MacDonald's Marketing Paper

Nowhere is the supplier loyalty more evident than in

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Unformatted text preview: ention than anyone else to field service and training at store level. Production was concentrated in huge plants devoted exclusively to McDonald¶s. McDonald¶s also started with tiny suppliers and grew with them displaying great loyalty. Nowhere is the supplier loyalty more evident than in development of new, improved products. Some of McDonald¶s classic food items like Filet-oFish, French Fries, and Chicken Nuggets etc. are results of supplier innovation. Interestingly, it took KFC more than three years before in finally introduced its own version of chicken nuggets. Thus supplier technological expertise had given McDonald¶s a product which was not a mere marketing innovation but a technical one. McDonald¶s attempted to squeeze labour out of the stores by moving more preparation back into the processing plant, creating the opportunity to develop unique products based on suppliers¶ processing skills. For the first time, McDonald¶s suppliers became the focal point of new product development. This converted the fast-food industry¶s most fragmented distributed system into more efficient one which helped McDonald¶s reduce its inventory and manage costs effectively. OPERATIONS COMPETITIVE STRATEGY 43 | P a g e McDonald¶s Corporation competes in a challenging market segment by providing need-satisfying products to customers. In this segment, ineffective competitors often fail without proper strategies. To sustain its viability, the McDonald¶s corporation employs an effective competitive strategy to make it stand out against competitors such as other fast food restaurants. McDonald¶s competes on several bases, including: 1. Cost 2. Speed and 3. Nutrition their strongest priority is ³making customers happy´. The company recently made strong changes to its process by introducing the ³Made for You´ system. COMPETITOR¶S ANALYSIS McDonald¶s has been a leading fast-foods outlet in Vile Parle. But the outlet understudy has other competitors eating away into its market share. In addition to its traditional rivals²KFC, Dominos, Pizza Hut²the firm encounters new challenges. Jumbo King competes using a back-tobasics approach of quickly serving up burgers for time-pressed consumers. On the higher end, the KFC has become potent competitor in the quick service field, taking away customers from McDonald¶s. Perhaps in the new environment, fast, convenient service is no longer enough to distinguish the firm. At this time, a new critical success factor may be emerging: the need to create a rich, satisfying experience for consumers. This brings us to service and experience based competition which McDonald¶s can use for competitive advantage against Jumbo King. 44 | P a g e Keeping in mind the demographics of the area, McDonald¶s has Wi-Fi enabled the outlet to cater to the student community. It is for this overall ³Food, Fun & Folks´ experience that customers pay a premium over the other competitors. MCDONALD¶S COMPETITOR¶S: COMPETITION BASES: SPEED McDonald¶s competes on several bases mainly to ³make their customers happy´ by providing speedy, affordable, and nutritious foods. Through extensive market research and survey, the organization discovered that its customers desire speed as one of the restaurants¶ top priorities. Therefore, McDonald¶s vision aims to ³provide fast, friendly and accurate service´. McDonald¶s realizes that specific targets are necessary to 45 | P a g e measure the performance of speed, and continuously takes relevant measurements to compare actual performance with desired targets. To achieve efficient service times, the company utilizes proven, standardized training processes for its employees and new drive-thru layouts to reduce service times. Along with speed, McDonald¶s also competes by offering prices at a low cost. COST To offer high quality products at low cost requires efficient processes throughout the entire McDonald¶s organization. Once again, this goal is built into their vision statement when they claim that ³We will be the most efficient provider so that we can be the best value to the most people´. McDonald¶s incorporates several ways of approaching to provide great value to its customers. One strategy that the company has employed for many years is the value meal. The value meal allows customers to buy a sandwich, French fries, and beverage at a discount when purchased together. McDonald¶s restaurants offer from seven to twelve value meals, both for their lunch menu and breakfast menu.More recently, McDonald¶s began offering a 46 | P a g e value menu, consisting of many individual items costing only $1.00 each. First tested in southern California, the value menu has proved to be very successful and has been since incorporated to the individual stores. Some individual franchise owners choose to offer daily specials of special menu items, such as ³$0.39 hamburger Wednesdays,´ or other similar specials. Big Mac Mondays are a popular regional promotion. NUTRITION McDonald¶s third main competitive base is nutrition. The...
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This note was uploaded on 01/12/2014 for the course IBS. 403 taught by Professor Mikedover during the Fall '13 term at Humber.

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