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McDonalds Analysis and Strategy

Extracts from this document...

Introduction

Strategic Marketing Ana Pedro 04017752 Silvia Calo 07050977 Justina Adeikyte 05047269 Achille Fontaine 07021065 Contents Page 1. Introduction ............................................................................... p.3 2. Value Proposition ....................................................................... p.3 3. Functional and Symbolic Associations ............................................. p.4 3.1 Functional ............................................................................ p.4 3.2 Symbolic ............................................................................. p.5 4. Unique Resources ..................................................................... p.6 4.1 Tangible ............................................................................. p.6 4.1.1 Restaurants ................................................................. p.6 4.1.2 Capital ........................................................................ p.7 4.2 Intangible ............................................................................ p.7 4.2.1 The Brand ................................................................... p.7 4.2.2 Product Innovation ......................................................... p.8 4.2.3 Human Resources ......................................................... p.9 4.2.3.1 Scouts ............................................................... p.9 4.2.3.2 Managers and Employees ..................................... p.9 5. Unique Capability ....................................................................... p.9 6. Competitor Differentiation ........................................................... p.10 6.1 Fast Food .......................................................................... p.11 6.2 Coffee Shop ....................................................................... p.11 7. Trust ...................................................................................... p.12 8. Contact Points ......................................................................... p.14 8.1 Restaurants and Drive Thru ................................................... p.14 8.2 Website ............................................................................. p.14 8.3 Advertising ......................................................................... p.15 8.4 Litter Patrol ........................................................................ p.15 9. Forms of Consumption ............................................................... p.16 10. Neo-Tribalism ........................................................................ p.16 11. Recommendations .................................................................. p.17 12. References ............................................................................ p.18 1. Introduction With more than 30,000 restaurants serving more than 60 million people each day in 121 different countries, McDonald's is one of the leading companies in the world and is the leader in the fast food industry (McDonald's Canada, 2010). As the external environment is always changing, McDonald's had to adapt to it in order to remain competitive and it did this by applying the resource-based view strategy and by matching internal resources and capabilities to the opportunities that arose in the external environment. According to Grant "Central to this resource-based view is the idea that the firm is essentially a pool of resources and capabilities, and that these resources and capabilities are the primary determinants of its strategy and performance" (Grant, 2005). This report has been commissioned to analyse the McDonald's brand for the purpose of providing some strategic recommendations based on the findings in order to improve and develop a sustainable plan for the future. 2. Value Proposition McDonald's Mission Statement is: "to be our customers' favorite place and way to eat" (McDonald's, 2010). ...read more.

Middle

For this reason, McDonald's spend lots of money hiring scouts in order to find the best locations within the marketplace to provide customers with convenience and accessibility. In general, McDonald's restaurants are located on prime high-traffic areas that are highly visible and easily accessible. From business areas to residential areas, from airports to shopping centers, McDonald's can be found almost everywhere. 4.2.3.2 Managers and Employees As mentioned, human resources are extremely important for McDonald's brand image, as the consumers' satisfaction is mainly dependent upon well-trained and motivated staff. McDonald's is committed to the development of all of its employees, at every level of the organisation. For instance, the average McDonald's restaurant manager spends more than four years in training. Training is a process, which is continuous, and employees have to attend courses not only in the restaurants but also at the company's Management Training Centres. 5. Unique Capability As defined by Ferrell et al, a company's capabilities relate to distinctive competencies that it has developed to do something well and efficiently. A company is likely to enjoy a differential advantage over its rivals in an area where its competencies out do those of its potential competitors (Ferrell, 2005). The unique capability of McDonald's is its Operations. The company follows a comprehensive framework of training and monitoring to ensure the consistent Quality, Service, Cleanliness and Value propositions offered to its customers worldwide. McDonald's had pioneered the term systematization; defined as the act of organizing something according to a system. The main idea, applied by Ray Kroc since the early stages of the company, is to translate directions and operation practices into essential steps to repeatedly follow during the day-to-day operations in every section of the business. In particular, the business system is guided by the operating procedures and training manuals that govern the operation and maintenance of each McDonald's restaurants. 6. Competitor's Differentiation The Fast food industry is a very competitive sector, with several different iconic brands battling it out for market share and trying to stand out. ...read more.

Conclusion

The protest, which coincides with the United Nations World Food Day is called National Anti-McDonald's Day, which was founded by the London branch of Greenpeace to express their disapproval of the company. The main aim of the protest is to raise awareness about issues such as how McDonald's damage the environment, exploit its workers and sell unhealthy food in a bid to become more profitable. This worldwide event, which is attended by many people, could have serious negative implications on the McDonald's brand and how it is perceived by its consumers. 11. Recommendations Based on the above brand analysis, this paragraph will now focus on recommendations about how McDonald's should act in the near future in order to maintain its success among consumers. Firstly, McDonald's should not lose sight of its core values as this is what makes McDonald's successful as a brand. Therefore, they must keep investing in employees' training and restaurants' ambient in order to portray the value of consistent quality food, fast service, cleanliness and value for money. In other words, the company needs to maintain the concept of "growing by getting better and not by getting bigger". Secondly, looking around the website, we realized that consumers are encouraged to ask questions about the company through the website earlier mentioned. However, it does not exist a section where people can suggest and advice, in order to communicate what they think about McDonald's and how they believe the company may improve. This is really important because it fortify the customer-company relationship while helping listening and understanding customers' needs in order to entirely satisfy them. Thirdly, in order to stay successful, McDonald's must be true to the society. It must be transparent and honest about what it sells to keep consumers trusting the brand. McDonald's should not use sneaky, dishonest tactics such as in past adverts because it may disguise the truth about its food. The company should react to societal needs and changes in a responsible and honest manner, rather than try to be perceived as a healthy brand. (4162 words). 12. ...read more.

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