McDonald's marketing strategy: A benchmark in the fast food industry

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About McDonald’s

McDonald’s is an American fast food company founded in 1940 in San Bernardino, California, United States. The company was previously based in Oak Brook, Illinois but relocated to Chicago in June 2018. As of 2018, McDonald’s served more than 69 million customers daily at 37,855,100 locations in more than 1.7 countries around the world, making it the world’s largest restaurant chain by revenue. With more than 2.3 million employees, McDonald’s ranks second among private employers worldwide (behind Walmart with 2.02 billion employees). As of XNUMX, McDonald’s has the ninth largest brand equity in the world.

History of McDonald’s

Richard and Maurice McDonald moved from New England to California in search of opportunities. In 1948, these brothers started a quick service system with hamburgers costing 15 cents each. After gaining popularity over time, they were able to offer their concept as a franchise.

A Chicago native, Ray Kroc was a salesman who visited the McDonald brothers in 1954. Kroc was deeply impressed by the way the McDonald brothers did business. This led to him becoming the first McDonald’s franchisee. He opened the first restaurant for McDonald’s System Inc. In 1961 he bought the rights from the McDonald brothers for $2.7 million.

McDonald’s franchise business model

McDonald’s follows a three-structure franchise model. The company’s franchisees own and operate 90% of its restaurants. Franchisees operate their restaurants under the company’s supervision and act as their employers. They have significant control over the prices, sales, and operations of their restaurants. McDonald’s business model is based on a master plan entitled “Plan to Win” that is being implemented worldwide. In accordance with McDonald’s mission statement of Quality, Service, Cleanliness, and Value, the company adheres to each of these attributes.

In 2020, McDonald’s generated total revenue of $19.21 billion.
In a 2021 ranking of brands based on their value, McDonald’s ranked ninth at nearly $155 billion, a 20% increase from the previous year.

The food sector, especially the fast food industry, has traditionally been very competitive. In order to sell more and better, marketing strategies that communicate the company’s value proposition and are aligned with sales promotions are essential. An example of a job well done is McDonald’s marketing strategy, which is a benchmark in the fast food space.

One of the challenges for the big fast food chains was
complex as customers are more interested in eating healthy and living much healthier lives. And these restaurants have been idealized or associated with a very unhealthy way of eating.

At this point, McDonald’s marketing strategy has always sought to support the company’s value proposition in order to stay ahead of its main competitors.

McDonald’s marketing strategy: its keys

Burger King or KFC competition

McDonald’s needs to make itself more attractive and modern to reposition itself in the global market, so it needs to reconnect with its customers and create a “fandom”. A place where your fans can find, discuss and share their knowledge on any topic. This is to re-engage customers who have withdrawn or attracted new users to your brand so that they can have a different experience than the one they managed.

Another problem that McDonald’s marketing strategy has to face is the competition where Burger King or KFC stands out. In fact, Burger King has done an impressive job of marketing, innovating, and experimenting with new options to position itself as a better, more fun, young and innovative option. And KFC, with big growth in social media, is not far behind.

So much so that Burger King has become the most creative company in the world, they have also been directly connected to popular culture. They do all of this by generating targeted marketing to welcome more users and expand their audience.

McDonald’s marketing: The storytelling

McDonald’s strategy is to manage its storytelling through improvement and renewal, focus on customer experiences, and also to improve the connection between the customer and the brand. The idea is based on interacting more with your audience and also getting to know them to satisfy their needs or tastes.

This implements a way to make the customer more attractive and modern. This would be a 3-year strategy (medium term) at McDonald’s. They mainly aim to leverage two lines of business: consistency and communication with a content marketing plan.

Therefore, McDonald’s marketing strategy is managed with the so-called 3D strategy (delivery, digital, and drive-thru), which strengthens the most requested products on the menu. McDonald’s has already thought about how to develop the strategy and a new relationship with the customers.

Fast Company, a US-based magazine, published an in-depth analysis of this new strategy to connect with the public, engage with marketers, and research the campaigns being launched in the United States.

As expressed in Fast Company, the fast food company’s idea that its customers should feel good about their food purchases and be 100% loyal to the brand is within the goal of awareness and loyalty of McDonald’s marketing strategy.

The importance of telling human stories

The company’s plan to meet the storytelling challenge is to focus on pivoting from its products to telling human stories, as seen in a campaign McDonald’s did in the United States, work done by Wieden and Kennedy.

This campaign did not show a hamburger, or fries, or the presence of the company in a high sphere. Using human stories to attract the public, one of the stories is about a farmer who is given French fries and about the food that is given for free to the employees of the front line or also from the Ronald McDonald houses, At the end of the history, the packaging and the Arches show their product in some frames.

To conclude this article on McDonald’s marketing strategy, we must remember that the brand has stood out for its good content marketing strategies and this is not the time to fail. The company has implemented several changes that will be made over time, creating more human, more aware, more real content that establishes a relationship and connection with its target audience, interacting with and getting to know its users more thoroughly, and showing them the sensitive part that the brand can offer them.

McDonald’s business model: segments

Qualitatively, the segments can be divided into four categories:

The United States remains the most important market as of 2018.
Leading international markets include Australia, Canada, France, Germany, the UK, and related markets.
High Growth Potential Markets include markets with significant growth potential including China, Italy, Korea, Netherlands, Poland, Russia, Spain, Switzerland, and related markets.
Foundational and Corporate Markets are the remaining markets in the McDonald’s system, most of which operate on a heavily franchised model.

McDonald’s: growth plan and accelerator

Launched in 2017, the Velocity Growth Plan is McDonald’s customer-centric strategy and business model that focuses on three key components of the business: food, value, and customer experience.

Retain Existing Customers: Emphasize areas where you already have a strong presence, such as B. Family events and food-oriented breakfasts.
Win back fewer regular customers: return to its historical strengths such as taste, quality, convenience, and quality food.
Turn casual customers into engaged customers: build lasting relationships with customers to encourage them to visit more often, strengthen and expand the McCafé coffee brand, and enhance the snacks and treats offered.

McDonald’s remains committed to continuing its aggressive use of the three growth accelerators in 2022 and beyond:

Experience of the Future (“EOTF”): A technological modernization and refresh that enhances the restaurant experience and improves customer perception of the brand.
Digital: McDonald’s is expanding its technology platform to offer customers more options for ordering, paying for, and receiving services, including expanded functionality in its global mobile app, self-service kiosks, and technologies that facilitate curbside and in-store service. Table.
Delivery: McDonald’s gradually began offering delivery to more than 50% of its global restaurant system in 2022. In 2017, McDonald’s announced it would be working with Uber Eats to deliver in the United States for the first time in 2022. As part of a strategy to stay relevant, these associations are focusing on the new generation of people who prefer home delivery to pickup.

McDonald’s response to Covid-19

McDonald’s has entered the pandemic well-positioned to operate in an environment where guests seek to minimize contact with others. Just under 95% of McDonald’s restaurants in the U.S. are drive-thru, and the company expects digital sales through its online ordering app, kiosk, or delivery in its six main markets to generate $10 billion, or nearly 20% of its sales will exceed.

Changing customer behavior due to COVID-19 gives McDonald’s a competitive advantage. Delivery is booming and usage of McDonald’sorder foodThe app has grown as more customers order and pay for their groceries on mobile devices.