Brand Management of McDonalds Golden Arches - Essay Example

?Brand Analysis of McDonald’s Golden Arches Introduction Brands are neither a modern creation, nor a marketing fortune. Brands are very old invention, as old as the development of writing, and as crucial as any other component of commercial, personal, or organisational activities (Goodchild & Callow 2001). At first a brand was merely a maker’s mark. To recognise who had created a product, goods are ‘branded’ with the name of the maker. The term ‘brand’ originates from the Scandinavian term for ‘fire’ and the concept of ‘branding’ is exactly to symbolise something with fire (Nilson 2003, 34). To be able to become a market leader it is vital to guide or, to a certain extent, control the customers. If the firm, by means of the obsolete portion of marketing theory, merely follows what the customers want, the brand will certainly, in the future, be surpassed in the market. The explanation is that unless there is a zero turnaround time, or the possibility of delivering immediately what is demanded for, the firm will fail to keep up (Nilson 2003). By the time the firm has created, manufactured and delivered what the customers requested for, they possibly have modified their preferences or a competitor may have by then introduced something into the marketplace satisfying the demand. Moreover, it is not possible for a customer to identify what a producer can offer. Merely listening to customers is to abandon the brand to the consumers and the management of the firm—and abandoning accountability is seldom a way to develop a strong brand identity, value, image, and positioning. The objective of this essay is to analyse in detail the McDonald’s brand in terms of its identity, value, image, and positioning. The Brand The significance of brand management is simply described by John Stewart, the CEO of Quaker Oats (Armstrong & Kotler 2007). He stated that “If this business split up I will give you all the bricks mortar and land and I would keep the brands and trademarks, and I would fare better than you” (Armstrong & Kotler 2007, 214). This evidently means that a strong brand can be more priceless than all the assets of a firm which make brand management very crucial. According to De Chernatony (2006), “a successful brand is an identifiable product, service, person or place, augmented in such a way that the buyer or user perceives relevant, unique, sustainable added values which match their needs most closely” (p. 13). A brand, in addition, can be defined as a system of signs and symbols that engages the customer in an invented or symbolic process that provides tangible value to a product or service (Kapferer 2008). The symbol of McDonald’s, which is an arching M, is only an M until every brand message has been sent or received by the potential customer. Herbert Rotfeld (2008) examines further the other abstract advantages and values branding can put in to a product or service. Similarly, Kapferer (2004) claimed that the brand is a mark whose objective is to express the hidden aspects of the product or service which are not readily available to the senses. McDonald’s is considered as one of the most popular brands across the globe. This essay will show how McDonald’s tries to constantly improve its brand by focusing on both its customers’ and brand owner’s perspectives. It also acknowledges the various stages in the branding and marketing process. Branding builds an identity and image for an organisation, product, or service. In particular, the brand image implies how customers distinguish or recognise the company. The mechanism of brand management will only be effective when a company performs and communicates itself in a trustworthy way (Nilson 2003). Techniques of marketing communication, such as advertising and promotions, are used to build brand identity, images, appeal, and methods which provide the brand its particular image (p. 49). This is represented at McDonald’s by its Golden Arches. The McDonald’s Brand McDonald’s is one of the groundbreaking brands in the global fast food market. The target markets of the company are children and teenagers although the buyer is normally much older (Love 2008). The major competitors of McDonald’s are perhaps KFC, Burger King, and Subway. The products of McDonald’s have their individual identity which is vital to McDonald’s because it provides an extra intangible value to their products and services (Love 2008). This substantiates the claim that McDonald’s apply a brand management design approach; nevertheless, products such as McFlurry and Twister Fries apply a source brand approach (Kapferer 2008). The branding technique of McDonald’s is clearly intended for children. In my opinion, brand management would furnish the products added personality. Their technique should be to implant direct product recognition in the customers’ minds. As McDonald’s becomes an institutionalised global brand, it informs a variety of customers of new forms of producing and consuming food, whereas prompting a number of societies into modernity (Love 2008). McDonald’s in the UK, for instance, underlines how McDonald’s teaches consumers to fall in queue and engage in practical processes of food consumption. It grants an awareness of cultural uniqueness that permits other societies to participate in the principle of Western modernity. The branding approach of McDonald’s is thus a cultural instruction, a philosophy, and a group of social practices (Armstrong & Kotler 2007). It is a cultural notion with its distinct myths, symbols, themes, meanings, and cluster of transformative mechanisms. Brand Value of McDonald’s As stated by Snoj and colleagues (2004), building brand value is crucial to establishing the position in which it should deal with a specific market and can smoothen the response of brand management to critical issues such as ‘does the marketing strategy provides extra value to the brand?’ Snoj and colleagues (2004) claim that brand management can be successful if brand value is prioritised. Prior to the introduction of the image of a brand to its target market, it should identify exactly what it wants to communicate and how to convey it in order to create the targeted brand value. Kapferer’s (2004) Brand Identity Prism illustrates that a brand is made up of six elements which all serve a function in creating its value. This framework can thus be used to evaluate the effectiveness of the brand management strategy of McDonald’s. However, only four of the elements will be taken into account in the analysis of the McDonald’s brand. Physique The first approach towards creating brand identity is distinguishing its physical aspects and tangible added value, which differentiates it from other brands. McDonald’s golden arches are recognised as the most striking and memorable symbol of the company. Customers usually remember the remarkable features of Ronald McDonald, which are his broad grin and big shoes (Love 2008). The physical feature is certainly a component of brand identity and adds value to the way consumers perceive the company. However, Kapferer (2004) warned that even though the physical aspect of a brand is vital it remains only one primary feature to consider. Culture The culture of a specific brand is communicated through their outside symbols and products/services, like emblem and packaging (Kapferer 2004). It seems that the emblem of McDonald’s is rather memorable because many of its customers remember the fine points of the emblem—the golden arch. This perhaps means that McDonald’s Westernised culture has been effectively integrated into the unique cultural behaviour and outlook of consumers in the UK (Nilson 2003). Relationship The way the brand communicates with its customers, performs in public, and delivers services offer a specific indication of a brand’s relationship with its consumers (Kapferer 2004). The family-focused features of McDonald’s effectively connect it with its target market. The perception of the customers of McDonald’s suggest that the brand is recognised and highly valued which is particularly essential to the effectiveness of the brand management approach of McDonald’s (Love 2008). Reflection As stated by Snoj and colleagues (2004), customer reflection is created in due course and related with how consumers recognise brands based on their identified target market. It appears that there is a common customer reflection of the brand value of McDonald’s. Many customers recognise McDonald’s as a sanctuary of family unity and values (Love 2008). As shown, these four elements play a crucial role in building brand value as it identifies the distinct aspects of the brand enabling a broad brand management strategy. Brand Image of McDonald’s Because brand image takes place at the part of the recipient, it has been argued that it is a consumers’ perception rooted in all kinds of brand communications which are made public (Armstrong & Kotler 2007). The retained image of the brand in the mind of the consumers is a result of message recognition, symbol analysis, and meaning interpretation resulting in cognitive brand valuation (Elliot & Percy 2007). To facilitate the maximisation of this cognitive process, brands should ascertain that the brand identity components define a brand image which is close to the personality of the potential customers in order to raise a favourable brand valuation (Armstrong & Kotler 2007). It appears that McDonald’s has successfully achieved this as many who have experienced the products and services of McDonald’s perceive the brand positively and depict it as though the brand is intimately attached to their selves. Thus, it can be assumed that the customer base of McDonald’s became loyal to and approving of the brand. In contrast, people who have negatively perceived their experience with McDonald’s perhaps do this to mitigate the level of cognitive problem they could have encountered. Brand Personality Brand personality is defined by Goodchild and Callow (2001) as the mechanism of linking human features to a brand, persuading consumers to recognise the brand as a mortal being. The Brand Identity Prism of Kapferer (2004) illustrates that these human features are entrenched into the brand identity and value. Nilson (2003) explains that perception of brand personality is a result of direct or indirect familiarity of a brand. Brand personality’s indirect features originate from an informational source, while direct attributes is via a personal channel connected to the brand (Nilson 2003). Customers of McDonald’s are mainly vulnerable to indirect experience due to the vast promotion of the brand through adverts. The personality of McDonald’s begins when a parent decides to take her family to McDonald’s to eat dinner and the children reacted with jubilation. The brand personality is reproduced any time that an individual looks for McDonald’s, thinking that s/he will have some practical value and fast food, and then goes on to McDonald’s golden arches to enjoy its food. Brand Positioning Positioning has been defined as “ensuring customers instantly associate a brand with a particular functional benefit or a very low number of functional benefits, identifying a brand’s differential advantage” (De Charnatony 2006, 37). This description does not take into account the fact that the gains should be of importance of value to the customer. Thoroughly cooked beef patties would possess the extra functional gain of a healthier and more sumptuous taste but in the industry of fast foods this would not be an advantage appreciated or valued by the customer. Positioning, according to Elliott and Percy (2007), “will reflect a particular benefit emphasis and focus. It is based on knowing why people buy this particular brand. Positioning is about which benefits the brand can deliver better than other brands and which are very important to the target market” (p. 92). Knox (2004) emphasises the value of advantages to the target market as well as considering what the competitors are carrying out in order to acquire a differential or core advantage. Nevertheless, the above definition of brand positioning does not consider integrating emotional positioning and the influence of outside socio-cultural forces to the decision making process of customers. The major external problem McDonald’s has been confronted with, for instance, is the flourishing of the health industry. The target market of McDonald’s could have efficiency, price, and taste preferences, but individual’s emotional requirement to create reference groups and belong to a social group can affect the cognitive process (Love 2008). It is not helpful to put emphasis only on the advantages to the customer base without taking into account the larger society. McDonald’s is frequently viewed as a representation of capitalism and Western culture (Kapferer 2008). Dissimilar from other definitions which mostly concentrated on emphasising advantages, Kapferer (2004) adds by indicating that the primary objective is to affect buying decisions. Kapferer (2008) claims that “the aim of positioning is to identify and take possession of, a strong purchasing rationale that gives (the brand) a real and perceived advantage... it is competition oriented” (p. 178). There is no consideration of direct connection as well and the definitions did not take into account the significance of how customers perceive which position has been occupied and the significance of communication. Indeed, positioning is not entirely manageable, such as product and price, if a brand does not survive in the consumers’ mind (Kapferer 2008). McDonald’s cannot just assume the reputation or position as the best fast food producer unless the customer gives that feedback. Ries and Trout pioneered the notion of positioning to illustrate the mechanism of winning customers’ mind space (Armstrong & Kotler 2007). New brands desire customers’ mind space, existing brands control mind space. The notion of mind space is crucial to the performance of a brand (Armstrong & Kotler 2007). McDonald’s has won the ‘fast food’ area in the customers’ mind space. Thus, a more inclusive definition is more appropriate (Corstjens & Corstjens 1999): Effective positioning is the successful communication of distinctive tangible and intangible benefits, emotional values and characteristics. The benefits and characteristics must be of value to the target market and provide sufficient purchasing rational to dismiss competitors. Association should be positive, instance and accurately received by the consumer resulting in the successful acquisition of mind space (p. 88). Kapferer (2008) has developed clear-cut questions which enable brands to build their positioning statement. 1. A Brand for what? What are the consumer benefits? 2. A Brand for whom? Who is the target market? 3. A Brand for when? When will the brand be consumed? 4. A Brand against whom? Who are the main competitors? *taken from Kapferer (2008, 286) Kapferer (2004) states that positioning statements have turned out to be a basic unit of branding, not due to their strategic benefits, but due to the fact that they have turned out to be a standard in the industry. The setback with positioning statements is they do not actually play a great deal of a leading role. Using Kapferer’s (2004) framework it is possible to create a McDonald’s positioning statement. By adopting the model of Kapferer (2004) we can come up with this positioning statement: 1. A Brand for what? What are the consumer benefits? Emotional benefits, convenience, efficient saving of time and effort, and affordability 2. A Brand for whom? Who is the target market? Children, adolescents, and adults 3. A Brand for when? When will the brand be consumed? Fast foods that is available anytime and anywhere 4. A Brand against whom? Who are the main competitors? Other fast food outlets in the UK like Subway, KFC, Burger King, and Wimpy’s Conclusions and Recommendations The triumph of the branding of McDonald’s was primarily a result of effective communication of its product and services. Social division, heightened mobility, and an environment where in young adults had substantial income helped build an appealing condition for fast food outlets in the UK. Younger people sought for their personal spaces and have been given opportunities to take their respite in burger and fries havens. McDonald’s has been tremendously successful in guaranteeing that people know how to identify or distinguish their products or outlets when they see one. They made use of the catchphrase “I’m loving it” in their promotional drives. A large number of their advertisements that apply this catchphrase are aimed at children, adolescents, and young adults, and often show the individuals in the advertisements enjoying while consuming the products of McDonald’s. The competition between McDonald’s and other fast food chains, as well as the conflict between public interest and corporate objectives, are likely to remain prevalent to the political system of the international marketplace. Evidently the protection and preservation of a corporate integrity should presently go beyond disseminating favourable media reports and endorsing happy routines and ways of life: brand exaggeration nowadays is a complicated and unstable activity which involves government lobbying, corporate social responsibility, brand promotion, and social marketing as major components of corporate endurance. Nevertheless, unlike the concerns posed by scholars and environmental supporters, the lifestyle issues experienced in the globalisation discourse emerge from the anxieties of the middle class of fatigued and burnt out parents who have problems taking care of their children. These will not vanish in an outbreak of lifestyle promotions. Hence possibly there is still an accrued cost of public confidence coming out of an intensifying parental cynicism towards McDonald’s ethical codes. Given the current dilemma of McDonald’s, the following recommendations are made. First, brand loyalty can be reinforced by affinity programmes that build recognition between the customers and McDonald’s, lifestyle, cause, or campaigns. The company should publicly display corporate social responsibility by trying to change the perception of customers about fast-food consumption. By being more health-oriented, McDonald’s could strengthen its brand equity. Increasing price can be another alternative for McDonald’s if majority of its customers believe that higher price means healthier or more quality fast foods. Since the major external threat to McDonald’s nowadays is the health sector then it should redirect its brand management approach to a health-focused brand image, identity, value, and positioning. References Armstrong, G. & Kotler, P. (2007) Marketing: An Introduction. Cornell University: Pearson Prentice Hall. Corstjens, J. & Corstjens, M. (1999) Store Wars: The Battle for Mindspace and Shelfspace. England: John Wiley & Sons. De Chernatony, L. (2006) From Brand Vision to Brand Evaluation: The Strategic Process of Growing and Strengthening Brands. Burlington, MA: Butterworth-Heinemann. Elliott, R. and Percy, L. (2007) Strategic Brand Management. Oxford, Oxford University Press.  Goodchild, J. & Callow, C. (2001) Brands: Visions and Values. Chichester, England: John Wiley & Sons. Kapferer, J.N. (2004) The New Strategic Brand Management: Creating and Sustaining Brand Equity Long Term. London: Kogan Page. Kapferer, J. (2008) The New Strategic Brand Management: Creating and Sustaining Brand Equity Long Term. London: Kogan Page. Knox, S. (2004) ‘Positioning and branding your organization,’ Journal of Product & Brand Management, 13(2), 105-115. Love, J. (2008) The Sign of the Burger: McDonald’s and the Culture of Power. Philadelphia: Temple University Press. Nilson, T. (2003) Customise the Brand: Make it More Desirable and Profitable. Chichester, England: Wiley. Rotfeld, H. (2008) ‘Brand image of company names matters in ways that can’t be ignored,’ Journal of Product & Brand Management, 17(2), 121-22. Snoj, B., Korda, A.P. & Mumel, D. (2004) ‘The relationships among perceived quality, perceived risk and perceived product value,’ Journal of Product & Brand Management, 13(3), 156-167. l. Read More