Has the Marketing of McDonalds products been successful?

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Introduction

The aim of this assignment is to investigate whether the advertising of McDonalds' products has been successful. To achieve this aim I am going to undertake research from both the general public and McDonald's itself, and use referenced information from other sources such as encyclopaedias and the Internet.

Background Information on McDonald's

McDonald's Corporation Inc., a multinational fast food restaurant company, was founded by the McDonald brothers when they opened their drive-in restaurant in San Bernardino, California, in 1948. They began by selling the traditional fast-food products such as hamburgers, cheeseburgers, soft drinks and chips. By the mid 1950's the original McDonald's was generating $350,00 a year. In 1954, Ray Kroc, a salesman who was convinced that the McDonald's idea could work in other cities was appointed by the McDonald brothers to sell franchises and a second McDonald's was opened in Illinois in 1955. By the end of the decade 228 restaurants had been opened which generated $37.6m in revenues

McDonald's continued to grow in the 1960s and during this period it adopted many of its well-known associations. In 1962 the golden arches were adopted as its trademark and Ronald McDonald was created as its official mascot. McDonald's also pursued several aggressive marketing campaigns during this period, including the very successful "You deserve a break today." By 1972 there were 2000 McDonald's restaurants and the company had begun to expand abroad.

McDonald's also expanded its product range in the 1980s, such as the introduction of breakfast meals and the bite-size Chicken McNuggets. They have also attempted to attract new customers by introducing healthier food. However, some of these products generated disappointing sales. They have also continued to expand abroad and McDonald's was one of the first companies to start trading behind the Iron Curtain, when they opened restaurants in Moscow and Beijing. McDonald's recently signed a marketing agreement with Disney, under the terms of which McDonald's will promote Disney films through its outlets in return for operating at Disney film parks.

Life has not been a smooth passage for McDonald's however. In 1991 they were forced to sue for libel against two environmental campaigners who claimed that the spaces cleared to graze the cattle for McDonald's beef were causing deforestation in the rain forests. Although McDonald's won the case their reputation was badly damaged. In another case a woman successfully sued the company for scalding herself on a cup of McDonald's coffee that had broken when she put it between her legs. Some of McDonald's promotions have also gone wrong, such as in January 1999 when a "2 for 1" promotion for the Big Mac had to be suspended due to an unexpectedly huge demand.

McDonald's main rivals in the fast food market are Burger King, Kentucky Fried Chicken (KFC) and Wimpy.

How I will investigate whether McDonald's advertising has been successful

To judge whether McDonald's advertising has been successful, it is necessary to canvas the general public about the effect of McDonald's promotions and whether they visit McDonald's often. I will also gain information from McDonald's own sources such as their website and writing to them asking for information. Firstly, I will examine the methods that McDonald's has used to market its products:

Marketing - the 4 'P' s

Marketing is all about the four 'P's - product, promotion, pricing, place. Here we will examine how these affect the marketing of McDonald's products:

Product

The product is the item that the company is selling to the public. In McDonald's case, it is the burgers, chips and drinks that are the products. A business often sells many different products in order to generate more sales and also to reduce its risk should one product fail. Different products may cater for different markets too. For example, the Big Mac is made for those who like to eat beefburgers, and the Chicken McSandwich is made for customers who prefer chicken. In this way McDonald's is satisfying two markets and therefore increasing sales. This is known as product differentiation.

To increase sales further a business will try to make its product as different from its competitors as possible. This will make it easier for customers to recognize the product and hopefully want to buy it. Businesses can try to make their products different in several ways, as shown by the example of the McDonald's:

a) Design and formulation

The products sold by a company can vary differently in their design although they are essentially the same type of product, thus creating a different formulation. For example, the Big Mac and Quarter Pounder are both beefburgers, but different sauces and ingredients are used in their preparation which makes them different.

b) Name

The name of a product can be very important in marketing. If the name is one that consumers will remember well or is attractive to the customer the product is likely to sell well. Such names tend to be short and easy to remember so that they will stick in the customer's mind and should also say something positive about the product. The Big Mac is a typical example of this - the name is very well known and cannot be used by any other company (due to copyright); it is short and easy to remember and the word "Big" makes the customer believe that they will be served a good product.
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c) Packaging

Packaging is used to deliver products safely to the consumer and enable them to use the product effectively. McDonald's uses plastic foam packaging for its burgers and cardboard containers for its chips, which is superior to its rivals which use paper wrapping for the burgers and paper bags for the chips.

Promotion

Businesses need marketing to communicate with their customers. Without it customers would not know about the company's products or even about the company itself. It is thus vital that advertising is done through as many channels as possible so the maximum ...

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