The Fast Food Industry
The American fast food business has in the past recorded unprecedented growth rates, with some of the most successful chains such as MacDonald’s, Burger King, Dairy Queen, and MacDonald dominating the marketing. This has seen a cut throat competition with every business implementing strategies to outweigh their competitors. Most of the fast food stores sell almost the same products, with MacDonald selling burgers, sandwiches, snacks, beverages and meal bundles consisting of bacon and sausage Mcmufin. Burger King also sells chicken sandwiches, shakes, smoothies, salad bars, and salads. These are the mainstream products, compared to dairy queen, which has included drinks and buttercup pies. W&A, on the other hand, offers hot dogs, sweets, chicken and beer to its customers.
MacDonald Marketing Strategy
MacDonald is a multinational chain of restaurants leading in food service, purely in the fast food segment. It serves nearly seventy million people, distributed across its 118 stores in more than 100 countries in which it operates in. The company boasts of over 90% turnover rate, in its 36,000 restaurants all over the world. It operates a franchise model of business, of which more than 70% of its stores are franchised. The company’s aim is to create space in order to treat and serve its customers in a unique way. This has increased the revenues over the years, with the company achieving steady growth rates in income. The company achieved an overall net income of $5.59 billion in 2013, showing consistency in the past three years, with strong accounting trends. MacDonald as a company started its operations 70 years ago. During this period, the company has implemented marketing strategies and best prices which have sustained its branch network of restaurants. Marketing being key in every business, is defined as the creation, distribution, promotion and pricing of products and services in order to establish and to develop satisfying relationships with stakeholders, in a dynamic environment (Pride & Ferrell, 2011). MacDonald’s, for instance, has an objective in meeting both short-term of long-term marketing goals by implementing marketing strategies through employing a marketing mix aimed at luring and sustaining their customers.
Product
MacDonald takes keen interest in developing and maintaining an attractive product menu, by offering the most attractive products and substituting their products as days go by as established after analyzing customer preferences. To add, the company also uses a homogenous look in its entire restaurants. This acts as a form of product strategy, which aims to satisfy the regulatory requirements hence ensuring high standards of hygiene. The company distinguishes itself in producing burgers, with its main ingredients being kenchup, beef and spice, added during seasoning.
Price
The company also uses psychological connotation on product prices through establishing best prices on products. This helps it to minimize costs, and at the same time add value to consumers. Macdonald also positions itself as a fast food business that offers lowly priced, as well standardized products of high quality, in its restaurants. It commonly offers prices in its menu, less a dollar to retain price sensitive customers. The company, on the other hand, also uses bundled pricing strategy, as well as psychological pricing techniques, to enable it penetrate its products more on certain target markets such as the middle-income class. This strategy has paid off in sensitive menu items such as breakfast. The company uses super cheap menu items, compared to what its competitors like Burger King offers in the market. The company prices its cheese burger at 3.29 Canadian dollars, which is relatively higher, compared to the US$. In its pricing strategy, the company gains $1 for every four dollars they sell, particularly the burgers.
Promotion
The company also uses promotional program such as chocolate offers to lure more. Apart from that, the company carries out other promotional activities on mainstream TV, cinema
venues, and its website in order to pass more information concerning its products. Apart from this, the company relies also on celebrity endorsement, and other more rigorous promotional activities, mostly as a strategy of appealing and tapping the younger generation associated with celebrities. The promotional efforts employed by the firm also enhance brand awareness, by fighting any negative publicity that might exist in the minds of customers, thereby being multi-facet and effective strategy. The company also uses personal selling, and the most common method applied in most of its stores, public relations, and direct marketing. In personal selling, the company employees get involved in personal interaction with customers, through which in the process, a cordial relationship is established with customers. This method is strategic and contributes to growth in client base as it makes the firm adjust to customer preferences as established hence luring more customers. The company uses public relations as a tool to address pertinent and sensitive issues concerning the brand. This is used in the day to day operations, by responding to customer's queries and enhancing understanding in cases where customers doubt a product, a common practice in business. While these strategies play a greater role, the company also uses direct marketing in its operations. This involves marketing over the phone, mails and within the online platform. It employs such efforts in through home delivery, by which company directly handles home deliveries.
Place
This strategy has helped the company successfully, by helping it abide with changing dynamic demands of the business environment. Apart from this, the company heavily relies on product quality control as another strategy. This helps it to maintain a high degree of standard that captivates its customers, through offering products of high quality. These efforts enable the company to penetrate a variety of areas with varying cultural norms. Target Market The company uses strategies in its target market, mostly being children under the age of 14 and their parents. This is made possible through strategic distribution effort that the company employs. The company uses direct distribution strategies to help take products to their customers. As the company implements such strategies, it also negotiates with co-partners on certain branding efforts. In this, the company has teamed up with several brands such as, coca cola and Walt Disney.
This strategy helps in luring other clients who may be influenced with such partnerships, and may feel to be associated with the products.
Packaging and Branding Another aspect in MacDonald’s strategy is packaging. Packaging is the safe delivery of the product to the consumer in sound condition at the most optimum cost (Coles & Kirwan, 2011). The company uses attractive packaging, in conjunction with Kraft foods to sell packed coffee across its restaurants. On the other hand, their packaging styles used in French fry packaging also attracts more customers to its products, hence increasing the customer base. The company uses packaging boxes also to ensure the products are delivered safely to various locations. This ensures product quality, which also works as a brand penetration strategy.
Distribution and Distribution strategy This is the distribution strategy in which products are moved by a sales force directly by selling products to a customer base (Rolnicki, 1998). This is well backed by warehouses that are situated on strategic locations, with delivery trucks feeding these units with products for the stores. On the other hand, the firm operates a standardized supply chain network, which is lean and incorporates producers, suppliers and processors who help the company in processing some of the raw materials, such as potato which the company uses to make some of its products. The supply chain helps in logistical supply of raw materials until they are converted to finished products, and stored in most restaurants across the country. Through such a strategy, the company delivers fresh content to its stores, without straining its supply chain system. MacDonald’s has achieved stable growth over the years, due to well laid down strategic efforts. This has placed the company at the top of the fast food businesses. Most of the competing brands continue to lag behind, the company’s strategies continue to bear fruits, allowing it to be in the forefront in the fast food industry.
SWOT analysis
Strengths
- Strong Brand visibility
- Strong workforce
Weaknesses
- Fluctuations in profits eating overall earning due to its pricing.
- Customers changing preferences towards organics and fats.
Opportunities
- Expansion to other places including countries
- Growth of the fast food industry.
Threats
- Media coverage towards obesity affecting its outlook
References
Coles, R., & Kirwan, M. (2011). Food and beverage packaging technology. Oxford: Wiley-Blackwell.
Pride, W. M., & Ferrell, O. C. (2011). Marketing express. Mason, Oh: South-Western Cengage Learning.
Rolnicki, K. (1998). Managing channels of distribution. New York: AMACOM.
