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The strategic marketing plan of McDonalds

A strategic marketing plan should be a clear and simple summary of key market trends, key target segments, the value required by each of them, how we intend to create superior value (to competitors), with a clear prioritization of marketing objectives and strategies, together with the financial consequences. Frequently, they are diffuse, confusing compilations for unconnected individual sections.

The McDonald’s has adopted a three-year rolling planning timescale, with three levels:

• A three year strategic plan;

• Annual operational plans;

• And individual staff work plans for the year.

Strategic and operational plans will be published on the McDonald’s website for the information of grant applicants and other stakeholders. This Strategic Plan for 2009/2012 sets out the vision, values and mission of the company and its strategic objectives for the next three years. It will be reviewed in a year’s time and the next Strategic Plan for 2010/2013 will then roll forward. This Strategic Plan should be read in conjunction with the Operational Plan for 2009/2010, which sets out, under each of the strategic objectives, the operational objectives to be achieved during the year, the activities to be undertaken, the timeline for these and the success measures to be used. Progress will be regularly monitored, outcomes will be evaluated towards the end of the year and this evaluation will inform the rolling-forward of the plan for the next three years.

After 50 years of operation, McDonald’ s is revitalizing its products, and pushing innovation through a variety of initiatives. This foodservice giant with more than 30,000 restaurants in 100 countries provides food to nearly 50 million customers each day, but decades of expansion, sales growth, and profits made the burger giant complacent. By focusing on getting bigger, not better, the company stumbled in 2002, recording its first losing quarter. By 2003, U.S. sales had flattened, as many consumers were turning to healthier options and restaurants with more upscale menu items, a segment sometimes referred to as “ fast - casual ” . Morgan Spurlock ’ s fi lm Super Size Me , released in 2004, also seriously diminished the public image of the quick - service chain, as moviegoers watched Spurlock become ill and gain 25 pounds after eating only McDonald’ s food for one month. With pressure to get back on track, it was time for McDonald’ s to rethink the business. The chain devised a recovery strategy that included new menu items, redesigned restaurants, and a focus on the consumer experience. Through a program titled “ Plan to Win, ” McDonald ’ s focused on making a deeper connection with customers through the five business drivers of 5 P’s

Using its own five P’s, the company is developing and refining new strategies to deliver value, offering product variety, developing updated and contemporary stores, balancing the delivery of value pricing with more expensive items, and marketing through bold and innovative promotions. Execution of this strategy has included mystery shoppers and customer surveys, along with grading restaurants to help the company deliver on its people goals. New menu items like the Fruit & Walnut Salad in the United States and deli sandwiches in Australia are part of the commitment to serve high - quality products to satisfy customer demand for choice and variety. Restaurants are staying open longer, accepting credit and debit cards, enabling wireless Internet access, and even providing delivery service in parts of Asia. As part of the program, franchisees and suppliers are asked to provide their opinions and ideas on facility design, while the company benchmarks retail leaders, such as Crate & Barrel, to help produce cleaner and smarter restaurants. The company is testing small handheld devices to use on what it calls “ travel paths, ” a process for checking operational failures such as the temperature inside the refrigerators. Experiments with a new grilling concept from Sweden, which grills burgers vertically instead of horizontally, offers space - saving possibilities for the chain. Product offerings like the McCafé, a concept developed in the Australian market that provides gourmet coffee inside 500 existing restaurants, are proving to be successful.

The trouble experienced in the early part of the millennium has abated, and executives at McDonald’s have declared success after several years of progress under the Plan to Win.

The Traditional Perspective

The increasing importance of strategic management may be a result of several trends. Increasing competition in most industries has made it difficult for some companies to compete. Modern and cheaper transportation and communication have led to increasing global trade and awareness. Technological development has led to accelerated changes in the global economy. Regardless of the reasons, the past two decades have seen a surge in interest in strategic management. Many perspectives on strategic management and the strategic management process have emerged. It based predominantly on three of these perspectives:

(1) the traditional perspective,

(2) the resource - based view of the fi rm, and

(3) the stakeholder approach

As the fi eld of strategic management began to emerge in the latter part of the 20th century, scholars borrowed heavily from the fi eld of economics. For some time, economists had been actively studying topics associated with the competitiveness of industries. These topics included industry concentration, diversifi cation, product differentiation, and market power. However, much of the economics research at that time focused on industries as a whole, and some of it even assumed that individual fi rm differences did not matter. Other fi elds also infl uenced early strategic management thought, including marketing, fi nance, psychology, and management.

Academic progress was slow in the beginning, and the large consulting fi rms began to develop their own models and theories to meet their clients ’ needs.

Eventually, a consensus began to build regarding what is included in the strategic management process. The traditional process for developing strategy consists of analyzing the internal and external environments of the company to arrive at organizational strengths, weaknesses, opportunities, and threats (SWOT). The results from this “ situation analysis, ” as this process is sometimes called, are the basis for developing missions, goals, and strategies. In general, a company should select strategies that take advantage of organizational strengths and environmental opportunities or neutralize or overcome organizational weaknesses and environmental threats. After strategies are formulated, plans for implementing them are established and carried out.

However, the traditional approach to strategy development also brought with it some ideas that strategic management has had to reevaluate. The fi rst of these ideas was that the environment is the primary determinant of the best strategy. This is called environmental determinism . According to the deterministic view, good management is associated with determining which strategy will best fi t environmental, technical, and human forces at a particular point in time, and then working to carry it out.

The Resource - Based View

In recent years, another perspective on strategy development has gained wide acceptance. The resource - based view of the fi rm has its roots in the work of the earliest strategic management theorists. It grew out of the question, “ Why do some fi rms persistently outperform other fi rms? ” An early answer to that question was that some fi rms are able to develop distinctive competencies in particular areas. One of the fi rst competencies identifi ed was general management capability. This led to the proposition that fi rms with high - quality general managers will outperform their rivals. Much research has examined this issue. Clearly, effective leadership is important to organizational performance, but it is diffi cult to specify what makes an effective leader. Also, although leaders are an important source of competence for an organization, they are not the only important resource that makes a difference.

Stakeholders

McDonald’s has internal stakeholders, such as employees, who are considered a part of the internal organization. In addition, the McDonald’s has frequent interactions with stakeholders in what is called the operating (or task) environment. The McDonald’s and stakeholders in its operating environment are infl uenced by other factors, such as society, technology, the economy, and the legal environment. These other factors form the broad environment.

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