Marketing Research for McDonald's - Case Study Example

1 A MARKETING RESEARCH BRIEF FOR MC DONALDS Background: Mc Donald's, by the sheer advantage provided by being the first one to set up the foundations of the fast food industry and quality service by employing latest technology has been one of the highest rated brand in terms on brand recall .Mc Donald's has shown excellent financial performance and has grown year after year by expanding into many geographical diversities and today Mc Donald's is available in almost every part of the world , having a presence in 118 countries and having over 30,000 outlets all over the world. However, fast food industry now is concentrated with competition and there is cut throat competition. Considering this, and to keep up the growth trends in the future, the management of Mc Donald's faces the following critical issues: 1. How to maintain the brand value at these high levels in future 2. How to project itself as a leading employer 3. How to emphasize the brand values that Mc Donald's by way of its branding activities does not "abuse" the imagination and lifestyles of children. 4. Devising a product range that keeps the success elements of the previous successful products yet catering to changing needs of a greater health and hygiene conscious customer base. Type of Business: Mc. Donald's provides fast food and has established and maintained its position as a market leader in the food retail business for over a century. Fast food is typically similar in behavior to fast moving consumer products. It is due to this, that Mc. Donald's needs to advertise all the time to generate a top-of the mind recall and to remind people what the brand stands for. The success of Fast food retail business is dependent on the ability of all marketing campaigns to instill a craving for their product offering. History of Business Theme: The business theme of Mc Donald's has evolved with time. However, even though their positioning statement has been varying and has been different for different campaigns, the key elements i.e. "warmth","Everyday slice of life" and "the Mc Donald's Experience", have been retained. This consistency in the theme and campaign has helped in building a clear image of Mc Donald's in the mind of customers. Their positioning statements in the past decades have been as follows: McDonald's is Your Kind of Place 1967 You Deserve a Break Today 1971 We Do it All for You 1975 You, You're The One 1976 Nobody Can Do It Like McDonald's Can 1979 Renewed: You Deserve a Break Today 1980 & 1981 Nobody Makes Your Day Like McDonald's Can 1981 McDonald's and You 1983 It's a Good Time for the Great Taste of McDonald's 1984 Good Time, Great Taste, That's Why This is My Place 1988 Food, Folks and Fun 1990 McDonald's Today 1991 What You Want is What You Get 1992 Have you Had your Break Today 1995 My McDonald's 1997 Did Somebody Say McDonald's 1997 We Love to See You Smile 2000 i'm lovin' it 2003 Stake Holders: The beneficiaries of any advertising campaign for Mc Donald's include: The Customers The suppliers The employees The business partners Shareholders Even though a campaign is usually aimed at the walk in customers and the bottom line is always a boost in sales. However, all the affiliated stakeholders including the employees, suppliers, business partners and stakeholders feel the spillover effects of any advertising. Customers; the customers would always want to purchase food that is convenient and hygienic. However, in the past few years, hygiene consciousness and heath consciousness has increased. Mc Donald's may ace at hygiene maintenance but in the "Health" segment it has to battle the negative image of fast food industry on the whole. The fast food industry carries a universal image that it is fattening food and is thus unhealthy. Suppliers: The suppliers need to know that the vendor management is efficient and fair. The suppliers also benefit from the positive image of Mc Donald's as it adds to their own portfolio of high profile clients that they serve. This helps in building up clientele Employees: Employees are the hidden assets of any organization. The employees need to know that the organization is performing well not only financially but also in the employee management by developing career development program, and having the best employees related policies. This aspect is also a weak area of Mc Donald's since it has to battle their image that potential job seekers have of Mc Donald's as an employer. The image of Mc Donald's as an employer is that of a temporary odd job place where one can serve customers and get paid enough to have a good pocket money. This is the worst image that not only Mc Donald's but also all other fast food retail outlets carry and is difficult to find and retain good quality human resource. There is no perception of a long-term career. One of the major objectives of Mc Donald's is to project itself as the "leading employer". Project Rationale Any communication or advertising strategy developed on the findings of research is bound to be more successful. Developing a media campaign requires significant chunk of the marketing budget. Considering this, the campaign does not have any margin of errors. It has to be successful inn terms of the objectives set out. McDonalds need to conduct research because it would be revamping its branding activities after the year 2003, which is almost half a decade and the choices and appeal of people and the target market have changed significantly since then. It is required to see what the customers seek in their food brand now and fine tune the image accordingly. By analyzing the above, it can be stated that Mc Donald's needs to conduct research to find out solutions to the following issues: 1. Overcoming the image of Fattening Food 2. Overcoming the image of part time employer and promoting the image of career employer 3. Possessing the best vendor management services It is necessary to carry out this research to maintain the same growth trends in future. The nature of fast food products is such that it needs constant advertising. However, the aim and scope of this advertising should be to communicate not only to the customers but also to the employers and potential employment seekers. Information Requirements of the Business The above-mentioned research is necessary since the retail fast food market has become very competitive over the years. Taco Bell & KFC are quite strong in the same market. The perceived difference between the product offerings is not very significant. Thus differentiation is becoming difficult in the product range whereby all food outlets are offering similar menus. The only difference that can actually make a difference is the brand personality and image. Considering the past trends, it can be seen that Mc Donald's revives its brand and positioning statement is slightly changed every three years. In light of this, it can be expected that Mc Donald's will be preparing for a new positioning statement which will see it through till the year 2010.Due to this, the new positioning statement should be such that it should keep the theme while changing the over all images that of a health conscious food provider and leading employer. Awareness, Attitude and Behavior of Customers: the fast paced lifestyles of people have supported the growth of the fast food industry. However. The awareness levels of people have significantly increased. Now people are more concerned about the Health factors of the food that they consume. Like it might appeal to them that Mc Donald's is using 100% cholesterol free soy bean oil or olive oil which is fat free. Currently, we are aware that the management of Mc Donald's believes in transforming the Mc Donald's brand into an: employer Brand". "As stated by Richard Floersch of McDonald's, in a recent Business Week article that building an employment brand is absolutely critical. Staples VP of HR, Dave Almeda noted in the same article "It's impossible to tell where HR ends and marketing begins." Purpose of Research Brief: The need for this research is crucial due to the following reasons: Better allocation of the marketing budget by concentrating on the communication tools that are most effective in reaching the target audience Reducing employee turnover and increasing preference of the Mc Donald's brand as a leading employer The information to conduct this research is suggested to be a combination of primary and secondary research. Since the research involves judging changing consumer preferences and lifestyles, primary research is required even though it is more expensive. The primary research should begin at the end of the second quarter i.e. August 2008 so that it can be completed by June end and first week of July. The reason behind choice of this timing is that the marketing research expense can be distributed over two financial years. Another advantage is that the result of the research can be used in devising the marketing campaign and media plans for the upcoming years since new budgets are allotted at the beginning of July. It is proposed that the primary research should begin in August and a final report of the findings is presented at the beginning of June. The secondary research should begin in the fourth quarter i.e. February and findings should be utilized to fine-tune the primary research results. Research Objectives The research is aimed at finding the following: Objectives Target Market Profile End Result The best medium for communicating Mc Donald's as the employer brand to potential employment seekers Graduates and experienced Professionals Employing and retaining the best human resource to lead Mc Donald's through highly competitive and difficult times ahead The most effective mediums to appeal to the walk in customers of Mc Donald's Teenagers, working professionals and children The mediums with the highest reach amongst the target market Definition of areas of problem/opportunity to be explored The problem areas for Mc Donald's are : 1. Battling with an image of being a part time employer of odd jobs rather than leading employer 2. Battling with the image of fast food not being healthy food and being fattening food. These two issues are not individual problems faced by Mc Donald's and are issues faced by other fast food industry members as well. Outline of Possible Method: Primary Research Focus Groups: this is the best method and gives valuable feedback on how improvements regarding the product or service can be brought about. Surveys: Focus groups are always limited to a handful of people. There are chances that the preference of the majority and diversity of people are missed out in focus groups. Surveys are an extensive way of knowing exactly what the majority of the target market desire. Secondary Research: Secondary research should be carried out by contacting a marketing research company like AC Nielsen to obtain records relating to consumer tastes and hygiene and employer branding campaigns that have recently been carried out and their impact and result. Even though the reports of the marketing research companies are not usually closely aligned to the research topic. However they can give leads as to what are the elements that appeal to the customers and most importantly they tell the dos and don'ts of the marketing campaign. Reporting & Presentational Requirements The Research findings should be such that they should be comprehendible and are innovative while keeping in mind the conditions of the market. The findings and the recommendations should be such that they would be practical to implement and suggestions should fall into a budget range. The findings should be presented in a report format with tabulated figures and trends showing changes in behavior and the causes for it. Timescales The above -mentioned research should take about the time span of maximum two quarters i.e. eight months and the report should be ready for consumption in July, at the beginning of the new financial year. Read More