Topics: Brand, McDonald's, Happy Meal Pages: 24 (7160 words) Published: March 15, 2013
1 The Business Strategy of Mcdonald’s

As one of the most successful fast food chain in the world, throughout the development of McDonald’s, we could easily identify many successful business strategy implementations. In this paper, I will discuss …........, which linked to the company’s structure and external environment. This paper is organized as follows: In the first section, I will give brief introduction to …....... In the second section, I will analyze …............. I will then analyze why McDonald’s choose these strategies in response to the changing external environment. Finally, I will summarize ….........

(开头)McDonald’s, originated in California, USA, 1954, has become one of the most recognized and respected brands in the world. The success achieved includes that they have established more than 30,000 franchising stores in 119 countries, serving more than 47 million people each day, and generating about $15 billions revenues annually. McDonald’s also continuously enhances its brand imagine through different social activities and the sponsorship of special events and sports i.e. as a major sponsor of the world cup since 1994 and the Champions League football in England from 1996 to 2000.

How can McDonald’s achieve such success? There are many formulating strategies, which we could use for our analysis of their recipe of success such as Porter’s competitive strategies model, which includes differentiation and low-cost leadership.

It is also very important to consider how McDonald’s applies these strategies and how their strategies interact with their business structure and the external environment.

McDonald’s, the most important strategic approach for maintaining its leading position is to keep their major markets at the same time expanding their business into the other emerging markets. However, different consumer groups in different countries may have very different tastes and/or requirements. So each full functional geographic unit of McDonald’s was required to wholly response for producing and marketing its products in that region. Through this regional structure, McDonald’s could not only satisfy the local consumers’ needs in different geographical areas but also pursuing ‘maximum local development’. Actually they produce and market slightly different types of products in different areas, and they even have different prices. As Jim Skinner, the vice-chairmen of McDonald’s illustrated that ‘if you are looking for a command center with one push button that operate our restaurant in every corner of the world, you won’t find it’. However, their philosophy of QSC&V-quality, service, cleanliness and value is same for everywhere. And McDonald’s targets the similar consumer segments that need fast service, affordable price and good standard hygiene. So their main products are similar in most countries, where they provided service, including beef, chicken, bread potatoes and milk. As the consumers in different countries having different foods requirements, McDonald’s keep launching new products for their regional consumers. In this case China and France can be very good examples.


In the fourth quarter of 2002, McDonald’s disclosed its first-ever quarterly loss, one reason why McDonald’s is struggling is that the consumers began to switch to its competitors, such as Burger King, Wendy’s, and Subway. These companies emphasized on offering fresher, hotter, high-quality foods at lower price with faster service. On the other hand, McDonald’s decided to close 719 poorly performing restaurants around world. All of these simply proved that McDonald’s might no longer be competitive in the fast-food market.

In order to keep their market share, increasing sales and profits. McDonald’s has to respond to the threat of competitors. In 2003, McDonald’s offered the McGriddles sandwiches in the US and the Canada feature breakfast. Meanwhile, McChicken Premiere and a zesty chicken...
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