MCDONALDS GLOBAL STRATEGY

McDonalds Global Strategy

McDonalds Global Strategy

Introduction

McDonald's is one of the world's giant companies that operate all over the globe in more than 100 countries. The business began first by two brothers Dick and McDonald in California in the USA IN 1940. The fast food retailing well known because of its burgers and fries that sells through over 31,900 restaurants in five continents around the world. Company offers a standard menu for all its restaurants. Company products are including hamburgers, cheeseburgers, Big Mac, soft drinks, breakfast, coffee and milkshakes and French fries. Big Mac which introduced in 1968 became one of the most branded foods not only for the company but in the world. The food service raises its capital through franchisee and company operated restaurants. Quarters of restaurants are operated by McDonald's and the rest (75%) are operated by franchisees. McDonald's headquarters situated in Illinois in the USA and its James A. Skinner serves as the CEO and director of the company. The company employees more than 400,000 people worldwide. The company builds restaurant in local area, motorways, shopping center, airports and any best location in the market. Europe and the US with tree-quarters of total are the major area of revenue for the company. Burger King, Wendy's/Arby's Group Inc and Starbucks are some of the major competitors of the company in the marketplace but still McDonald's total revenue is much higher than all these three competitors. McDonald's strong brand which considered as one of the top ten global brands with valued “at $31,049 million in 2008” attracts to all age of customer and helps the company acceptability in new market.

Definition of Innovation

Innovation is a new approach to designing, producing, or marketing goods or services that creates value and gives the innovating company an advantage over competitors.

Nature of the McDonald's Global Strategy

McDonald's innovation budget has never been matched by any other single brand name. McDonald's spends more than $800 million dollars every year on innovation and promotion. Nearly all McDonald's innovation is aimed at children. In the UK McDonald's also markets young children, ages 2 to 8. McDonald's commercials contain a simple song; which was easy for children to remember. John Hawkes, the McDonald's UK Chief Innovation Officer, said the song was to reach families through the children.

McDonald's take a new approach to target young adults of age between 16-25 they use discounts and coupons. McDonald's offers 29-cent and 39-cent hamburgers and cheeseburgers. For many years McDonald's mostly targeted the young people, however this has changed in this decade; McDonald's has turned towards a more general market. By doing this McDonald's concentrates on the family, targeting a diverse market which includes consumers ranging from children to elderly people, using products such as the "Happy Meal" for children and "Egg McMuffin" for the elderly. McDonald's also realized the changing world we live in and the need for healthier food, since there is an ever changing demographic group, who demand fast, top quality food that is low in ...