There are over 14,000 McDonald’s restaurants in the USA and 1,270 across the UK and Northern Ireland. This blog is an overview of McDonald’s marketing mix, and how they have used and evolved the 7 P’s over time to become the world’s largest restaurant chain today.
McDonald’s uses aggressive promotion within their marketing mix. Their promotional strategy uses a combination of sales promotion, public relations/sponsorship, direct marketing and advertising campaigns. McDonald’s has come to where they are presently because of diligent work and powerful showcasing systems. (Rodrigues et al. 2016).
McDonald’s sales promotions offer attractive deals and new products. Children are the target consumer base of McDonald’s, hence it becomes inevitable for the organisation to develop such promotional strategies that may create enthusiasm in children, (Essays UK 2018) the main example of this being Happy Meal toys. McDonald’s also introduces competitions and games from time to time, for example Monopoly. Realising that today’s consumers have become more conscious about healthy eating, McDonald’s have come up with new ways of preserving its existing clientele. They have been introducing items like healthier wraps and salads to their menu as well as designing healthier Happy Meals with fruit, milk and fruit juices to promote healthy eating among children.
Creating employee customer relationship has always been something that McDonalds hasn’t failed in. McDonald’s has been involved in various large scale events which help portray a positive message whilst advertising the brand image. McDonald’s became an Olympic sponsor in 1976 and their restaurants were a familiar sight on various Olympic Parks and Villages. (Rumsby 2017) In 1984 McDonald’s built the Olympic Swim Stadium in Los Angeles and in 2005, McDonald’s launched the campaign – “It’s what I eat and what I do”, with the support of the International Olympic committee. This initiative called attention to the importance of eating right and staying active. (McDonalds 2015)
McDonald’s has also been an official partner of the FIFA World Cup since 1994. As part of their sponsorship for the 2006 World Cup in Germany, McDonald’s brought a piece of the World Cup action to its restaurants with a number of promotions including: sandwich promotions featuring flavours from countries competing in the World Cup, World Cup themed posters and beverage cups in certain restaurants, an indoor table soccer game where customers can take penalty shots and wine prizes. McDonald’s also launched its global Player Escort Program, in which they sent 1,408 children ages 6-10 to the World Cup in Germany. (Chief Marketer Staff 2006)
The online websites that McDonalds hosts to different countries offers direct information to the consumers on their diverse products and services, giving the consumers sufficient knowledge about their products and deals. Home Delivery system, which began in 1993, also works in an effort of direct marketing as they serve the consumers need by delivering the products directly to their houses being one of the very first success food chain to do so. (Rodrigues et al. 2016)
With the help of television advertisements, newspapers and magazines, McDonald’s has successfully managed to create a positive image of its brand.
Promotional strategy through the years
Since its inception, McDonald’s has evolved itself from using a product-based positioning to using a value-based positioning strategy. (Bhasin 2018) There are three objectives McDonald’s has for advertising: make people aware of the item, feel positive about the item, and remember the item.
In 1952, the McDonald brothers decided they needed a new building, so they closed down their store to create a more eye-catching appearance that included the two yellow golden arches we know today. During this time, McDonald’s had no advertising strategy.
When Minneapolis operator Jim Zein saw his sales explode in 1959 after running radio ads, (Ray) Kroc encouraged operators to take to the airwaves with their own campaigns. Following this directive, two washing, D.C., franchisees, John Gibson and Oscar Goldstein, decided to target kids by sponsoring a local children’s show, Bozo’s Circus. When the station cancelled the show in 1963, the franchisees hired the headliner, Willard Scott, to create a new clown persona for local ads. Thus was born one of advertising’s most enduring icons: Ronald McDonald. In 1967, McDonald’s spent $2.3 million on its first national advertising campaign, which was an unheard of amount for a fast-food chain. (Gross 1997)
McDonald’s is now one of the most recognisable brands in the world. “The Golden Arches” are a significant symbol used in McDonald’s promotional strategy. McDonald’s original slogan in 1960 was “Look for the Golden Arches” and the iconic arches still feature in McDonald’s promotional efforts today. These are usually in the form of tall road signs that can be seen from a distance. According to the Sponsorship Research International, 88% of people can identify McDonald’s Golden Arches in comparison to only 54% who could correctly identify the Christian cross (Lubin & Badkar, 2010).
Today, McDonald’s uses the famous slogan “I’m Lovin’ It” which was introduced in 2003 with five TV advertisements, aimed at different demographics, translated into 11 languages, and at times customised for certain regions. According to AdAge, McDonald’s spent $1.37 billion on advertising that year. “I’m Lovin’ It” was no ordinary jingle. It was also a full-fledged Timberlake song, credited to Batoy, Tortora, Heye creative director Andreas Forberger, and Pharrell Williams. (Hogan 2016)
Even though McDonald’s have adapted their approaches throughout their lifetime, the origin of the brand remains consistent and the same and can be recognised worldwide.
Alongside promotional strategies, McDonald’s make use of the other 6 P’s within the marketing mix.
•Starting off as a small stand-alone restaurant in 1940, McDonald’s had a very simple menu: hamburgers, cheeseburgers, potato chips, soft drinks, milk, coffee and a slice of pie.
•In 1949, potato chips were swapped with french fries and McDonald’s started selling milkshakes.
•Today, McDonald’s is one of the world’s leading fast food chain. They now have 145 items on their menu, with some seasonal products added throughout the year.
•The unique thing about McDonald’s, is that each product has a name. For example, their signature burger is called the ‘Big Mac’, their chicken nuggets are called ‘Chicken McNuggets’ and one of the items on the breakfast menu is called a ‘Sausage and Egg McMuffin’. They also have one of the most famous ice cream desserts in the world: the ‘McFlurry’.
•The overall aim for each individual McDonald’s restaurant is to provide food at a competitive value driven price for the customers. Rahman (2020).
•When the McDonald brothers opened their store, they sold their hamburgers for 15 cents, which was about half the price of their local competitors. The most expensive thing on the menu was the “Triple-Thick Shake” which cost 20 cents.
•McDonald’s has been successful at employing cost leadership marketing strategy by offering fast food meals at low prices Scilly (2016). Prices have been kept low by:
-hiring and training inexperienced employees instead of trained cook
-hiring only few trained managers
-self-service kiosks have now decreased the need for large numbers of staff. Smith (2016)
•There is also some psychological pricing involved. For example, the company offers meals and bundles for a discounted rate, and they also use pricing that appears to be more affordable such as £_.99 rather than rounding it off. Meyer (2015)
•McDonald’s Mission Statement has been created to reassure customers that even though the prices are affordable, this does not impact the quality: “Our aim is to provide a fun and safe environment where our customers can enjoy good food made with quality ingredients at affordable prices.” McDonald’s UK (2020)
•McDonald’s have a range of different distribution strategies. They have over 36,000 restaurants in over 100 countries all around the world. A lot of these restaurants are open 24-hours a day.
•Many of the McDonald’s restaurants have a ”Drive-Thru” option, making it more convenient for the customer to access their products.
•As well as the restaurants, McDonald’s in certain countries such as the UK, offer home delivery service.
•McDonald’s now offer a mobile app where customers can look at the menu, prices and even order online. You pay via the app and they only start preparing your meal when you are close to the restaurant, ensuring that the collection process is smooth and quick.
•Today, McDonald’s have made their products available through all possible channels of distribution which helps increase their sales and total revenue. Rahman (2020)
•There are approximately 210,000 people employed by McDonald’s worldwide. They have a standard uniform for employees.
•McDonald’s focuses on friendly and prompt service. All new franchise’s are trained in customer management and in keeping the customers happy. (Bhasin 2019)
•In 1961, McDonald’s founder Ray Kroc launched Hamburger University to train McDonald’s managers. It has a 1% acceptance rate meaning that the highest quality of candidates are accepted to train and become McDonald’s managers.
•McDonald’s employees are trained to handle high levels of pressure and negative responses.
•McDonald’s is unique in that the whole process is visible to customers. The fast food joint allows its customers to view and judge the hygienic standards. (Bhasin 2019)
•McDonald’s are known for their prompt service. Aspects of this but are not limited to: how customers place their orders, how long they wait for their food, and how they are treated by the customer care assistants. (Rahman 2020)
•Many McDonald’s restaurants are using self service kiosks in place of staff.
•McDonald’s offer an experience and not just a service. When customers think of McDonald’s, they don’t just think of the products, they think of the entire brand.
•The atttibutes of physical evidence displayed are speed of service, quality and hygiene, cleanliness and transparency of processes. MBA Team (2020)
•McDonald’s stores have specific brand colours, they have a young and vibrant feel and they want to promote the idea that the it is a family restaurant.