Promotional Strategy of McDonald’s and their Target Market
Category : Mcdonalds Case Study
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This paper delves on the whole question of age and gender, not just of the producer and audience or consumer, but of their representation in promotional material. This paper will discuss ways in which age and gender or sexuality is a factor in promotional culture. For further understanding, the case of McDonalds and Wendy’s will be used as examples in this paper.
Promotional Strategy of McDonald’s and their Target Market
McDonald’s Corporation is one of the most popular and valuable brands in the fast food industry. McDonald’s is undoubtedly a corporation of tremendous magnitude, with outlets in over 30,000 sites in 121 countries, serving over 35 million customers a day and earning profits of over $2 billion annually. McDonald's has successfully used a differentiated market segmentation strategy by targeting the family unit and particularly children with their "Happy Meals" and prices. McDonald's has traditionally offered lower prices than other hamburger chains, thus gaining the patronage of larger-size families. The location of its outlets has been instrumental in making McDonald's so successful. It was the first hamburger chain to expand into the suburbs and into the crowded downtown areas of large urban cities (Greco & Michman, 1995).
The issue of targeting children, particularly by commercial advertising like the one used in McDonalds, for example, sometimes raises many questions and, probably more than most topics, involves strongly held views and opinions. Given the vulnerability of children, questions about ethics, about the regulation of advertising and about effects of advertising, are in the forefront of heated debates.
Many ads have one specific target audience and the target character is designed accordingly. It is possible, however, for one commercial to address multiple target audiences and still achieve identification. Although McDonald’s mostly targets on children as audience, their commercials most of the time target multiple audiences specifically families. An example is the McDonald’s ad that shows a working mom in a business suit showing her husband and lads everything in the refrigerator and freezer. She's going on a business trip and has color-coded the plastic wrap around all the foods--blue is for broccoli, red is for. . .--dad and the kids are just looking at her, not paying attention. Then you cut to dad pulling stuff out of the refrigerator for dinner, asking the kids, 'What do you want for dinner, blue or red?' They say, 'Let's go to McDonald’s.' Lots of McDonald’s spots work against multiple targets (Sutherland & Sylvester, 2000).
McDonald’s also has focused on a global fundraiser benefiting Ronald McDonald House Charities and children around the world. Helping children and families in need is one of the most important things that the global corporation does for the local communities. A large percentage of McDonald's fast food chains worldwide are owned and operated by independent, local businessmen and businesswomen and together they support Ronald McDonald House Charities.
Promotional Strategy of Wendy’s and their Target Market
On the other hand, Wendy’s, which had no real intention to be a national chain, began to operate in 1969 as a single unit in downtown Columbus, Ohio. A second unit quickly followed on the opposite side of the city. The next step in the development of the company was the opening of the first franchise in Indianapolis, Indiana, in 1972, which was followed by many more Wendy’s restaurants within and outside the United States. Wendy's has positioned itself as an adult-oriented fast-food hamburger chain and has attracted the largest proportion of female customers. Geographic segmentation is precarious in many large markets. In the late 1980s, Wendy's tried to broaden its base of targeted consumers by focusing on weekend and dinner markets and opened restaurants in Sears and even in supermarkets (Greco & Michman, 1995).
The promotional strategy of Wendy’s which is designed for women, does not feature the usual debate about presenting sexuality and discriminating men. The gender of the person here does not appear to promote some form of discrimination that leaves men and children out. However the kind of advertisement that Wendy’s makes are more appealing to adult women than to men and children.
Gender roles have created much issue in the past. Masculine rivalry has long been identified as a popular advertising theme, and competition for financial success was especially prevalent in the money-oriented 1980s. However, women's progress in the male workplace caused profound changes in the financial services market. Once women embarked on lifelong careers and gained sufficient education to compete for lucrative positions, they began earning salaries that made them a tempting target for financial vendors (Stern, 1997). This has paved way for many promotional campaigns that at present now target women.
The issue of cultural conditioning leads to the need for more careful examination of whether (or how) advertising perpetuates/changes sex-role stereotypes. Despite objectively similar roles that can be taken by men or women nowadays, stereotypes about sex-linked appropriate behaviors - including language - persist and are embodied in advertisements. Even though women have entered the work force and educational institutions in record numbers in the past decades, old habits built into the traditional cultural heritage die hard. The construct of appropriate role behaviors may be changing more slowly than the actual socio-cultural changes in role performance.
Comparison of the Two Promotional Strategies
Wendy’s market intensity in the US is estimated at 61,055 people per unit. Comparatively, McDonald's has one restaurant for every 22,000 persons. Innovation took place when McDonald's developed the concept of the assembly-line hamburger with French fries and when Wendy's became the first hamburger chain to offer a salad bar and baked potatoes nationwide. McDonald's, in an effort to compete in small-town markets, emphasizes a smaller cafe-style restaurant in total square feet than units located in metropolitan and suburban areas (Greco & Michman, 1995).
An interesting comparison between the two companies is that McDonald's has the third most recognized brand name in the world, whereas Wendy’s is barely known outside the US. Another intriguing aspect of the hamburger war between these two companies is advertising. Wendy’s has the second highest advertising awareness among the US fast food service restaurants in spite of the fact that McDonald's, which is in the number one position, outspends Wendy’s by a proportion of five to one. However, outside the US, unlike McDonald's the promotional marketing abroad for Wendy's has been rather limited due to lack of economies of scale in advertising. The minimum scale required to launch a national advertising program is 25 stores per country. So far, in the global market only a few countries are meeting the Wendy's standard required to launch national advertising campaigns. While McDonald's expanded one store at a time, Wendy's preferred to unfold in blocks (Carrada-Bravo, 2003).
Between the two, it can be safely deduced that McDonald’s seem to be on the top of the race. This could be attributed to the different strategies that the fast-food chain pattern in response to their customers in different geographic locations. McDonald's success in world markets has been attributed to its tradition of adapting to the conditions of local demand like serving a non-beef hamburger in India and Saudi Arabia, while offering a teriyaki burger in Japan, and falafel in Egypt. Another important aspect of McDonald's strategy in world markets is its program to develop local suppliers like in Brazil where they invested a significant amount of resources into helping farmers master the cultivation of potatoes (Carrada-Bravo, 2003). McDonald’s success is largely a result of articulation of its product and services with changing social and cultural conditions in the United States and then a global economy that enabled the fast-food industry to thrive and made McDonald’s triumph possible.
Promotional culture has the ability to disseminate information to a variety of people comprising of different backgrounds. When companies have to promote their products they have to utilize a strategy that will catch the attention and interest of their target audience. This also goes to say that before an advertisement or promotional strategy is concocted, the company already has an image which will reflect the target audience that their brand caters to. In the context of this paper, two fast food chains, McDonald’s and Wendy’s were analyzed on the basis of their promotional strategies, their target audience, and their appeal to the market. On the large picture, McDonald’s is on the top of the race and seems to be doing well on its promotions designed for children and in a way also captures the family audience, attracting more customers than their targeted audience. On the other hand, Wendy’s has a different target audience, which focuses more on women, and so although both offer food choices, they do not target the same audience and so the success cannot be measured in terms of which one is more popular. It is however safe to conclude that both fast food chains are utilizing the right promotional strategies and targeting the right audience for their brands, resulting to their continued success in their respective fields.
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