Disclaimer: This is an example of a student written essay.
Click here for sample essays written by our professional writers.

Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of UKEssays.com.

History and marketing strategy of McDonalds

Paper Type: Free Essay Subject: Marketing
Wordcount: 3356 words Published: 11th May 2017

Reference this

Introduction: McDonald’s

McDonald’s is a worldwide franchise restaurant, serving nearly 47 million customers per day. (www.mcdonalds.ca) Thus, it also recognized by the golden arches. (encyclopedia2.thefreedictionary.com) McDonald’s provides fast foods such as burgers, French fries, and so on. They serve the world some of the favorite foods such as World Famous Fries, Big Mac, Quarter Pounder, Chicken McNuggets and Egg McMuffin. (www.aboutmcdonalds.com)

Get Help With Your Essay

If you need assistance with writing your essay, our professional essay writing service is here to help!

Essay Writing Service

1.1 History of McDonald’s

In year 1940, McDonald’s Bar-B-Que opens in San Bernardino, California, by Dick and Mac McDonald. After a three-months shut down for alterations, McDonald’s has reopens as a self-service drive-in restaurant, which has included to nine items, and they got the World Famous French Fries by replacing potato chips into French fries. (www.aboutmcdonalds.com) In year 1955, the first McDonald’s restaurant has opened in Des Plaines, Illinois, and they got $316.12 of sales in the first day and the McDonald’s Corporation was created. Moreover, in year 1958 and 1959, McDonald’s has become very successful as they had sell out 100 million hamburgers and had opened 100 restaurants, and by year 1963, McDonald’s has opened 500 restaurants. (www.aboutmcdonalds.com) McDonald’s start to promote Hamburger University and indoor seating restaurant in year 1960’s, and they started to go internationally in year 1967.

The first McDonalds’ restaurant in UK was open at October of 1974, which was the 3000th McDonalds’ restaurant in the world. The location of the first UK McDonald is Woolwich, south east London. Currently, according to the Annual Report of McDonald’s in year 2009, McDonald’s has getting more and more outlets, on the end of year 2009, there are 32478 McDonald’s restaurant in 117 countries where 26216 restaurants were operated by franchisees and 6262 were operated by the company. And UK has a total of 1115 McDonald’s restaurants.(www.nationmaster.com) Moreover, according to www.mcdonalds.co.uk, there are almost 1200 restaurants can be found in variety of location such as shopping centers, leisure centers, airport, railway station, traditional high streets, retail parks, roadside, and motorway services areas. This has shown the growth of McDonald’s from a drive-in and carhop service, into a worldwide franchise fast food restaurant.

1.2 McDonald’s Great Britain – The Turnaround Summary

McDonald’s in UK growing very well but they were also experience a slack period in year 2003 and 2004. There are many reasons that cause these slack. With the low barrier of entry in food & beverage market, McDonald’s has begun to have more and more competitors. New F&B chains such as Yo! Sushi and Nando’s Chicken Restaurant have outpaced McDonald’s. Moreover, Subway Restaurants are attracting customers with the healthy fresh food; and Starbuck has made McDonald’s outlets look out of date.

McDonald’s has its day and is now on the slippery slope to oblivion. There are many negative factors cause the loss of reputation of McDonald. The best-selling book, Fast Food Nation, said that McDonald’s beef patties could come from up to 100 different cows; an actor in a hit firm, Super Size Me, did nothing except eat at McDonald’s for a month cause his health problem; the released documentary, McLibel pitted McDonald’s against two Greenpeace activists. Although there are many negative issues occurs, but still have some positives announcements from McDonald’s, which is $118 million profit a year and it still the number one food brand.

There are steps that taken by McDonald’s have to reserve the trend. There are new healthy recipes provided by McDonald’s, which is to satisfy the demand of customers. Nutritional information is provided to let customer know better what they are eating. New tag line “McDonald’s — But not as you know it” show the healthy meals such as salad and fruits. Besides that, McDonald’s is serving coffee made form freshly ground Kenco beans. Result show that they are selling good for their new products.

As for the comments from the newly appointed CEO of McDonald’s UK, they are not going to change even the world is changing. There are going to upgrade the McDonald’s experiences and give more values to their customers. There are going back to the basics on the service area, understand what the customers’ problem and wants, for example make McDonald’s UK as breakfast restaurant. After five consecutive years of sales decreases, in 2007, sales were up 4.6 percent with substantial in market share. This positive respond has shows that the steps taken by UK management were beginning to pay off. They carry out many events such as adjust their menu and include healthy choices, menu changes to suit the local taste, new designs of restaurant outlook and staffs uniforms, and launch advertising campaigns to counter negative images of McJobs. McDonald’s UK vice president said the campaign is not being done, because it is difficult to attract customers who already have strong negative perception on McDonald’s.

2.0 Question 1

Identify the problems confronting McDonald’s, U.K. and list them from the most to the least critical. For each problem identified, explain your reasoning.

2.1 Negative Images & Impressions from Media, Documentary, Press and others

The most critical problem that McDonald’s U.K. faces is the impact of negative news and documentaries that exploit the lack of health in their menu. With the rise of vegetarianism and green or raw diets, the demands of the nutritional balance of foods are very high. Therefore, McDonalds are no longer satisfied those customers, as consumers are be influenced by the media, documentary and presses. The bestselling book “Fast Food Nation”, which revealed about the mad cow disease that fears consumer from purchasing McDonald’s. Nevertheless, the beef or patties in McDonald’s can come from up to 100 difference cows. Moreover, the hit film “Super Size Me” was a significant strike against McDonald’s as it gives compelling data against the food they provide. A documentary, McLibel has also recounts and reopened McDonald’s old wounds, and it affects the image of McDonald’s.

2.2 Health Issue

British government aims to reduce childhood obesity. They had the policy to prohibit various television channels to play any “junk food” advertising before 9.00 pm, and to reduce the opportunities for children to watch these advertisements, which McDonald’s is one of them. According to the British experts, cola, soft drinks, candies, French fries, potato chips, hamburgers and many other high sugar or high-oil food, salty snacks, are the main culprit to cause young people overweight and obese. According to the British government radio, television, and communication sector Ofcom statistics, it has showed that 70% of UK school-age children watch TV between 6 pm to 9 pm, which more and more people obese because of eating too much snacks and lack of exercise. The World Health Organization warned that the obesity has serious effected the global health and economic development. In addition, not only about health conscious, the food that serves in McDonald’s is lacking its quality and standards, which is also a disadvantage for McDonald’s.

2.3 Layout, Design

Another problem confronting McDonald’s U.K. is their layout and design of the restaurant. According to the case study, it is observe that Starbucks has made McDonald’s outlets look sterile and out of date. There are many McDonald’s customer had been attracted by the Starbucks outlets. According to Clifford Burrows, the general manager of Starbucks U.K., they take McDonald’s as a competitor, and as a result, many consumers will choose Starbuck rather than McDonald. The McDonald’s restaurant design of yellow, white, and red color with plastic furniture has made people feel boring and dry. Due to the trends, consumers need something different and new that can refresh them. Not only Starbucks, other restaurants nowadays furnished with a more trendy and modern environment, so that they can pull in more customers.

2.4 Service Standard Decreases

Service standard is also one of the most important role in every restaurant, however, McDonald’s is facing problem on services that provided by the staffs and employees. According to Cateora(2009), it had stated that the performances on the services in McDonald’s are flat. Meaning the services at McDonald’s UK has been slipping. In order to keep customers come back, it is important to provide good services. This is because if customers are unhappy with the service provided, they will not only just walks away and never come back. They will start mouth-to-mouth complaining to their friends and family, so that they will not go dine in McDonald’s because of the bad services provided.

2.5 Competition

The fast food industry has becoming an increasingly competitive sector. Although McDonald’s is the clear leader of the fast food industry in terms of revenues generated and restaurants established, but they still faces competition from other fast food chains, such as Burger King Corporation, Wendy’s International, Carl’s Junior, Yo! Sushi, Jack in the Box Inc, and much more. Other new chains that come into the market such as Nando’s Chicken, have outpaced McDonald’s as well. Operators such as U.S.-based Subway Restaurants are pulling in their customers with fresh salads and sandwiches on focaccia bread. Therefore, there is a need to maintain the standards and quality in every sector of the restaurant, so that consumers will not change their targets by visiting other outlets, and be more loyal to McDonald’s.

Question 2:

Some problems you identified in question1 may require a “quick fix” in the short run, while others may require a major shift in company strategy. Assuming that you cannot focus on all the problems at once, suggest the order in which the issue should be addressed and suggest an approach to solving each problem.

3.1 Quality of Food

The most important issues that most of the consumers face is their menu, McDonald’s used to be a very famous and delicious fast food restaurant, where their food is good in standard and quality. However, according to the case study, most of the problems that occur are about food. For example, their bread taste like cotton or wool, and the beef patty is lacking its texture compare to the past. (Cateora, et al, 2009) Therefore, it is a need to improve the quality of their food, get back into their basics, and gain back their old customers. McDonald’s can also add in more options on their menu, so that customers can have more choices. For example, McDonald’s breakfast is one of the good starts, to provide more choices to fulfill consumer needs and wants.

Find Out How UKEssays.com Can Help You!

Our academic experts are ready and waiting to assist with any writing project you may have. From simple essay plans, through to full dissertations, you can guarantee we have a service perfectly matched to your needs.

View our services

According to the case study, it has also mentioned that McDonald’s has actually selling health food such as salads and fruits. However, the quality is still lacking, because McDonald’s is still a franchise fast food restaurant. As health food is one of the big things in the industry nowadays, it is important for McDonald’s to address the health value of their menu, and continue to add more light options. They can add in more choices and options for their salads and their dressings, salads without meat are encouraged, to attract more vegetarians. Moreover, McDonald’s can also try to add in organic foods into their menu, which will lead to a great boost on their business.

3.2 Services

According to the case study, McDonald’s services have been slipping; it has become inefficient and inconsistent, so as their cleanliness. (Cateora, et al, 2009) According to the case study, customers are outspoken and they criticize. Therefore, as the service in McDonald’s is bad, customers will start criticizing the bad services provided in McDonald’s, which lastly affects the business to decrease. It is important to develop the services of their staffs and employees. Therefore, providing training for new and existing employees on how to treat customers is an excellent step to take.

Moreover, accepting the responsibility when there are customer service problems, and following through on disciplinary actions in order to prove both the customer and employee that McDonald’s do take their customer services in a serious manner. Maintaining the cleanliness is also very important as guests can dine in McDonald’s in a more clean and comfortable environment. By doing so, it will not only get back customers’ satisfactions, they will start mouth-to-mouth praising McDonald’s services and makes them come and dine.

3.3 Design/Layout

As mentioned above, Starbucks has made McDonald’s outlets look sterile and out of date. As comparison, the design in Starbucks is modern and trendy, while McDonald’s still remain the old trend- yellow, white, and red color with plastic furniture. It has showed that the design and layout in McDonald’s has becoming boring, dry and out to date. Therefore, it is a need to improve the designs in McDonald’s, by making them into a more classy and trendy so that it can attract customers to sit and dine in McDonald’s. However, McDonald’s is trying to get into the trend by redecorate and refurbish their outlets in UK. Therefore, it is very important for McDonald’s to keep the faith by putting trendy designs in the restaurant and in the same time remain their trademark such as the big yellow “M”, or the McDonald’s clown.

Not just the restaurant layout, the costumes and the uniforms is also one of the tools to make the restaurant more trendy and modern. As a fact, if the restaurant design is modern and trendy but the service crew’s uniform is odd and out of fashion, it will pull down the images of the restaurant as well. Moreover, service staffs not only dress in a more fashion look, but also with the requirement that related with the restaurant. It is not to show that they look trendy and good, but to show how the way they dress as professionals, which is part of the service that can pull attentions, as consumers need something difference and new that can refresh them.

3.4 Culture

McDonald’s is a franchise company that locates in worldwide; therefore, it is hard to keep the same procedure in every country, because different countries have their different cultures. Moreover, it is impossible to fix each McDonald’s outlets into the same culture. Therefore, it is recommend that McDonald’s can actually recruit menu, designs or even services that suits with the cultures in the respective location. By doing so, it can attract customers’ attention because McDonald’s is getting closer to their culture not only on design but their menu selections.

4.0 Question 3:

By 2007, it seemed that the decision made by McDonald’s U.K. management had begun to pay off. However, McDonald’s U.K. still lags behind the performance of other region in the European division. Considering your responses to Question 1 and 2, identify problems that may still exist and suggest actions to be taken.

4.1 Service

The quality of services in McDonald’s is still a major issue as British people don’t respect people who work in McDonald’s, because they mix up service with being servile. (Cateora, et al, 2009) Moreover, for customers who experienced bad services from McDonald are will definitely keeps them remember how they been treated. They will always keep bad image in heart although they received good services when they visit the second time. Therefore, as a suggestion, McDonald’s can run campaigns, events, or advertisements that can gain back customers to dine in McDonald’s by reinforce the friendliness of McDonald’s environment. It might not pay off immediately, but as the image of the friendly face of McDonald’s continues to make an impression, customers will give them another chance and try.

4.2 Quality of Food

McDonald’s is a franchise restaurant, and it is hard to maintain the standard of the food because their foods are manufactured, and their food mostly comes in frozen basis. Therefore, the freshness of their food is still a limitation as it is manufactured and frozen. Keeping the standard of the food, especially vegetable and frits is very important as they provide salads, fruits and smoothies, which needs to maintain its freshness. Healthy menu is very advisable to maintain and improve. Moreover, providing healthy menus that serves fast could turn around their bad health reputation very quickly. However, becoming the healthy choice for fast food is something that would set them, or any fast food restaurant, apart from the rest.

4.3 Bad Images That Created

As mentioned above, bad publicities such as Super-Size Me and Fast Food Nation had created a very bad image and impression towards consumers. Moreover, to all entire bad images that created, it has changed customers’ perception that McDonald’s is not a healthy food, so do other fast food restaurants. Therefore, keeping the faith and maintaining their standards of the menu is one of the encouraged solutions. By doing so, it will help to lead customers to change their perceptions that McDonald’s actually do provide healthy menu.

5.0 Conclusion

As conclusion, although McDonald’s has become so successful as compare with the pass until now. However, due to the expansions and developments in the food and beverage industry, McDonald’s has facing a lot of problems and threats that affects their business as well as their revenue and profit. Things such as the increases of competitors, the negative publicities upon McDonald’s, the quality of food and service, customer changes in tastes and more. All these are their greatest disadvantages that definitely affects McDonald’s image and therefore it turns down their business. As when all these threats are getting increase, McDonald’s is facing a huge decrease in revenue, and they then start to put actions on it, to pull back the business. However, because of the bad images that has already created and customers’ perception on McDonald’s has changed to unhealthy food, they find hard to turn their way back to what they used to be.

Due to the problems that occurred, McDonald’s has trying their best to improve and maintain their standard in menu, services, and environment, to gain back customers’ attention. They add up extra selections on the menu such as McDonald’s breakfast, and giving out fresh and healthy foods such as salads and fruits. Moreover, McDonald’s also promotes special offers on their menu such as a larger burger. (Cateora, et al, 2009) They also changed their layout and designs in their restaurants and provide extra service such as free Wi-Fi services, to give customers fresher and better environment to dine. (Cateora, et al, 2009) Although they give out many ideas and strategies to get back their customers, they still need to put more efforts on it, to show customers that they are improving. However, McDonald’s is still many people’s favorite food, and they will be more successful if they really put efforts for improvement.

 

Cite This Work

To export a reference to this article please select a referencing stye below:

Reference Copied to Clipboard.
Reference Copied to Clipboard.
Reference Copied to Clipboard.
Reference Copied to Clipboard.
Reference Copied to Clipboard.
Reference Copied to Clipboard.
Reference Copied to Clipboard.

Related Services

View all

DMCA / Removal Request

If you are the original writer of this essay and no longer wish to have your work published on UKEssays.com then please: