Strength
Strong Brand Value:
• McDonald's is renowned as a leading fast-food chain, having a significant market share.
• McDonald’s has Strong Community Presence the Ronald McDonald House Charities and
the McDonald’s Global Best of Green environmental program support communities to
strengthen their value of the corporate brand
Effective Supply Chain: The company has perfected a global supply chain through the 4Ps of
marketing to ensure consistency, quality, timely and delivery and meets the demand of consumer
of products across thousands of locations worldwide.
Diversifying Portfolio of Products: McDonald's has actively diversified its portfolio to
strengthen its market presence to satisfy market demand, improves its revenues.
Star Product: McDonalds burger is the most selling product which we can identify as star
portfolio according to Boston matrix theory because it generates more cash flow than other
products. This high revenue generation supports investments in product innovation, marketing,
and expansion, helping McDonald's maintain its competitive edge
Global Presence: McDonald’s operates in over 100 countries, allowing it to tap into diverse
markets and spread its brand internationally. For instance, McDonald’s serves localized menu
items.
Attractive and Competitive Pricing Strategy: McDonald's uses an attractive and competitive
pricing strategy to make its menu accessible to a wide audience. By leveraging bundle deals such
as happy meals and psychological pricing (e.g. $__.99 pricing). This pricing approach strengthens
McDonald’s competitive edge and drives high sales volumes, keeping it affordable and appealing
to consumers.
Effective Promotional Tactics: McDonald's practices impactful promotional strategies,
leveraging both above-the-line and below-the-line marketing to maximize its reach and brand
visibility. Through extensive advertising across television, radio, print, and digital media,
McDonald's ensures a wide audience engagement. Additionally, the company utilizes sales
promotions, such as discount coupons and limited-time offers, to draw in customers and drive
sales.
Online food and delivery services: By partnering with platforms like Postmates and offering its
mobile app, McDonald's enhances customer convenience and accessibility. This strategy meets the
rising demand for delivery options.
Weakness:
Health Perceptions: McDonald's has struggled with negative perceptions related to health and
nutrition, as many consumers associate fast food with unhealthy eating. This can affect sales and
the brand's image.
Cost Control Challenges: As a large fast-food chain, maintaining profitability while managing
rising costs—such as food ingredients, labor, and operational expenses can be difficult. Increases
in minimum wage or supplier prices can reduce profit margins, making it challenging to keep menu
prices competitive.
Franchisees Quality Control Management Issues: McDonald’s revenue from franchise
operations relies heavily on the success of individual franchisees. If franchisees face challenges in
maintaining quality of services and foods, it can adversely affect the overall brand reputation and
profitability. On the other hand, it’s hard to monitor and control the franchisees operations.
Opportunities
Expansion in Emerging Markets: McDonald’s can target countries with growing middle-class
populations, such as India and China, where there is an increasing demand for fast food.
Health-Conscious Menu Innovations: Introducing more healthy menu items, like salads and
plant-based options, can attract health-conscious customers and improve the brand’s image.
Promoting Eco-Friendly Practices: By adopting and marketing sustainable practices such as
green management, McDonald’s can strengthen its brand image and attract environmentally
conscious consumers.
Technological Advancements: Investing in mobile ordering and delivery apps can enhance
customer convenience and increase sales through slight customization via food delivery
application.
Partnership and Collaboration: Partnering with companies like Pepsi, and Uber Eats could allow
McDonald’s to enhance its product and service offerings while also providing opportunities for
growth and innovation in a competitive fast-food industry.
Threats
Intense Rivalry: Competitors like Burger King, Wendy’s, and health-focused chains pose a
constant threat by offering similar products in same price range and healthier alternatives.
Increase in Consumer Health Consciousness/ Threat of New Entrants in Health-Focused
Market Segments: Rising health awareness could decrease fast-food sales, with consumers
increasingly associating traditional fast food with unhealthy options, prompting many to turn to
health-focused alternatives. On the other hand, Emerging brands focused on health-conscious fast
food (e.g., Sweetgreen) can attract consumers, increasing the risk of substitution and weakening
McDonald’s customer loyalty.
Economic Downturns: Economic fluctuations can affect consumer spending habits; during
recessions, customers may opt for cheaper dining options.
