Integrated Marketing Communication Plan for McDonald's
Category : Globalization, Marketing Plans Examples, McDonald's, Mcdonalds Case Study
Communication and Cultural Strategies of McDonald’s Globalization in Hong Kong
Fast food chain, are considered as one of the most powerful and famous business in the world. Many believed that the concept of fast food chains nowadays is linked with the efficiency of the capitalist and the practices of the American consumers. This feature has become the recipe for McDonald’s success and popularity. For some, fast food chains symbolize good capitalism and as opponents of modernity have proven fast food chain is absolute and a powerful factor that make great influence in both society and the culture (1993). There is one fast food chain industry that conquers the marketplace in the global arena, i.e. McDonald.
McDonald's restaurants offer a substantially uniform menu, common in the usual fast foods. This includes hamburgers, cheeseburgers, chicken sandwiches, french fries, salads, milk shakes, desserts and ice cream sundaes. The company’s top sellers, and can also be considered as innovative ones, include the Big Mac, Quarter Pounder with Cheese, the Filet-O-Fish and Chicken McNuggets ( 2004). Recently, the company has added a number of new nutritional products. This includes the Salads Plus products i.e. Garden Side Salad and the Grilled Chicken Flatbreads (2004). Uniformity continues in McDonald's restaurants operating in the US, UK and certain international markets that are open during breakfast hours and offer a full or limited breakfast menu.
The McDonald restaurants undoubtedly present a useful and effective example of a common sociological artefact that can be scrutinized to create a more universal conceptualization. Several artefacts and traditions of the modern world are as well recognized and omnipresent as McDonald’s popular brands, promotional strategies with the famous toys and films, its charities and the McDonald’s saturation advertising. With the unique and efficient strategy of McDonald, both the rationalization of production and consumption of its products have been incomparable in the modern society, and functions as a model for the emergence of the term McDonaldization. The discussion that follows presents the communication and cultural studies of McDonald’s globalization strategy in Hong Kong.
Market Penetration of McDonald’s in Hong Kong
Globalization is an undertaking to make markets, politics and the likes to be same throughout the world. It is in as sense a process of denationalization of markets, politics and legal systems, i.e., the rise of the so-called global economy. They have utilized the most effective way to influence people and that is through attempting to alter their cultural orientation. As such, cultural re-orientation is necessary in order for the imperialist to introduce new products to the target country therefore creating a new market. While it is common to see cultural values such as ‘modernity’ as a product of the early family environment (1973), it is often far from clear how such values may be transmitted, as broad notions of ‘socialization’ are rarely defined. Every society is full of artefacts and norms or rules that help maintain and bolster cultural values ( 1992). These ideas become shared among members of a society.
As stated earlier, many aspects of the Hong Kong way of life has already been infiltrated by globalization. One of these aspects is food production, distribution and consumption. It is usually the case that when tourists are handed Hong Kong tourism brochures yumchas will be highlighted. Before, they would highlight Hong Kong as a shopper’s paradise given the diversity and competitive prices of goods (1997). However, in recent years neighboring Asian countries were able to grab the title away from them. Because of this yumchas became one of the sought after Hong Kong experiences. Yet, another global event threatened to eradicate yumchas as one of the sought after Hong Kong experiences.
McDonald’s is among the most popular fast food brands in the world. Started out in the fifties, McDonald’s now boasts of operating, franchising, and serving a worldwide chain of around 30,000 fast food restaurants that prepare, package and sell a menu of ready to eat foods. Specifically, it has branches in 119 countries, and claims to serve 47 million customers each day ( 2004). The company and its franchisees operate all restaurants in order to guarantee uniformity in both services and standards. When granting franchises and forming joint venture agreements, the company is selective and is not in the practice of franchising to, or partnering with, investor groups or passive investors (2004).
In 1975, the first McDonalds were opened in Hong Kong. Many thought this was one wrong move for McDonald’s. Various reasons were laid for this claim. Although, the main reasons lays on the fact that Americans and Hong Kong Chinese at that time have very different perceptions about food. McDonald’s, being an American food chain, view breads as full meal while Hong Kong Chinese view them as snacks. As time went by, McDonald’s slowly became part of the Hong Kong landscape and way of life rather than just being an outpost of American culture. Hong Kong Chinese soon accepted that the food McDonald’s produce and serve are ordinary, thus, they are for ordinary people like them (1996). Furthermore, Watson believes that the introduction of McDonald’s to the Hong Kong society changed the very weave of Hong Kong’s cultural fabric. Along with the rest of the world, Hong Kong was being McDonaldized.
Communication and Cultural Strategies
The first person who had coined the popular phrase “McDonaldization” is George Ritzer in his “McDonaldization of Society” which describes the development of modernization i.e. connected with the fast food industry. According to (1996), the fast food restaurant is the modern paradigm of the rationalization system (1998). McDonaldization is defined as the process of adapting the standards of the fast food chain which functions in a gradually broad range of the social settings including the higher education, health care, work places and other organizations (1997). The point of McDonaldization is to remove unpredictable circumstances from both the production and consumption of food. By eliminating ‘surprises’ from the consumption of food, McDonaldization also removes risk ( 1994).
McDonaldization is a new process although it has deeply rooted in the historical process of rationalization. McDonaldization has a profound effect on the way individuals experience their world. The term describes the rationalization of society—the places and spaces where people live, work, and consume—using the fast-food restaurant as a paradigm. The process is a direct consequence of the ascendance of four related processes: a push for greater efficiency, predictability, calculability, and replacement of human with non-human technology ( 2000).
Since Hong Kong time is as valuable as money itself, the first cornerstone of Mcdonaldization appealed much to the Hong Kong society. The second cornerstone is calculability in relation to the food industry in which production needs to be quantifiable while the taste of the food being served is relative to the preferences of the target market. The third cornerstone is predictability which suggests standardization and uniformity of services while the fourth cornerstone is control that pertains to the standardization and uniformity of employees. The last two cornerstones are manifestations of the aim of McDonaldization to homogenize the food production, food services, and food preferences of the Hong Kong consumer market (2004). According to (2004), the Hong Kong society runs in an assembly line-like manner where production, distribution and consumption of products and services are being done in the fastest possible time while keeping with acceptable outcomes.
It is known that every organization’s primary purpose is to stay in business, so that it can promote the stability of the community, generate products and services that are useful to customers, and provide setting for the satisfaction and growth of organization members (1969; 1985; 1986). In this regard, quality strategy if executed appropriately can make the company prosper not only through increased number of customers and the greater possibility eventual gained customer loyalty but also in fostering ideal working environment within the business organization.
For McDonald's, people are its most important asset (2004). This is because customer satisfaction begins with the attitudes and abilities of employees and committed, effective workers are the best route to success. For these reasons, McDonald's strives to attract and hire the best, and to provide the best place to work. In fact, McDonald's is so active and successful in newly emerging markets that other companies will sometimes use the golden arches as a valuable indicator of future growth markets.
Cultivating customer loyalty is about establishing a relationship between the company and its consumers (1997). This is emphasized by (1997) who considers that gaining consumer loyalty is a business’s most advantageous strategic purpose because it has a constructive effect on company, culture, development and the bottom-line. Aside from being a strategic purpose, gaining consumer loyalty is also a key corporate challenge today especially in the increasingly competitive and crowded marketplace because of the eventual and inevitable profitability it will provide the company ( 1997).
McDonald's recognized the need for a co-coordinated marketing policy. In order to be successful, an organization must find out what the customers want, develop products to satisfy them, charge them the right price and make the existence of the products known through promotion. McDonald's, the franchisor grants the right to sell McDonald's branded goods to someone wishing to set up their own business, the franchisee. The license agreement allows McDonald's to insist on manufacturing or operating methods and the quality of the product (2004). This is an arrangement that can suit both parties very well. In Hong Kong,
Channel communications works in a two-way system wherein information transfers to the user and bounces all the way back to the producer (1992). In other words, marketing communications works like a feedback system, which allows company producers to relay information to the customers. In response to the provided information, consumers give certain reactions or behaviors. According to (1990), if consumers somehow become better customers -- that is, more knowledgeable, participative, or productive -- the quality of the service experience will likely be enhanced for the customer and the organization.
Organizations that capitalize on customers' active participation in organizational activities can gain competitive advantage through greater sales volume, enhanced operating efficiencies, positive word-of-mouth publicity, reduced marketing expenses, and enhanced customer loyalty (1979;1990). Cinema and television advertising have played a major part in McDonald's marketing mix. McDonald's is now the biggest single brand advertiser on British television. Radio and press advertisements are used to get specific messages across emphasizing the quality of product ingredients. Promotional activities, especially within the restaurant, have a tactical role to play in getting people to return to the restaurants regularly. All franchisees benefit from any national marketing and contribute to its cost, currently a fee of 4.5 per cent of sales (2004).
Moreover, (1996) emphasized the idea to take advantage of the competitive situation not just by being better in how that product gets sold, serviced, and marketed at the customer interface. It requires that companies create breakthroughs in how they interact with customers, and design a way of interacting that makes an indelible impression on customers, one that so utterly distinguishes them from others that it becomes a brand in itself (). Rather than going after every potential source of revenue, companies eliminate useless assets that do not add value for customers’ satisfaction. Business organizations implement bureaucratic policies and procedures for the benefit of the staff, customers and the company in general.
McDonald's views the relationship between franchisor, franchisee and supplier to be of paramount importance to the success of the business (2004). , the founder, recognized the need very early on for franchisees that would dedicate themselves to their restaurants. He wanted people who had to give up another job to take on the franchise venture, relying on their franchise as their sole source of income and would therefore be highly motivated and dedicated. Consequently, McDonald's will not offer franchises to partnerships, consortia or absentee investors. The initial capital has to come from the franchisee as a guarantee of their commitment. The selection process is rigorous to ensure that McDonald's only recruits the right people.
According to (2003), there are at least four types of resources which the company can use to achieve its objectives: financial, tangible, human and technological resources. The company’s social responsibilities should be taken seriously by supporting local charities, funding educational scholarships, and contributing to the socially relevant causes and projects that get publicity by linking with like-minded public and private sector organizations, particularly groups that pursue sports events and other athletic cause (such as local community based organizations, colleges, and chambers of commerce). Moreover, sustainable development efforts of the organization through environment-friendly social drives that promotes responsible waste management along with other cause-oriented social activities in communities.
Business in our society plays a very important part in “shaping the structures of our society” and in “challenging traditional values” (1993). Corporate competitiveness will be achieved by those companies that are successful in formulating, implementing and communicating sound global strategies. For decades, corporate strategy practitioners and academic researchers have drawn widespread attention to the importance of formulating comprehensive, sound, futuristic corporate strategies (1996). Corporate strategic success can be figured out by strategy implementation of the companies’ core objectives in order to achieve the long-term goals and mission of the organization.