CASE STUDY -1

BURGER KING: DEVELOPING A MARKET MIX FOR GROWTH

Burger king uses its marketing mix (4p’s) for the global quick services
restaurant industry. marketing mix is a combination of strategies and
tactics to effectively implement a marketing plan. Wendy’s and
McDonald’s are in the focus of BK’s marketing mix efforts.
1) Importance of each component (product /price
/promotion/place in burger kings marketing mix –
A) Product –
Burger king operates as a quick services restaurant business focusing
on burger as its main product and product is one of the main
components of BK’s marketing mix which targets customer.
 Even though bk revolutionized their products according to
trend and market their main core products remain same –
Hamburgers, French fries, onion rings, soft drinks, milk shakes
and desert.
 The signature sandwich of bk is still the whopper which is
created in 1957, the whopper: hamburger with lettuce,
tomato, mayonnaise, pickle and ketchup.
 1970’s- BK started serving breakfast.
 2015 – company still offered traditional breakfast such as
browns, sandwich with eggs, cheese, sausage, breakfast bowls,
oatmeal’s etc.
 1986 – BK introduced bk chicken tenders to compete with
McDonald’s chicken McNuggets.
 1990- Broiled chicken sandwich, kids club.
 1998- Value meal
 2013 – Angus steak burger
 2015 – steakhouse XT burger.
 Regional tastes
 In Saudi Arabia – pork was not served
 In Australia – introduced Aussie burger with Australian
flavours.
 In Asian countries – company featured dark- meat chicken.
B) PRICE –
BK ‘S pricing strategy is based mainly on cost minimization
 BK’S prices were traditionally high.
 Company tried to be more price conscious
 In late 2014 and early 2015, BK offered its chicken tenders for
half price for limited time which results in a lower per-unit cost
than McDonalds.
 Market – oriented pricing strategy.
 Bundel pricing strategy.
C) PLACE: Distribution, Design, and Layout of the
Stores, and Store locations
a) Distribution –
 In early 1990s BK creates Restaurant Services Inc. (RSI)
It is an independent supply chain management and
distribution co-operative, owned jointly by bk’s franchises
and bk’s corporation.
 In 2015, RSI managed BK’s distribution by identifying
potential new distributors and increase standards regional
distribution centres.
 RSI attempted to reduce logistics and distribution cost.
b) Design and Layout of the stores -
 Resembled the classic fast food chain outlet and small
interior with a limited dining area.
 In 2009 BK announced 20/20 plan for remodelling of
interior and redesign with rotating red flame chandeliers,
TV screen menu and corrugated metal and brick walls
which costs about $300,000 to $300,000 per restaurant.
 In 2013, Schwartz introduced cost effective plan
 In 2015, 19% 0f bk’s U.S. and Canadian restaurants had
been upgraded.
 BK reported sales increases of 10 to 15 % at the
remodelled locations.
 c) Store location –
 in 2015, BK operated restaurants in all 50 states.
 50 % overall restaurants operated in America and
remaining 50% restaurants are operated in 85 countries
worldwide.
D) PROMOTION –
 In 1950, BK promoted as “the king”
 In 1959 first promotion tool used – TV ads.
 In 1970s Memorable Slogans – “it takes two hands to
handle a whopper” and “have it your way”
 In 2003, viral web – based advertisements and social
media promotion.
 Celebrity camping’s
2) BK’s competitors and their marketing strategy –
In 2015, BK faced strong competition from McDonalds and Wendy’s
directly and also, they faced competition with sonic and jacks, KFC and
taco bell
a) McDonalds and its strategy –
 In 2002, McDonalds introduced its dollar menu
 In 2014 McDonalds team aggressively expand business.
 In 2015 McDonalds became largest fast-food chain in the world
(36,000 locations in 1118 countries)
 They placed their products strategically example – Big Mac,
happy meal for children, Egg McMuffin.
 In 2015 McDonalds starts Provides local food in restaurants.
 in 2015 McDonalds considered as high-quality fast-food
suppliers
 very competitive price
 regional preferences
 in India, beef-based products were not sold
 redesigned their restaurants in café style
 outsourcing – distribution and supply chain network
 they focused on regional distribution channels
  even though the McDonalds supply chain was complex it is
always in the top 10 and top in 2013 according to Gartner’s
supply chain list.
 they targeted children with its iconic company mascot.
 game promotions like Ronaldo MacDonald
 Slogans like – “I’m Lovin it”
b) Wendy’s and its strategy –
 Products placement – they never featured a signature
sandwich like big mac of McDonalds and the whopper of BK
instead of these they offered single, double, triple
hamburgers. and they offered tadeonal chicken sandwich and
another classic product was Frosty dessert.
 They provide free WIFI
 Centralized distribution channel
 Advertisements and slogans
c) Sonic –
 the strategy used by sonic was DRIVE- IN stalls
 outdoor seating and flat screen TV’s
 product – popcorn shrimp, pork sandwich, beer and wine
 in 2004, company began a national ad campaign
d) jack’s –
 it is the first company to introduce intercom services in its
drive-in which allowed multiple customers served
simultaneously.
 they featured more ethnic foods like egg rolls, tacos and etc.
e) PANERA BREAD –
 PANERA BREAD also offered a hidden menu via social media.
f) five guys
g) CHIPOTIE -
 YouTube commercial ads
 it used non-traditional strategy by 2015
 created iPhone app
h) KFC –
 They followed regional and local taste.
 In Muslim countries they offered Halal chicken
i) Taco bell
3) Corporate strategies, Marketing strategies adopted
by Daniel Schwartz when he was CEO of BK –
IN 2010 TGP sold BK to 3G Capital, a Brazilian private equity company for
$ 4 billion. Daniel Schwartz became CFO up to 2014 afterwards he
became CEO, after Daniel became CEO, he put lot efforts to back up the
company, below are some strategies used by the CEO
a) Corporate strategies –
 Several top executives dismissed and 650 employees laid off.
 BK sold around 1200 restaurants and the company only left
with 52 corporate owned restaurants
 Daniel took many costs cutting measures
 BK corporate jet sold
 Converted lavish executives and secretaries’ office to modest
 Open plain office
 He cancelled Italian lake party which cost about $1million
 He saves about $400 million after he became CEO
THE MAIN STRATEGIES –
 IN 2012 BK partnered with justice holding company which
leads to increase of 34% in Net Income
 In 2014, Outlet were raised to 1,493 and 13,667 restaurants in
85 countries
 In 2014 acquired TIM HORTONS for $18,000 million and raised
restaurants by 18,000 locations worldwide –
o 3G Capital hold 51 % of share
o BK owned 27% of share
o TIM HORTONS owned 22% of share
 CEO of TIM HORTONS became VC and Director of BK
b) Marketing strategies –
 Viral marketing strategy
 Sales promotion in the form of coupons
 Website and mobile app ads
 Celebrity campaigns – David Beckham, Mary j bilge and jay
leno
 Slogans and campaigns by college and school students.
 Print media
 Social media and YouTube
4) Key marketing takes -aways from this case –
 Targeting customers –
As we see above in the case that, McDonalds and BK target their
customers i.e., children’s
We have to target customers based on the product significance
And also, by the taste and preferences.
 Positioning –
We have to position the product in the market by targeting
customers by various sales promotion.
 Promotion –
Our promotion should be based on the trend and customer
preferences, like BK they used to do promotion by viral media,
slogans, camping’s, personal selling, coupons and discounts.
Even though the BK promote products by viral media, social media.
They never failed to do promotion by print media. and the biggest
media for promotion is word of mouth we should use this properly.
 Cost effective –
Our promotion should be in cost effective manner
After Daniel became CEO, he cancelled Italian party which cost
around $1 million.
 Marketing strategy –
Our marketing strategy and promotional way should be based on
Scio-cultural, regional, local and common relation