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This document discusses McDonald's marketing process and strategies. It explains that McDonald's evaluates market circumstances, develops marketing strategies and mixes, and executes and controls their plans. McDonald's orientation is focused on customers and satisfying their needs better than competitors. This benefits McDonald's but also increases some costs. The document also discusses how McDonald's considers micro and macro environmental factors that influence their marketing decisions, such as customers, competitors, suppliers, and economic, technological, demographic and political conditions in different regions.

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1 An Assignment on, MARKETING PROCESS Submitted to Submitted by,
2 Contents Sl. No. Title Page no. Introduction 4 1 1. Understand the concept and the process of marketing 4 1.1 Explain the various elements of marketing process 4 1.2 Evaluate the benefit and cost of marketing orientation 5 2. Be able to use the concept of segmentation, targeting and positioning 7 2.1 Show micro and macro environmental factors which influence marketing decision 7 2.2 2 Propose segmentation criteria to be used for products in different markets 8 2.3 Choose a targeting strategy for a selected product or service 10 2.4 Demonstrate how buyer’s behavior affects marketing activities in different buying situation 11 2.5 5 Propose new positioning for a selected product: 12 3. Understand the individual elements of extended marketing mix 13 3.1 Explain how products are developed to sustain competitive advantage 13 3.2 2 Explain how distribution is arranged to provide customer convenience 14 3.3 Explain how prices are set to reflect McDonald's objectives and market conditions 15 3.4 : Illustrate how promotional activity is integrated to achieve marketing objectives 16 3.5 Analyze the additional elements of the extended marketing mix 17 4. Be able to use the marketing mix indifferent contexts 18 4.1 Plan marketing mixes for two different segments in consumer markets 18 4.2 2 Illustrate the differences in marketing products and services 19 4.3 Show how and why the international marketing differs from domestic marketing 19 Conclusion 20 References 21
3 Executive summary: McDonalds is a well-known restaurant all over the world. It takes various types of market strategy to run business in various countries. It ensures the appropriate utilization of resources. It provides both the product and the service to the customers making different marketing mix for every individual segment of target market. It has already created the brand image among the market and achieves the loyalty of the consumers ensuring the standard of product and service.
4 Introduction: All the products are made to serve the target and gain the organizational goal. Marketing serves this purpose and control the production and distribution process. It links the target market with the production team being the medium. Thus, the marketing process of a product should be emphasized more than other sectors. The goal of marketers is to catch the attention of consumers to the product and persuade them to consume. However, the marketing process means to understand the need and fin out the target, explain the situation, making a strategic plan, creating a marketing mix and lastly implementing them to fulfill the need of target market. McDonald’s is one of the largest restaurants in the world operating business in more than 119 countries with 36000 outlets having more than 64 million consumers. It has already efficiently led their position and handled their consumers providing the better service and goods. 1. Understand the concept and the process of marketing 1.1 Explain the various elements of marketing process: Marketing means the activity of distributing products among the target market and attain the organizational goal. Marketing process is to evaluate a new market and launch a product to fulfill the need of that market. The process consists of four basic steps; those are being described below according to the McDonald’s, marketing process. evaluate the circumstancs marketing strategy marketing mix execution and control
5  Evaluate the circumstances: the marketers need to search the deprivation of people and find out the policy to fulfill that necessity. This is the first step of marketing process. McDonald’s started their journey with hamburger from 1944. They are evaluating new target market and discover teir unfulfilled necessity and develop a new product to fulfill them. Thus the demand pof the product of McDonald does not lower even after 72 years.  Marketing strategy: marketing strategy means to make an overall plan that covers every goals of the organization. .most of the companies’ major goals are to capture more market share with sustainability,. McDonald has successfully handled their marketing strategy and increasing their sale with the increase of more outlets. Now they are called the burger king becaue of the perfect combination of maximizing sale and creating durable consumers.  Marketing mix: marketing mix is tools of marketing to launch a brand r product. A planned mix of controllable elements of product’s marketing plan such as product, price, promotion, place are called marketing mix. McDonald always evaluate their product’s efficiency with thes marketing element and they are now become the largest brand of restaurants..  Execution and controlling: after finishing the planning, the next step is execute them and control according to the plan. If there Is any mistake in the plan, then the marketers are allowed to correct it immediately.. McDonald’s recently launches a program through which it collects the idea from the consumers to develop product. 1.2 Evaluate the benefit and cost of marketing orientation: Today’s business is dependent on consumers: the market is maintained by the demand of the customers. The target of any business organization is to satisfy the target market by producing the product according to the expectation of consumers and serving the appropriate service that the consumers desire. The market orientation means that achieving the organizational goals are relied on evaluating the customers need and efficiently satisfy them providing better goods and services than other competitor. The marketing concept starts from market focuses on the consumer needs. It’s an integrated marketing system that ensures profit through customer satisfaction. Here customers are treated as the heart of the business. Total marketing process is being maintained around the customer. Each and every activities is oriented to the customer. Here is a figure that described the interrelation between customers and producer in the marketing orientation approach-
6 Each and every activities of McDonald is according to the market orientation approach. They launch every product as the customer’s taste and try to provide services to their consumers more than their expectation. Here are some benefits of customer orientation or market orientation approach-  Consumer directed: McDonald produces each product that the customers expect.  Priority on customer benefit: the products are made answering the question “why the customers will my products?"  Responds on customer demand: McDonald always tries to responds the customers demand on right moment.  Get more benefits: the company who follows the market orientation concept usually get more opportunity than another company who doesn’t do so. The market oriented production concept has some critics also, those-  Increase the costs of production: to fulfill the necessity of consumer within their affordable purchase limit most often increase the production cost  Increase promotion costs: to inform about the importance of the products the company needs to spend more capital to this sector.  Expensive research: the company has to keep eyes on the market thus he needs to extract the circumstances of the market through research and servey. customers products services processes researches
7 The customer never asks their essential product to the company. The company has to find out. the need of market.  Decrease the marginal benefit: the increase in costs decrease the profit of the products. 2. Be able to use the concept of segmentation, targeting and positioning 2.1: Show micro and macro environmentalfactors which influence marketingdecision: Micro environment are the factor that has a direct influence on the activities of the company. There are six micro environmental factors, such as-  Customer: all the products are produced to serve the customer needs. Thus the customers are the heart of the company’s success.  Competitors: competitors are the units who offer the same product to the company's target market. Thus their movement influences the activities of the company.  Suppliers: the suppliers serve the raw materials to the company. The standard of raw materials ensures the standard of the products.  Dealers: the dealers are the part of the supply chain of the company. They helps the company reach the consumers.  The public: public maintains the ethical and social factors of the company. They are also the possible consumers. A statistics shows that the company who performs social factors gets more favor of the company. McDonald has to face all the above factors. They always tries to keep positive image to these stakeholders. Macro environment are the factors that have indirect influence on the company. But they often obliged the company to change its traditional decision. The factors of macro environments are-  The economy: the economy of the region where the business operated influence to fix the price and to take other monetary facts.  The technology: the technology of that region also influences the production and delivery system. McDonalds produce their product with the help of local technology as it is more economical to them.  Demographic characteristics: age of customers, their ethnicity, education level, household, and lifestyle are the factors to select production function. Mcdonalds has to suffer in third world country because of ethnicity, education level, and
8 lifestyle. Most of the people of third world country don’t take fast-food as their daily meal. Moreover they don’t bear the cultural mix.  Natural factors: the weather and natural resources of the region matters to the company. McDonald’s tries to use the regional materials.  Political elements: the political and legal situation often hinders or paves the way of business. There is no business relationship between Bangladesh and Israel only because of political factors.  Social and cultural factors: the culture and social structure of the region often influences the business to operate. 2.2 Propose segmentation criteria to be used for products in different markets: Segmentation is a marketing strategy to divide the large target market from various criteria to select the production and distribution process. It is the process of creating the subset of target market into clearly recognizable segment having same type of need, want and demand. The objective of market segmentation is to create a perfect market mix that fits with the consumer’s desire. The market should have some characteristics thus the division will be possible, some of them are describing below-  The target market will be identifiable.  The segmentation obviously reachable.  Every division will have unique character.  It will be stable to reduce the cost of rapid changing.  The segment will enough large to use the resources efficiently. There are two types of market where the segmentation is possible, such as-  Consumer markets  Industrial markets
9 Consumer market: Industrial market segmentation: Consumer market geographic demographic psychographic behavioristic -Region -Size of town -Population density - population -climate -age -gender Familysize -family lifestyle -generation -income -occupation Ethnicity -religion -social status etc. -activities -choice -needs Values -Attitude -opinion -ceremonial -usage rate -consumer’s’ loyaltytobrand -willingnessto buy -facilitysought Industrial market Company type location Behavioral characteristics -size -purchasingrequirement -production -administration -region -communicativefacility -materialsavailability -technology -purchase procedure -buyersstandard -Usage rate
10 McDonald uses the customer segmentation and divides the market on the basis of age, income, taste, preference and the food habit of people of the region. 2.3 Choose a targeting strategyfor a selected productor service: Targeting strategy means to select the potential consumers to whom the business wants to serve their products. Targeting strategy consists of the division of market and choosing the perfect division and selecting appropriate product for each division. There are six steps to target the market, this are- There are three types of targeting strategies, such as-  Undifferentiated strategy::using same policy of promotion for all the segments of market.  Concentrated strategy: decorating promotion system for the individual segment of market.  Differentiated strategy: selecting different promotional massage for different segment. McDonalds’ target market is kids, families and youths.it uses differentiated strategy to its customers. selecting the additional facilities extracting the internal capablity of the organization evaluating the market ensuring value to the customer assuming the market scenes understanding the need of market
11 2.4 Demonstrate how buyer’s behavior affects marketing activities in differentbuying situation: Consumer buying behavior means the integrated consumers preference, interest, attitude, opinion, and decision while buying products. Consumers’ behavior follows a process while buying expensive products: the process is shown below- Mr. x wants to buy a car. At first he collects the information of the price, configuration of the well-known branded cars and then he chooses the cars according to his budget and decides to buy the best configured car. He is happy to buy the car with his preferred configuration. But as McDonald is just a restaurant their buying process is not too long. The consumers knows about the brand image of it , they comes and buy their desired food, if there is anything wrong in the product or delivering service, they might be dissatisfied. There are four types of consumer behavior; those are showing in the following table- Types of behavior Time Product cost Options Others Complex buying behavior Spend a lot of time precious various Asks experts for recommendation Ask variance Seek latest one Not much precious A lot of variety Company tempts the buyers. Dissonance buying behavior Less time spent medium Poor amount of options Company has less promotion costs Habitual buying behavior Least time to choose medium A lot of same product Daily necessary product Their impact on the market –  In the complex buying behavior the company has to ensure long run standard and few after purchasing facilities to attract the consumers.  The consumer asking lot of variety, the company has to develop their product continuously. McDonald has to invent new recipes to attract and sustain the customers. evaluating need collecing information searching options selectthe source to buy afterbuying satisfaction level
12  The consumer has little option, the company should not run monopolistic business to sustain in the market for long time.  Habitual buying behavior, here the company needs to ensure the freshness of the product. 2.5 Propose new positioningfor a selected product: Positioning is marketing strategy to capture the greater position in the target market than the competitor brand. The company promotes some extra facility to achieve the comparatively more brand loyalty. There are seven steps in positioning the product in the market- The positioning statement of company expresses the target market, defines the market, shows the brand promise, and lastly the cause to believe them. After performing segmentation and targeting the market; the company has to position their product through promotion, standard, service quality and other marketing strategy. McDonalds’ use the promotion and positioning statement as well as maintenance of other service and product standard. determine the brand's current position recognize the direct competitors evaluate competitors positioning strategy compare and find uniqueness create identical and stantard positioning idea make a positioning statement test the competency of the positioning statement
13 3. Understand the individual elements of extended marketing mix 3.1 Explain how productsare developedto sustain competitive advantage: Product development refers to the process of designing, making and serving new products or services to fulfill the consumer necessity or to modify the existing product to increase its capability. Product development can be done in 4 perceptions, such as-  Enhancement  Innovation  Improvement  Creation McDonalds’ performs all the above ways to develop product. It continuously modifies and tries to maintain the flow of new tastes to sustain the customer satisfaction. The products process has seven major steps, those are – 1. Invent new idea: at first the developer should find an idea to modify or create a new product. 2. Correcting the concept and experimenting: if It is found strong efficiency to attract the consumer. Then identify the weakness and correct them. Then test the idea whether it is applicable or not. 3. Collect customer feedback: let the idea know the customer and collect their opinion. 4. Analyzing the previous result: The outcomes of the previous steps are analyzed here and also measure the marginal cost and benefit of the new product. 5. Providing demo: now launch the demo product to the customer or to the related loyal employee to consume it and provide the feedback. 6. Prepare the marketing mix: if all the previous results are positive then prepare an appropriate marketing mix. 7. Ready to launch: now the products should be on the market and try to collect the customer response. Development process ends here temporarily, if there is any decline in the market then again the company will follow the step to correct them. McDonalds always gives higher priority to the customer preference to market a new product.
14 3.2 Explain how distribution is arranged to provide customer convenience: The distribution process of the products manages the customer and company relationship. Company communicates with their target market through exchanging benefit to them. There are mainly three types of dealing process, such as 1. Producer to customers: this distribution process ensures a direct relationship. The producer can easily know about the customer satisfaction and directly communicate them to get any recommendation. Most of the service providing business deals through this process. The McDonalds’ is a restaurant; they usually maintain this process of distribution. 2. Producer to retailers to customer: here the products are delivered to the retailers and they serve the customers. The easily perishable, sensitive products such as, vegetables and dairy products are dealt in this way. 3. Producer to wholesalers to retailers to customers: this relationship is too complex and customers or the company could not reach each other easily. Often there happens misrepresentation and misunderstanding and the destructive los for each other. But the industrial products are badly dependent to use this process. Moreover, McDonalds use a further way to deliver products that is through franchise business. It sells the brand image to the domestic country investors and also ensures the products standard. producer consumers producer retailers consumers producer wholesalers retailers consumers
15 ‘3.3 Explain how prices are set to reflectMcDonald'sobjectives and marketconditions: From the view of customers, price refers to the monetary value of the products to consume and they are willing to pay it in exchange of goods and services. From the view of producers the price means the expected value that they deserve in exchange of their products and services. Pricing means to determine the value of the products that will fulfill the production cost and also ensure the expected profit in customers’ affordable level. The company maintain a series of tasks while marketing; those are- The organization has several objectives that it wants to implement through the appropriate pricing of the product. The most common objectives are stated below-  Optimal profit: the company always expects the highest profit from serving consumers: the price of products plays a major role to serve this purpose.  Increase revenue: the profit is related to the sales revenue; to ensure the revenue the company has to pricing efficiently.  Increase marginal profit: the cost of each product is recovered by the revenue; thus pricing is essential to increase, marginal benefit.  Leader standard: the appropriated price helps marketers to lead his company more efficiently.  Sustainability: the price helps the company to sustain in the market.  Cost refund: the cost is charged against production cost.  Stability of price: the pricing helps to control inflation and the frequent change of price. 1.create marketing strategy 2. determine marketingmix 3. assume the demandcurve 4. measure the expenses 5. considerthe environmental forces 6. determine the price objectives 7. fix the price
16 McDonalds’ ensures the above objective while pricing. There are four pricing strategy; those are-  Premium pricing: it means that company charges high price artificially from the competitors to create a sense that the product of higher price has the higher standard.  Penetration pricing: it means company charges lower price than the competitor to capture he market share quickly.  Economy pricing: here the company charges the lower cost by reducing production and distribution cost; here margins are very poor.  Skimming strategy: here the producer runs monopolized business till the competitors’ flourishes their product. McDonalds’ uses the premium pricing usually as it is now an established brand: but it uses economy pricing also in the more competitive period. 3.4: Illustrate how promotional activity is integrated to achieve marketingobjectives: Promotion is one of the elements of the marketing mix. The company usually invests in this sector comparatively more than the other sectors. The company has to use all the varieties of promotion strategy to gain the marketing objective through attracting more customers to the company. There several kinds of promotion, such as-  Advertising: arranging dramatically presentation of the product and broadcasting them in TV, radio and to news portals or publishing in print media, such a magazines, newspaper, leaflet, bulletin etc. it also can be done through signboard, LED billboard etc.  Personal selling: appointing attractive and efficient salespersons who personally convince the buyer to buy their product.  Sales promotion: to increase the sales immidiately, arranging some temporary and more appealing offer like discount, gift hampers and attracting the consumers.  Mailing: sending mass email to the all possible customer and informing them about the configuration of the products. This is a poor promotion strategy.  Social media: broadcasting the advertisement in social media or using a page of the products and maintain a direct relationship with customers. It is now the most popular and also proved effective form of promotion.  Sponsorship: bearing the cost of any public meeting or ceremony or to invest in public welfare. It is costly but too useful.
17  Encouraging competition: arranging competitions among the consumers to take any new decision or providing new idea. it is also popular nowadays. The company must combine the above items of promotion to create an integrated promotion strategy that accelerate the marketing objectives. McDonalds’ has already mixed most of the above promotion policy to capture its expected market share, it has successfully handled it. 3.5 Analyze the additionalelements ofthe extended marketingmix: Marketing mix is not now the 4ps, its now 7ps. The extensions are people, process and physical evidence. These three additional marketing mix is mostly applicable in the service sector. The elements are being discussed shortly-  People: this people consists of company’s internal employees who maintain direct and indirect relationship with the consumer, such as, sales person, managers, production employees etc. there prevails three types of communication in an organization, they have internal relationship among them. It is shown below- Internal relationship External relationship Interactive relationship These three types of relationship have a strong connection among them. If the internal relationship is not maintained the interactive relation is not possible, again if the external relation is not handled efficiently the marketing objectives will be hindered. The element “people” deals with the internal relationship through performing various types of motivation strategy.  Process: the process actually means the payment system while dealing. If the company maintains various options to pay the bill, the consumers can quickly Company Employee s Custome rs
18 pay their payments. It will hasten and make easy the transaction. While consuming service the repeated asking of paying bill in the company’s favorable form is too irritating.  Physical evidence: the decoration and the comfortless in the place where the service is rendered is meant by physical; evidence. The most standard goods and services may not be accepted by the consumer if the place from where they take the service or good is not hygienic or doesn’t have friendly environment. McDonalds’ is a restaurant, it is more conscious about the extended marketing mix. It maintains a well relationship with the employees, and has fluctuated payment system, the restaurants are neat and clean. 4. Be able to use the marketing mix indifferent contexts. 4.1 Plan marketingmixes for two differentsegments in consumer markets: Consumer market is segmented by demographic, psychographic, geographic and customer behavior categories. McDonalds launches its product on the basis of demographic and psychographic behavior. It considers the age, income, preference, taste and customer food habit to produce new product or to develop existing product. Its target market is the kids, family and teen agers. Thus the age variance is a major matter. The kids prefer the dairy product, soft and easily digestive products; the teenagers want the cheesy and spicy product; the age old family members expects healthy and diet foods. According to their preference the company offers different products to them. It considers the places where the family can enjoy dinner; it also extended marketing mix people physical evidence process
19 arranges some amusement for the teenagers. The company signs their promotion system for these three ages and has some opportunities o cheaper but delicious products for lower income capable customer. the organization knows that all the types of customer demands convenient environment in the restaurant; the teenager usually create noises and want to enjoy themselves within the restaurant; on the other hand the aged person wants to have the silent soft moment. The company tries to ensure the convenient environment for both of them. The less earning persons usually pay their bill in cash particularly in the developing country. The manager has arranged the easy process to pay the bill. It tries to motivate its employee through monetary and nonmonetary incentives and ensure the well behavior to the customers. 4.2 Illustrate the differencesin marketingproducts and services: The products are tangible, not easily perishable, and homogeneous and standard of the product can be maintained easily. But the services ate intangible, perishable, variable from time to time, person to person and obviously heterogeneous. Thus the marketing plan of product and services are separate from one another. McDonald's provide products as well as services. The product marketing mix needs to combine 4p's of marketing and saw vice marketing needs more three P's, such as people, process, physical evidence. Because of intangibility and perishability the service standard is not constant, and the place matters a less in service; the promotion system of service marketing is different, here the organization just promises to the consumers to attract them to take service. The payment process of service marketing is held after consuming. Physical evidence has a vital role in service marketing. The company needs to create a lucrative and well decorated restaurant to attract the consumers. Employees' behavior is also one of the most important factor in service marketing, McDonald's is more concern about maintaining employees' behavior to the consumers. Service marketing is more complex than product marketing and the company needs to be very conscious to ensure customer satisfaction. 4.3 Show how and why the internationalmarketingdiffers from domestic marketing: International marketing means to market the product out of the home country where it is produced. Market refers to the group of potential and actual buyers, it doesn't matter where the group live. International marketing paves the way to serve all the potential buyers and fulfill their needs and demands. The company when has surplus product it wants to export them to the possible consumer across the border. The globalization process paves the way to international marketing providing easy access to the market of any country. Here are the reasons of entering into the international market is-
20  If the company is successful in the domestic market.  If the expected sales and benefit could be earned in the domestic market.  If the product life in the domestic market is at the end, the international marketing creates an opportunity to find new market place and develop a new market for the dead product.  If the domestic market of the product is more competitive and less profitable the company can shift business to convenient profitable place.  If the domestic technology is less developed than the technology of another country and the export of that technology can cause more production and exceed benefit than the cost.  If the segmentation of the global market is similar to the global market, the company can take the opportunity. The company should consider 4 factors to operate business internationally, these are-  Political factors: the political stability, government features, government facilities, barriers to trade etc.  Economic factors: the monetary maintenance, loan facilities, tax facilities, economic resources etc.  Social factors: the social value, norms, customs, religious value, education, tradition etc.  Technological factor: the development of technology, the efficiency of the machineries, the recycling technology etc. The company should keep in mind the above factors while entering into the market of foreign country. McDonald's efficiently handled these factors to open a new branch in the foreign country. There are also some considerations to enter into the global market, such as-  Cost: how much costs will increase to operate business globally.  Speed: how prompts the company can serve the customers; actually it depends on the communication and transportation system.  Flexibility: how the customers will response to the change in service and product. The market is flexible or not.
21  Risk factors: the competition with the domestic business, economic barrier, tax burden, political instability and cultural difference are now considered most risky terms.  Long term goal: how many years the company wants to operate business here, it depends how much loyal market share it has. After all it can be concluded that the global market is a huge opportunity to increase the demand and supply of the products. McDonald's can easily ensure its higher production and sufficient profit from expanding market globally. Conclusion: McDonald's is a famous restaurant in the global market; it serves products as well as services. It maintains different marketing policy according to the environmental factors of that country. It has successfully managed the business in 119 countries satisfying around 64 million customers. The manager has to plan more flexible marketing process to increase the revenue and decrease the opportunity cost.
22 References Crimp, M. (1981). The marketing research process. Englewood Cliffs, N.J.: Prentice/Hall International. DeLozier, M. (1976). The marketing communications process. New York: McGraw-Hill. Engel, J., Warshaw, M. and Kinnear, T. (1983). Promotional strategy. Homewood, Ill.: R.D. Irwin. Kerin, R. (2006). Marketing. New York: McGraw-Hill/Irwin. Kotler, P. (1986). Principles of marketing. Englewood Cliffs, N.J.: Prentice-Hall. Mattison, R. (1999). Winning telco customers using marketing databases. Boston: Artech House. Milne, G. and McDonald, M. (1999). Sport marketing. Sudbury, Mass.: Jones and Bartlett. Reedy, J. and Schullo, S. (2004). Electronic marketing. Mason, Ohio: Thomson/South- Western. Sanchez, R. and Freiling, J. (2005). A focused issue on the marketing process in organizational competence. Amsterdam: Elsevier JAI.

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Mkt

  • 1. 1 An Assignment on, MARKETING PROCESS Submitted to Submitted by,
  • 2. 2 Contents Sl. No. Title Page no. Introduction 4 1 1. Understand the concept and the process of marketing 4 1.1 Explain the various elements of marketing process 4 1.2 Evaluate the benefit and cost of marketing orientation 5 2. Be able to use the concept of segmentation, targeting and positioning 7 2.1 Show micro and macro environmental factors which influence marketing decision 7 2.2 2 Propose segmentation criteria to be used for products in different markets 8 2.3 Choose a targeting strategy for a selected product or service 10 2.4 Demonstrate how buyer’s behavior affects marketing activities in different buying situation 11 2.5 5 Propose new positioning for a selected product: 12 3. Understand the individual elements of extended marketing mix 13 3.1 Explain how products are developed to sustain competitive advantage 13 3.2 2 Explain how distribution is arranged to provide customer convenience 14 3.3 Explain how prices are set to reflect McDonald's objectives and market conditions 15 3.4 : Illustrate how promotional activity is integrated to achieve marketing objectives 16 3.5 Analyze the additional elements of the extended marketing mix 17 4. Be able to use the marketing mix indifferent contexts 18 4.1 Plan marketing mixes for two different segments in consumer markets 18 4.2 2 Illustrate the differences in marketing products and services 19 4.3 Show how and why the international marketing differs from domestic marketing 19 Conclusion 20 References 21
  • 3. 3 Executive summary: McDonalds is a well-known restaurant all over the world. It takes various types of market strategy to run business in various countries. It ensures the appropriate utilization of resources. It provides both the product and the service to the customers making different marketing mix for every individual segment of target market. It has already created the brand image among the market and achieves the loyalty of the consumers ensuring the standard of product and service.
  • 4. 4 Introduction: All the products are made to serve the target and gain the organizational goal. Marketing serves this purpose and control the production and distribution process. It links the target market with the production team being the medium. Thus, the marketing process of a product should be emphasized more than other sectors. The goal of marketers is to catch the attention of consumers to the product and persuade them to consume. However, the marketing process means to understand the need and fin out the target, explain the situation, making a strategic plan, creating a marketing mix and lastly implementing them to fulfill the need of target market. McDonald’s is one of the largest restaurants in the world operating business in more than 119 countries with 36000 outlets having more than 64 million consumers. It has already efficiently led their position and handled their consumers providing the better service and goods. 1. Understand the concept and the process of marketing 1.1 Explain the various elements of marketing process: Marketing means the activity of distributing products among the target market and attain the organizational goal. Marketing process is to evaluate a new market and launch a product to fulfill the need of that market. The process consists of four basic steps; those are being described below according to the McDonald’s, marketing process. evaluate the circumstancs marketing strategy marketing mix execution and control
  • 5. 5  Evaluate the circumstances: the marketers need to search the deprivation of people and find out the policy to fulfill that necessity. This is the first step of marketing process. McDonald’s started their journey with hamburger from 1944. They are evaluating new target market and discover teir unfulfilled necessity and develop a new product to fulfill them. Thus the demand pof the product of McDonald does not lower even after 72 years.  Marketing strategy: marketing strategy means to make an overall plan that covers every goals of the organization. .most of the companies’ major goals are to capture more market share with sustainability,. McDonald has successfully handled their marketing strategy and increasing their sale with the increase of more outlets. Now they are called the burger king becaue of the perfect combination of maximizing sale and creating durable consumers.  Marketing mix: marketing mix is tools of marketing to launch a brand r product. A planned mix of controllable elements of product’s marketing plan such as product, price, promotion, place are called marketing mix. McDonald always evaluate their product’s efficiency with thes marketing element and they are now become the largest brand of restaurants..  Execution and controlling: after finishing the planning, the next step is execute them and control according to the plan. If there Is any mistake in the plan, then the marketers are allowed to correct it immediately.. McDonald’s recently launches a program through which it collects the idea from the consumers to develop product. 1.2 Evaluate the benefit and cost of marketing orientation: Today’s business is dependent on consumers: the market is maintained by the demand of the customers. The target of any business organization is to satisfy the target market by producing the product according to the expectation of consumers and serving the appropriate service that the consumers desire. The market orientation means that achieving the organizational goals are relied on evaluating the customers need and efficiently satisfy them providing better goods and services than other competitor. The marketing concept starts from market focuses on the consumer needs. It’s an integrated marketing system that ensures profit through customer satisfaction. Here customers are treated as the heart of the business. Total marketing process is being maintained around the customer. Each and every activities is oriented to the customer. Here is a figure that described the interrelation between customers and producer in the marketing orientation approach-
  • 6. 6 Each and every activities of McDonald is according to the market orientation approach. They launch every product as the customer’s taste and try to provide services to their consumers more than their expectation. Here are some benefits of customer orientation or market orientation approach-  Consumer directed: McDonald produces each product that the customers expect.  Priority on customer benefit: the products are made answering the question “why the customers will my products?"  Responds on customer demand: McDonald always tries to responds the customers demand on right moment.  Get more benefits: the company who follows the market orientation concept usually get more opportunity than another company who doesn’t do so. The market oriented production concept has some critics also, those-  Increase the costs of production: to fulfill the necessity of consumer within their affordable purchase limit most often increase the production cost  Increase promotion costs: to inform about the importance of the products the company needs to spend more capital to this sector.  Expensive research: the company has to keep eyes on the market thus he needs to extract the circumstances of the market through research and servey. customers products services processes researches
  • 7. 7 The customer never asks their essential product to the company. The company has to find out. the need of market.  Decrease the marginal benefit: the increase in costs decrease the profit of the products. 2. Be able to use the concept of segmentation, targeting and positioning 2.1: Show micro and macro environmentalfactors which influence marketingdecision: Micro environment are the factor that has a direct influence on the activities of the company. There are six micro environmental factors, such as-  Customer: all the products are produced to serve the customer needs. Thus the customers are the heart of the company’s success.  Competitors: competitors are the units who offer the same product to the company's target market. Thus their movement influences the activities of the company.  Suppliers: the suppliers serve the raw materials to the company. The standard of raw materials ensures the standard of the products.  Dealers: the dealers are the part of the supply chain of the company. They helps the company reach the consumers.  The public: public maintains the ethical and social factors of the company. They are also the possible consumers. A statistics shows that the company who performs social factors gets more favor of the company. McDonald has to face all the above factors. They always tries to keep positive image to these stakeholders. Macro environment are the factors that have indirect influence on the company. But they often obliged the company to change its traditional decision. The factors of macro environments are-  The economy: the economy of the region where the business operated influence to fix the price and to take other monetary facts.  The technology: the technology of that region also influences the production and delivery system. McDonalds produce their product with the help of local technology as it is more economical to them.  Demographic characteristics: age of customers, their ethnicity, education level, household, and lifestyle are the factors to select production function. Mcdonalds has to suffer in third world country because of ethnicity, education level, and
  • 8. 8 lifestyle. Most of the people of third world country don’t take fast-food as their daily meal. Moreover they don’t bear the cultural mix.  Natural factors: the weather and natural resources of the region matters to the company. McDonald’s tries to use the regional materials.  Political elements: the political and legal situation often hinders or paves the way of business. There is no business relationship between Bangladesh and Israel only because of political factors.  Social and cultural factors: the culture and social structure of the region often influences the business to operate. 2.2 Propose segmentation criteria to be used for products in different markets: Segmentation is a marketing strategy to divide the large target market from various criteria to select the production and distribution process. It is the process of creating the subset of target market into clearly recognizable segment having same type of need, want and demand. The objective of market segmentation is to create a perfect market mix that fits with the consumer’s desire. The market should have some characteristics thus the division will be possible, some of them are describing below-  The target market will be identifiable.  The segmentation obviously reachable.  Every division will have unique character.  It will be stable to reduce the cost of rapid changing.  The segment will enough large to use the resources efficiently. There are two types of market where the segmentation is possible, such as-  Consumer markets  Industrial markets
  • 9. 9 Consumer market: Industrial market segmentation: Consumer market geographic demographic psychographic behavioristic -Region -Size of town -Population density - population -climate -age -gender Familysize -family lifestyle -generation -income -occupation Ethnicity -religion -social status etc. -activities -choice -needs Values -Attitude -opinion -ceremonial -usage rate -consumer’s’ loyaltytobrand -willingnessto buy -facilitysought Industrial market Company type location Behavioral characteristics -size -purchasingrequirement -production -administration -region -communicativefacility -materialsavailability -technology -purchase procedure -buyersstandard -Usage rate
  • 10. 10 McDonald uses the customer segmentation and divides the market on the basis of age, income, taste, preference and the food habit of people of the region. 2.3 Choose a targeting strategyfor a selected productor service: Targeting strategy means to select the potential consumers to whom the business wants to serve their products. Targeting strategy consists of the division of market and choosing the perfect division and selecting appropriate product for each division. There are six steps to target the market, this are- There are three types of targeting strategies, such as-  Undifferentiated strategy::using same policy of promotion for all the segments of market.  Concentrated strategy: decorating promotion system for the individual segment of market.  Differentiated strategy: selecting different promotional massage for different segment. McDonalds’ target market is kids, families and youths.it uses differentiated strategy to its customers. selecting the additional facilities extracting the internal capablity of the organization evaluating the market ensuring value to the customer assuming the market scenes understanding the need of market
  • 11. 11 2.4 Demonstrate how buyer’s behavior affects marketing activities in differentbuying situation: Consumer buying behavior means the integrated consumers preference, interest, attitude, opinion, and decision while buying products. Consumers’ behavior follows a process while buying expensive products: the process is shown below- Mr. x wants to buy a car. At first he collects the information of the price, configuration of the well-known branded cars and then he chooses the cars according to his budget and decides to buy the best configured car. He is happy to buy the car with his preferred configuration. But as McDonald is just a restaurant their buying process is not too long. The consumers knows about the brand image of it , they comes and buy their desired food, if there is anything wrong in the product or delivering service, they might be dissatisfied. There are four types of consumer behavior; those are showing in the following table- Types of behavior Time Product cost Options Others Complex buying behavior Spend a lot of time precious various Asks experts for recommendation Ask variance Seek latest one Not much precious A lot of variety Company tempts the buyers. Dissonance buying behavior Less time spent medium Poor amount of options Company has less promotion costs Habitual buying behavior Least time to choose medium A lot of same product Daily necessary product Their impact on the market –  In the complex buying behavior the company has to ensure long run standard and few after purchasing facilities to attract the consumers.  The consumer asking lot of variety, the company has to develop their product continuously. McDonald has to invent new recipes to attract and sustain the customers. evaluating need collecing information searching options selectthe source to buy afterbuying satisfaction level
  • 12. 12  The consumer has little option, the company should not run monopolistic business to sustain in the market for long time.  Habitual buying behavior, here the company needs to ensure the freshness of the product. 2.5 Propose new positioningfor a selected product: Positioning is marketing strategy to capture the greater position in the target market than the competitor brand. The company promotes some extra facility to achieve the comparatively more brand loyalty. There are seven steps in positioning the product in the market- The positioning statement of company expresses the target market, defines the market, shows the brand promise, and lastly the cause to believe them. After performing segmentation and targeting the market; the company has to position their product through promotion, standard, service quality and other marketing strategy. McDonalds’ use the promotion and positioning statement as well as maintenance of other service and product standard. determine the brand's current position recognize the direct competitors evaluate competitors positioning strategy compare and find uniqueness create identical and stantard positioning idea make a positioning statement test the competency of the positioning statement
  • 13. 13 3. Understand the individual elements of extended marketing mix 3.1 Explain how productsare developedto sustain competitive advantage: Product development refers to the process of designing, making and serving new products or services to fulfill the consumer necessity or to modify the existing product to increase its capability. Product development can be done in 4 perceptions, such as-  Enhancement  Innovation  Improvement  Creation McDonalds’ performs all the above ways to develop product. It continuously modifies and tries to maintain the flow of new tastes to sustain the customer satisfaction. The products process has seven major steps, those are – 1. Invent new idea: at first the developer should find an idea to modify or create a new product. 2. Correcting the concept and experimenting: if It is found strong efficiency to attract the consumer. Then identify the weakness and correct them. Then test the idea whether it is applicable or not. 3. Collect customer feedback: let the idea know the customer and collect their opinion. 4. Analyzing the previous result: The outcomes of the previous steps are analyzed here and also measure the marginal cost and benefit of the new product. 5. Providing demo: now launch the demo product to the customer or to the related loyal employee to consume it and provide the feedback. 6. Prepare the marketing mix: if all the previous results are positive then prepare an appropriate marketing mix. 7. Ready to launch: now the products should be on the market and try to collect the customer response. Development process ends here temporarily, if there is any decline in the market then again the company will follow the step to correct them. McDonalds always gives higher priority to the customer preference to market a new product.
  • 14. 14 3.2 Explain how distribution is arranged to provide customer convenience: The distribution process of the products manages the customer and company relationship. Company communicates with their target market through exchanging benefit to them. There are mainly three types of dealing process, such as 1. Producer to customers: this distribution process ensures a direct relationship. The producer can easily know about the customer satisfaction and directly communicate them to get any recommendation. Most of the service providing business deals through this process. The McDonalds’ is a restaurant; they usually maintain this process of distribution. 2. Producer to retailers to customer: here the products are delivered to the retailers and they serve the customers. The easily perishable, sensitive products such as, vegetables and dairy products are dealt in this way. 3. Producer to wholesalers to retailers to customers: this relationship is too complex and customers or the company could not reach each other easily. Often there happens misrepresentation and misunderstanding and the destructive los for each other. But the industrial products are badly dependent to use this process. Moreover, McDonalds use a further way to deliver products that is through franchise business. It sells the brand image to the domestic country investors and also ensures the products standard. producer consumers producer retailers consumers producer wholesalers retailers consumers
  • 15. 15 ‘3.3 Explain how prices are set to reflectMcDonald'sobjectives and marketconditions: From the view of customers, price refers to the monetary value of the products to consume and they are willing to pay it in exchange of goods and services. From the view of producers the price means the expected value that they deserve in exchange of their products and services. Pricing means to determine the value of the products that will fulfill the production cost and also ensure the expected profit in customers’ affordable level. The company maintain a series of tasks while marketing; those are- The organization has several objectives that it wants to implement through the appropriate pricing of the product. The most common objectives are stated below-  Optimal profit: the company always expects the highest profit from serving consumers: the price of products plays a major role to serve this purpose.  Increase revenue: the profit is related to the sales revenue; to ensure the revenue the company has to pricing efficiently.  Increase marginal profit: the cost of each product is recovered by the revenue; thus pricing is essential to increase, marginal benefit.  Leader standard: the appropriated price helps marketers to lead his company more efficiently.  Sustainability: the price helps the company to sustain in the market.  Cost refund: the cost is charged against production cost.  Stability of price: the pricing helps to control inflation and the frequent change of price. 1.create marketing strategy 2. determine marketingmix 3. assume the demandcurve 4. measure the expenses 5. considerthe environmental forces 6. determine the price objectives 7. fix the price
  • 16. 16 McDonalds’ ensures the above objective while pricing. There are four pricing strategy; those are-  Premium pricing: it means that company charges high price artificially from the competitors to create a sense that the product of higher price has the higher standard.  Penetration pricing: it means company charges lower price than the competitor to capture he market share quickly.  Economy pricing: here the company charges the lower cost by reducing production and distribution cost; here margins are very poor.  Skimming strategy: here the producer runs monopolized business till the competitors’ flourishes their product. McDonalds’ uses the premium pricing usually as it is now an established brand: but it uses economy pricing also in the more competitive period. 3.4: Illustrate how promotional activity is integrated to achieve marketingobjectives: Promotion is one of the elements of the marketing mix. The company usually invests in this sector comparatively more than the other sectors. The company has to use all the varieties of promotion strategy to gain the marketing objective through attracting more customers to the company. There several kinds of promotion, such as-  Advertising: arranging dramatically presentation of the product and broadcasting them in TV, radio and to news portals or publishing in print media, such a magazines, newspaper, leaflet, bulletin etc. it also can be done through signboard, LED billboard etc.  Personal selling: appointing attractive and efficient salespersons who personally convince the buyer to buy their product.  Sales promotion: to increase the sales immidiately, arranging some temporary and more appealing offer like discount, gift hampers and attracting the consumers.  Mailing: sending mass email to the all possible customer and informing them about the configuration of the products. This is a poor promotion strategy.  Social media: broadcasting the advertisement in social media or using a page of the products and maintain a direct relationship with customers. It is now the most popular and also proved effective form of promotion.  Sponsorship: bearing the cost of any public meeting or ceremony or to invest in public welfare. It is costly but too useful.
  • 17. 17  Encouraging competition: arranging competitions among the consumers to take any new decision or providing new idea. it is also popular nowadays. The company must combine the above items of promotion to create an integrated promotion strategy that accelerate the marketing objectives. McDonalds’ has already mixed most of the above promotion policy to capture its expected market share, it has successfully handled it. 3.5 Analyze the additionalelements ofthe extended marketingmix: Marketing mix is not now the 4ps, its now 7ps. The extensions are people, process and physical evidence. These three additional marketing mix is mostly applicable in the service sector. The elements are being discussed shortly-  People: this people consists of company’s internal employees who maintain direct and indirect relationship with the consumer, such as, sales person, managers, production employees etc. there prevails three types of communication in an organization, they have internal relationship among them. It is shown below- Internal relationship External relationship Interactive relationship These three types of relationship have a strong connection among them. If the internal relationship is not maintained the interactive relation is not possible, again if the external relation is not handled efficiently the marketing objectives will be hindered. The element “people” deals with the internal relationship through performing various types of motivation strategy.  Process: the process actually means the payment system while dealing. If the company maintains various options to pay the bill, the consumers can quickly Company Employee s Custome rs
  • 18. 18 pay their payments. It will hasten and make easy the transaction. While consuming service the repeated asking of paying bill in the company’s favorable form is too irritating.  Physical evidence: the decoration and the comfortless in the place where the service is rendered is meant by physical; evidence. The most standard goods and services may not be accepted by the consumer if the place from where they take the service or good is not hygienic or doesn’t have friendly environment. McDonalds’ is a restaurant, it is more conscious about the extended marketing mix. It maintains a well relationship with the employees, and has fluctuated payment system, the restaurants are neat and clean. 4. Be able to use the marketing mix indifferent contexts. 4.1 Plan marketingmixes for two differentsegments in consumer markets: Consumer market is segmented by demographic, psychographic, geographic and customer behavior categories. McDonalds launches its product on the basis of demographic and psychographic behavior. It considers the age, income, preference, taste and customer food habit to produce new product or to develop existing product. Its target market is the kids, family and teen agers. Thus the age variance is a major matter. The kids prefer the dairy product, soft and easily digestive products; the teenagers want the cheesy and spicy product; the age old family members expects healthy and diet foods. According to their preference the company offers different products to them. It considers the places where the family can enjoy dinner; it also extended marketing mix people physical evidence process
  • 19. 19 arranges some amusement for the teenagers. The company signs their promotion system for these three ages and has some opportunities o cheaper but delicious products for lower income capable customer. the organization knows that all the types of customer demands convenient environment in the restaurant; the teenager usually create noises and want to enjoy themselves within the restaurant; on the other hand the aged person wants to have the silent soft moment. The company tries to ensure the convenient environment for both of them. The less earning persons usually pay their bill in cash particularly in the developing country. The manager has arranged the easy process to pay the bill. It tries to motivate its employee through monetary and nonmonetary incentives and ensure the well behavior to the customers. 4.2 Illustrate the differencesin marketingproducts and services: The products are tangible, not easily perishable, and homogeneous and standard of the product can be maintained easily. But the services ate intangible, perishable, variable from time to time, person to person and obviously heterogeneous. Thus the marketing plan of product and services are separate from one another. McDonald's provide products as well as services. The product marketing mix needs to combine 4p's of marketing and saw vice marketing needs more three P's, such as people, process, physical evidence. Because of intangibility and perishability the service standard is not constant, and the place matters a less in service; the promotion system of service marketing is different, here the organization just promises to the consumers to attract them to take service. The payment process of service marketing is held after consuming. Physical evidence has a vital role in service marketing. The company needs to create a lucrative and well decorated restaurant to attract the consumers. Employees' behavior is also one of the most important factor in service marketing, McDonald's is more concern about maintaining employees' behavior to the consumers. Service marketing is more complex than product marketing and the company needs to be very conscious to ensure customer satisfaction. 4.3 Show how and why the internationalmarketingdiffers from domestic marketing: International marketing means to market the product out of the home country where it is produced. Market refers to the group of potential and actual buyers, it doesn't matter where the group live. International marketing paves the way to serve all the potential buyers and fulfill their needs and demands. The company when has surplus product it wants to export them to the possible consumer across the border. The globalization process paves the way to international marketing providing easy access to the market of any country. Here are the reasons of entering into the international market is-
  • 20. 20  If the company is successful in the domestic market.  If the expected sales and benefit could be earned in the domestic market.  If the product life in the domestic market is at the end, the international marketing creates an opportunity to find new market place and develop a new market for the dead product.  If the domestic market of the product is more competitive and less profitable the company can shift business to convenient profitable place.  If the domestic technology is less developed than the technology of another country and the export of that technology can cause more production and exceed benefit than the cost.  If the segmentation of the global market is similar to the global market, the company can take the opportunity. The company should consider 4 factors to operate business internationally, these are-  Political factors: the political stability, government features, government facilities, barriers to trade etc.  Economic factors: the monetary maintenance, loan facilities, tax facilities, economic resources etc.  Social factors: the social value, norms, customs, religious value, education, tradition etc.  Technological factor: the development of technology, the efficiency of the machineries, the recycling technology etc. The company should keep in mind the above factors while entering into the market of foreign country. McDonald's efficiently handled these factors to open a new branch in the foreign country. There are also some considerations to enter into the global market, such as-  Cost: how much costs will increase to operate business globally.  Speed: how prompts the company can serve the customers; actually it depends on the communication and transportation system.  Flexibility: how the customers will response to the change in service and product. The market is flexible or not.
  • 21. 21  Risk factors: the competition with the domestic business, economic barrier, tax burden, political instability and cultural difference are now considered most risky terms.  Long term goal: how many years the company wants to operate business here, it depends how much loyal market share it has. After all it can be concluded that the global market is a huge opportunity to increase the demand and supply of the products. McDonald's can easily ensure its higher production and sufficient profit from expanding market globally. Conclusion: McDonald's is a famous restaurant in the global market; it serves products as well as services. It maintains different marketing policy according to the environmental factors of that country. It has successfully managed the business in 119 countries satisfying around 64 million customers. The manager has to plan more flexible marketing process to increase the revenue and decrease the opportunity cost.
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