McDonald's Corporation:

Mcdonald’s Corporation is the largest chain of hamburger fast food resturant’s , serving
more than fiftyeight million customers daily.

Pre-Internationalization:
The Business began in 1940 with restaurants opened by brothers Richard James and
Maurice James McDonald in San Bernadio ‘California’. Their Introduction of the ‘Speedo
Service System’ in 1948 established the principle of the modern fast-food restaurants.

The present McDonald’s Corporations date its founding to the opening of a franchised
restaurant by ‘Ray Kroc’ in Des plains, Illinois on April 1955. Kroc later purchased the
McDonald’s brothers equity in the company and led its worldwide expansion.

Internationalized:
In 1967 McDonald’s went International with restaurant in Canada and Puerto Rico.
With the expansion of McDonald’s into many international markets, the company has
become a symbol of globalization and the spread of the ‘American Way’ of life. Its
prominence has also made it frequent topic of public debate about obesity corporate
ethics and consumer responsibility.

 The first product of McDonald’s was famous pure “Beef” Hamburger.

 They served their domestic market from 1940 to 1967.
 McDonald’s primarily sells hamburgers, Chicken Product, Cheeseburger and
Break Fast Items.
 To ensure customer’s buy more product McDonald’s focuses on Psychological
pricing strategies in its marketing mix that appear affordable to customers.
 They started their business in “Sen Barnadio California” and now they are in 110+
countries with 36,000 restaurants in worldwide.

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McDonalds’ segmentation, targeting and positioning strategy
If we focuses on Segmentation Targeting and Positioning of a company’s
products/services of McDonalds, we find result as follows:

1. Segmentation
Segmentation is the dividing of a populations into groups according to certain
characteristics. Dudovskiy (2016) claims that McDonalds uses these segmentations and
segmentation criteria:
 Geographical; region, density
 Demographical; age, gender, life-cycle stage, income, occupation
 Behavioral; degrees of loyalty, benefits sought, personality, user status
 Psychographic; social class, lifestyle.

2. Targeting
Targeting implies choosing specific groups identified as a result of segmentation to sell
products. How does McDonalds select/target the right segments? Iacobacci (2014)
advices that marketers iterate between understanding corporate fit and having
information about segment size and likely profitability. Dudoviskiy (2016) supplies the
targets for the segments he proposed earlier (Figure 4).

Figure 4: Targets for McDonalds customers (Source: Dudovskiy 2016)

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However, according to Carol Sagers (McDonald’s Director of US Marketing) the
company seeks specific segments of its target population, and then customize or
position their products to each segment. Unlike other big package goods companies
that have brand managers for their various brands, McDonalds does not have a Big
Mac manager or a salad group. Their marketing department consists of consumer
segments; there can be a Director of Young Adults, a Director of Moms, a Director of
African Americans, and Hispanics etc. (YouTube 2013).

Of course, there are limited time promotional meals where customers can be extracted
from the existing customer segments e.g. young adults for AFL promotion, mums
buying for their kids for Kung Fu Panda promotion etc.

3. Positioning
Positioning refers to the selection of the marketing mix the most suitable for the target
customer segment. Positioning is achieved via a manipulation of the marketing mix 4Ps,
and the positioning matrix demonstrates that certain combinations make more sense
than others (Iacobacci 2014). McDonald’s uses adaptive type of product positioning and
accordingly, the company is engaged in periodical re-positioning of products and
services according to changes in the segment (Dudovskiy 2016). The following is a
direct quote from McDonald’s franchise strategy document:

“McDonald’s has made itself to be the family friendly low cost restaurant in the fast food
business. We have a narrow scope for a customer base and a low cost strategy” (McDonalds
2016).

4. Conclusion
McDonalds segments its customers according to the life-cycle stage and then positions
itself as a family friendly low cost restaurant.

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5. References
 AdNews, 2016, This is not a drill – maccas has a fashion range, retrieved
11 April 2016, < http://www.adnews.com.au/campaigns/this-is-not-a-drill-
maccas-has-a-fashion-range >
 Balaji, M., Ghosh, R., Shah, J. 2016, McDonalds: behind the golden
arches, retrieved 11 April 2016,
< https://www.scribd.com/doc/11520753/Marketing-Strategies-of-
McDonalds >
 Brown, V. 2016, McDonald’s launch all-day breakfast across
Australia, retrieved 11 April 2016,
< http://www.news.com.au/lifestyle/food/eat/mcdonalds-launch-allday-
breakfast-across-australia/news-
story/dd61284c91f12a28cfdd06bfc58771f0 >
 Dudovskiy, J. 2016, McDonalds segmentation, targeting and
positioning, retrieved 11 April 2016, < http://research-
methodology.net/mcdonalds-segmentation-targeting-and-positioning/ >
 Iacobucci, D., 2014, Marketing management (MM4), South-Western,
Cengage Learning, Mason.
 McDonalds. 2016, McDonald’s franchise strategy, retrieved 11 April 2016,
< https://sites.google.com/site/mcdonaldsfranchisestrategy/home >
 YouTube, 2013, Segmentation, targeting, and positioning –
McDonald’s, retrieved 11 April 2016,
< https://www.youtube.com/watch?v=RcRFBVIvJHw >