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Marketing Essential

Introduction

The word marketing is basically a cluster of activities those have been occurred in between the customers and the business organizations.  It derives from the market place concept where both the sellers and buyers come together for conducting a profitable transaction. Hollensen (2015) has marked the marketing as a process of management that identifies, supplied and anticipates the requirements of the customers efficiently as well as profitably. This project has discussed this relationship elaborately with the example of McDonald’s. Additionally, a marketing plan has been developed by using the 7Ps elements of marketing mix which all together would produce a complete project in the field of marketing.

As per the given scenario, the learner has to serve the role of a junior marketing consultant in a fast food chain which has wished to expand their business. The operation style of this business is similar to McDonald’s, therefore, before developing the marketing plan the company has decided to focus on the marketing report of McDonald’s. The food chain has the huge range of fast foods as well as beverages. Almost 375,000 are presently working with this organization in its different branches. The yearly revenue of this company is  US$24.622 billion (Mcdonalds.com. 2017).

Two yellow arches joined together to form a rounded letter M.

marked the marketing as a process of management that identifies, supplied and anticipates the requirements of the customers efficiently as well as profitably. This project has discussed this relationship elaborately with the example of McDonald’s. Additionally, a marketing plan has been developed by using the 7Ps elements of marketing mix which all together would produce a complete project in the field of marketing.

As per the given scenario, the learner has to serve the role of a junior marketing consultant in a fast food chain which has wished to expand their business. The operation style of this business is similar to McDonald’s, therefore, before developing the marketing plan the company has decided to focus on the marketing report of McDonald’s. The food chain has the huge range of fast foods as well as beverages. Almost 375,000 are presently working with this organization in its different branches. The yearly revenue of this company is  US$24.622 billion (Mcdonalds.com. 2017).

Two yellow arches joined together to form a rounded letter M.

Figure 1: Logo of McDonald’s

(Source: Mcdonalds.com. 2017)

 

 

Assignment 1:

1.1 Explaining the key roles and responsibilities of marketing function with the examples of McDonald’s (P1, M1)

According to Baker (2014), the marketing department of a business organization is responsible for the growth of the revenue and to increase the market share of the organization. In a small organization, the marketing department seems to be only a person or only hiring ten marketing manager or director and marketing executive. However, in case of large corporations like McDonald's the story is something different. They have to serve several marketing related activities such as advertising, promotion and so on. Therefore, the overall department has to maintain a strategy by which they could be able to complete their activities in the proper manner.

Figure 2: Importance of marketing

(Source: Gnizy and Shoham, 2014)

As stated earlier, that marketing department is needed to satisfy the need of the customers along with the earning of remarkable profit for the company. Sahadev et al. (2015) have noted that marketing department has to serve some duties on behalf of the company such as strategy making, market research, product development, communications, sales support and events. The senior members of the marketing department in McDonald's should develop the strategies with maintaining the alignment with the overall strategy as well as primary objectives of the company. The company has determined their vision as to be the quickest serve restaurant and to make all the customers happy at every time they were having the meal from their outlets.

As per the vision of the company, they have focused on the franchise model, and that is why they have only 15% of restaurant that has been owned by them on the other hand rest of the 85% have operated by several franchisers (www.slideshare.net. 2017). Even, they have focused on several developing countries like India to expand their business. Other than that, the inclusion of vegetarian meal is the further process that can attract the customers more. While discussing on the product development of McDonald's their versatile items should be mentioned along with their happy meal concept.

Raffelt et al. (2013) have stated that market research is a fundamental responsibility of marketing department. The company serves a detail market research every time before introducing a new outlet or launching the new product. Communication is another task that needs to be planned by the marketing department. It includes several promotional activities depending on the budget. McDonald's sent mass messages through mobile by including their ranges of products. Agrawal (2014) has stated that cooperation between marketing and sales departments can make the sales performance better.

1.2 Explaining how the roles and responsibilities of marketing can be related to the wider organizational context giving examples from McDonald’s (P2, M2, D1)

Figure 2: Key elements of marketing

(Source: Gnizy et al. 2015)

Marketing includes a number of activities, and each of them is related to the product, price, market, advertising and so on. All of them should be performed necessarily in a business organization like McDonald’s. Most of the key elements have been narrated in the previous part of the project. However, the two key elements have been discussed here from the perspective of McDonald's. Planning is one of the most important factors in this regard. It involves the sales forecasting of the company. McDonald’s has a definite plan which encompasses communication strategy, financial planning and so on. On the other hand, tactics is another way to attract the customers, but it works in short-term process. For example, McDonald’s has introduced the happy hour menu for the customers. It offers lower prices and attracts a huge range of customers. 

The business organizations like McDonald’s consider the marketing department as a communicator within the organization. Therefore, it is quite obvious this department has to maintain an active relationship with other departments of the firm. Loveland et al. (2015) have opined that this department is closely related to the finance department as it includes the financial information for both the existing and new products. These financial information support the management which has been provided by the people of a marketing department. On the other hand, while it needs to estimate the number of products to be prepared, the production department would contact the marketing department. For example, when McDonald’s decided to launch the happy hour, before planning the food for this special hour, the production department has contacted the marketing department to know the most demandable items from their food range, and they have planned in accordance to it. 

Image result for sales forecast of McDonald's in 2017

Figure 3: Sales forecast of McDonald’s

(Source: Badal, 2017)

Huang and Sarigöllü (2014) have commented that sales department is deeply related to marketing department as it develops the relationship between clients as well as marketing to offer more inputs to earn more profit. The above graph is showing the sales forecast of McDonald’s which is ensuring that the marketing department has performed its responsibility flawlessly and that is why the sales rate of the company is higher. On the other hand, the research and development department can be assisted by the marketing department thus the idea of new product development has been generated from it. The marketing department helps the R&D department by giving the idea of new products which would be accepted by the potential customers.

Assignment 2:

Task 1: Comparing the ways in which the organizations may use marketing mix elements (7Ps) for achieving the business objectives (LO 2: P3 & M3)

1.1 Comparing the ways in which several fast food brands like McDonald’s o-r Burger King apply marketing mix in the process of marketing planning for achieving the business objectives (P3, M3)

Similarities

Dissimilarities

Both the companies have expanded the product portfolio of them.

McDonald’s advertises more than Burger King

Using the franchises as a primary source of earning money.

More celebrity endorsement has been used by McDonald's rather than Burger King

Psychological marketing is being used by both of them

The punch line of McDonald’s is so popular, whether Burger King has no such catch line

Both of them offer $1 meal

 

 

Comparison between the marketing strategies of McDonald’s and Burger King

(Source: Mintz and Currim, 2013)

According to Leonidou et al. (2013), marketing mix should be considered as the factor that should be controlled by the company for influencing the customer thus they buy their products. Seven elements are there in the process of a marketing mix. They are the product, price, promotion, people, place, process and physical evidence. The product here seems to be the physically proved product offered by McDonald’s to the customers. They include some other aspects of their products such as looks, packaging, desirability, etc. It consists both the intangible and tangible aspects of the products. They have customized their menu in order to the place where they are serving the products. They have removed the beef, pork and mutton for the international market.

On the other hand, Burger King operates the business as a restaurant of quick service. The main products line of Burger King are burgers, salads, several desserts and beverages and so on. Both the companies have almost same products. McDonald’s is more focused on the international market, and they are planning their menu in accordance with it. Especially, their customised menu should be mentioned in this regard which can be changed depending on the tastes and demands of the customers. However, Burger King is not currently experimenting that much with their menu. Hanssens et al. (2014) have commented that place here mainly indicates the distribution channels as well as outlets of the company. The company needs to ensure that the customers are getting right products at the right places.

That is why McDonald's has established 50% of their outlets within 3 minutes of distances in the USA (www.slideshare.net. 2017). Even, the company is trying so much to make the customers comfortable at their places. Thus, they have included several facilities like music, internet facilities, hygienic outlets and so on. On the other hand, the products of Burger King are also available in several outlets of them. Additionally, they have the own mobile application and website through which the company can deliver their products as well.

According to Fan et al. (2015), pricing strategy has been considered as one of the most important aspects in a marketing mix. McDonald's has introduced several pocket-friendly prices for their customers. Thus, the inclusion of happy meal, combo meal, happy hour should be mentioned in this regard. On the other way, Burger King is also trying to attract the customers with its market-oriented prices. Other than that, they also implement the bundle pricing strategies. Importance of promotion in business is accepted by everyone. Steenkamp (2017) has opined that a business organization should adopt such promotional activities those would be helpful to communicate with the customers.

They use personal selling, advertising, public relations, sales promotion as well as direct marketing to become the leading fast food joint in the world. On the other hand, Burger King almost adopts the same tools to promote their businesses to the target customers. Though it mainly depends on the advertising in this regard, other techniques have also been used by the company. Hollensen (2015) has mentioned that people in marketing mix indicate to all the people those are involved in the overall business process. McDonald's believes that only a satisfied employee can make a customer happy. Therefore, they have focused on conducting the internal marketing by more proficiency as it may automatically improve the external marketing.

The internal marketing includes training and rewarding the existing employees as they can give their bests to the company. On the other hand, Burger King also values their employees, but they do not have such employee retention strategies yet.

McDonald’s has brought changes in their processes. They have introduced the new technique for packaging as well as distribution. They have invented some efficient cooking equipment. They often invite the customers to taste the ingredients using in foods. They believe in transparency, and thus they allow the customers to enter into the place where the overall process is taken place. On the other hand, Burger King mainly focused on the young customers as they visit the place more. The company is recently trying to enter into a new marketplace.

Baker (2014) has pointed out that physical evidence influence the impression to the outsiders and also reflects the business function as well. The factors in physical evidence involved staff members, building maintenance, appearance and interior. The company takes care of each of the factors. On the other hand, Burger King also maintains the same elements in physical evidence. Besides that, their online presence is another physical evidence of them.

 

 

Task 2: Developing and evaluating the basic marketing plan (LO 3: P4, M4 & D2)

2.1 Producing and evaluating a detailed marketing plan for the company by using the 7Ps (P4, M4, D2)

It is highly required to develop a better marketing plan for McDonald's as it serves the business in a highly competitive market.

Company introduction:

This world famous fast food chain was established in 1954. It is one of the most popular food chains in the world. It is almost serving 69 million customers every day in around 100 countries. They have almost 36,900 outlets last years (www.slideshare.net. 2017).

Mission and vision:

The mission of the company is to be the favourite place of their customers.

The vision of the company is to be a quick service restaurant and provide support by the set of core values as well as guiding principles.

SWOT analysis:

Strengths

  • Worldwide presence
  • Leading both the international and domestic market
  • Facing long-term economic growth

Weaknesses

  • Being saturated in market has created difficulties in its expansion
  • Slow process of product innovation

Opportunities

  • Betterment in outlets for attracting the new customers
  • More international expansion
  • Market penetration in Latin America, Europe and Asia

Threats

  • Fluctuation in foreign currency
  • Aggressive global growth is awful for the economic slowdown of other countries

 

Table 2: SWOT analysis of McDonald’s

(Source: Baker, 2014)

Competitors:

Huge competition from Burger King, Yum! Brands, Pizza Hut, KFC, Jack in the Box Inc and so on.

Marketing objectives:

Currently focusing on the service delivery time as the customers have no such time today in their hands.

Overall objective:

  • Products could be easily accessible
  • Easy handling of complaint
  • Covering the overall target market

Primary objectives for business:

  • To make additional 40% growth in their sales within the coming 6 months
  • To make aware about the brands to the customers those are not yet their customers

Strategic objectives for primary objective:

  • From the strategic aspect, the primary focus of the company is to satisfy the customers

Segmenting the target market:

  • Demographic segmentation strategy has been used
  • Primary target on kids, young urban families and youth

Main strategies:

  • Market penetration
  • Market development
  • Product development

Budget:

Gnizy and Shoham (2014) have mentioned that it is required to support the marketing strategies while they need a large expense. McDonald’s allocate almost 50% of their total budget to the marketing department every year. However, this ratio can be varied based on the seasonal changes and other factors as well. 

 

 

Conclusion

The tag line ‘I’m loving it’ is such famous among the food lovers, thus the company has become one of the leading fast food joints in the world. The marketing department within an organization plays the most important roles. Each of the department is interrelated with the marketing department. This project has shed light on this interrelationship as well. It has included the 7Ps of the marketing mix of McDonald's, and it has become more authentic after comparing it with the Burger King. The comparison has proved that both the company has almost similar status. Therefore, it can be said that McDonald's is in a high competitive market. Thus, a revised marketing plan has been developed here for the further betterment of the company.