This is solution of HNC Business Marketing planning Assignment given Icon College of technology and management, it is written based on the research on McDonald's Marketing strategy.
Task 1 Barriers to marketing planning
1.1 Role of marketing planning
Marketing planning is an important activity which helps the organization in achieving its organizational objectives with the help of effective marketing plan that aims at achieving maximum market share in the market. There are various roles that are played by this activity within the organization. Some of the important roles with the perspective of McDonalds can be following:
- It is a road map for the accomplishment of the objectives and defines the implementation for the strategies of marketing by a proper planning.
- Monitors and controls the objectives defined for marketing planning using different measures.
- Aims at clarification of different roles and functions to be performed within the activity of marketing planning with the help of clear communication between various teams.
- All the resources required within the processes are defined by marketing planning.
- Deadlines and the responsibilities of various tasks are defined by this activity in order to make the clear plan for the achievement of objectives.
- It clarifies all the potential barriers that may create problems while achieving the defined objectives of marketing planning by proper assessments.
- Marketing planning assures that all competitors and customers are being taken care while planning various tasks in the activity using SWOT analysis.
So, it can be easily commented that marketing planning would help McDonalds in achieving the objectives in an effective and efficient manner (Pheng, 1998).
1.2 Potential barriers to marketing planning
Marketing planning is an activity which has direct impact on the marketing efforts of the organization and sometimes repositions the entire brand in order to achieve the defined objectives. So, there is no doubt that this activity would face some barriers and it becomes important to identify those barriers in starting itself so that a plan for handling those barriers can be included in the marketing planning activity. These barriers make it difficult to implement the various tasks. So, this section would discuss various barriers that may play a role in the marketing planning phase of McDonalds:
- A weaker support from top management for marketing planning would create a barrier in the implementation of marketing strategy as the lower management would not be able to implement the strategies in planned way.
- Communication is critical in the implementation of any kind of activity as the communication regarding the purpose of the activity and about the proper plan is necessary for the success. So, improper communication may hinder the progress.
- Line management also plays an importunate role in the implementation of the activity so an irresponsive line management can be considered as a potential barrier to the marketing planning.
- Considering it as a meaningless activity because of an annual activity would result in lack of interest.
- Improper organizational change by management would create barriers during the change process.
- Not considering the macro and micro environment of McDonalds would create internal and external pressures.
- Not estimating the resource requirement in an exact manner would not be able to match the resource requirement during implementation (Burrell, 1995).
Task 1.3 overcoming the potential barriers
Potential barriers in the marketing planning for McDonalds are being identified in the above section in order to find solutions for these barriers and create a marketing plan which is free from barrier. If these barriers are not taken care while planning the activity may result in the heavy losses for the organization. Following are the recommendations for McDonalds to overcome all the possible barriers in the activity:
- Complete and unconditional support from top management and line management must be ensured by proper coordination in order to successfully plan the activity.
- Proper communication regarding the purpose of marketing planning and the activities defined must be communicated to all the concerned members in order to get it successfully implemented so that all members are aware about their roles.
- All the aspects of the customer requirements should be assessed in order to implement the activity in an effective manner so that customers accept the products widely.
- Macro environment and micro environment of McDonalds keep on changing and play an important role, so it is necessary to do a proper assessment of the environment using analysis methods like Ansoff’s matrix and PESTLE analysis.
- Human resource management should ensure a proper change management in McDonalds according to the activity of marketing planning.
- Proper assessment of resource requirement is must for proper marketing planning to meet all requirements on the time (McDonald, 1992).
Task 2 Conducting Marketing Audit
Task 2.1 Macro Environmental Analysis
Macro environment of any organization consists of the various entities like competitors, regulatory framework, economic phase of the operating country, technological environment, laws, regulations, social and cultural environment of the consumers etc. Micro environment of any organization consists of the capabilities of the organization in terms of resources, technology, employees etc. PESTLE analysis analyses the macro environment while porter’s value chain, McKinsey’s 7 S model and SWOT analysis are some methods used to analyse the internal environment of the organization. PESTLE analysis of McDonalds can be done in following way:
Political Factors: Various policies defined by various governments for the health, license, and employee laws, tax issues (like direct or indirect taxes which are different in different countries) and issues of foreign investment etc. would have a direct impact on the business of McDonalds in direct or indirect manner as it operates in lot of countries with his franchise system.
Economic Factors: Interest rates, tax rates and exchange rates which defines the economic policies of any country impacts the business of McDonalds as these factors defines the economic conditions of a country and an assessment of economic factors help the organization in understanding whether a country’s economic environment is favourable or not. Exchange rates impact the revenues of multinational companies as these keep on changing with time according to economic situation of nations.
Social factors: The cultural beliefs, lifestyle, value, language of a country is necessary to assess in order to attract the maximum share from the market. The kinds of business McDonalds conduct, these factors play an important role as these decide the people live, eat and make purchase decisions.
Technological factors: Quick payment facility, mobile apps, wireless internet facilities to the consumers in the stores, effective distribution channels etc. are the main benefits that can be derived from the technological environment. Mobile apps help the organizations to provide the ordering facility to the consumers irrespective of their locations.
Legal Factors: Legal environment comprises of various legal laws like taxes, registration, safety rules and licensing processes etc. These laws impact the business of McDonalds as following and adhering to these rules and regulations in must for the organization. Registration procedures define the level of easiness and obstacles for the organization.
Environmental factors: McDonalds is being criticized for the use of harmful elements like Styrofoam containers and non-biodegradable substances for its products and it is necessary for the organization to follow environmental rules in order to avoid such criticisms and benefitting the consumers from such practices (Qiulin, 2012).
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Task 2.2 Potential Opportunities
Above discussed macro environmental factors are important to be considered by the organization and opens up various opportunities for McDonalds that can help the organization in achieving the maximum market share and can help in the better brand image of the organization. The opportunities that can be considered helpful for McDonalds from the analysis of above discussed macro environment are as follows:
- Developing nations where economic policies of the countries are so strong that the global recessionary situations don’t impact the economic scenario of the country should be focused by McDonalds as such countries would provide a better business environment for the organization.
- There is a requirement for the organization to have more focus on the social factors as the products of the McDonalds are directly impacted by these factors. Products with health concerns, religious beliefs and personal values of the consumers should be introduced in developing market in order to capture maximum market.
- Social media, mobile apps, TVCs etc. that can create a viral impact should be included in the marketing plan in order to capture the young consumers which are the main targets for the organization.
- Environmental factors which impact the environment like packaging and the methods used in the operations of the baking need to be constantly upgraded (Lee, 1996).
Task 2.3 SMART marketing objectives
It is necessary to define the end results which an activity which is going to take place within the organization as the results are the main motivating factors for the implementation of the activity. So, it is important to define the objectives of the marketing planning activities which McDonalds is aiming at conducting. The marketing objectives defined for the organization should be SMART in nature SMART objectives means that defined objectives must be specific in nature, can be measured at any point in time, attainable, realistic to be implemented and should follow some timelines. According to the defined opportunities for McDonalds in the above section, SMART objective for the organization can be defined in the below mentioned manner:
- 20% increase in the market share of newly introduced healthy products by the organization in a year in the new markets.
- Market development in a speedy manner in countries like India to grab the maximum market share of these countries after understanding the local needs of the consumers at grass root level.
- Changing the position of McDonalds’ products in a manner that it can be known for its healthy products instead of the organization which promotes obesity in 3 years like vegetarian burger.
Task 3 Formulating Marketing Plan
Task 3.1 Marketing Strategies
Strategies for the marketing efforts are necessary in order to define the direction and scope of the actions of organizations in a long term perspective to achieve the defined objectives. Previous sections, talked about the objectives of marketing planning for McDonalds, so it is necessary to define the marketing strategies for achievement of these objectives in an effective and efficient manner. Segmentation, targeting and positioning are the main activities and concepts involved in the process of defining marketing activities. In a collective manner, it is known as STP and considered as a main strategy of the marketing. For McDonalds, STP can be identified in below mentioned manner for new product i.e. vegetarian burger:
Segmentation: This process divided the available market for products from an organization in various segments. Basically a segment means the group of individuals with similar kind of needs. There are mainly four methods of segmentation of market. These methods are the segmentation of market on the basis of geography, demography, psycho graphical attributes and behavioural attributes. McDonalds should segment the market available in the developing countries on the basis of vegetarian and non-vegetarian consumers by assessing demography as much diversity exists in the markets of developing countries.
Targeting: After the segmentation of the markets for the products from an organization, it becomes necessary for the organization to identify the most profitable segment so that it can be targeted in order to get maximum benefits from the available segments. As the market needs to be targeted for vegetarian products from McDonalds, the main target should be vegetarian consumers from developing nations like India in order to grab the maximum market share.
Positioning: Positioning is basically related to the consumers’ perception about the products and services provided by an organization. Positioning of the products matter a lot as it directly impacts the growth of the sales from an organization due to the important role of word of mouth marketing. It is necessary for McDonalds to position its vegetarian burger by showing health benefits along with touching their social values the newly introduced products (Cavicchi, 2012).
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Task 3.2 Marketing Mix
It is an important concept as it play a deciding role in the decision making process of the consumers while looking for the products and services of an organization. It consists of 4Ps (place, price, product and promotion) in case of product based organization and 7Ps (4Ps and people, physical evidence and process) in case of organization which are based on the services to the consumers. 4Ps for McDonalds for vegetarian burger can be identified in following manner in order to get success by the organization:
Product: Products are the physical exchange which is offered to the consumers for consumption and consumers derives values from the products during consumption. Health, tastes are the main benefits that consumers would drive from the newly introduced products i.e. vegetarian burgers.
Price: Price is the exchange given by the consumers in the return of the offerings from the organization. Pricing is important as consumers look for the value to worth products. So, McDonalds should price its new products in a manner that consumers accept the price as affordable price.
Place: The accessibility of the products and services from an organization is important for the consumers and is also concerned about the facilities provided by the organizations to the consumers. McDonalds ensure that these newly introduced products are widely available on those outlets which are in the close proximity of the vegetarian consumers.
Promotions: It is concerned with the promotional efforts from the organization in order to make consumers aware about the products and services. It is necessary for the McDonalds to promote the vegetarian products using various online and offline marketing campaign by making the consumers aware about the benefits from vegetarian burger (Sirohi, 2005).
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Task 4 Ethical Issues in Marketing
Task 4.1 Ethical Issues in Planning
Ethics are the basic values and principles of individuals, communities, and societies etc. which direct the thought process, decision making and actions (Rawwas, 1997). So, these ethics differ from individuals and the communities. However there is a code of ethics that organizations need to follow in order to avoid any issue that can impact negatively the organization. These ethical issues impact the marketing activities of the organizations also. One can define ethical issues as identifiable situations or problems that can impact the organizations result and should be considered by the organizations or individuals after evaluation of these situations and accordingly should define their actions. So, it becomes necessary for organizations to identify the ethical issues, evaluate them and define actions accordingly. If organization fails in following code of ethics in their actions, they have to face heavy losses many a time. Many organizations are following practice of identifying and publishing the ethical standards of their organization in order to display the code of conduct followed by the. Various ethical issues in marketing planning activity can be explained in following manner:
- It is necessary for McDonalds to disclose various potential threats related to the consumption of products and services offered.
- Detailed expressions of the extra cost associated with the extra features in the products or services.
- No use of false or misleading promotional activities.
- Advertisement efforts in accordance to the concerns of kids and genders.
- Avoiding cartels for the essential products for the consumers or during epidemics (Rawwas, 1997).
Task 4.2 Consumer ethics and its effect
Consumer behaviour is basically the study of individuals, organizations, processes and groups in order to understand the way consumers select, attain and dispose various products, services etc to meet their needs and wants. Ethics followed by the consumers play an important role in the marketing efforts of the organization as many times negative marketing efforts lead to the bad marketing for the organizations. Nestle, Mattle, Citi Bank, Coca Cola and Wal-Mart are the some big organizations to be named in this context and were in lime light for non-ethical conducts. McDonalds was also in lime light once due to unethical practices at business place and suffered losses in the business. Following example shows how Nestle was impacted by the consumer ethics and how its marketing efforts were influenced (Hashim, 2013).
Nestle was being blamed by World trade organization for its instant formula milk. The organization started distributing its instant formula milk at free of cost in developing countries for first six months after the child is born. The mothers in developing countries were unable to feed the children by the instant milk due to the non-availability of funds and their own milk was also dried up. So, they had no other option but to buy the instant formula milk from Nestle. It was observed by WTO and the organization was sued for such non ethical practice for the promotion of the products.
It is necessary for McDonalds to ensure that the code of conduct defined by them is followed by all the employees of the organization so that they don’t face any kind of issues in future. It can be easily done by quarterly assessment of such practices within the organization and defining control measures for them as well.
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This report was able to discuss various important concepts related to the marketing planning. Marketing planning is an important activity which plays a critical role in the success of any organization. It can be stated that this report would help the readers in understanding all these important concepts in details.