Unveiling the Secret Behind McDonald’s Business Strategy

McDonald’s is a global fast-food franchise that has managed to establish an iconic brand. This has been achieved through strategic marketing and business approaches that have allowed the franchise to stand out among its competitors. While there is no ‘magic formula’ behind McDonald’s incredible success, there are certainly strategies and approaches that those in business should be aware of if they hope to achieve similar results. In this article, we will take an in-depth look at McDonald’s business strategy and how it has helped the franchise position itself as a leader in the fast-food industry.

McDonald’s: An Introduction

Founded in 1940 by Richard and Maurice McDonald, the fast-food franchise quickly grew from a single location in San Bernardino, California to thousands of restaurants worldwide. The franchise has come a long way to achieve its current status. McDonald’s now boasts of a global presence, serving approximately 69 million customers daily in over 100 countries. Its reach is undoubtedly reflected in its impressive annual revenue, estimated to be $21 billion.

So, what is McDonald’s Business Strategy?

McDonald’s business strategy centres around the ‘Plan to Win’ initiative, which is split into five strategic pillars: people, products, promotion, price, and place. This initiative is geared towards ensuring that McDonald’s remains competitive in a constantly evolving industry.

To achieve this, McDonald’s is highly focused on innovation. For example, the franchise has made adjustments to its menus and ordering system, allowing customers to order via mobile applications. It has also introduced a gourmet burger line, which features higher quality ingredients at a premium price, targeting customers looking for a higher-end experience.

One interesting aspect of McDonald’s business strategy is its focus on franchising. Approximately 93% of McDonald’s locations are owned by franchisees, a strategy that allows the brand to expand rapidly while outsourcing costly investments such as site development and equipment. Franchising also allows McDonald’s to take advantage of local market knowledge and adapt to the preferences of customers in different regions.

To ensure efficiency and uniformity in its franchise network, McDonald’s maintains strict quality control measures. All franchisees are required to follow specific operational procedures, training programmes and support services. This approach has been essential in helping McDonald’s maintain its promise of consistent customer experience across all locations.

Marketing and Advertising: The Secret Sauce

Marketing is an essential aspect of McDonald’s business strategy. The franchise has implemented a variety of marketing strategies, including television advertising campaigns that feature its iconic mascot, Ronald McDonald. McDonald’s’ approach to, consistent messaging across advertising channels, such as email newsletters, websites, billboards and social media platforms. The brand’s distinctive logos and colour schemes have become synonymous with the chain, and this consistency has been key in establishing recognition and trust in the minds of its customers.

The Chain’s Marketing strategy is also based on understanding global consumer trends. For example, McDonald’s introduced its “tray liners”, which are customised with QR codes to encourage customers in select markets to download the McDonald’s mobile app. This takes advantage of one of the latest consumer trends in these markets: the use of mobile smartphones.

Conclusion

McDonald’s is a master of business strategy. It has managed to create an iconic brand that is recognised in almost every country of the world. McDonald’s business strategy is based on innovation, consistency, the strategic deployment of franchises and marketing to create an unmistakable brand that competes well against its competitors. Its success is a functional byproduct of its exceptionally well-conceived business strategy and visions that have stood the test of time.