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Unit 8 Marketing in Hospitality Assignment
Diploma in Hospitality Management (Marketing)
Unit Number and Title
Unit 8 Marketing in Hospitality
Marketing is a process through which organizations understands the needs and demands of the consumers and then try to satisfy them by providing them products and services. Marketing is a concept which is wide one it has no boundaries it does not start from anywhere and it does not end anywhere, organizations have to continuously analyse the market and thus plan and form strategies to achieve the set marketing objectives set by the organization. In unit 8 marketing in hospitality assignment we would analyse the marketing strategy undertaken by McDonald’s in consideration with UK. Also we would find out how McDonald’s older plans are making way to the newer plans and strategies to meet the changing needs of the consumer.
1.1 Concept of Marketing for McDonalds:
- Product Concept: According to the management orientation, if you make a quality product and you have set a reasonable price, you will need to put a very little marketing effort. For example, McDonalds serves a good quality of food and its prices are also affordable. (PRIDE, William M., 2011)
- Selling Concept: The selling concept explains that the customers will not buy a product unless it is promoted to them with aggression.
- Marketing Concept: The marketing concept explains that the needs of the consumers must be first identified as it will satisfy their needs more effectively and efficiently.
- Societal Concept: The societal concept focuses on satisfying the needs of the consumers in a long run so as to achieve the objectives of the company and for the welfare of the society. (PRIDE, William M., 2011)
Concepts of Marketing for Making a Brand McDonalds:
- Use Integrated Concept which is a mix of marketing and social concept: - McDonald’s being a brand which has a global presence and the field of operation being hospitality and leisure thus; McDonald’s have to use an integrated concept of marketing. By integrated concept it is meant that equal importance is given to society of the consumer and business as to the consumer needs and business performance. (PRIDE, William M., 2011)
Thus for example:- McDonald’s not only have to innovate with their marketing mix but in addition to it McDonald’s also have to earn the social respect so that the brand McDonald’s can be evolved and not mere another food giant.
- Proper Segmentation and Targeting: - McDonald’s have to also undertake the two important concepts of marketing very carefully as segmenting marketing and then prospecting the right customer and then targeting them with the tools of marketing so that the whole business grows.
1.2 Marketing Strategy for McDonald’s
Important marketing strategies undertaken by McDonald’s in UK are:-
- Global thinking backed by local acts: - As McDonald’s is an American organization started its business in UK with its first outlet in 1996 and it is from there one today McDonald’s has more than 2000 outlets throughout the country the reason for success has mainly been the strategy of thinking globally i.e. bring homogeneous production methods etc. to UK however then cater to UK by giving the customer the way they want their food to taste, by using beef and other likes of UK population.
- Forms of expansion: - McDonald’s has also used different forms of expansion like opening newer stores throughout the length and breadth of the country, also the organization has also resorted to various other forms like giving franchisee etc. so that the organization can further grow its brand however the whole franchisee is more or less standardized with McDonald’s principles and working style as a whole. (VIGNALI, Claudio, 2011)
These are the two main marketing strategies McDonald’s has used in UK along with an effective marketing mix which is their other important marketing strategy to manage its business in UK. (VIGNALI, Claudio, 2011)
However the Marketing strategies are nothing without the applicability of them on the business environment of an organization, in order to address the business environment of McDonald’s lets us use SWOT analysis so as to find out how compatible is the organization and what does it look for the organization in the future. Through SWOT analysis we would be able to find out the strength, weakness, opportunities and threats for McDonald’s going forward.
- Innovation:-McDonald’s due to its effective product planning and marketing mix has evolved as an Innovative organization which strongly justifies the idea to come up with newer food articles so as to give consumers newer reasons to visit it time and again, (VIGNALI, Claudio, 2011)
- Brand image and strong presence:- McDonald’s is a strong brand in itself also the brand image which McDonald’s as a brand has evolved over many years is also very positive and impactful.
- Densely present: - McDonald’s has a presence which is very dense and easily located by a consumer, its wide presence makes it a popular brand in UK.
- Monotonous:-McDonald’s has now for a long time had the same brand appeal and product offering for the consumers there by making it the whole appeal of the store monotonous thus in search of something new consumers tend to drift from it.
- Lower emphasis on healthy food: - McDonald’s gives more emphasis on fast food however the emphasis on healthy food is very low. (VIGNALI, Claudio, 2011)
- Increase in level of awareness: - UK’s population is gaining wide awareness as according to a research around 20% of all the food sold in UK will be organic food and healthy food by 2020. Thus McDonald’s needs to understand the social drift and cater the need of consumers as well. (VIGNALI, Claudio, 2011)
- Increase in competition: - Competition has been increasing in the space where McDonald’s operates.
- Have a healthy food product offering and through this McDonald’s can also charge premium for its products as they can enjoy the first mover advantage,
- Also have tie ups with offices and government bodies lie railways so as to serve food to a newer target market.
Now understanding the business environment of McDonald’s strategies should be formed on the basis of the environment of operation, these strategies should be such that the low growth of McDonald’s in UK turns around and the share of McDonald’s rises.
1.3 Consumer Market:
Consumer markets can be defined as the markets where the products and services that are designed for the general consumer dominate the market. There are basically four categories of consumer markets, which are, consumer products, food and beverage products, retail products and transportation products. (LEADLEY, Peter and Forsyth, Patrick, 2004)
Characteristics of Consumer Market:
- Demographic Characteristics: The demographic characteristics comprise of differences in gender, age, income, education, ethnic background etc. Companies identify their customers by their demographic features and target their products and services accordingly. For example, the population of UK depends mostly on the junk food and therefore they need brands which serve them good junk food.
- Psychographic Characteristics: The psychographic characteristics of the consumer market can be classified as interests, values and beliefs, activities, opinions and attitudes of the consumers. McDonalds serves its UK market after performing a research work on the psychographic characteristics of their consumers. These features help McDonalds in serving its customers well. (KOTLER, Philip and Armstrong, Gary, 2013)
- Behavioural Characteristics: The behavioural characteristics of consumer market include brand loyalty, benefits to the consumer, rate of the usage of product, status of the user. McDonalds distinguishes its customers in UK based on their behavioural characteristics. By doing this, it can come to know the customers who visit McDonalds most frequently and how much do they spend each time they visit.
- Geographic Characteristics: The geographic characteristics of the consumer market are based on the size of the market, region, density of the population and climate. For example, McDonalds serves its market of UK after knowing about the geographic features of its market. It will open its franchisee where there is a maximum crowd of students and children. The geographic characteristics will help McDonalds in knowing the size of its market. (KOTLER, Philip and Armstrong, Gary, 2013)
1.4 Importance of Consumer Market:
The consumer market has various importance for its different market segments. For example, McDonalds has four different types of customers in UK and it has a different importance for all these groups of customers. The various types of customers of McDonalds are as follows - (VIGNALI, Claudio, 2011)
- A parent with two children: McDonalds has a great importance for the parents as they can give their children a treat here. In UK, the parents find McDonalds the best place for giving their children a fun filled treat.
- Children:For children, McDonalds carries a great importance as well because the children feel very happy here in McDonalds. They enjoy their food as McDonalds give happy meals to the children.
- A business customer:A business customer finds McDonalds a convenient place to eat as it has a fast service and the food can be eaten in the car as well.
- Teenagers:Teenagers get attracted to McDonalds as it has affordable prices plus there is also the Wi-Fi facility available in the restaurants.
Thus McDonald’s needs to understand the characteristics and research on the eating habits of each of the above mentioned 4 target classes of the UK society and in addition define the business activities whether of small or drastic nature only in accordance with the needs and demands of the targeted and segmented consumer market.
McDonald’s, one of the biggest organizations functioning in the fast food industry is one of leaders in the industry. However with the advent of consumer awareness towards fast food and health implications, McDonald’s now needs to re-strategize and come up with plans to cater the changing business needs. (ROGER, Kerin, 2010) Also the business environment of McDonald’s is such that the sped of change is extremely fast thus McDonald’s needs to cope up with the speed of change and in changing it also has to maintain its brand image and integrity.
LEADLEY, Peter and Patrick FORSYTH. 2004. Marketing: Essential Principles, New Realities. Glasgow: Kogan Page Publishers.
MOOIJ, Marieke de. 2010. Global Marketing and Advertising: Understanding Cultural Paradoxes. California: SAGE.
PRIDE, William M. 2011. Marketing. Texas: South-Western Cengage Learning.
VIGNALI, Claudio. 2011. McDonald’s: "think global, act local"-The Marketing Mix. British Food Journal. 103(2), pp.97-111.
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