Professional Documents
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Marketing - Mcdonalds
Marketing - Mcdonalds
A MARKETING PROPOSAL
Presented to
the Faculty of the College of Business Administration
ADAMSON UNIVERSITY
Manila
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Chapter 1: Introduction
happened after Ray Kroc from Chicago joined two brothers in their business. He
quickly realized and had a vision to expand the business throughout USA and
beyond1. They spread across 120 countries and operate around 37, 241
million customers per day. In 2018, McDonald’s generated revenues of more than
21 billion U.S. dollars and the largest proportion of which came from the USA 2.
The key to such a rapid and successful international expansion is the business
restaurants that are franchised. The company can achieve rapid expansion by
franchise model. Today over 90% of McDonald’s restaurants are running based
on franchise model.3
1 https://corporate.mcdonalds.com/corpmcd/about-us/history.html
2 https://www.statista.com/statistics/273057/value-of-the-most-valuable-fast-food-brands-
worldwide/
3 https://corporate.mcdonalds.com/corpmcd/about-us/our-business-model.html
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Figure 1 1st First McDonald’s Restaurant4
to eat and drink. Our worldwide operations are aligned around a global strategy
McDonald’s place the customer experience at the core of all they do. The
customers are the reason for their existence. The company demonstrates its
4 https://corporate.mcdonalds.com/corpmcd/about-us/history.html
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appreciation by providing them with high quality food and superior service in a
clean, welcoming environment, at a great value. The goals of the company are
quality service, cleanliness and value (QSC&V) for every customer, each time.
nurture talent, develop leaders and reward achievement. We believe that a team
company employees, is our foundation, and balancing the interests of all three
groups is key.
business. At McDonald’s, they hold themselves and conduct the business to high
the responsibilities that come with being a leader. They help their customers build
our size, scope and resources to help make the world a better place.
5 https://corporate.mcdonalds.com/corpmcd/about-us/history.html
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McDonald’s grow their business profitably. McDonald’s is a publicly traded
company. As such, they work to provide sustained profitable growth for our
shareholders. This requires a continuous focus on our customers and the health
of our system.
that aims to anticipate and respond to changing customer, employee and system
cent hamburger.
1949 French Fries replace potato chips and debut Triple
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1954 Multimixers. The 52-year-old Kroc is fascinated by
would be in hamburgers.
1955 Kroc opens his first McDonald's in Des Plaines,
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Delligatti of Pittsburgh, is added to the national menu.
McDonald House.
1975 The Egg McMuffin, created by Owner/Operator Herb
national menu.
1983 Chicken McNuggets are introduced into all domestic
U.S. restaurants.
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Australia.
1995 McFlurry Desserts, invented by Ron McLellan, O/O
UberEATS.7
7 https://corporate.mcdonalds.com/corpmcd/about-us/history.html
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1.5 Management
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Steve Easterbrook
President and Chief
Executive Officer
Corporate Regional
Kevin Ozan
Francesca DeBiase Executive Vice
Chief Supply Chain and President and Chief
Sustainability Officer Financial Officer Joe Erlinger
President, Internation
al Operated Markets
Mason Smoot
Senior Vice
David Fairhurst President, Strategic
Executive Vice Alignment and Chief Ian Borden
President and Chief of Staff, Office of the President,
People Officer CEO International
Developmental
Licensed Markets
Daniel Henry
Robert Gibbs Executive Vice President,
Executive Vice Global CIO
President and Global
Chief Communications
Officer
Piotr Jucha
Senior Vice President,
Jerry Krulewitch Global Restaurant
Executive Vice President Development &
and General Counsel Restaurant Solutions
and Secretary Group
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McDonald’s Corporation has a divisional organizational structure. The
area or set of strategic objectives. One of the aims of this corporate structure is
cover all its operations worldwide. This feature of the organizational structure
McDonald’s CEO directs the activities of all business areas through this structural
characteristic. Mandates and directives are passed from the CEO down to middle
organizational structure: (a) U.S., (b) Europe, (c) Asia/Pacific, (d) Middle East
and Africa, and (e) Other Countries & Corporate (OCC) including Canada, Latin
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America and Corporate. After the reorganization, the company used performance
as basis for the new divisions in its organizational structure: (a) U.S., (b)
International Lead Markets, (c) High Growth Markets, and (d) Foundational
Markets and Corporate. The United States division provides the biggest regional
markets account for a small minority of McDonald’s revenues, even though these
economic development.
its corporate structure. Like in corporate operations, the company has a People
group for human resource management, and a Supply Chain and Sustainability
group for supply chain management and sustainability endeavors. Each group is
Groups may be added or changed as the company grows and its target
markets change.
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McDonald’s international expansion started in 1967 when the company
opened in Canada and Puerto Rico. 10 The company has grown into a global giant
with increasing numbers of stores year-on-year over the years. The international
more than 21 billion U.S. dollars, where the largest proportion of this came from
the U.S. Even more critical than the amount of sales to the company is the
There are a few major reasons why McDonald’s not only chose to invest
overseas originally, but also continuously since, in the last ten years, almost 90%
During that time, the 1990’s saw an increase in international units from 3,600 in
1991 to more than 11,000 by 1998, largely in Japan, Canada, Germany, Great
the entrepreneur ranked, and has entrepreneur franchised of 500 for 2018.
set a long-term plan to increase the percent of restaurants that are franchised. He
describes the benefits of franchising as “By identifying strategic partners who share our
10 https://corporate.mcdonalds.com/corpmcd/about-us/history.html
11 www.global linksconsulting.com/Global%20Inc/pgs/recorp/mcd/mcds.html
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values and vision to accelerate our growth and scale across diverse markets, we will
drive innovation, becoming more relevant to our customers and the communities we
serve.”
More than 90% of our restaurants worldwide are owned and operated by
independent Franchisees.12
Pricing Strategy
costs, analyzing competitors costs, prices and offers, selecting pricing method
and selecting the final price. These processes are the basic framework that
The price points and price ranges of the company’s food and beverage
products. The aim is to use prices to maximize profit margins and sales volume.
In the bundle pricing strategy, McDonald’s offers meals and other product
bundles for prices that are discounted, compared to purchasing each item
12 https://corporate.mcdonalds.com/corpmcd/franchising/global-franchising.html
13 http://burnsetal.com/2015/06/pricing-strategies-macdonalds/
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separately. For example, customers can purchase a Happy Meal or an Extra
more affordable, such as $__.99 instead of rounding it off to the nearest dollar.
Growth Strategy
named as such because the company is moving fast and in a clearly defined
direction. The most meaningful way to grow the business and create value for all
McDonald’s focused on giving customers what they really want, hot, delicious
14 http://panmore.com/mcdonalds-marketing-mix-4ps-analysis
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food served quickly – with an overall experience and value for their money that
and snacks.
15 https://corporate.mcdonalds.com/corpmcd/about-us/our-growth-strategy.html
16 https://corporate.mcdonalds.com/corpmcd/about-us/our-growth-strategy.html
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Chapter 2: The Product
Obesity is one the major public health concern in this modern-day society
and in recent years, they are focusing on the environmental factors that are
calories expended and globally there has been : 1) Increased in intake of energy-
dense foods that are high in fat, and ; 2) An increased in physical inactivity, for
works are now becoming sedentary in nature and even the changes in
are the 2016 data from WHO, that shows the statics of obesity globally 18:
More than 1.9 Billion adults ages 18 years old and above were
were obese.
The worldwide prevalence of obesity nearly tripled between 1975
and 2016.
17 https://www.who.int/news-room/fact-sheets/detail/obesity-and-overweight
18 https://www.who.int/news-room/fact-sheets/detail/obesity-and-overweight
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The presence of fast food restaurant has been associated with poorer diet
quality and higher energy intake for individual, which are the reasons why fast
food industry is being criticized for their contribution on the increasing rate of
obesity.
19 https://mchb.hrsa.gov/whusa13/health-status/health-behaviors/img/nVas.gif
20 https://infograph.venngage.com/p/8840/how-does-the-rise-of-fast-food-factor-into-the-growing-
obesity-rate
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The figure above shows the relationship of Fast food restaurant in USA.
As per the data in the above figure the obesity rate is affected by the number of
fast food restaurant in that state, and the research also proves that if a person is
living within 10 miles of the fast food restaurant they are twice as likely to be
obese.21
21 https://infograph.venngage.com/p/8840/how-does-the-rise-of-fast-food-factor-into-the-growing-
obesity-rate
22 http://kidskunst.info/59/07777-fast-food-obesity-statistics.htm
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Increasing Health consciousness
Due to high obesity rate in the large part of the world more and more
individuals are turning their back in the fast food industries and this trend is
Below is a statistic that shows people are now shifting their lifestyle into a
healthier one, because of the continuous growth in the revenue of the health and
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Chart 1 Revenue of Health and wellness food market23
Switzerland, Russia, Hong Kong, China, Japan, Taiwan and Australia), where
85% of their overall sales is accounted for. 24 They will have an increase access
23 https://www.statista.com/statistics/502267/global-health-and-wellness-food-market-value/
24 https://www.nytimes.com/2013/09/27/business/mcdonalds-moves-toward-a-healthier-menu.html
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In June of 2018, 100 percent of the meal combinations offered on Happy
Meal menu boards in the US is 600 calories or under, and together with this is
Conclusion
With all the reasons stated, from the relationship of Obesity with fast food
aligned with all the trends and plans of the Company. The researchers have
concluded that the product must not only be healthy but also enough to still
provide the needed daily intake of calories especially for the working individual,
Figure 6 will show the average dietary energy requirement per day, and
the range is from 1700 to as high as 2500 kcal per day 26.
The Product
Meal” with a tagline “The Meal that will get you through out the day, and a
The product name was come up, because the researchers do want to
convey the message that the new product will give them the energy like a Super
25 https://www.healthiergeneration.org/articles/mcdonalds-announces-global-commitment-to-support-
families-with-increased-focus-on-happy
26 https://ourworldindata.org/food-per-person
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Human, while having a healthy lifestyle in their hectic and busy schedules.
The product will include the Garden McSalad Shaker (contains a green
salad mix, a cheddar and jack cheese blend, chopped eggs, chopped tomatoes
and green onions), Steamed Chicken Breast (in apple cider sauce), a fruit bag
McCombo Meal:
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The Niche Market of this proposal are the working individuals, that is why
the product should contribute on the achievement of their daily Average Dietary
Energy Requirement in a healthy way and at the same time can be a grab and go
meal to match their busy and hectic lifestyle. Below are the products included in
This has been eliminated for a while in the menu of McDonald’s since
2008 due to low sales27. This item is only a victim of wrong timing of entry, but
now is the time to re-introduce the product, since the trend is already into a
healthy lifestyle and at the same time McDonald’s is into healthier Menu.
This product is perfect for working individuals since you can just grab and
27 https://mashable.com/2013/11/14/forgotten-mcdonalds-menu-items/
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Figure 7 McSalad Shaker Packaging
The researchers choose the steamed way of cooking the chicken rather
than grilling, because the latter way leads to more carcinogens which causes
higher risk to cancer, steaming allows the chicken to be cook without using oil
The Breast part of the chicken will be use because it is very low in fat and
has more protein, it is a leaner food too, meaning the consumer won’t feel heavy
on the stomach upon consumption of the food. This part can provide more
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Figure 8 Image of Steamed
Chicken Breast
The apple cider is chosen to be sauce of the steamed chicken for its taste
gives also a flavor to salads, which is the partner of the chicken. Other reasons
are its health benefits, such as it aids in weight loss, can reduce blood pressure
and cholesterol.28
Sauce, which can be served mix together with the chicken or as a separate item.
28 https://edition.cnn.com/2017/04/18/health/apple-cider-vinegar-uses/index.html
29 https://www.myfitnesspal.com/food/calories/178621882
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Carbohydrates (g) 7.6
Of which sugar (g) 6.4
Fiber (g) 1.1
Protein (g) 0.1
Table 3 Nutritional Facts of Apple Fruit Bag
The Drinks
There will be only three choices for the drinks of Super McCombo meal to
ensure that the healthy meal combination will be partnered by a healthy drink too.
The choices will be Bottled Water, Tea, or Organic Milk. These are chosen
3.1 Introduction
“What segment should be the target?”, this includes the types of customers and
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the product that will be introducing to satisfy and create value on the consumers.
This has been already addressed by McDonald’s, being 2 nd in the rank for the
Most Valuable Restaurant Brands in world 30 and operating in 120 countries with
37, 241 restaurants (34,108 were franchised and 3,133 were operated by the
company) as of the end of 2017 31, the company has already segmented their
similar characteristics and opportunities for growth will be combined, and this
segmentation also reflects how their management reviews and evaluate the
operating performance. The table below shows how McDonald’s segmented their
market.
30https://www.qsrmagazine.com/content/10-most-valuable-restaurant-brands-world
31https://corporate.mcdonalds.com/content/dam/gwscorp/investor-relations-content/annual-
reports/McDonald%27s%202017%20Annual%20Report.pdf
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Foundational Markets & Corporate The remaining markets in the
Revenues
9.00%
35.00%
24.00%
32.00%
With all the facts presented, the researchers choose the International
Lead Markets to be the potential target markets, in which a new product will be
launched. The reason behind is that this market segmentation contributes largely
32 https://corporate.mcdonalds.com/content/dam/gwscorp/investor-relations-content/annual-
reports/McDonald%27s%202017%20Annual%20Report.pdf
33 https://corporate.mcdonalds.com/content/dam/gwscorp/investor-relations-content/annual-
reports/McDonald%27s%202017%20Annual%20Report.pdf
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to the income of the company, and this segment is in the 2020 plan of
McDonald’s where the healthier menu will be launch, where in our proposed
product is very timely. The conductors of the study will focus on Germany,
France, and United Kingdom, because these three places are among the highest
income contributor on their market segment, and the bracket that they belong
with have maintained an increasing Guest Counts in the past years. Also, as
shown in figure 11, the three chosen countries are included in the places that
holds the most numbers of McDonald’s around the world, that contributes to the
34 https://corporate.mcdonalds.com/content/dam/gwscorp/investor-relations-content/annual-
reports/McDonald%27s%202017%20Annual%20Report.pdf
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Figure 11 List of
Countries with Most
McDonald's35
History
restaurant, which was in Creteil, a suburb of Paris did not experience success, as
the French fought the Americanization of their country, and thus the franchise
closed quickly. Therefore, McDonald’s recognizes its official entrance into France
open a restaurant in the food court at the Louvre to celebrate its 30 th anniversary
35 https://www.worldatlas.com/articles/countries-with-the-most-mcdonald-s-restaurant.html
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in France (Samuel). Employees at the world’s most visited fine arts museum are
McDonald’s will take attention away from the artwork that the Louvre is known
for, stating that “the first thing visitors will likely see when they arrive are big
have stated that this McDonald’s is in line with the image and aesthetic of the
Louvre, and it also represents the American portion of the food court (Samuel).
culture, they cannot deny the success of American business models, especially
in the case of fast food. When examining the battle of globalization that exists
between the United States and France, it becomes clear that the French are
fast food, McDonald’s has seen great success in France. Today there are more
with Canada, Japan, Germany, Australia, and England, France helps to make up
the company opened 30 new franchises in order to serve 450 million new
customers, effectively creating the largest market for McDonald’s outside the
United States (McDonald’s History). It is unlikely that French citizens will ever be
truly satisfied with McDonald’s and the Americanization that it represents, yet
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French customers continue to be frequent patrons, meaning that the company
efforts, one of the step that they had take is changing their logo. The green logo
had change the traditional red background for a deep green. The company will
also make this change to other branches in Germany and in Great Britain.
36 https://uramericansinparis.wordpress.com/2010/12/14/mcdonalds-in-france/
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Figure 13 McDonald's
France Logo
France.
and other restaurant data conducted by Gira Conseil, a food consultancy firm.
The latest survey, to be released in May, found that fast food chains now account
for 54 percent of all restaurant sales in France. While McDonald's has been in
France since the 1970s, many industry observers say it wasn't until the turn of
this century that outlets for both American and European fast food chains really
began proliferating. The fast food market is now so ripe that Subway says it has
opened some 400 stores in the past decade, and Burger King, which shut its 39
French restaurants 16 years ago, recently re-entered the market with great
success. And as we've previously reported, McDonald's has risen to the top of
the fast food pack in France, with more than 1,200 outlets, precisely by fine-
tuning its menu to fit the local culture (think grass-fed beef burgers). In 2011, the
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company even opened a salad-only cafe, called McSalad, which managed to win
McDonald’s restaurants in Europe (Germany is still No. 1), it’s seen a 4 percent
growth just since 2016. And its way out ahead of any other fast-food chain: The
Bertrand Group, which owns Burger King, Au Bureau, Quick and Hippopotamus,
earned less than $2 billion in 2017. McDonald’s is also a titan of job production in
greater than the French economy, McDo is one of the largest sources of private-
Through the articles that have been stated above, McDonald’s was able to
show that for a long time, they are number one in the fast food industry of
France. This also shows how the McDonald’s had change the game, from the
The chart below will support the articles that have been stated earlier
37 https://www.npr.org/sections/thesalt/2013/04/29/179879664/mon-dieu-fast-food-now-rules-in-
france?sc=tw&cc=share
38 https://www.ozy.com/acumen/in-france-mcdonalds-not-the-bistro-is-king/89709
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Chart 3 McDonald's Standing in French Market
INDUSTRY ANALYSIS
Force Influence Factors
Threats of New Moderate - Due to the amount of capitalization need
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Power of provide the needs of the players, thus this
prices.
Threats of Strong - Since France is also known for its fine
substitution
Intensity of Strong - Fast food industry in France is growing
Bracket
0 - 14 6,360,218 6,076,598 12,436,816
15 - 24 4,045,901 3,864,395 7,910,296
25 - 54 12,773,900 12,578,256 25,352,156
55 - 64 4,020,507 4,315,407 8,335,914
65 – Above 5,648,888 7,422,091 13,070,979
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The total population of France as of July 2017 is 67,106,161 39, and the
Populati on
19.48% 18.53%
12.42% 11.79%
37.78%
0 -14 15 - 24 25 - 54 55 - 64 65 - Above
39 https://www.indexmundi.com/france/demographics_profile.html
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Chart 4 Percentage of Population in France
14,000,000
12,000,000
10,000,000
8,000,000
6,000,000
4,000,000
2,000,000 Fema l e
Mal e
0
0 - 14 15 - 24 25 - 54 55 -64 65 - Above
Mal e Femal e
Housing, Health status, Civic Engagement, Work Life Balance and Personal
Security, that will help to have a better understanding of the target market.
Income
capita is USD 31,137 per year. This is higher than the average in OECD
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countries, which means that the people in this country has a higher standard of
living, and a large part of their income can be allocated for eating at fast foods,
40
and even fine dining restaurants.
Jobs
About 65% of France population ageing from 15 to 60 years old has a paid
job. This might be lower than the average rate in the OECD Countries, but those
that have been identified as unemployed are actively looking for work.
The wages and monetary benefits averages for USD 42, 992 per year, but
41
there is an average of 0.1% increase per year since 2005.
Education
Education level in one country can help their citizens to land on a job with
income that will suffice for their needs. France has 16.5 years of education that
ranges from 5 to 39 years old, which is less than the average education year in
OECD countries. Also, 78% of the adults ageing from 25 to 64 have completed
Health
40 http://www.oecdbetterlifeindex.org/countries/france/
41 http://www.oecdbetterlifeindex.org/countries/france/
42 http://www.oecdbetterlifeindex.org/countries/france/
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Because of the living conditions, public health interventions, and progress
in medical care, French enjoys 82 years life expectancy and it is higher than the
Obesity
Life Satisfaction
This is measured on how the people evaluated their life, and French
people rate it 6.4 which is close to the average life satisfaction rating in OECD
countries.45
France, almost 8% of the employees work for very long hours, but they are
devoting 16.4 hours to their personal care and leisure which is more than the
French people eat three times a day with no snacks in between. Breakfast
is the lightest meal, which consist of bread and coffee, followed by a large leisure
43 http://www.oecdbetterlifeindex.org/countries/france/
44 https://www.indexmundi.com/france/demographics_profile.html
45 http://www.oecdbetterlifeindex.org/countries/france/
46 http://www.oecdbetterlifeindex.org/countries/france/
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lunch and four-course dinner. They are taught at the very young age to
appreciate fine foods, that is why they have less of fast food culture. 47
Strategy to introduce the new product. This strategy will cover the age bracket
conferences.
47 https://traveltips.usatoday.com/food-eating-habits-france-12279.html
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In Great Britain McDonald’s is the largest fast food restaurant in
terms of the sales generated, and this all started way back in 1974, when
Woolwich
- Head Office was sited in
broadcast
1978 - Head Office was relocated to
QSR restaurant in UK to
consumers
- Chicken McNuggets was first
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introduced in the menu
1986 - First franchisee-operated
Middlesex
- Happy Meals were introduced
to UK.
1989 - Manchester regional training
center opened.
- McChicken sandwich was
introduced in Menu
1994 - McDonald’s celebrated 20
League
1996 - Vegetable Deluxe was
introduced nationwide
1998 - McDonald’s was recognized as
an Investor in People
1999 - McDonald’s celebrated its silver
year in UK
2000 - McDonald’s UK launched their
website:
www.mcdonalds.uk.com
- McFlurry ice cream dessert
was launched
2003 - Fruit Bag was Introduced in the
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menu
2004 - Additional menu on breakfast
UK
2007 - McDonald’s started to use
Tea
2011 - McDonald’s became more
40th year in UK
- They launched free fruit
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behind the scenes of supply
their products
2017 - McDonald’s celebrated 11
UK
Table 7 Timeline of McDonald's UK48
McDonald’s in UK Market
contributed to its great success49, and this can be attributed to the result of a
survey conducted in the year 2015, in which the objective was to know the
48 https://www.mcdonalds.com/gb/en-gb/newsroom/history.html
49 https://realmoney.thestreet.com/articles/10/25/2017/mcdonalds-uses-u.k.-market-springboard-
international-sales-growth
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leading fast food restaurant in UK and turns out that 57% of the respondent said,
INDUSTRY ANALYSIS
Force Influenc Factors
50 https://www.statista.com/statistics/527217/leading-fast-food-restaurants-in-the-united-kingdom-uk/
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Threats of New Entrants Strong - The cost of setting up is a new chain
the market
ready-to-eat meals.
Intensity of Rivalry Strong - The dominant firms control a larger
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As of July 2017, United Kingdom has a total population of 64,769,452 51,
and the table below shows the complete data on the demographics of the said
country.
51 https://www.indexmundi.com/united_kingdom/demographics_profile.html
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Populati on
18.04% 17.53%
11.98% 11.90%
40.55%
0 - 14 15 - 24 25 - 54 55 - 64 65 - Above
14,000,000
12,000,000
10,000,000
8,000,000
6,000,000
4,000,000
2,000,000 Fema l e
Mal e
0
0 - 14 15 - 24 25 - 54 55 - 64 65 - Above
Mal e Femal e
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According to the Better life index, United Kingdom is performing well as
the different criteria that the researchers have taken into consideration.
Income
household after taxes and transfer, which simply means, it is the amount of
money that is available for a household spending on goods and services. The
average household net adjusted disposable income per capita is USD 208,408
per year. 52
financial worth (e.g. money held in bank accounts). The average amount of
Household net financial wealth per capita is USD 83,405, which is lower than the
Jobs
In United Kingdom, 74% of the working age population has a paid job. The
wages and other monetary benefits that come with the employment, average in
the United Kingdom at USD 42,835 per year and per person. The amount stated
Education
52 http://www.oecdbetterlifeindex.org/countries/united-kingdom/
53 http://www.oecdbetterlifeindex.org/countries/united-kingdom/
54 http://www.oecdbetterlifeindex.org/countries/united-kingdom/
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A person who have a good education increase the likelihood of finding a
job and earning enough money. In United Kingdom, ages 5 to 39 years old has
55
an average of 16.8 years of education.
because it can indicate if the country is preparing its students to meet the
81% of its population from 25 to 64 years old who had completed their Upper
Secondary Education, which is higher than the average for OECD Countries.
Health
The United Kingdom has a Life Expectancy of 81 years, which is one year
higher than the average in OECD Countries. This higher life expectancy can be
attributed to the higher health care spending per person, living standards,
Obesity
Life Satisfaction
55 http://www.oecdbetterlifeindex.org/countries/united-kingdom/
56 http://www.oecdbetterlifeindex.org/countries/united-kingdom/
57 https://www.indexmundi.com/united_kingdom/demographics_profile.html
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This life satisfaction or the presence of positive experiences and feelings
and even the absences of negative experiences and feelings, is also necessary
country. British has an average of 6.7 life satisfaction that is higher than the
Work-Life Balance
important for the well being of every individual. Almost 13% of the employees in
United Kingdom work for very long hours, which means they are spending 50
Despite of the long hours British is spending on their work, they still
manage to have 14.9 hours for personal care and leisure, and this is close to the
Unlike French people, British eat six meals a day which are Breakfast,
Eleven, Lunch, Tea, Dinner, and Supper. The Breakfast is usually heavy and with
a lot of variety. Eleven, refers to the time of the day, where morning snack is
Lunch is usually a take away food. Dinner is the main meal of the day, which
61
consist of a meat and any two vegetable.
58 http://www.oecdbetterlifeindex.org/countries/united-kingdom/
59 http://www.oecdbetterlifeindex.org/countries/united-kingdom/
60 http://www.oecdbetterlifeindex.org/countries/united-kingdom/
61 https://www.scribd.com/document/83327061/Eating-Habits-in-Great-Britain
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Target Market Strategy
Targeting Market Strategy to introduce the new product. This strategy will cover
conferences.
Munich, Germany
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1989 Sales reached 1 billion for the first
time
1999 1000th restaurant was opened
2003 Introduction of new marketing era with
A study was conducted in Germany from year 2014 to 2018 to show who
are the most popular fast food restaurant in the country. The graph shows that
McDonald’s is the lead player in the German fast food market and has a large
gap between its competitors. Also, according to the study, the population ages
from 14 years old and above is visiting the place at least once a month. Through
this we can conclude that McDonald’s have a strong hold to the German Market.
62 https://www.statista.com/statistics/560813/most-popular-fast-food-restaurants-germany/
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Porter’s Five Forces Analysis
INDUSTRY ANALYSIS
Force Influence Factors
Threats of New Moderate - Entering the market in Germany is
entrants.
- The legal requirements for a new
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restaurant are also threated as a
different customers.
Bargaining Power Strong - There is a trend in Germany now,
demand.
Threats of Moderate - Fast food offers cheaper prices than
offer convenience.
Intensity of Rivalry Strong - The players are more of
quality.
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Table 10 Porter's Five Forces – Germany
As of July 2017, Germany has a total population of 80, 549,017 63, and the
below table will give the detailed composition of the said number.
63 https://www.indexmundi.com/germany/demographics_profile.html
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Populati on
12.82%
22.06%
10.09%
14.58%
40.45%
0 - 14 15 - 24 25 - 54 55 - 64 65 - Above
Chart Title
18,000,000
16,000,000
14,000,000
12,000,000
10,000,000
8,000,000
6,000,000
4,000,000
Fema l e
2,000,000
Mal e
0
0 - 14 15 - 24 25 - 54 55 - 64 65 - Above
Mal e Femal e
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Consumer Analysis – Standards of Living
As per the result of Better Life Index, Germans are more satisfied in their
lives than the average of OECD countries. This is supported by the below
criterion.
Income
Jobs
About 75% of the working age in Germany which is 15 to 64 years old has
a paid job. This percentage is higher compared to the other OECD countries.
The population with paid job is enjoying wages and other monetary benefits on
the average of USD 46, 389 per year and this is more than the average on what
Education
through 18.3 years of education, which is more than average of 17 years in the
OECD countries. Also, the age group of 25 to 64 years old is comprise of 86%
66
who have completed their secondary education.
64 http://www.oecdbetterlifeindex.org/countries/germany/
65 http://www.oecdbetterlifeindex.org/countries/germany/
66 http://www.oecdbetterlifeindex.org/countries/germany/
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Health
higher on the average of other OECD Countries, and 65% of their population is
Obesity
Life Satisfaction
This a measure of how people evaluate their life, and Germans, do have a
Work-Life Balance
Five (5) percent of the German work force population is working for more
than 50 hours per week, and they are also enjoying 15.6 hours for personal care
Like the French people, German do have 3 main meals per day, which are
the Breakfast, Lunch and Dinner. The breakfast generally bread, cold cuts,
cheese, eggs, honey, coffee or tea. Their main meal is the Lunch which
comprises a meat and vegetables. Dinner is the smallest meal of the day, but
67 http://www.oecdbetterlifeindex.org/countries/germany/
68 http://www.oecdbetterlifeindex.org/countries/germany/
69 http://www.oecdbetterlifeindex.org/countries/germany/
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due to change in eating habits, it is also becoming an important meal, this consist
Like in first two countries, the researchers opted to use the Focus or
strategy will cover the age bracket which have their own source of income.
conferences.
After gathering all the necessary data, a comparison had been done, for
France UK Germany
Bargaining Strong Moderate Strong
Power of Buyer
Through this we can see that the France and German consumers greatly
affect the movement of the company. Both countries are now having a shift in
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their lifestyle, the French are going back to fine dining, while Germans are having
France UK Germany
st st st
Market Standing 1 1 1
chosen, since in the three countries McDonald’s is the top market player.
France UK Germany
Population 62% 64% 65%
percentage
Among the three markets Germany has the largest percentage if the
chosen Niche market of the researchers. The niche market is consisted by the
working age group, which is according to the study of Better Life Index, it is from
15 – 60 years old.
France UK Germany
Employment 65% 74% 75%
Rate
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The country with highest employment rate among its working age group is
the Germany, which will give a higher number of customers in that country.
France UK Germany
Wages and other USD 42, 992 per USD 42,835 per USD 46, 389 per
benefits
This shows that among the three countries Germany has the highest
income given to its work force, which gives them the ability to avail meals in fast
food restaurants.
Obesity Rate
France UK Germany
Obesity Rate 21.6% 27.8% 22.3%
United Kingdom is the country with highest obesity rate among the three
global markets. This states impliedly that they have the highest consumption of
France UK Germany
Meal of the Day Breakfast Diner Lunch
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France and Germany are the two countries that are product might be
suitable because the proposed meal is intended to get the consumers throughout
the day.
The Conclusion
With all the facts that have been laid down for the three countries, and
after comparing the chosen global markets, Germany standout among the other
choices. The reason is that, Germany is the most sensitive country in terms of
the demand of its consumers, that is why they belong to the plan of McDonalds
for 2020 Healthier Menu. At the same time, they have the largest percentage of
the Target Market of our product. The working population of Germany has also
the highest amount of paid wage, which allows them to have a higher purchasing
power. Lastly, the “Super McCombo Meal” is really intended to give the
necessary nutrition for the day in a healthy and convenient way, which the
Germans are up to, since they are into healthy living, but their way of life is so
has been rapid period of growth and success in reaching the one billion sales for
the first time in 1989. The company opened its 1000 branch in 1999 in Germany
and continued with further development: like the induction of new era of
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marketing slogan in 2003 “I’m Lovin’ It” (Ichliebees-in germany) also creates new
line of high quality, fresh products like Salads and fruit bags in 2004. 70 They also
more on Healthy living. The company further proved its ability in listening to
market trends, that’s why McDonald’s launched almost 500 McCafe across
70 http://www.foodchainmagazine.com/2015/11/30/mcdonalds-germany/
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Standard menu items at German McDonald's include the Hamburger
Royal TS, Caesar salads,71 one Veggie burger called Veggie Clubhouse and
Caesar, honey mustard, and Ranch chicken wraps, The McRib sandwich, a
Eggs with Bacon and "Classic Breakfast", a choice of bread rolls with sweet
Since in Germany they value Nutritional foods and Health Concern we will
launch a bundle of food consist of veggie salad, a piece of apple and a steamed
breast chicken.
variables to segment the market, at the same time considering changing taste,
Our target markets are those people who are ages 25-60 since as the
survey showed that most people who patronize McDonald’s in Germany are the
the working people. They are income generator they afford the product and the
72 Feder, Barnaby J. (December 9, 1992). "A McDonald's Burger of the Garden Variety". The New York
Times. Archived from the original on November 16, 2011.
73 "Breakfast product information at mcdonalds.de". Retrieved 17 February 2013.
74 https://www.marketing91.com/marketing-strategy-mcdonalds/
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Brand Name
The branding of McDonald’s has evolved since the early conception. This
has tried to conform to both popular culture and changing views of healthy living
or eating.
The McDonald’s Brand itself has evolved considerably to cope with the
face of changing society. What was the once seen as a predominantly child
oriented “fun” restaurant has now undergone a shift into a slightly more health
Brand Equity
value. More than 48% feel comfortable at McDonald’s. 76 The kids feel excited and
with friends.
Positioning
75 https://www.marketing91.com/marketing-strategy-mcdonalds/
76 https://www.marketing91.com/marketing-strategy-mcdonalds/
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McDonald’s overall positioning can be summarized as: the leading fast
food chain, with lots of convenient locations, well-priced products with a tasty
value propositions that attract and retain customers. Like for example Happy
Meals for young children, Convenient of drive-thru service, Decent quality, and
well-priced food, Wide choice of menu items, Quick service, and Comfortable
surroundings and so on. Happy meal if your targets are the kids, for teenagers
and young adults what attracts them are the menu and price and to attract health
strict process to determine the price for a market. McDonald’s Pricing Process:
competitors costs, prices and offers, selecting pricing method and selecting the
final price. McDonald’s have two pricing strategy the bundle pricing strategy and
We will use both strategies in the product that we will launch. We will offer
a bundle of food and a lesser price or to save amount of money unlike if they buy
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4.5 Promotion
Distribution Strategy
McDonald’s have several franchised set up to cater to the growing needs
of the different segments and that’s what helps them to survive in the competitive
supply chain with the help of 3 rd party logistics is helping the company in making
the products available to the consumers across the service delivery channel.
Also, to make this kind of store set-ups work properly, TAT (turnaround-Time) and
restaurants. Other places where the company uses to sell its products are:
counter-service
sit-down
drive-thru
Kiosks
77 http://www.foodchainmagazine.com/2015/11/30/mcdonalds-germany/
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McDonald’s mobile app7879
inexpensive and gives brands instant reach to billions of active users. For these
reasons, social media has proven to be one of the most effective channels to
Waterfall Strategy
The “Super McCombo Meal” will be released first to Germany, as per the
research done by the researchers, and we will duplicate it and launched to other
markets. The next target market will be in France then United Kingdom. Since
they belong to the same Segmentation and they are identified in the top 20
78 https://mpk732t12016clusterb.wordpress.com/2016/05/14/distribution-and-logistics/
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Markets that will have healthier menu in 2020. Finally, as we go global, further
research regarding the other target countries will be conducted. Things that will
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