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An Assignment On
Marketing Principles
PREPARED BY:
Name: Oana Loredana Stanciu
ID: hndb11683
Table of Contents
Introduction...............................................................................................3
Task 1: Understanding the concept and process of marketing..................4
1.1: Explaining the various elements of the marketing process of
McDonalds............................................................................................4
1.2: Evaluation of the benefits and costs of a marketing orientation for
McDonalds............................................................................................5
Task 2: Be able to use the concepts of segmentation, targeting and
positioning................................................................................................6
2.1: Showing macro and micro environmental factors which influence
marketing decisions for McDonalds.....................................................6
2.2: Proposing segmentation criteria to be used for products in
different markets....................................................................................6
2.3: Choosing a targeting strategy for a selected product/service..........7
2.4: Demonstrating how buyer behavior affects marketing activities in
different buying situations.....................................................................7
2.5: proposing new positioning for a selected product/service..............8
Task 3: Understanding the individual elements of the extended
marketing mix...........................................................................................9
3.1: Explaining how products are developed to sustain competitive
advantage...............................................................................................9
3.2: Explaining how distribution is arranged to provide customer
convenience..........................................................................................10
3.3: Explaining how prices are set to reflect McDonalds objectives
and market conditions..........................................................................10
Introduction
A business organization whether product based and services based must satisfy the customers. In
a word, customers are the core center of focus for a business organization. Every business must
build a profitable customer relationship and that is why a particular organization always exerts
on maximizing the customer value. Marketing takes this major responsibility. It makes the
customer about the product and services of a business organization, helps organization by
providing the customer feedback and attraction, enables organization to design business activities
and services according to the customer demand and satisfies the customer by meeting their
requirement. In this competitive business world, excellence in marketing mostly differentiates an
organization from its existing and potential competitors. In this report, I will try to demonstrate
how McDonalds, the world largest fact food brand, can practice basic marketing principles
efficiently to hold a better customer attention and build up a profitable customer relationship.
What to produce?
Answers of the above questions help McDonalds to much in their marketing process.
A well constructed program delivering superior value: Market research helps the
management to gather information about current and potential customers, competitors, legal and
technological factors, economic factors and so on. Factors that affect customers buying decision
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are also selected through this system. The SWOT analysis that indicates the strengths,
weaknesses, opportunities and threats is a good strategy to find superior information.
Increasing customer loyalty: Achieving customer loyalty is another important factor that helps
an organization to face the competition and sustain in the market. McDonald always tries to
satisfy customers with standard products and services, low price and building good relationship.
Capturing value: McDonald analyzes the 4p (product, price, place and promotion) for capturing
value from the customers. Then it takes the best decisions based on the available information. In
this case, a good marketing strategy works better. (Trout, 2010)
These are the major elements of McDonalds marketing process. They are highly appreciating.
McDonalds is providing its services worldwide. Attitudes, cultural norms, values, tastes, choices
are not same over the world. Through geographic segmentation, McDonalds will be able to
identify the variations due to geographic location and find the target segment fit for the
organization. Using this criterion, McDonalds will segment the customer on the basis of region,
urban or rural areas, population density, etc. (Yankelovich, 1964). From this segment in each
region, McDonalds will be able to pick the target segment. Further, McDonalds will adopt a
positioning strategy for the identified target segment.
behaviors. So, McDonalds must consider this issue into marketing activities. For example, target
customer of McDonalds want organic food items with fresh ingredients. McDonalds now need
to circulate and promote that the company is introducing organic food items only considering the
customer expectation. Thus, customer behavior may affect marketing activities of McDonalds
and need to be addressed in marketing policy.
3.3: Explaining how prices are set to reflect McDonalds objectives and
market conditions
McDonalds has the opportunity to select a pricing strategy among the strategies of cost based
pricing, value based pricing, value added pricing, and good value pricing (Lee &Staelin, 1997).
Cost based pricing states that McDonalds charge prices after the final production. This system
charges prices adding margin with the production cost.
Value- based pricing states that McDonalds set the prices on the basis of customer value. Value
added pricing is pricing the products along with some added feature and good value pricing is
pricing a set of products.
Among all these strategies I prefer value based pricing for McDonalds. This strategy starts with
assessing customer need and perceived value, then setting the prices based on customer
perceived value, predetermine the probable cost of product, and at last manufacture product that
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satisfies customer need and in return McDonalds do have the desired price. This strategy will
enable McDonalds to set the price level based on customer value.
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In this part, the 4Ps of marketing mix are focused more. Efficient way of developing new
products, efficient pricing, promotion and efficient placing are ensured for sustaining in business
environment.
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emotional appeal while marketing products to the consumers. Consumers will not search so
much information like a business organization. They are the ultimate user of products and
services.
4.3: Showing how and why international marketing differs from domestic
marketing
Fundamentally marketing strategy is same in international and domestic boundaries. But in case
of international marketing things seem to be more complex than domestic market.
In domestic market, McDonalds is very much aware about the customer demand, face little
political issues, design products and services for domestic people, can easily capture the markets
only by delivering better customer value of domestic people.
In case of international marketing, McDonalds has little knowledge about the customer
perception and demand trends. For indenting true scenario, it engage regional supervisor. This
regional supervisor communicates to the head location of McDonalds. Political situation is
complex there as McDonalds conduct business overseas. It has to maintain legal procedures set
by the authority.
Competition is much more higher here than the domestic market. Update technology is highly
required. Establishing a profitable brand image seems to be harder (Agmon&Lessard, 1977).
Summarized feedback:
There are various segments in the market. They follow different strategies. Strategies also vary in
marketing expansion both in domestic and international market.
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Conclusion
In todays competitive business world the success of an organization highly depends on how
much an organization is able to meet customer needs and fulfill customer satisfaction. An
effective marketing process serves this purpose. Using effective marketing process starts with
understanding the present market situation and identifying customer needs. After this an
organization adopts marketing plans and strategy, ensures customer satisfaction and better value,
at last capture value from the customers. An organization segments, targets, and takes position in
the target market. Marketing mix, promotional mix, pricing strategy all contribute to build up a
profitable customer relationship. The efficiency of creative marketing enables an organization to
spread its uniqueness in product and service provision which contribute to have competitive
advantage over the competitors.
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