Integrated Marketing Management
Integrated Marketing Management
Integrated Marketing Management
McDonalds Case Study Introduction about the fast food chain and its product
Evaluation of the market condition
The fast food industry has been around for decades. In the United States, fast food chains have been in operation for over a century. The growth of fast food chains has been necessitated by the changes in lifestyles as more modern lifestyles have turned to fast foods as it is more convenient to their lifestyles.McDonalds, for instance, was founded in 1940. The basic fast food chain industry structure and operations had been popularized two decades earlier by the White Castle fast food chain company. The company was initially started as a restaurant that specialized in barbecue by the McDonalds brothers. Ray Kroc, a businessman, however, was responsible for the growth of the McDonalds food chain industry to the rest of the world. His aggressive marketing and expansion methods saw the fast food chain company expand to other states and to the rest of the world. Over seven decades later since the company’s foundation, McDonalds, is the second largest global private employer after Walmart stores. It has over 35, 000 store outlets worldwide as well as millions of employees. However, the McDonalds company does not own all the outlets. It operates the business through franchises. Franchising has enabled the company to expand fast through the world and has now established its branches and affiliates in 119 countries (Nestle, 2013).
The McDonalds fast food chain restaurant primarily deals in fast foods such as hamburgers, chicken, French fries, cheeseburgers, milkshakes, softdrinks, desserts, as well as breakfast items. McDonalds faces stiff competition from a host of other companies that have joined the fast food industry and are competing with McDonalds on every front.In every local market that a McDonalds branch operates in, there are local players as well that compete with the restaurant. Globally, the fast food chain also faces stiff competition from fast food chains such as StarBucks, KFC, and Subway. The fast food industry saw its growth expand astronomically during the 21st century as profits moved toward billions of dollars. However, in recent years, the fast food industry has been facing stiff competition from dining restaurants. The stiff competition has seen the fast food chain sales nose-dive significantly. Recent trends have also seen the fast food chains try new trends and expansion of their menus to offer other products such as salads, fish and fruits. The expansion of the menu has been necessitated by the changing consumer tastes and preferences over the years. Health campaigns against fast foods due to their negative documented effects on human health have also significantly contributed to lower sales, both in the United States and across the globe (Hearst et al., 2013).
The McDonalds brand has grown over the years and the fast food chain restaurant is globally recognized as an American entity and is used to depict the American lifestyle. Recent health campaigns against fast food chains mention McDonalds adversely due to its global status as the biggest fast food chain restaurant.Obesity and other health problems caused by changing lifestyles have been blamed on fast foods and McDonalds have been on the receiving end. The campaigns have necessitated a change in strategy as well as the change of their product recipes to include more nutrition-rich products. McDonalds’ huge presence has been established through a variety of ways. Advertising has been the main criterion that McDonalds has used over the years.However, growth and expansion into new markets such as the Middle East have been ongoing and have helped the firm to maintain its profitable margins as the fast food chain industry continues to face resistance from health campaigners (Schlosser, 2012).
Competitiveness of the business with other fast food chain
The McDonalds fast food chain restaurant can be rightly classified as the most competitive fast food chain restaurant in the United States.The brand is globally recognized and is even used to represent and depict the American lifestyle. However, other fast food chains have since entered the industry and made the fast food industry more competitive.Recent reports show that McDonalds still tops the rankings in the fast food industry. It is important to note, however, that other fast food chains have grown over the years. Dunkin’ Donuts and Subway have shown significant growth in the past few years and their aggressive and ambitious growth plans are helping the firms eat into the McDonalds’ profit margins.
To keep off its competition, McDonalds heavily invests in advertising. McDonalds leads in advertising when compared to other competitors in the fast food industry. Adverts that seek to target the children and older children have helped McDonalds in gaining increased sales in the past few years. McDonalds uses a variety of adverts to target different audience. The company identifies the websites, the TV shows and programs, as well as the magazines that the target audiences frequently use. The company then creates adverts that are target-specificin order to obtain more sales. To make the adverts more effective, the company has often resorted to delivering the same message through all its adverts. In essence, an integrated marketing approach has been instrumental in the McDonalds brand establishment and its ability to maintain its brand at he top of the industry (Chib, 2012).
Reacting to competitors has also been instrumental for McDonalds. Its ability to react to new trends and customer demand have always enabled the company to retain its competitive advantage. Other competitors have distinguished their brands through improving their customer experiences. McDonalds have always maintained a high level of customer satisfaction. Customer feedbacks have been essential in helping the company to react to react to customers’ changing tastes and preferences. Moving away from the traditional products to include new products such as fruits, seasoned fries, as well as fish and salads have been efforts directed towards reacting toward consumer changing tastes and needs. The ability to respond positively to consumers’ changing needs have often set the company apart from the rest. This quality has ensured that customer loyalty is retained and new entrants cannot easily encroach into the company’s territory.
Using SWOT analysis, conduct product evaluation, consumer evaluation and target market evaluation
A SWOT analysis helps reveal the company’s place and status in a market. A SWOT analysis reveals the company’s strengths, weaknesses, opportunities, as well as threats.
McDonalds enjoys a number of strengths that have enabled it maintain its place as the most profitable fast food chain entity in the world. The Company has been around for over 70 years since it was founded in 1970s. Its strengths include:
An established brand name; the company has established itself as a fast food chain restaurant that offers quality fast food.
The company has also grown globally and expanded to new locations. The expansion has been possible through franchising and affiliates. In fact, affiliates and franchises make up or a majority of the company’s staff and locations worldwide. The many locations help in self-advertising and in the establishing of the company brand.
Aggressive marketing campaigns; McDonalds invests a lot of cash in running promotional materials through a variety of media. These media include magazines, TV shows and Movies, as well as websites. They have different adverts that target different audiences. However, the company has ensured that the adverts are consistent in terms of the message and the information they reveal to the public.
A unique business model; McDonald has a unique business model that is different from most of its competitors. The company owns about 15 percent of the restaurants under the McDonalds name. In this unique business model, the company may collect rent, calculated based on sales, or own the property in which he affiliates and franchises operate. The company is, therefore,run in a unique way that has enabled it to establish its presence worldwide.
The company also has a few weaknesses that its competitors have capitalized on to have a footing in the fast food industry. These include:
Its business model; in which a majority of its locations are franchised. Operating through franchises reduces the influence the company has on its affiliates and on the businesses that operate under their name. It also makes it difficult for the company to monitor all the branches’ activities and their customer relations.
McDonalds enjoys a number of opportunities that it can take advantage of to maintain its status at the top of the fast food industry. Examples of these opportunities include:
Growth opportunities; the business model that McDonalds runs enables it to grow through its franchises. The business model is ideal for faster growth without the need to find the finances. Moreover, the business people seeking to run these franchises often do the market analysis on behalf of the company. The business model ensures that the company saves on marketing and expansion finances.
Expanding menus; McDonalds has an opportunity to expand its menu. Though the company is primarily operatingfast foods such as hamburgers and cheeseburgers, other products can also be incorporated into their menu. The new products should benutrition-oriented to take advantage of the health campaigns that have been discouraging people from consuming fast foods.
The McDonalds company faces a number of threats to the business. These include:
New entrants into the fast food industry. New entrants with newmarketing models are joining the industry. McDonalds cannot afford to ignore such entrants as they seek into encroach into the company’s territory.
Campaigns against fast foods; obesity and other health problems have seen the blame laid on fast food restaurants. These campaigns have seen a significant drop of sales for the fast food restaurants (Malik et al., 2013). It, therefore, calls for McDonalds to incorporate new products in its portfolio to encourage new customers into their restaurants.
Selection of appropriate media for your target market and justify the choice of media
TV shows and adverts on TV, as well as the social media are the best methods for carrying out promotional content and campaigns for McDonalds fast food restaurant. Popular Tv shows attract millions of viewers daily as people seek to watch their favorite TV programs. Adverts during commercial breaks at the time of watching these shows ensure that the target audience can be accessed. There are different shows for various age groups. Therefore, different adverts targeting various age groups can be aired at different times to correspond to the age group watching the programs or TV shows.
Social media has emerged as a leading marketing medium in 2015 and in recent years. Social media campaigns have been known to have higher access to more people than TV shows. Therefore, social media campaigns that will take advantage of the various popular platforms such as Facebook and Twitter will ensure that McDonalds’ products are advertised to more people, especially the young generation.
Identification of the appropriate media organizer or marketing communication agency to do the task required
The Appropriate media organizer in the case of McDonalds would be a PR department with the right staff and experience to carry out all the required integrated marketing communication procedures. Integrated marketing requires knowledge and skills in all forms of marketing channels and avenues. The integrated approach means that the different marketing procedures customized for the various media need to be integrated by reflecting the same message across all the platforms. The different platforms, apart from carrying the same message, can have complementaryfunctions. For example, a TV advert can encourage the target audience to visit their website to sign up or to make a subscription.In this case, the TV advert and the website are different media complementing each other in achieving the overall marketing objectives.
Critical analysis and discussion of the role of intermediaries and their relevance to the fast food chain
Intermediaries act as ‘go-betweens’ between the supplier and the consumer. In the marketing sense, the McDonalds brand and name are the product. The affiliates and the joint ventures that participate in the chain via franchising are the intermediaries. Intermediaries have a huge role to play in business and can enable a firm to make more sales without the financial ability or the physical capability of increasing its sale or reach. In most cases, the intermediaries invest their own cash in the process of the supply chain for the benefits they would gain on the premium. Therefore, intermediaries can push a business to new heights via increasing its sales and its expansion into new geographical locations and markets.
However, using intermediaries by McDonalds, albeit with its benefits, has its own limitations. Using the affiliates reduces the control on quality and standards of the services across all the McDonalds branches and locations worldwide. Intermediaries may also a different vision and if not closely monitored may affect the brand name negatively.
Presentation of relevant findings and conclusion
Evidently, McDonald leads the fast food industry. Its position at the top of the industry has been made possible through years of brand development and rigorous marketing activities. Presently, the fast food industry is synonymous with McDonalds. Other entrants have also entered the industry and made significant strides. Such players include Subways and StarBucks. However, a different business model that includes affiliates and franchising of the brand has enabled the McDonalds to grow faster and increase its influence globally.In the Middle East, the company has seen significant growth as more establishments are opened in the region. Investing significantly in the marketing of the brand has helped McDonalds establish itself in the fast food industry. An integrated marketing approach, however, will take the company to newer heights. A dedicated Public Relations department will be crucial in this stage to ensure that all marketing activities carry the same message and that they work in complementary fashion if need be. An integrated marketing communication approach will also ensure that there is increased marketing efficiency and eliminate all forms of redundancies in the marketing process.
Chib, S. S. (2012). Relationship Matrix between Customer Satisfaction and Service Quality in Fast Food Industry – A Comparative Study of KFC and McDonalds. International Journal of Retailing & Rural Business Perspectives, 1 (1), 43-50.
Hearst, M. O., Harnack, L. J., Bauer, K. W., Earnest, A. A., French, S. A., & Oakes, J. M. (2013). Nutritional quality at eight US fast-food chains: 14-year trends. American journal of preventive medicine, 44(6), 589-594.
Malik, V. S., Willett, W. C., & Hu, F. B. (2013). Global obesity: trends, risk factors and policy implications. Nature Reviews Endocrinology, 9 (1), 13-27.
Nestle, M. (2013). Food politics: How the food industry influences nutrition and health (Vol. 3). Univ of California Press.
Schlosser, E. (2012). Fast food nation: The dark side of the all-American meal. Houghton Mifflin Harcourt.
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