A brand is defined as a name, term, sign, symbol, design which identifies the goods and services of a seller from that of another. Brands add different kinds of values to a product (Farquhar, 1990). The importance of brands in the current marketing environment which is cluttered with competing businesses is well known to businesses and their marketing managers. Brands help companies in differentiating their products from those of their competitors and provide a range of values to the consumers. Branded products were also found to be perceived by consumers to be of higher quality than unbranded products (Erdem and Swait, 1998). Recognising the importance of brands many organizations offer a lot of brands to their consumers. McDonald’s in one of the most loved brand of fast food restaurants in the USA and around the world. The restaurant brand has its presence in many countries around the globe. The present report focuses on how McDonald’s employed different marketing mix elements to accomplish a successful marketing strategy in the US market.
McDonald’s is one of the leading fast food chains in the world. The business was founded in the year 1940 by two young brothers, Richard and Maurice Donald when they opened their first restaurant in San Bernardino in California (McDonald’s, 2013). McDonald’s was later acquired by one of McDonald’s franchises Ray Croc in the year 1961. Ray Croc had later expanded the business operations of McDonald’s all over the world and got company listed in the year 1965. McDonald’s business model was mainly based on earning revenues as a franchisor licensing its brand to franchisees and as direct operator of restaurants. 15 percent of the total McDonald’s restaurants globally are directly owned and operated by the company itself. The McDonald’s brand is targeted at a number of markets and customer segments like children, teenagers, families, and business customers.
Segmenting, Targeting, Positioning and the Marketing Mix of McDonald’s Brand
McDonald’s is a family brand which is targeted mostly at the US families which look for a quick lunch and breakfast. It is positioned as an affordable restaurant brand where high quality food is served to customers quickly. McDonald’s has consistently used the various marketing mix elements like product, price, place and promotion to evolve a highly successful marketing strategy:
McDonald’s places a lot of emphasis on developing products which are desired by its demanding US customer base. McDonald’s has always put a lot of emphasis on developing a menu which is desired by its customers (Kroc, 1992). But the tastes and preferences of consumers also change often due to a variety of factors. The marketing team at McDonald’s continuously monitors the changing tastes of customers. In order to meet the changing preferences of customers, McDonald’s introduced new products and withdrawn the older ones over time. McDonald’s products range from burgers, sandwiches, chicken nuggets, ice-creams and beverages like soda, fruit juices, and even coffee. By making such a vast range of food items available to customers, McDonald’s made it hard for people to not dine at one of its outlets.
McDonald’s is a restaurant which is positioned to be an affordable place for all the family to have their food. McDonald’s has always tried to keep its menu items affordable for the common American. The company achieved this both by keeping the price of its menu items cheaper and also by introducing several special menus targeted at different customer segments. Its happy price menu is mainly targeted at children and teenagers who want to have a snack at the restaurant. McDonald’s had also introduced everyday dollar meals for busy executives and dollar menu items for families. Its dollar menu always has 10 items which makes it very easy for customers to have quick bite without burning a hole in their pocket. It also runs many special cheaper items for breakfast like $2 sandwiches (Munarriz, 2013).
The ‘place’ has been recognised by marketing researchers and companies as being the most important of the marketing mix elements for any brand. Being a world leader in the fast food industry, McDonald’s products are brought by 52 million customers worldwide. Right from the time it was founded, McDonald’s made it a point of being close to its target customer segments. Its stores are located in prime locations in all the cities of USA. 50 percent of the American citizens can reach a McDonald’s outlet in just three minutes (Burger Business, 2010). The increased access of stores made McDonald’s one of the most easily reachable restaurants in US and dominate other fast food restaurant chains. All the outlets of McDonald’s have a good ambience to suit the tastes of families. Many outlets of McDonald’s in US offer a playground for children with all kinds of play tools like Swings, Slides, and Ball-Pits. Place as a marketing mix element also involves a range of processes involved in making the end products available to the customers. McDonald’s developed an advanced processing system where most of its ordered products are served very quickly to the customers. Even made to order products like ‘McWrap’ are served to the customers within 60 seconds (Berfield, 2013).
The promotional aspect of marketing mix covers all the aspects of marketing communications like TV, Radio, Internet, and outdoor media. McDonald’s used different kinds of marketing communication channels to effectively target the various customer segments in the US market. Rather than trying to communicate all its customer segments with a single advertising strategy, McDonald’s altered the marketing communication channels depending on the target market segment. When trying to communicate with its female customers, McDonald’s focused on women oriented magazines like Cosmopolitan and Woman’s Own. To target children, McDonald’s preferred buying advertising space in cinemas during cartoon films. Over the years, McDonald’s has also used several slogans like ‘Food, Folks, and Fun’, ‘I’m loving’ it’, and ‘We Love to See you Smile’. These slogans made people to easily remember the McDonald’s brand and visit its outlets more and more often. Another promotional strategy used by McDonald’s over the years is the promotion of its figurehead, Ronald McDonald. Originally introduced in the year 1963, the Ronald McDonald resembles a clown character and helped McDonald’s in effectively targeting one of its most important customer segments − children. Ronald McDonald later emerged as the second most recognizable character to the US children after the circus clown.
Conclusion and Recommendations
The brilliant customer driven marketing strategy of McDonald’s made it one of the most loved and successful brand in the USA. Despite all the success, McDonald’s can still come up with some more changes to its marketing strategy to make the brand more successful. As the brand is accused of promoting unhealthy eating habits among the children, McDonald’s can focus on introducing lower fat items in its menu to target children and calorie conscious consumers better. On the promotional front, McDonald’s should put more emphasis on promoting its products on social networks rather than just concentrating on the traditional marketing communication channels like TV.
- Berfield, S. (2013, July 3). Why the McWrap is so important to McDonald’s. Business Week, p. 46.
- Burger Business. (2010). McDonald’s offers 3-minute drive-thru guarantee. Retrieved on February 11, 2013 from <http://www.burgerbusiness.com/?p=5672>
- Erdem T., & Swait J. (1998). Brand equity as a signalling phenomenon. Journal of Consumer Psychology, 7(2), 131 -157.
- Farquhar, P.H. (1990). Managing brand equity. Journal of Advertising Research, 30(4), 7-12.
- Kroc, R. (1992). Grinding it out: The making of McDonald’s. Boston: St. Martin’s Paperbacks.
- McDonald’s. (2013). About McDonald’s. Retrieved on February 4, 2013 from < http://www.aboutmcdonalds.com/mcd/our_company/mcdonalds_history_timeline.html >
- Munarriz, R.A. (2013, October 23). $2 Is the New $1 on McDonald’s Value Menu. Daily Finance. Retrieved on February 11, 2013 from <http://www.dailyfinance.com/2013/10/23/mcdonalds-revamps-dollar-menu/>