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5C Analysis

Discuss about the Emotional Branding and Emotionally Intelligent Consumer.

McDonald’s is one of the largest fast food chains in the world. The franchises are located both in the United States and aboard. The company was founded in 1940 and their mission statement is to be the customer’s favourite place to eat and drink (Boyland et al. 2015). The company’s brand vision is to be the best quick service restaurant in terms of quality, cleanliness, service and experience. The value statement is to provide excellent customer service as the customers are provided with high quality food, welcoming experience and superior service. McDonald’s is committed to the people as they provide opportunity, recognizing talent and develop leaders to drive success. McDonald’s operates its business ethically and profitably. The continuous strive for improvement helps the company in achieving its goals and objectives (Mcdonalds.com.my 2017). The brand uses its slogan ‘I'm lovin' it’ which became the longest running McDonald’s slogan and the jingle was inspired from Justin Timberlake’s vocal (Kashif et al. 2015).

The fast food chain is known for its hamburgers, French fries, cheeseburgers, desserts and others. The brand is dedicated to deliver outstanding customer experience. McDonald’s undertakes relationship marketing as its marketing orientation where the main goal is to maintain and enhance customer relationships. McDonald’s believes that the customers demand and tastes are ever changing. Therefore, it has adopted marketing strategies to satisfy their needs and become the leader in the fast food industry. They key to McDonald’s marketing and branding success is experimentation and appropriate segmentation (Harrington, Ottenbacher and Fauser 2017).

This section comprises of situation analysis for McDonald’s covering the micro and macro-environmental forces.

Company- McDonald’s is one of the most valuable brands in the global marketplace. It has huge brand equity with a large market-share. The brand has diversified income streams unlike its competitors. However, McDonald’s has unhealthy food image and been recognized as a source of increasing obesity among people due to large amount of calories in its food. The brand faces intense competition from other companies like burger King or Yum!Brands. The brand has also been involved in legal cases and disputes. McDonald’s has scope for international expansion and form joint venture with supermarkets or retailers. As a large number of customers prefer low cost menu, McDonald’s has market for these customers as it shall attract them significantly. McDonald’s can develop new and healthy products based on increasing concern for health and lifestyle. However, the brand faces threat from competitors as they have stronger market share than McDonald’s. The economic crisis negatively impacts the number of visitors at the fast food chain (Schmitt 2014).

Collecting Information

Customers- The main customers of McDonald’s are children, family, teenagers and business customers. The children visit McDonald’s as they find it a fun place to eat. The brand also gave goodies and toys to the kids that attract the kids. As the ambience and food menu is apt for family, the parents visit the place with their children to give a treat. Further, the teenagers visit McDonald’s as the prices of food products and services are affordable in nature. Further, some restaurants offer internet connection that attracts the teenagers and spend more time at the place. The business customers may visit the outlet as the food tastes great, service is quick and the take away option provides ease to eat food while travelling without affecting busy work schedule (Peterson 2015).


Collaborators- The suppliers of McDonald’s provides chicken, beef, fish, potato, lettuce, apple, coffee and other ingredients to help the brand prepare food for its customers. McDonald’s is in collaboration with Gavina Gourmet Coffee so that it can prepare coffee. Different variants of apple and lettuce are supplied to McDonald’s from the farm assuring freshness and ripeness (Mcdonalds.com 2017). The fish suppliers, Kenny Longaker, cast a wide net in the sea to bring the best to McDonald’s. The potatoes are supplied by the farmers to prepare French fries. The beef is inspected by the officials of Lopez Foods and used to make patties in the restaurant. Chicken from Keystone Foods are used to prepare McNuggets (Mcdonalds.com 2017).

Competitors- McDonald’s is in direct competition with the fast food chains Burger King, Taco Bell, KFC, Subway, Wendy’s as they have millions of customers across the world. The needs of customers change over time. The supply chain of these companies is impressive and the prices of all these companies are highly competitive. The main competition is between the innovative product portfolio and menu of all these companies (Gayle and Luo 2015).

Context- McDonald’s is affected by government regulations as it affects the fast food industry. The company has opportunities to reform its strategies and practices so that the tax implications can be lessened without law violation (Nestle 2013). Economic factors affect McDonald’s as the economic slowdown may threaten the spending of customers. The socio-cultural factors include cultural diversity (Belasco 2012). The healthy lifestyle and trend may affect McDonald’s business negatively (Requillart and Soler 2014). The technological advancement shall improve mobile services and tap more consumers. Technology can also improve business efficiency and effectiveness. McDonald’s can expand its corporate social responsibility strategies to reach higher performance and raise environmental concerns (Moodie et al. 2013).     

Developing Marketing Strategy

Collecting information involves discovering insights, achieving goals and objectives fr business growth and gathering information to fulfil customer needs. McDonald’s collects customer information through referral websites, telephone numbers and interaction with the executives of the company. The data is also gathered from transactions, sources and communication. The information system analyses the market using decision support system and resolve issues that arises in the company (Zikmund 2013).

About the competitors, the data is gathered using competitive intelligence research. The website of the companies enlists the pricing strategies, press releases or revision in the food menu (Zhao, Fan and Hu 2014). Therefore, press analysis reviews information to the major public about any changes made in the senior management or key personnel. The advertisement patterns are kept in check after the news about competitors are read in magazines, television, newspapers or any other medium of communication or advertising (Bolton et al. 2013).

To collect information about the context of changing business, the medium of communication such as personal contacts, academic books, commercial database, academic journals, reports, government publications and other sources are reviewed. It will be beneficial if McDonald’s conducts environmental scanning to trace the changes in business context. This information can be used by the brand to sell its products and services (Griffin et al. 2013).

McDonald’s follows collaborative information seeking so that it can gain information regarding situations, methods and motivations. McDonald’s works closely with its staff members so that they provide appropriate information. Collaborators play a shift role and work jointly with McDonald’s so that a trusting and working relationship is established. The problems between McDonald’s and market are defined and plans of action are developed accordingly (Lim, Chen, and Chen 2013).

Currently, McDonald’s targets everyone and does not have a selected audience. The restaurant claims that it offers exciting meals for kids, breakfast for people having busy schedule and is a place for the adults to relax. As seen, the food products of the brand are high in calories and fats that prohibit the people aged 20-40 who are health-conscious.

The target market is chosen as middle-aged people who belong to the age group 20-40 as they have greater consciousness about their eating habits in comparison with the other age groups. This target group has a greater focus on fitness and exercising as they watch what they consume. The changing expectations of customers from fatty to nutritious meals are increasing. The focus needs to be shifted to a more holistic concept by involving veggies and healthier products in the food menu and phasing out artificial colours and flavours. The main target must be to make the customers feel better about the food they crave. The existing customers such as kids, family and teenagers shall enjoy the food at McDonald’s, but with this additional target group of health-conscious consumers, McDonald’s can take the competition to a new level. McDonald’s knows that it needs to offer products that can offer some kind of health benefit. The changing lifestyles and consumer demand requires innovation to meet increasing personal needs (Sonnenberg et al. 2014).

McDonald’s promises to serve food as the customers like it. The food and beverage products need to be better than the competitors. The brand does not have many vegetarian options and it needs to enhance its options. The new products need to be superior to other competitive menu options (Lunt et al. 2014). People have started realizing the ill effects of fast food, especially fries and cheesy food. However, the people are so busy in their schedules that they do not have time to prepare a healthy meal by themselves. McDonald’s with its slogan ‘I’m Lovin it’ can develop new products and enhance the food menu so that customers visit the outlet and have a healthy diet (Lim, Chen, and Chen 2013).

The positioning statement could be, ‘To the people who want to inculcate health in their modern eating habit, McDonald’s is a brand of fast food that shall offer great meal with fresh ingredients and value for money. Moreover, McDonald’s shall offer excellent customization in their menu that would satisfy even the most fastidious customer’. McDonald’s has attained this legendary position by maximum satisfaction of its customers and marketing tactics. As the middle aged people are more health conscious, McDonald’s needs to take initiatives and encourage healthy eating and generate self-awareness among the people about freshness and fitness (Dibb 2013).

This section involves 7P framework to support the marketing strategy and tactics can be framed to achieve the targets and goals. The 7Ps are elaborated as under-

Product- The main product in the McDonald’s menu is its hamburgers and French fries. McDonald’s can switch to a healthier version with non-fatty ingredients or process of preparing the food items. A healthy range can be introduced for the health-conscious consumer group. Not only hamburgers, but a full course meal ranging from wraps, beverages and desserts can be introduced as a healthy option for them so that they do not hesitate in visiting the outlet. The brand must pledge to increase the nutritional value of its food items and beverages. All the new range products shall be roasted, grilled or shallow fried that would be non-fatty in nature (Hanssens et al. 2014).

Price- McDonald’s may follow cost leadership strategy and competitive prices can be offered. One of the most competitive brands, Subway follows premium pricing strategy and has a higher price than McDonald’s or KFC. However, McDonald’s may slightly increase its prices while maintaining quality of food products. Various combo meals and prices can be offered for the products being available at lower prices if more than one unit is bought at a time (Mintz and Currim 2013).

Place- McDonald’s operates worldwide and has scope for expansion in the Asian and Eastern region. The company may focus to expand in the semi-urban areas so that the market share can be increased. The outlets can be opened at busy marketplaces so that the customers can access the place with convenience. Restaurants can also be expanded in airports, railway station, malls, toll ways and colleges to reach more customers. Moreover, online delivery can also help in capturing greater market as the products can be taken to the customers at the right place and time (Mintz and Currim 2013).

Promotion- McDonald’s can use integrated marketing communication strategy in promoting its products and services. Further, McDonald’s can conduct ‘Meal of the Day’ campaign and attractive offers can be put on that particular food item. The same can be repeated on seven days of the week. Different promotional offers and codes can be used as promotion tactics during festivals and occasions such as Christmas, New Years and others. Student discounts can be provided for the students so that they avail the same healthy products at low prices and healthy food is encouraged. The campaigns must be designed while promoting healthy food that is freshly made using fresh ingredients. The charitable contributions shall also gain goodwill (Mintz and Currim 2013).

People- In every country, the company employs local people. Therefore, the needs and pattern of health conscious consumers in every country can be understood by the people. The people can be trained both in technicality and customer focus. The training centres can teach the employees to develop and prepare healthy food especially designed for the obese people. Therefore, training can help in standardizing product and service delivery.

Physical Evidence- The outlets are similarly created with a family friendly ambience and environment. The theme can be designed for activities and quiz for health conscious consumers. Service at the outlet shall be provided with a smile. The menu can be structured in similar ways with fries and drink combos. The health conscious consumers ordering healthy food items can be provided with magazines and tips on staying healthy or fit (Mintz and Currim 2013).

Process- There are thousands of McDonald’s outlet worldwide and all use the same process for preparing its food. The size, weight and ingredients used for products are standardized. Therefore, the suppliers need to meet specifications. The layout of kitchen and restaurant are the same. However, the menu images and process of preparing food needs to differ according to the culture and tastes of consumers. Service deliveries must be made quicker and wait time needs to be reduced (Su and Tong 2015).

Conclusion

Conclusively, McDonald’s excellent customer service as the customers is provided with high quality food, welcoming experience and superior service. The brand is dedicated to deliver outstanding customer experience. The brand has diversified income streams unlike its competitors. McDonald’s has scope for international expansion and form joint venture with supermarkets or retailers. As the ambience and food menu is apt for family, the parents visit the place with their children to give a treat. The suppliers of McDonald’s provides chicken, beef, fish, potato, lettuce, apple, coffee and other ingredients to help the brand prepare food for its customers. The supply chain of these companies is impressive and the prices of all these companies are highly competitive. Economic factors affect McDonald’s as the economic slowdown may threaten the spending of customers. The data is also gathered from transactions, sources and communication. The advertisement patterns are kept in check after the news about competitors are read in magazines, television, newspapers or any other medium of communication or advertising. Collaborators play a shift role and work jointly with McDonald’s so that a trusting and working relationship is established. The target market is chosen as middle-aged people who belong to the age group 20-40 as they have greater consciousness about their eating habits in comparison with the other age groups. . The campaigns must be designed while promoting healthy food that is freshly made using fresh ingredients.

References

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Bolton, R., Parasuraman, A., Hoefnagels, A., Migchels, N., Kabadayi, S., Gruber, T., Komarova Loureiro, Y. and Solnet, D., 2013. Understanding Generation Y and their use of social media: a review and research agenda. Journal of Service Management, 24(3), pp.245-267.

Boyland, E., Kavanagh-Safran, M. and Halford, J., 2015. Exposure to ‘healthy’ fast food meal bundles in television advertisements promotes liking for fast food but not healthier choices in children. Appetite, 87(6), p.399.

Dibb, S., 2013. Market Segmentation Success. 1st ed. Hoboken: Taylor & Francis.

Gayle, P. and Luo, Z., 2015. Choosing between Order-of-Entry Assumptions in Empirical Entry Models: Evidence from Competition between Burger King and McDonald's Restaurant Outlets. The Journal of Industrial Economics, 63(1), pp.129-151.

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