Introduction
Product positioning is a crucial marketing mix function that ensures the strategic placement of goods and services in the market. McDonald’s is known for its robust product positioning strategies that have continued to offer the brand, which has a unique competitive edge in more than 100 countries worldwide. This essay provides insight into McDonald’s product positioning strategy.
McDonald’s Product Positioning and Corporate Strategy
The fast-food company conducts its business in a way that targets families. In fact, it has made itself a friendly family low-cost restaurant in the fast-food industry (Hanratty et al. 548). The corporate strategy focuses on an economical business by providing healthy and blissful meals with considerably short delivery times.
The McDonalds utilizes tech-savvy point-of-sale systems to shorten the customers’ waiting time. The company made globalization one of its core strategies. Through internalization, the organization has introduced its products and customer service to various foreign countries. Close attention is paid to the cross-cultural diversity aspects associated with the cross-border business (Dabija and Postelnicu 210).
To position their products in line with the globalization strategy, the company has introduced numerous local business themes such as the ‘Aunt and Uncle’ McDonalds in China. The themes correspond to the country’s emphasis on family values. The company has also established a unique fast food globalization strategy known as ‘Mcdonaldization.’ The term implies the proliferation of the fast-food company worldwide by matching the principles of the organization with the family values of the host country.
The company has gone further to make its environment a hangout place by introducing services such as wireless internet connections, laptop points, play stations, and playgrounds for children (Bobba 76; Hanratty et al. 549). As the restaurants serve children, they have products too for the whole family.
Weaknesses in McDonald’s Product Positioning
The McDonald’s product positioning has faced stiff challenges in both the American markets and abroad (Nandini 21). Its products have been criticized for posing health threats such as obesity, heart disorders, asthma, and mad cow disease to children. The McDonald’s products have also been questioned for having environmental issues such as the genetically modified potatoes that are used to prepare the meals. In addition, the beef used in the restaurants comes from as many as five different countries (Nandini 21).
This practice of mixing substances from different and extreme distant origins is problematic since the likely contamination is difficult to trace. The introduction of fast food products in different countries has affected local cultures adversely. Many people feel that it undermines the local cuisines that match with their traditions (Westjohn, Singh, and Magnusson 59).
The relevance of the EPS/EBIT Chart in Strategy Implementation
The determination of the financial risks of the enterprise is accomplished using different tools with a view of acquiring adequate capital to implement various strategies. Business risk refers to the unpredictability of the enterprise’s expected earnings before the interest and taxes (EBIT) (Rose 137). An EBIT analysis is utilized as a technique to determine the extent to which the debt and/or stock should be used to fund the projected strategies.
Successful strategy implementation requires additional capital that can be obtained from the debts and equity besides the company’s operations and sale of assets (Rose 137). The EPS/EBIT Chart Terms include the Earnings Per Share (The Net Income divided by the number of Shares Outstanding), Earnings Before Interest and Taxes (EBIT, also referred to as operating income), Earnings Before Tax (EBT), and Earnings After Tax (EAT).
Works Cited
Bobba, Samantha. “The role of the food industry in tackling Australia’s obesity epidemic.” Discover the opportunities in general practice 1.1 (2013): 76. Print.
Dabija, Dan-Cristian, and Cătălin Postelnicu. “Mcdonald’s – Between Internationalization and Regionalization of Restaurant’s Value.” Review of Management & Economic Engineering 14.1 (2015): 205-219. Print.
Hanratty, Barbara, Beth Milton, Matthew Ashton, and Margaret Whitehead. “‘McDonalds and KFC, it’s never going to happen’: the challenges of working with food outlets to tackle the obesogenic environment.” Journal of Public Health 34.4 (2012): 548-554. Print.
Nandini, Satya. “McDonald’s Success Story in India.” Journal of Contemporary Research in Management 9.3 (2014): 21. Print.
Rose, John. “Extending the Presentation of the EBIT-EPS Relationship for Introducing Financial Leverage in the Classroom.”Journal of Financial Education 1.1 (2010): 137. Print.
Westjohn, Stanford, Nitish Singh, and Peter Magnusson. “Responsiveness to Global and Local Consumer Culture Positioning: A Personality and Collective Identity Perspective.” Journal Of International Marketing 20.1 (2012): 58-73. Print.