Professional Documents
Culture Documents
Burger King Case
Burger King Case
Burger King
Sidhom
:Industry overview The fast-food hamburger category operated within the quick service restaurant (QSR)
segment of the restaurant industry. QSR sales had grown at an annual rate of 3% over the
past 10 years and were projected to continue increasing at 3% from 2010 to 2015. The
fast food hamburger restaurant (FFHR) category represented 27% of total QSR sales.
FFHR sales were projected to grow 5% annually during this same period. Burger King
.accounted for around 14% of total FFHR sales in the United States
Burger King competed against McDonalds, Wendys, and Hardees's restaurants in this
category and against regional competitors, such as Carls Jr., Jack in the Box, and Sonic.
Indirectly, they also competed against the QSR restaurant segment, including Taco Bell,
Arbys, and KFC. Although the restaurant industry as a whole had few barriers to entry,
marketing and operating economies of scale made it difficult for a new entrant to
challenge established U.S. chains in the FFHR category. The QSR segment appeared to
be less vulnerable to a recession than other business as proven during the quarter ended
May 2010, both QSR and FFHR sales decreased 0.5%, compared to a 3% decline at both
casual dining chains and family dining chains. The U.S. restaurant category as a whole
.declined 1% during the same time period
Apart of all the above, Americas increasing concern with health and fitness was also
putting pressure on restaurants to offer healthier menu items. For example, one county in
California had attempted to ban McDonalds from including toys in its high-calorie
.Happy Meal because legislators believed that toys attracted children to unhealthy food
:Company objectives
.To boost the brand image of the company
.To provide measures to improve the companys performance in the market
:Weaknesses
.Heavily concentrated in the U.S
.Few corporately owned stores
:Opportunities
.New product development (breakfast)
:Threats
.Changing consumer habits towards healthier food choices
In this kind of firms are defenders with a limited product line that focus on
improving the efficiency of their existing operation. This cost orientation makes
.them unlikely to innovate in new areas. With its emphasis on efficiency
:Strategies
A strategy of a corporation forms a comprehensive master plan that states how the
corporation will achieve its mission and objectives. It maximizes competitive
.advantage and minimize competitive disadvantage
:The typical business firm usually considers three types of strategy
Corporate strategy : Stability , growth and retrenchment
-1
-2
-3
-1
-2
Encirclement attack
Bypass attack
-3
-4
-1
Product proliferation
-2
Product innovation
-3
Improved services
-4
-5
Pricing is one of the most important elements of the marketing mix, which
.generates a turnover for the organization
The success in pricing strategies for businesses is heightened with clarity on
market conditions, an understanding of the consumer's unmet desire, and the
.amount they are willing to pay to fulfill it
-1
-2
-3
-4
-5
-1
-2
Specific recommendation:
Focus on its two basic strengths fl ame boiled burgers and
food made
the way customers want
Do operation analysis of the in-store work and speed up the system
e.g.
introduction of multiple counters for taking orders.
I n t ro d u c e a n d e n f o rc e c e n t r a l l y p re p a re d d e t a i l e d f o o d
p re p a r a t i o n g u i d e l i n e s t o bring in uniformity and
consistency in the
taste, ingredient proportion and overall quality of the food.
Remodel the less aesthetically appealing stores
10
Re - e v a l u a t e p ro m o t i o n a l o ff e r s . I n t ro d u c e v a l u e m e a l s
with
d i s c o u n t o n b i g g e r orders
Introduce home delivery facility wherever possible.
Retain ice-creams even if the erstwhile menu is pruned. This is
because
the major ice-cream brands in US such as Baskin Robbins do
not have the
kind of extensive n e t w o r k o f s t o re s l i ke B u rg e r K i n g .
Hence it is
p o s s i b l e t o g a i n a h u g e c h u n k o f shares of ice cream
market in the
strategically favorable locations OR Enter into a tie-up with
ice-cream
brands like Dunkin Donuts has done with Baskin Robbins at
some stores.
Conduct an extensive audience analysis to assess the image of the
company Vis -Vis its competitors and based on it design the communication
strategy.
If its proved that many customers viewed it as a low quality
product
maintain low profile temporarily to identify the root cause of bad
image and
address it. The causes may be anything from bad service to
constant image
change, but it is necessary to address it before launching another
campaign
Advertisements should be relevant and succinct. Creativity and
humor are
Welcome but no beating around the bush.
11
12
13