For Catherine Owens
R unning H ead: M C D O N ALD ’S M AR KETIN G PLAN
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Frieday N ight w ith Redbox: A M cD onald’s M arketing Plan
Sam uel A . Sam ple
BU S 330 Principles of M arketing
Professor Sadeghinejad
February 16, 2016
M CD O N A LD ’s M A RK ETIN G PLA N 2
M cD onald’s M arketing Plan: Frieday w ith RedBox
Brand or C om pany D escription (m inim um 25 words)
M cD onald’s is the w orld’s largest fast food chain w ith over $25B in annual sales and m ore than
35,000 retail locations in m ore than 100 countries (M cD onald’s Corporation, 2015).
C ore Products or Services (m inim um 25 words)
Beyond the burgers, french fries and m ilkshakes that they’ve been selling since its founding,
M cD onald’s sells a variety of w raps, salads, sandw iches and beverages – m ore than 200 item s in all (The
Econom ist, 2015). M cD onald’s locations are typically open for breakfast, lunch, dinner and late night
dining and m any feature drivethru service.
A Brief H istory (m inim um 50 words)
The first M cD onald’s restaurant w as opened in 1948 by Richard and M aurice M cD onald. It
brought production line techniques to the burger business and challenged the dom inant carhop drivein
business m odel. Ray K roc w as one of the earliest franchisees and the key figure in the rapid expansion of
the business after he bought out the M cD onald brothers 1961. M cD onald’s becam e a public com pany in
1965 and opened its first international location in 1967. Sales and locations have continued to grow every
year since.
K ey current com petitors (m inim um 50 words)
H istorically, M cD onald’s prim ary com petitors w ere identified to be the large fast food burger
chains like Burger K ing and W endy’s. But given M cD onald’s size and the expansion of their m enu, the
com petitive set m ust be view ed m ore broadly to include sandw ich shops like Subw ay, other fast food
concepts like ChikfilA , m ore upscale fast casual restaurants like Panera and Chipotle, as w ell as coffee
shop chains like Starbucks and D unkin’ D onuts.
M CD O N A LD ’s M A RK ETIN G PLA N 3
SW O T A nalysis (m inim um 500 words)
SW O T A nalysis: Strengths (D escribe a m inim um of 3 positive controllable factors)
1. A nytim e, anyw here convenience
W ith over 14,000 locations in the U .S. alone, there’s a M cD onald’s w ithin a short drive of alm ost
everyone and m ost are open from 6am to 11pm . The num ber of locations also m eans that M cD onald’s can
purchase m edia nationally w hich is m ore cost efficient than buying locally.
2. Brand equity
A s a results of its m any locations, consistent brand experiences and hundreds of m illions of
dollars spent on m arketing each year M cD onald’s has developed a very strong brand. For exam ple, they
ranked 5th on BrandZ’s 2014 m ost valuable global brand list (Rooney, 2014).
3. The Best French Fries
M cD onald’s french fries are universally loved even by people w ho don’t otherw ise like
M cD onald’s food. M cD onald’s fries w ere voted #1 in a 2015 Y ouG ov study (Peterson, 2015).
4. K id appeal
M cD onald’s is a popular destination am ongst younger kids. M any locations have indoor
playgrounds and there are m enu item s such as H appy M eals w hich com bine several kid friendly food
offerings in a fun box that includes a toy. The brand does a lot of advertising on kid targeted program s
and Ronald M cD onald is a highly recognizable spokesperson.
5. Inexpensive
W ith it’s w ell know n dollar m enu, M cD onald’s is perceived by m ost consum ers as an
inexpensive place to go for breakfast, lunch or dinner or a betw een m eal snack.
SW O T A nalysis: W eaknesses (D escribe a m inim um of 3 negative controllable factors)
1. M enu bloat
M CD O N A LD ’s M A RK ETIN G PLA N 4
In their attem pt to com pete w ith a w ide range of com petitors, M cD onald’s m enu has sw ollen to
m ore than 200 item s. This is driving dow n operational efficiency as it takes longer for consum ers to order
and longer for the food to be prepared (W alton, 2015). Franchisees also have to invest in additional
kitchen equipm ent and training.
2. D ining environm ent appeal
M any M cD onald’s locations are outdated relative to chains like Starbucks or Panera w hich offer
com fortable seating, am enities like fireplaces and greater cleanliness (W alton, 2015).
3. Low custom er satisfaction
In a 2014 A CSI survey, M cD onald’s ranked last w ith a rating of 71% , som e 7 points below com petitors
like W endy’s and Subw ay (Com oletti, 2014). The rating reflects factors such as order accuracy, food
quality, staff courtesy and m enu variety.
4. Low em ployee w ages
M cD onald’s does not pay its restaurant w orkers w hat m ost w ould consider to be a “living w age”. A s a
result, M cD onald’s does not alw ays attract the highest quality em ployees and turnover can be high,
resulting in a constant need for rehiring and retraining.
SW O T A nalysis: Threats (D escribe a m inim um of 3 negative uncontrollable factors)
1. H ealthier eating trends
W hile M cD onald’s m enu does feature som e healthier item s like salads and w raps, they are still
prim arily associated w ith burgers, french fries, m ass production and processed food. A s such, healthier
eating trends represent a threat to M cD onald’s business.
2. A ging of the population
The percent of population in the U nited States over the age of 65 is grow ing. From 10% in 1970
to a projected 20% by 2030 (O rtm an, V elkoff, & H ogan, 2014). The aging of the population is a threat for
a business w hose core consum er franchise has historically been fam ilies w ith younger children.
M CD O N A LD ’s M A RK ETIN G PLA N 5
3. R ising social consciousness
W hile M cD onald’s business or environm ental practices have likely im proved over tim e, the level
of scrutiny surrounding the triplebottom line and associated negative publicity has increased in recent
years. Popular docum entaries like Super Size M e and Fast Food Nation have not portrayed M cD onald’s
food or its business practices in a positive light.
SW O T A nalysis: O pportunities (D escribe a m in. of 3 positive uncontrollable factors)
1. Positive childhood associations
Regardless of people’s current perceptions or level of satisfaction, m ost M cD onald’s consum ers
have fond childhood m em ories associated w ith the brand that can be potentially activated w ith the right
m essaging or product offerings. This creates an opportunity w ith the next generation of parents.
2. The prolonged U .S. econom ic recession
The m ore people’s budgets are pinched, the m ore they are apt to “trade dow n” to less expensive
options like fast food. W ith its w ellknow n dollar m enu, M cD onald’s has the opportunity to benefit from
a prolonged econom ic dow nturn.
3. G row th in speciality coffee
The percentage of A m ericans drinking speciality coffee in the U S has m ore than doubled since
2009 (W ard, 2004) and teenagers are a particularly high grow th segm ent. M cD onald’s M cCafe specialty
coffee product line should continue to benefit from this trend.
M arketing Plan Focus (W hat you’re m arketing and why, m inim um 100 words)
Based on m y SW O T analysis, I believe there is an opportunity to significantly grow the
afterdinner snacking business (i.e., french fries and M cCafe beverages) am ongst teenagers and young
adults. This is also a w ay to show case updated facilities and am enities like W ifi to custom ers w ho m ay
not have visited M cD onald’s recently. I think it’s im portant to reestablish brand liking w ith this age
M CD O N A LD ’s M A RK ETIN G PLA N 6
group prior to them having kids of their ow n. The rem ainder of this docum ent lays out the details of m y
M cD onald’s Frieday N ight w ith Redbox m arketing plan.
Segm entation A pproach (Include rationale, m inim um 75 words)
For this m arketing plan, I’ve opted for a straightforw ard dem ographic approach to segm enting the
m arket given m y desire to target a specific age group. I considered a behavioral approach based on past
purchase history as captured via use of the M cD onald’s app. H ow ever, the app w as only introduced in late
2015 and age is not captured in the registration process (unless a social m edia login is used).
Furtherm ore, I don’t w ant to lim it m y audience to just existing custom ers. G iven the broad appeal of the
M cD onald’s concept and its national footprint, I did not feel geographic targeting or form al
psychographic targeting w as needed.
Target D efinition (m inim um 25 words)
M y target for the Frieday N ight w ith Redbox prom otion are U .S. teens and young adults ranging
from approxim ately 15 to 23. To the degree m edia targeting allow s it, an interest in m ovies, fast food
restaurants and coffeehouses w ould represent a further level of definition.
Positioning Statem ent (m inim um 25 words)
For teenagers and youngadults, Frieday night w ith Redbox is a chance to hang w ith friends and
enjoy great fries, cool coffeehouse drinks and a m ovie w ithout draining the w allet.
M arketing M ix D iscussion (m inim um 800 words)
M arketing M ix: Product
This m arketing plan is focused around tw o M cD onald’s product lines, french fries and M cCafe
beverages, w hich include specialty coffee drinks as w ell as sm oothies. The core idea is to use the hook of
A m erica’s favorite french fries (in the red box) to drive trial and aw areness of high m argin M cCafe
beverages (that m ight otherw ise be bought at a D unkin’ D onuts or Starbucks) and kickstart an
inexpensive, athom e social gathering occasion involving a RedBox m ovie (or video gam e) rental.
M CD O N A LD ’s M A RK ETIN G PLA N 7
M arketing M ix: Price (identify the pricing strategy and details)
M cD onald’s everyday pricing strategy for its french fries can be defined as com petitive relative to
other fast food chains. In contrast, the pricing strategy for the M cCafe line is better characterized as
skim m ing relative to the specialty coffee houses they are trying to take business from . For exam ple, a
large M cD onald’s M ocha Frappe is $3.80 w hereas a com parable Starbucks M ocha Frappuccino is $5.54
(Bacic M edia G roup, LLC., n.d.).
A s part of this m arketing plan, on Friday (henceforth referred to as Frieday) from 7pm to 11pm
(or closing tim e, if later), all custom ers can upgrade from a sm all to a large M cCafe sm oothie, frappe or
espresso drink for free w hen they purchase a large order of fries. This represents a $1 savings to the
custom er. The offer w ould be lim ited to Frieday nights (at least initially) to create an air of urgency and
specialness. The prom otional pricing represent a deepening of the M cCafe skim m ing strategy as w ell as
an exam ple of segm ented pricing as w ell as peakload (or in this case, offpeak) pricing, as this discount
is only available on Friday nights after the peak dinner rush hour.
M arketing M ix: Prom otion (describe m edia and prom otional strategies)
In addition to the prom otional pricing deal discussed above, there w ould be a scratchoff gam e
that w ould also involve the use of a m obile phone (perhaps to look up a code on a Frieday night
m icrosite). The m obile com ponent is im portant as w e w ant to reinforce the fact that M cD onald’s has
W iFi. Prizes w ould be things in redboxes, nam ely free large fries, free Redbox m ovie rental nights and a
big prize like your ow n fully stocked Redbox unit or a special A rch (gift) Card that gets you free
M cD onald’s french fries for life. Codes that are not instant w inners could be translated into electronic
punches via the M cD onald’s app and redeem ed for free fries w hen a certain threshold w as reached (e.g.,
six cards or by spelling the w ord redbox).
I selected Redbox as a prom otional partner because of the link to the M cD onald’s red french fry
box, but also because it is a good m atch w ith the low cost im age, has w idespread distribution, high use by
M CD O N A LD ’s M A RK ETIN G PLA N 8
teens and young adults and is related to the late night hangout ritual that I’m seeking to integrate to
M cD onald’s into. I believe Redbox w ould be w illing to offer up free night prom otional codes in exchange
for the publicity the prom otion w ould bring them .
A s for the m edia I w ould leverage to prom ote Frieday nights w ith Redbox, I w ould stay aw ay
from traditional m ass m edia channels, despite M cD onald’s ability to buy such m edia cheaply. For this
prom otion to w ork, teenagers and young adults w ill need to feel it’s for them . A s the offer w ill be
available to anyone, the “just for m e” nature of the prom otion w ill need to be achieved through the m edia
channels used and the m essage execution. I w ould focus m y prom otional efforts around targeted
advertising on Facebook, Y ouTube and/or Instagram given its younger skew and highly visual nature.
W ould also explore w hether there is possibly a w ay to license Rebecca Black’s “Friday N ight” song (or
K aty Perry’s “Last Friday N ight”), as these w ould be a good conceptual fit.
Instore signage for a lim ited tim e of day and/or w eek prom otion can be difficult to coordinate,
but in this case, I think the lim ited presence of such m aterials (e.g., a counter card or drivethru w indow
sticker) w ould enhance the specialness of the prom otion for the target.
M arketing M ix: Place (physical/virtual place strategies, incl. channel partners as relevant)
The Frieday night w ith Redbox prom otion w ould occur at all participating M cD onald’s locations
and w ould relate to instore and drivethru purchases on Friday nights. Redbox m ovie redem ptions w ould
happen at any of Redbox’s 35,000+ U .S. locations w hich are typically found near grocery and
convenience stores (Redbox A utom ated Retail, LLC, n.d.).
I w ould also m ake use of a dedicated M cD onald’s Frieday night m icrosite w here custom ers
could be directed to learn m ore about the prom otion and check their prize codes. Integration w ith the
M cD onald’s app m ight be a potential m eans of executing the “collect x codes, get free fries” aspect of this
prom otion (and encouraging additional dow nloads of the relatively new M cD onald’s app).
Potential Success M etrics (discuss at least 3 potential m etrics, m inim um 100 words)
M CD O N A LD ’s M A RK ETIN G PLA N 9
There are a variety of m etrics that could be potentially captured and analyzed to m easure the
effectiveness of this m arketing plan. The m ost direct m easures w ould be the grow th in custom er counts
and dollar sales during the prom otional w indow versus the previous period or year ago tim efram e. A s the
prom otion w ould only be offered on Frieday nights, sales grow th on other nights could be used for
com parison. O ne m ight also m onitor increases in social m edia follow ers, app dow nloads and counts of
prom otional codes entered (and other prom otional m icrosite actions). Redbox could m onitor rental counts
and num ber of prom otional codes redeem ed to evaluate the success of their prom otional participation.
International C onsiderations (discuss at least 3 considerations, m inim um 100 words)
If this M cD onald’s Frieday night m arketing plan w as to be translated for a foreign m arket, it
w ould probably be a com plete start from scratch scenario. First, the prom otion w ould need a different
nam e as the verbal link betw een Frie (as in French Fries) and Friday w ould not likely exist in m ost
languages. Secondly, a different prom otional partner w ould be needed as RedBox is strictly an A m erican
concept. Finally, the focus on coffee products m ight need to change in a country like China and India
w here coffee consum ption (versus for exam ple, tea, is m uch low er than in the U .S..
C onclusion (sum m arize and explain why your plan should be funded, m inim um 50 words)
M y Frieday night w ith Redbox m arketing plan should be approved for funding because it w ill
succeed in leveraging A m erica’s favorite french fries to drive increased trial of M cCafe beverages by
teens and young adults. It w ill also increase consideration of M cD onald’s as an evening snack destination
and help cem ent the brand’s association w ith Friday night m ovie gettogethers. It w ill also help build
brand affinity am ongst this future generation of parents.
M CD O N A LD ’s M A RK ETIN G PLA N
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R eferences
Bacic M edia G roup, LLC. (n.d.). M cD onald's prices fast food m enu prices. Retrieved February
1, 2016, from http://w w w .fastfoodm enuprices.com /m cdonaldsprices/
Bacic M edia G roup, LLC. (n.d.). Starbucks’ prices fast food m enu prices. Retrieved February
7, 2016, from http://w w w .fastfoodm enuprices.com /starbucksprices/
Com oletti, J. (2014, June 19). A m erica's favorite fast food chains. Retrieved from
http://w w w .businessinsider.com /m cdonaldslastincustom ersatisfaction20146
The Econom ist. (2015, January 10). W hen the chips are dow n. Retrieved from
http://tinyurl.com /m g8nm qh
M cD onald's Corporation. (2015). 2014 Annual Report (Rep.). Retrieved from
http://tinyurl.com /haq4fkp
O rtm an, J. M ., V elkoff, V . A ., & H ogan, H . (2014). A n aging nation: the older population in the
U nited States. W ashington, D C: U S Census Bureau, 251140.
Peterson, H . (2015, July 13). The best fast food french fries in A m erica. Retrieved from
http://w w w .businessinsider.com /thebestfrenchfriesinam erica20157
Redbox A utom ated Retail, LLC. (n.d.). Redbox corporate inform ation. Retrieved February 7, 2016, from
http://w w w .redbox.com /facts
Rooney, J. (2014, M ay 20). G oogle beats A pple A s BrandZ m ost valuable global brand.
Retrieved from http://tinyurl.com /hsg5zu3
W ard, H . (2014, D ecem ber 10). Specialty coffee consum ption: A look at the num bers. Retrieved
from http://tinyurl.com /jm k5ok7