Case study: Repositioning McDonald's
McDonald's is ubiquitous part of life on both America and global culture. Traditionally, McDonald's restaurants were largely standardised, and consumers knew what to expect when they entered any one of its restaurants. This was fine for decades, but now the environment has changed with competitors entering the marketspace. Not all of the scene is changing, but quite a bit is. McDonald's is gradually re-imagining its stores in an effort to improve consumer perceptions of quality, providing value continuously and more effectively than competition and to retain highly satisfied customers According to the CEO Steve Easterbrook, who has successfully turned around McDonald's downward slip:
“As customer expectations increased, McDonald's simply didn't keep pace with them. Making meaningful improvements in quality, convenience, and value will win back some of the McDonald's best customers.”
Many adjustments have been made as a part of this repositioning efforts in many areas, including change to the interior design, menu and ingredients, packaging and use of technology. Several of the changes made involve the quality of the input ingredients. For example, pounders are made with fresh versus frozen beef and butter is being used rather than margarine. Artificial preservatives are no longer in chicken Mac-Nuggets, artificial growth hormones are no longer in milk, and high fructose corn syrup is no longer used in the bank. One change that is especially appealing to socially conscious customers is that McDonald's has redesigned the packaging and its bags, cups, and sandwich containers. The design was meant to be a modern font and simplified feel to stand out in a landscape of distractions. The package redesign also brought McDonald's closer to its commitment to using 100% fibre-based packaging from recycled or certified sustainable resources.
McDonald's also has made some radical changes from its traditional model in terms of technology. Going digital is McDonald's most recent push to lure customers back to its stores. Digital engagement is an increasingly important aspect of the modern food service experience and it enhances the level of convenience that customers want and expect from a quick service chain. McDonald's is increasingly implementing the digital video kiosks with a touch screen to select and customizer their food order. Another development is the McDonald's app with the mobile order and pay function, where customers can purchase their order from the app and then have it delivered to their car on the curb side of a McDonald's restaurant. Finally, McDonald has partnered with Uber EATS to provide delivery in many markets.
McDonald's various efforts to reimage its stores and reposition its brand appeared to be effective so far. Both customer traffic and sales were up after dropping in several years prior. The performance is outpacing competitors such as Burger King and Taco Bell, during the same time period. Further, measures of customer perception and satisfaction illustrates and increase in regard to service, taste, and quality.
Answer the following questions:
Q.1 (30 marks)
Discussed positioning as developing a distinct image for the product in the mind of the customer. In your opinion are the changes McDonald's has made enough to constitute a significant change in public perception of McDonald's? justify your response. And what difficulties may McDonald's face when repositioning its brand image. Word count: 300 words.
Q2. (35 marks)
Define the societal marketing concept and its importance. Referring to the case study and other external sources, discuss how McDonald’s integrated marketing ethics into its philosophy and operations. Word count: 350 words.
Q3. (35 marks)
Describe how technology enhances the exchange between marketers and consumers and how they can affect consumer purchasing behavior. Use evidence from McDonald's case. Word count: 350 words.