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McDonald’s: Remaining Relevant in a Health Conscious Society
McDonald’s Corporation is one of the world’s largest food service retailing chains. The company is primarily known for its burgers and fries, which it sells through more than 32,000 restaurants in 117 countries. In 2010, the company served an average of 64 million customers per day. It primarily operates in Europe, Asia Pacific, and the Americas. The company is headquartered in Oak Brook, Illinois and employs about 400,000 people. McDonald’s has been able to successfully increase revenues and profits in recent years in spite of much negative publicity and an increasingly health conscious public. This case study shows how the company has achieved these goals in a difficult trading environment.
McDonald’s has, to a great extent, defied recent difficult economic conditions and continued to experience strong sales and profit growth in recent years, as it has been able to attract diners with an improved and expanded product range while remaining competitive on price.
McDonald’s has been the target of much criticism in recent years for serving large amounts of foods high in saturated fat, salt, sugar and calories. The 2004 documentary film Super Size Me brought this under the spotlight. The company responded to this criticism by introducing healthier menu choices, adjusting portion sizes and reducing salt and sugar content. It has also expanded its product range in an attempt to attract a new type of customer, most noticeably through its McCafe offering.
McDonald’s utilizes a highly visible and innovative marketing campaign to push its offering to consumers so that they are always aware of what is on offer in its restaurants. This includes commercials on TV, radio, billboards, bus tickets, in newspapers; sponsorship of major events such as the Olympic Games and the FIFA World Cup; and sponsorship of high profile athletes. Its marketing and publicity efforts have made it one of the world’s most valuable brands.
McDonald’s is primarily a franchisor, but also operates company-run restaurants. This balance means that it is not overexposed to any one format, and its broad geographical spread prevents an over-reliance on a single market. Furthermore the McDonald’s ‘System’ – which is a chain of franchisees-suppliers-company employees – is a well-oiled machine that keeps a massive global operation running efficiently.
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