FREE ESSAY ON MCDONALDS

MCDONALDS

I Introduction
II Differentiation
III Product Differentiation
A. Variety
B. Quality
C. Taste
D. Size
E. Price
IV Service differentiation
a. Ordering ease
1. At Mcdonalds
2. Drive through
b. Delivery
1. A home delivery
c. Miscellaneous services
V Personnel Differentiation
d. Competence
e. Courtesy
f. Credibility
g. Reliability
h. Responsiveness
i. Communication
VI Image Differentiation
A. Symbol
B. Media
C. Atmosphere
Conclusion
I. Introduction:
We have come to a time where the competitions between firms is getting more aggressive
than ever before therefore every company has to have a certain weapon to defend itself or
to gain new markets.
This project is about the differentiation tools used by the McDonlads Company and how it
uses it resources to gain a competitive advantage and to be the leader in the market
II. Differentiation
It is the act of designing a set of meaningful differences top distinguish the company's
offering from competitors offering.
The number of differentiation opportunities varies with the type of industry:
1.volume industry: one in which companies can gain on only a few but rather large,
competitive advantage. In the construction-equipment industry, a company can strive for
the low cost position or the highly differentiated position and win big on either basis.
Profitability is correlated with company size and Market share.
2.stalemated industry: one in which the are a few potential competitive advantages and
each is small. Profitability is unrelated to the market share
3.fragmented industry (applied on our case):one which companies face many opportunities
for differentiation, but each opportunity for competitive advantage is small. Both small
and large companies profitable or unprofitable.
4.specialized industry: one in which companies face many differentiation opportunities,
and each differentiation can have a high payoff, some small companies can be profitable
as some large companies.
III. Product differentiation:
Physical products vary in their potential for differentiation .at one extreme we find
product that allow little variation ex:(chicken) .At the other extreme products there are
products which are capable of high differentiation :(cars).
A. Variety
It is how many products the company produces and for how long does have to be in the
market before we can introduce new ones.
It depends on how long the products are in the market. In a new market, we prefer not to
have too much in order to be consistent with the public knowledge.
Few products at first is always a better strategy.
I.e.: Big, quarter, pounder, filet o fish.
Eventually you introduce more products (Mc royal, Mc feats, Double cheeseburger after a
certain period when the people are familiar with the old product
(Happy meal)
B. Quality
It is the quality of the product and what are the steps taken by the firm to have the
maximum quality using the available resources \
When you start with few products this increase the quality
Quality requires several needs.
Purchasing a product has to be done in a very organized way and it has to pass all the
health procedures.
We conduct a training program for all the crew in the kitchen (back area) so we can make
sure that they have good sanity and the have the knowledge of the all the required
measurements.
All this makes sure that quality is food 
C. Taste
Is how the consumer perceive the product even he likes it or not and if he things that it
needs improvement or not 
We get the right ingredients and the right portions of ingredients either locally made or
imported to make sure that we are serving the right product and the same taste expected
worldwide
In some countries after a few years (never at the beginning) we try to offer special
product with local taste (spicy chicken & burger in Egypt, Japan with Japanese sauce,
China with sweat and sour.) 
We try to adapt to the local taste in few items and to keep our international flavor as
well
D. Size
Either the company has a size standard and how does it respect it or It doesn't have a
standard and how does It act due to this situation 
We have standard size internationally and we have to respect it, but we do have bigger
size (Big Mac) we try to offer the force flavor (local taste) in a bigger sandwich to
give more value to the consumer (Upsize your Combo).
Size is very important, The more the client pay in a Big size the more it is profitable
as we save more on paper cost.
The more the size is bigger the more we save cost.
E. Price
Price is he selling value of the product whether it is cheep or expensive. This is one of
the most important aspects because due to it the customer my change his mind
We make a Price sensitivity study (PSS)
We conduct interviews and we try to know at which price the consumer is willing to pay.
We come with an average price for every product and if it is profitable, we try to market
it
When we put the price we look at our coast (food and paper) the more we sell the more we
save cost. The purchasing dept. buys in volume to cut down the coast to enable us to:
A. Make more profit
B. Adjust the price 
Competition is a very important aspect in price. Since we are the Market leaders, we
start the price and usually the market follows.
Advertising is an important factor to make others follow 
The International average of food coat at Mcdonald is 33 %
In Egypt the coast reach's 45% 
IV. Service differentiation
When the physical product cannot easily be differentiated, the key to competitive success
may lie in adding valued services and improving their quality.
A. Ordering Ease
This refers to how easy it is for the customer to place on order with the company.
1.At McDonalds
We give the best at McDonalds for a customer to take a product in the right timing. The
product must be ready, this needs a lot of experience .The employee behind the counter
has to see (make an evaluation) what is the product the most wanted so he can tell the
Back area (the Kitchen) to increase a certain product (if he made a wrong evaluations the
product will be thrown away) .a harmony between the crew has to exist in order to satisfy
the customer needs
When there is a lot of traffic (the restaurant is full) it is easier to produce the
product in a better Quality. The difficult part is when it is a slow day part in this
case the employees have to entertain the customer so that he will not feel board.
2. Drive trough 
We have only one lane but it has to be very wide in order to have two cars or if one car
wants to leave the line.
We have to provide good and quick service
The stand has to be equipped with a mic in order to make the order, when the client
reaches the second window the meal should be ready to be delivered.
Drive through gets 35% more sales than any restaurant as it has accessibility and good
service
The disadvantage of the drive through is the big size of the required building which will
increase the capital needed.
a. Delivery
Delivery refers to how well the product or service is delivered to the customer it
includes speed accuracy and care attending the delivery process, buyer will often choose
a supplier with a better reputation for on time delivery.
1. Home delivery
We try to make a good service so the consumer can receive a hot meal in a short time
(unfortunately the food is better sold at the shop). To do so we make sure that all the
outlets conduct delivery service to the decrease the radios of each restaurant (to offer
more quality and standard to the product) 
Usually we have two to three lines with waiting calls and around five to ten motorcycles.
We have also more drivers than the number of motorcycles to make sure that if one did not
show he will be immediately replaced 
We make the deliver takes only one order per time so that the food we be hot and quick
To avoid any error in orders we make the employee repeats to the customer the product
ordered.
We are now working on a one number for home delivery to make it easy to remember when you
call McDonald's (Dial 30 30 30 3 from anywhere in Egypt)
b. Miscellaneous 
Companies can find other ways to differentiate customer services they can offer product
warranty, establish awards.... ECT
LSM Local store market
We try to provide inside McDonald's the best experience and some time we provide a local
neighborhood entertainment to make it more pleasant to the guests (entertainment in
Shoubra is different than Heliopolis). We also offer Music, Karaoke, competition, special
hours, and happy hours 
To make our guest enjoys his stay a Mcdonald to the maximum. 
We also provide B.O.G. (be our guest) card.
V. Personnel differentiation:
Companies can gain a strong competitive advantage through having better trained people
In an age when competitors can knock off products or services in an instant, some savvy
companies are marketing their employees.
We screen people before we enroll them and we give them the proper local and
international training and on job training. All job skills are taken into consideration
as competence and how to be accurate to customer requests. Courtesy and friendliness are
very important aspects in the personnel, Credibility is expected from the crew to match
customer expectation by providing good service and also reliability, responsiveness are
also very important to serve the client immediately with his order. The greater the
responsiveness in a fast food business the better image and the frequency of repeat
visits by the same customer are achieved.
Communication is important between the crew and the mangers to provide better, fast
service to customer. Communication between the staff and the customer 
VI. Image differentiation
Byers respond differently to company and brand images. Identity and image needs to be
distinguished. Identities compromise the ways that a company aims to identify or position
itself or it's products. Image is the way the public perceives the company or the
product. Images is affected by many factors beyond the company's control
An effective image does three things:
1.establish the product's character and value position
2.it conveys this character in a distinctive was so as not to confuse with competitors
3.it divers emotional power beyond a mental image
A. Symbol
Images can be amplified by strong symbols as al lion, apple.... ECT
A brand can be build around a famous person; companies may also choose a color identifier
such as blue, yellow. Alternatively, a specific piece of sound, even reproduce logos of
most admired companies.
Every brand portraits a special image in people mind that is why brand advertising is
very important not only product advertising
We have to pay for the brand, this means special market and special media with the best
quality artwork
B. Media 
The chosen image must be worked into ads and media that convey a story, a mood, and a
claim. It should appear in annual reports, brochures, the company stationery, and
business cards.
What we do is that we have a market calendar for the year shows all the activities and
plans for the different targets (Value, kids…. Etc)
I.e. Ramadan is a very good time for advertising (the Bay). 
We do the market plan and the media plan (we determinate the budget for the whole year:
I.e. :( upsize with Combo) in January and the media will be TV (Channel 1 or Channe2) and
press (Al Ahram, Noss El Donia) 
The choice of media depends on how you want to approach the customer as every body has
his way to cover the market.
C. Atmosphere
The physical space occupied by the company is another powerful image generator.
We like to believe that we offer a very special experience to our customer with a fast
friendly courteous and always with a smile. We provide as much as we can play land for
the kids to assure a frequent visit of the kids with their parents. Kids are very
important as they represent with their parents an important potential of customers.
We always ensure a non-smoking area to please the family atmosphere
The LSM with events (special birthday parties) 
I.e. A television for an important football match
VII. Conclusion