A Gap analysis is a tool that is used by marketing managers to decide upon marketing strategies and tactics. This allows them to see where they (organisation) want to reach over a period of time and the level if the organisation does nothing at all. The larger the gap between these 2 will indicate that it will take longer for the organisation to gain more of the market share, which is bad for an organisation such as McDonalds.
This is indicated clearly on the graph that if an organisation maintains their normal levels of operation and predict their level of market share they wish to be at, the gap shouldn’t be too significant if the organisation is operating efficiently.
When the marketing department of McDonalds can conduct how the gap will be judged over the period of time that is expected, the quicker thing to do next will be to find ways in order to close the gap as close as possible. By McDonalds doing this, this shows that they are operating more efficiently and that they are achieving a bigger market share. However, in order for this gap to be closer together, McDonalds will have to find ways in order to fill the gap that they wish to achieve. This depends on what McDonalds hope to achieve i.e. market share or whether they should introduce a new product on to the market.
This is linked to Ansoff’s matrix as it allows McDonalds to decide on whether they should introduce a new product to their market or whether they should introduce existing products to the current market. The diagram below is Ansoffs matrix diagram.
Market penetration is basically introducing existing products to the current market. This mainly focuses on the organisation increasing the market share on current products so that they can secure dominance in the growth market. McDonalds do this by ensuring their prices are at a competitive level in order for them to rival other competitors.
Market development is when the organisation introduces existing products to a new market. McDonalds do this by having franchisees around the world so that it increases the popularity of the products they sell. McDonalds also do this by making sure that their packagings on their products are up to date and of new design very often. The happy meals they sell have their packaging changed very often and the toys are chose sparingly when customers purchase this product. Making the product more appealing will encourage customers to purchase and increase the overall development of the product itself.
Product development is when the organisation introduces new products to an existing market. McDonalds do this often, most recently with their McFlurry, as they introduced the overall product as an ice-cream, but they introduce the new product by it consisting of many new flavours. The product itself is already on the market by they re-introduce it every time they establish a new flavour.
Diversification is when the organisation introduces new products to a new market. This is the most risky strategy out of the 4 as the organisation are about to introduce a completely new product into anew market, in which they can be unsure about the successfulness of the product and the reaction into the new market. However, McDonalds will cover this and can work around this as they can invest a lot of money into making sure any new products are well publicised.
Benchmarking is the process of being able to measure and compare organisational performances against other organisations that are of greater presence in the same market. Benchmarking is used by organisations to improve the overall performance so that they can compare themselves against other organisations. McDonalds would benchmark by comparing their own performances against maybe Burger King, who are in the same market.
Organisations who want to benchmark will have to conduct a specific programme in which they have to identify their organisation strengths and weaknesses (areas of improvement). Then, organisations such as McDonalds will have to gather information and data and see how other organisations such as Burger King tackle the same problem. Only doing this, only then can organisations see how well they are doing in the market.
Ishikawa (fishbone analysis)
The Ishikawa diagrams, also known as the fishbone analysis, is a process that is commonly used by organisations as it allows them to find out where their potential problems are and the source of the problem. McDonalds use this to make sure that they capture problems at an early stage and that they can identify where the problem started. The Ishikawa diagram is stated below.
The Ishikawa diagram that is show above reveals the factors that potentially occur in modern day organisation. Key factors such as transport, premises, people, clients, finance and I.T are some of the factors that can lead to the main problem of an organisation. The smaller arrows under the main headings are the key points that could potentially lead to the main problem.
The 6 factors are stated below that could lead to the problem:
Ishikawa diagrams are also used by organisation such as McDonalds to see which factors contribute most significantly to the overall problem that is occurring. By organisation being able to identify this, only then can they suggest and target room for improvements. This diagram can help you to think through causes of a problem thoroughly.
The Ishikawa diagram works by firstly identifying the problem and placing it into the box on the right of the diagram. Secondly the organisation will then decide what the contributing factors could be for this problem and place them in the diagram.
Database marketing is a form used for direct marketing using databases of customers in order to promote a product for marketing purposes. Database marketing concentrates on the use of statistical methods to develop methods on customer behavior, which enables organizations to then select customers for communication. This is also known as CRM, customer service management, which consists of holding information of customers and the methods used to communicate with them.
McDonalds use customer service management in relation with their customers to access which customers choose a certain and product and their influences behind their purchases. This allows McDonalds to target specific customers more efficiently as it enables them to select customers from their own databases rather than gathering customer information at the same point. This will save time and will be easier for McDonalds to target their customers.
McDonalds will have customer details on their databases which are protected by them that allow McDonalds management to access. This is very common in places such as the U.S. as McDonalds have a home delivery service. In order for this to work, they must need address and the name of the person who is purchasing. This data is automatically saved on the data and can be easily referenced if needed to in the future. By McDonalds using this data, they are able o get an inside view on which customers purchase which products. Overall, the CRM can potentially boost sales and increase customer awareness more efficiently as customer are targeted quicker when using the CRM databases.
Direct and E-marketing
Direct marketing is the process of being able to communicate directly towards their customers. McDonalds do this by handing out leaflets and posters in the US only. This is seemed as a way of promoting their products services and increases their customer awareness on their products. However, in the UK, McDonalds do not participate in direct marketing for this product as it will be unhygienic to approach customers with this product, knowing that some of the products have taken longer to reach its customers than others.
However, McDonalds do have employees that are placed in town centres in which they hold a big arrow pointing in the direction of the nearest McDonalds store so that consumers are aware where to find McDonalds. This is direct marketing as they encourage customers to shop at McDonalds by showing them to direction of where McDonalds are situated. This is very commonly used by them when they open up a new branch and when they are keen to attract more customers.
E-marketing is when you can make purchases using the internet. McDonalds do not use e-marketing as they do not do home delivery or able to make purchases when using the internet. In some countries, such as the US, they are able to phone in and place an order for home delivery. Other than that, McDonalds only participate on e-marketing will be the promotion of their products. This is clearly stated on their company website as they promote all their products online.
M2: Analyse the effectiveness of methods that are used to track and evaluate customer satisfaction within a selected organisation.
In this assignment, I will be analysing the different methods that are used to track and evaluate customer satisfaction within a selected organisation. The chosen organisation that I have chosen for this assignment is McDonalds.
McDonalds wish to achieve their objectives at a very high standard that represents them in their market. Therefore, McDonalds must ensure that they offer their customers a high standard of customer service and that their customers are top priority. In order to McDonalds to achieve this, they must be able to track and evaluate their customer service in order to see whether their customers are satisfied.
McDonalds do this the by the following methods that are stated below:
Customer service desks
McDonalds have a customer service desk in every restaurant in which customers are freely allowed to approach employees about any questions or queries they may have. By McDonalds having this, they are ensuring that their customers are seen to quicker and that any problems are quickly seen to. Also, it gives the satisfaction towards their customers that help is there for the taking at any time and that their questions are answered directly to the customer. This saves time for the customer as waiting on the phone or a reply back via the internet can be time consuming. Also, customers are able to put forward job application forms through the help desk or an employee will take the form off the customer. This again is helpful for those customers who cannot have regular access to the internet so in-store hand in seems the next best thing to do.
Customer suggestion schemes
McDonalds make sure that they keep regular interaction with their customers, this method being that customers are allowed to put forward any suggestions or ideas that can help the performance of the business. This is good for an organisation such as McDonalds as it allows heir customers to feel part of the organisation itself, and its customers believe that they have a part to play in order to help the business succeed. McDonalds offer their customers this responsibility ion order to make sure that customers are keep loyal to the organisation.
Below is how McDonalds consider customer feedback at the importance of how customers influence the overall performance of the organisation.
“Submission of Ideas: Submissions shall be deemed to have been submitted voluntarily and shall remain the property of McDonald's Corporation. Subject only to the limitations set forth in McDonald's , McDonald's shall have the right to copy, distribute, transmit, perform, display, modify, adapt, and otherwise use your Submission for any purpose whatsoever (including, without limitation, in the development, manufacture and marketing of products and services based on or incorporating ideas, know-how and techniques contained in your Submission), in all forms and media (including, without limitation, by means of the Internet or other electronic media) throughout the world”.
McDonalds will have regular checks on their employees to see whether they are meeting to the standards that are expected from and McDonalds itself. One method in which McDonalds will use to’ check’ on their employees to see whether their employees are performing to the standard set, they will use a mystery shopper in order to find this out.
McDonalds use their mystery shoppers as a method to see how their employees treat their customers. Some of the criteria in which may be covered could be whether the employees greet their customers, the way they talk to customers and the general feeling they send out when they are dealing with customers. By McDonalds doing this, they can evaluate individual employees and see where the positives and negatives came from.
McDonalds could only then be able to come to a solution to minimise the amount of negatives they may encounter and could look to further recruitment to ensure they are limited. If McDonalds recruit more skilled employees that are ‘specialists’ at their jobs, this would most likely mean that they are experts at their jobs and that random employees would not be able to perform tasks on the same level.
McDonalds use user panels to directly ask questions towards their customers so that they acquire information about a particular product or service that McDonalds may have to offer. User panels are set out in groups in which a large amount of customers are questioned in order to see whether the products or service will be successful in the current market. McDonalds would ask direct questions such as ‘What do you think about the McDonalds drive-thru system?’, in which customers could respond in either a positive or negative way. By gathering a large amount of data based on this question, only then can McDonalds assess the situation in which the majority of their customers think that the drive-thru is a positive or a negative feature.
Rizwan Zaid BTEC Business