In all around the world there are different companies are facing diverse kind of challenges. This problem even gets bigger for multinational organisations. In such an environment it has become crucial for the firms to manage all its challenges so as to strengthen their position in the market. It is seen that companies are making strategies on the basis of the challenges they are facing in any specific market. Most of the organisations are making strategies based on the contingent approach which checks the situations and then strategies are applied. Marketing mix and concepts such as total product and solution offering along with commoditisation becomes very much essential in gaining success. Experimental marketing, customer relations and experience management plays a very crucial role in that. Since most of the business has taken the internet route hence use of Internet in the marketing campaign has become very much crucial. Cost structure and pricing are very much essential part of the modern day business. In this regards the role of the branding is also very much crucial. Along with this company should also have to focus on sustainability and stakeholders associated with it.
McDonalds is the world’s largest food chain restaurants from USA. The same is the case with McDonald’s Singapore which is one of the biggest in the Singapore food industry. This report analyses different concepts of marketing that is applied in McDonalds Singapore such as P’s and C’s of marketing, total product and solution along with commoditisation, management of service element. It also describes customer relationship management, experience management and experimental marketing in regards to McDonalds Singapore. It also elaborates about use of internet as well as cost and pricing structure, use of branding and sustainability marketing principles.
There are people from the local and international market and hence marketing has to be done with special attention to the marketing concepts. Marketing mix plays a very crucial role in making the marketing effective. 7P’s of marketing mix are:
In terms of marketing the 4c’s are also very much essential. The four c’s for McDonalds are as follows:
Marketing mix is an essential part of the modern day marketing. In this regards both P’s and C’s have to manage in an appropriate manner. By involving all the stakeholders into the decision making process, a company will be able to improve the c’s of marketing.
Commoditisation refers to process whereby competition removes differentiation in products hence leading to creation of market having price-based competition. In McDonalds commoditisation is maintained in an appropriate manner as they do not have different types of products when compared with competitors rather they lead their customers in terms of the prices at which different products are available at the firm (Paul and Roy, 2014). They are providing products at such reasonable cost that it dwarfs all other purchasing factors.
McDonalds can improve its low cost pricing strategy by reducing the cost of franchising or bringing innovation in the company’s portfolio. These innovations can also be in terms of the ways in which different processes are conducted within the firm.
McDonalds does not offer many products from different food segments. Numbers of products are 145 only. These products are capable of providing all the type of solution that is demanded by the company. All the products made in the organisation are consumable and it is as per the company has promised to its customers. In the management of Total Product and Solution offering, McDonald’s has been continuously adding to its product range. Due to this, innovation has become the major part of the business (Montgomery, et al. 2012). Total product and solution offering is also relatable to the business that is provided through online mediums. All its products are marketed in such a manner that it creates a positive impact on the minds of the people and the products are also designed accordingly. Total product and solution offering is enhanced within the organisation by the help of combined efforts done by all the stakeholders within the firm.
Managing service element has been a tedious job for the organisations. Service elements are considered as an optional unbundled feature that is associated with making the arrangements for serving. They are providing the best of services to the customers. For which they had to take effective measures to manage their service element. In this regards the most crucial role is played by the technology. They have used different types of technology so as to improve the services provided at the workplace. In terms of managing the service element, they have a highly skilled workforce that is capable of dealing with different types of situations (Al Badi, 2015). Their workforce is highly skilled and trained which adds value to the service element that is used within the organisation. There are people that are from the local and international markets working at the McDonalds. Their experiences add to the company’s way of doing business.
Regular trainings are being provided to the employees based on their requirements. These requirements is analysed based on both company’s plan for its future growth and changing customer demands. Quality which is one of the major service elements in any industry has a role in improving the sales of the company and having edge over the rivals. McDonalds at each step of its different processes maintains a set of activities that helps them in maintaining their quality. Quality becomes more important in the case of services as it has a direct relation with the quality of the output that will be produced in the company.
Along with this there are many risks attached with the business. These risks have to be evaluated on regular basis and hence react with a plan so as to mitigate plans accordingly. Cleanliness and sanitisation is taken proper care so that no such problems reduce the quality of the services (Akaka, Vargo and Lusch, 2013). This can be improved by the help of setting service quality parameters. These parameters need to be designed seeking the benefits that organisation aims to achieve.
This is the form of the marketing that is gaining trends in the Singapore and other markets. This has a strong influence on the minds of the consumers. Experiential marketing involves marketing services and products on the basis of their experiences. It engages people to create an emotional attachment with the products and services. McDonalds do it by the help of guerrilla marketing, live marketing, event marketing, on-ground marketing. This is done with some kinds of events or special events (Wood, 2012). The franchises of McDonalds in Singapore do not only looks for customers as passive receiver of the messages rather they involve them in creating and producing marketing program. This is also done widely through the help of online sites especially the social media sites or through one-to-one interaction.
This is also done within McDonalds in a smarter way by reacting towards the people’s requirements. Experience management is basically considered as the practice of designing and reacting towards the consumer’s conversations so as to meet or stay ahead of the expectations of the consumers. It helps in increasing loyalty, advocacy and satisfaction of the consumers (Jie, 2012). At McDonalds there is high use of technology so as to manage the experience of the consumers. They continuously make process alterations so as to accomplish the targets.
Customer relation is one of the core concepts of modern day marketing and it aims to make more effective relation with the consumers. In order to maintain healthy customer relationship company apply different types of Initiatives such as localisation. For example they do not serve beef or port in India. They are highly active in the social activities which include child education, vaccination programs (Verma, Gupta and Nangia, 2014). They also help people from every section of the society so as to understand their product demands. Based on the data received from their customer, they often make changes in their menu. In order to maintain healthy customer relation, company use different types of plans.
Every business is benefited from having an internet presence. Using the internet in marketing is more of a matter of commitment. Mc Donald can make use of the internet marketing and it comprises digital media to inform about products and lure people to purchase products and services. The internet is a vehicle of promotions, advertising, and public relations efforts. The internet should be used in the overall marketing plan of the Mc Donald. The ways to use the internet for marketing can be:
The cost structure of the Mc Donald is localized than the globalized. Mc Donald has different pricing and cost structure for the different countries. Singapore is required to undergo a strict process for determining the price of the market. This process comprises:
Choosing price objectives
Defining demand
Approximating costs
Evaluating competitors’ costs, prices and offers
Picking pricing method
Selecting the final price
The pricing objective of the company is to enhance market share. It also considers the price of the competitors for allowing to price products appropriately. It also balances quality along with the value. Mc Donald also decides the price as per the life cycle of the products.
(Source: Market realist, 2013)
In the cost structure of the Mc Donald, majorly considers a purchase, wage, marketing, rent and utility, depreciation and others (Market realist, 2013). All these factors have a role in the pricing and cost structure of the Mc Donald. The raw material is being the largest component which is followed by the labor.
Mc Donald mainly makes use of the three generic pricing strategies like focus, differentiation and cost leadership. The company has been successful in employing cost leadership marketing strategy by making available fast food at low prices. The prices of the company have been kept low by:
Hiring and training inexpert employees instead of the trained chefs
Hiring only a few trained managers
The pricing strategy of the Mc Donald comprises price bundling along with the psychological pricing. The brand offers meals and other product bundles for a discount in the price bundling (Fast Food, 2018). On the other side, Mc Donald uses prices which appear to be suggestively more affordable instead of passing it off to the nearest dollar. The company often makes use of the price bundling in order to encourage customers to purchase more products.
The company is itself imprecise about its pricing strategy. It understands the perceived value of the customers which is an important determinant in the price variation. It is also realized that using low price as a marketing tool can promise customers as a product of conceded quality. Besides, the competitors of the company can even count in the price war resulting profit margins reduced without enhancing sales. The pricing and cost structure of the Mc Donald implements cost leadership marketing strategy successfully. Its main objective is to enhance market share. Arriving at a pricing decision is the outcome of evaluating demand, costs, product lifecycle, and competitor pricing. It even balances quality with the value.
The branding is a marketing practice which unveils in creating name, logo and the overall design. It helps to differentiate product and services from the competitors. It creates consumer preference for the offerings of the company. It is helpful in generating revenues and market share. It even expands the company’s estimated worth. Mc Donald is ranked sixth as the top brand. It is one of the most visited restaurants and is successful in branding success globally. The comprehensive market research and segmentation are the main reason for the success of the Mc Donald in the restaurant business (Kowitt, 2012). It is imitated in the offerings of the company like drinks, burgers, and fries as it varies as per the eating habits of the people centered on the demographics. The company caters to the people of different cultures and consider their differences. The franchises are even given on the authority to prepare menus as per the food habits and interest of the local people. Other than the different menus, ambiance, experiences and color palettes are alike around the globe. If it is talked about the color palettes then the company chooses red and yellow which is known to encourage hunger in human beings. It comprises a clever branding. The branding takes time along with the patience. It demands entire attention and firm commitment. The company promotes branding by keeping memorable and exciting advertisements. The slogan of the company ‘I’m loving it’ become prize game and marketing technique. Mc Donald always makes sure that it stays consistent with the promotions (Samsudin, et al. 2011). It is to be believed that the branding strategy of the company is based on the uniformity and a person will always be in a situation to order the most iconic menu items like Big Mac. The brand has created its image by the greater choice, better value, and faster delivery.
Mc Donald is the world’s leading restaurant company. Using a scale for good by the company can be sustainable for the customers, producers, and the environment. It is the vision of the company to source food and packaging sustainably. The company addresses 3 Es of sustainability like ethics, environmental responsibility, and economic viability. The company makes sure that the food and packaging originate from sustainably managed land. It is called sustainable land management commitment (Prakash and Singh, 2011). Mc Donald extended its commitment to address all the three Es. The company is even assuring to reduce greenhouse gas emissions from its restaurants and offices. There are two environmental goals which company want to achieve by 2025. It wants to have 100% of its customer packaging come from the renewable and recycling sources and have the option of recycling in all of its restaurants. At present, 50% of the guest packaging comes from sustainable sources whereas just 10% of the restaurants are recycling. Such moves are being made by the company in response to the customer’s demand. The company desires to reduce wastage and have a positive impact on the community.
The TBL (Triple Bottom Line) is a grouping of economic affluence, environmental stewardship, and social responsibility. Mc Donald tries to enact and maintain a degree of corporate responsibility. It denotes to being a good citizen in the global community along with maintaining profit. There are some issues which have begun to become conspicuous in regard to the corporate responsibility. The company tries to be responsible for the promotion of sustainable farming methods. The company has even joined Unilever and Nestle in promising to shift to completely sustainable sourced palm oil. Because it is a source of greenhouse gases and also leads to a great deal of the negative outcomes. The environmental impact can be reduced by recycling wastes (RATHI, 2013). The economic impact can be reduced by being more sustainable and making profits. At last social impact can be reduced by including more salads and nutrition in the meals. The consumption of the whole wheat bread should be promoted.
The top stakeholders of the Mc Donald are its employees and customers. the stakeholder group of the company mainly comprises the following parties:
Conclusion
From the above based report, it can be concluded that marketing has become very much essential in the modern day marketing. Marketing mix such as 7p’s and 4C’s are properly managed in McDonald’s Singapore. They have been following commoditisation and total product & solution offering in an effective manner. Experiential marketing, experience management and customer relation is also to be managed within the organisation in an appropriate manner. Internet marketing is highly used within the organisation especially social media marketing is highly used by McDonalds. Cost structure of company is more localised than globalised. They have adopted the pricing strategy that is more on the lower side. Branding is used within the organisation so as to improve the image of the firm in front of their customers. Sustainability is their main focus and hence they have used triple bottom line structure. In this the role of the stakeholders becomes very much essential.
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