resources to use these advanced features, then it can cause a big threat to McDonald’s to lose its profit game.

  • Severe Competition From Rivals:

There are several competitors of McDonald’s such as Burger King, KFC, Subway, and many more. But the biggest rival of McDonald’s is Check-fil-A in QSR (Quick-Service Restaurant) area.

  • Cultural Threat:

McDonald’s is a famous worldwide fast-food chain, but there’s always a chance to face cultural threats from different regions which can damage the brand name. For example, McDonald’s experienced huge backlash from various Muslim countries for using ‘’haram’’ ingredients in their products. These controversies and scandals are not beneficial for the company at all.

  • Modern Fast Food Trends:

McDonald’s is still considered outdated in its products and menu. They tried to follow and compete with the latest trends but this thing didn’t work for them. That’s why they are still struggling in this matter.

  • Invariable Environmental Worries:

McDonald’s also facing severe pressure to enhance its working and nature-friendly environment. They also faced criticism from environmental activists over the use of plastic bottles and straws.

 

Conclusion:

McDonald’s is one of the leading fast-food brands in the industry. It has loyal customers and fan-following locally and internationally. But they need to look at several other factors to boost their operations and working as we mention above.

 

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