McDonald’s Marketing Research Report: Strategy

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Research on McDonald’s

This marketing research proposal for McDonald’s beverage line seeks to highlight on a new product line that the company can introduce for the market.

The information presented in this report, therefore, illustrates a marketing gap that the company can take advantage of and expand its business, especially in the premium beverage line.

Based on the marketing models and theories used in the report, it is recommended that the company pursue this strategy as it is an opportunity that could be grabbed by its competitors.

Key Background Issue at McDonald’s

McDonald’s is the leading food-service retailer serving more than 52 million customers with over 30,000 local restaurants and 100 countries around the world. However, the company offers a variety, yet limited menu (Gherasim, 2011).

The restaurants are either operated by the company directly or franchised to individual entrepreneurs. Despite the increasing success that the company has experienced in recent years, McDonald’s has increasingly faced competition from premium coffee makers such as Starbucks and caribou, particularly since the introduction of the ‘leed’ coffee and premium coffee blends.

In view of this, the company must explore market gaps in the beverage segment and offer competitive products to counter the competition posed by rivals (Mattern, 2011).

New Products at McDonald’s

Although the company is not commonly viewed as a preferred coffee house, McDonald’s can enhance its position and attract many consumers who love coffee. However, the company is well known for its value-products that it offers for the market.

Introducing premium or top brand coffee varieties at relatively lower prices could greatly increase the sales and market share for the company. The primary research indicated that many consumers would buy cappuccino, latte, and mocha if it were offered at McDonald’s.

Therefore, this marketing research report deems it fit for the company to expand its premium beverage line by offering these products. There exists a relationship between gender and the chances of an individual purchasing a specific type of coffee (such as mocha and latte) at the restaurant.

People who have purchased other types of coffee drinks at McDonald’s are also likely to consume these proposed drinks (Mattern, 2011). Thus, the company could conduct its marketing strategy based on the Segmentation, Targeting, and Positioning (STP) model.

STP for Cappuccino, Mocha and Latte

In order to develop an effective marketing strategy, McDonald’s should understand its target customers. Understanding the customer well will assist the company in effectively communicating to its market.

McDonald’s should segment the proposed products according to demographic, behavioral and psychographic bases. Segmentation is grouping of customers with similar characteristics is a pool so that their needs can be adequately met.

The coffee brands should be segmented according to students, family and gender. Given that men are more likely to consume cappuccino than women, while women prefer mocha and latte, the company should structure their marketing strategies such that women are well served with mocha and latte, while men provided with cappuccino.

More customers can also be attracted to the new products if the company emphasizes on the targeting technique. In order to appeal to customers and achieve a sustainable advantage over competitors, the company should introduce these products with low levels of sugar and cholesterol.

There is a significant number of consumers that prefer diet beverages (Mons, et al., 2011) and therefore, targeting this segment with low glucose and cholesterol products will be a big boost for the company.

Given that the company is already known as value-restaurant, using this targeting technique, especially for the mocha and latte brands, will increase sales and market share.

The company should apply new positioning methods to create a positive perception in the minds of consumers about these products. Positioning helps the company increase its market share by letting customers understand the uniqueness of a product relative to competitors’ offer (Hsu, 2011).

McDonald’s can use healthy messages in advertising for these new coffee variants. The adverts for the company should therefore carry all healthy qualities and benefits of the coffee variants.

Marketing Mix at McDonald’s

By using the STP model for the new product, the company will thus use the 7 Ps of marketing mix to stage a comprehensive marketing campaign for cappuccino, latte and mocha variants. The following is an outline of the marketing mix:

Product – McDonald will introduce cappuccino, latte and mocha as the main product for the competitive market. These products have not been offered by the company and therefore are unique. Therefore, the marketing campaign will focus on these products.

Price – The Company has a rich history of providing high-end products at value-prices. The new product should therefore be introduced at prices relatively lower than that which competitors’ such as Starbucks offer.

Promotion – The prime focus for the company is to target students and middle-aged working class individuals. The marketing team could introduce schemes of winning raffles and coupons especially for couples. This will enable both the target groups to frequent the restaurant.

Place – McDonald’s has a good network of restaurants throughout the country and in the international market (Mattern, 2011). Although the initial campaign will be done in selected local outlets, the success of the campaign will be a benchmark for rolling a nationwide and international marketing campaign.

People – The employees of the company will be used in the product promotion and awareness. The abled staff at McDonald’s is friendly and their excellent customer service will be handy in the marketing campaigns.

Process – Food processing procedure at McDonald’s is completely transparent. The nature of these new product variants is such that they can be prepared instantly while the customer is waiting and ‘seeing’ the process. This will allow the customers to judge the production standards and hygiene involved (Burton, Parker, and Lawley, 2012).

Physical evidence – The Company has always focused on the cleanliness and hygiene of its production and selling processes. This has given it a competitive edge, which will be helpful in marketing the new product variants.

Conclusion

The marketing research report has highlighted the marketing opportunity that McDonald’s can take advantage and counter the increasing competition from other players in the industry.

Since the company is well known for its value-products, introducing cappuccino, latte and mocha as new variants of coffee in the market will enable the company to gain a competitive advantage.

McDonald’s Marketing Research strategies, based on the Segmentation, targeting, and Positioning (STP) model will enable the company to tailor the products in the market. During its marketing campaign, the company will use its 7 Ps of marketing mix to appeal to all the niches in the market.

Bibliography on McDonald’s Marketing Research

  1. Burton, P., Parker, G., and Lawley, B. 2012, 42 Rules of Product Marketing: Learn the Rules of Product Marketing from Leading Experts from Around the World. Super Star Press.
  2. Gherasim, T. 2011, “An Approach Of The Product View Through The Perspective Of The Marketing – Mix”, Economy Transdisciplinarity Cognition, 14, no. 1, pp. 402-409.
  3. Hsu, Y. 2011, “Design innovation and marketing strategy in successful product competition”, The Journal of Business & Industrial Marketing, 26, no. 4, pp. 223-236.
  4. Mattern, J. 2011, Ray Kroc: McDonald’s Restaurants Builder. Checkerboard Books.
  5. Mons, F.S., Haugland, S.A., Grønhaug, K. & Hammervoll, T. 2011, “Marketing strategy and customer involvement in product development”, European Journal of Marketing, 45, no. 4, pp. 513-530.

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