McDonald s Strategic Organizational Communication
Strategic Organizational Communication
Description of the Organization
In this discussion, my organization of choice will be McDonald’s Corporation. On its website, the firm describes itself as a “leading global foodservice retailer with more than 35,000 local restaurants serving nearly 70 million people in more than 100 countries each day” (McDonald’s, 2014). Like any other company keen on reflecting its intentions, McDonald’s has a clear and precise mission statement that reads:
McDonald’s brand mission is to be our customers’ favorite place and way to eat and drink. Our worldwide operations are aligned around a global strategy called the Plan and Win, which center on exceptional customer experience — People, Products, Place, Price and Promotion. We are committed to continuously improving our operations and enhancing our customer’s experience (McDonald’s, 2014)
The company also has well-defined values that not only shape its culture but also support its vision. These values include; enhancement of customer experience by providing quality service, advancement of employee skills, preservation of the McDonald System/business model, promotion of ethical standards, observance of good corporate citizenship, advancement of shareholder interests, and continuous improvement (McDonald’s, 2014).
Some of McDonald’s key competitors include, but they are not limited to Yum! Brands, Inc., Doctor’s Associates Inc., and Burger King Worldwide, Inc. Currently, McDonald’s, as Yahoo! Finance (2014) points out, engages the services of 440,000 full-time employees. The top officers of the firm include Don Thompson, Tim Fenton, Peter J. Bensen, Steve Easterbrook, and Bridget Coffing who are, respectively; the company’s president and chief executive officer, chief operating officer, senior executive vice president and chief financial officer, senior executive vice president and chief brand officer and lastly, senior vice president and chief communications officer. This is the group entrusted with the strategic leadership of the company. In a competitive business environment, such as the one McDonald operates in, the relevance of having in place a competent cast of top executives cannot be overstated. The top leadership of this particular company has, so far, performed relatively well — especially when it comes to the promotion of the interests of its shareholders. For the year ended December 31st 2013, the company raked in a net profit of $5,585,900,000. During the previous year, the company had registered a net profit of $5,464,800,000. The 2.17% increase in profitability is impressive.
In the past, the company has won numerous awards for its exemplary performance on various counters. These include the 2012 Forbes award as one of the world’s most powerful brands, the 2013 Interbrand as one of the best global brands, and the Fortune’s 2014 award as one of the most admired companies in the world (McDonald’s, 2014). A global entity with operations in numerous locations accross the world, the company is headquartered in the United States.
Part Two: Strategic Communication in the Organization
From the onset, it is important to note that unless some meaningful form of communication occurs between a business entity and the audience, advertising cannot be seen as having been effective (O’Guinn, Allen, Semenik, and Scheinbaum, 2014, p. 26). In the words of the authors, “advertising is about mass communication.” McDonald’s has many avenues it could utilize in the creation of a coherent image and identity, as it seeks to communicate its identity. One of these is paid corporate advertising.
In the past, the company has made use of many forms and versions of corporate advertising. An analysis of the advertising campaigns the company has run in the past reveals two things: they are i) consistent and, ii) strategic. On this front, it would be prudent to take several adverts the company has made into consideration. To begin with, we have the World Cup McDonald’s advert that features several individuals displaying their football playing prowess. A woman on high heels perfectly handles the ball, an old man — probably in his late 60s, skillfully shows his ball control techniques, and young boys aim a ball at seemingly impossible targets — and score! It is important to note that McDonald’s could have themed this particular advertisement around McDonald’s or football — doing both would have been close to impossible. They elected the latter. This particular advert succeeds, almost effortlessly, in capturing the raw spirit of the game. The ad can be found here: http://www.youtube.com/watch?v=-T7zyezBkuY.
The next ad I will be considering in this case is known as the ‘First Day’ Ad which features a guy during his first day at work. After several confusing moments, whereby he is introduced to numerous individuals and organizational procedures, he finds his way to a McDonald’s cafe where he orders a burger and some fries. The delicious nature of the burger seems to blow all his frustrations away. Complete with the McDonald’s catchphrase ‘I’m loving it’, the advert presents McDonald’s ambience and products as the ‘solution.’ The advert can be found her: http://www.youtube.com/watch?v=PYCrQlhWCu0.
When it comes to consistency, it is clear that the two adverts under consideration present a message of ‘happiness’, as has been the case with most McDonald’s advertisements. While the football theme in the World Cup advertisement is consistent with the moods of the times, the ‘First Day’ advert puts forth a strong corporate message: that whatever is happening in someone’s life, a dose of MacDonald’s is all it takes to put things back on track. With regard to strategy, both adverts are forward looking — they appeal to people’s emotions and seek to build a strong connection with both the existing clientele base and prospective customers.
In basic terms, public relations has got to do with the establishment of relationships that are seen as being mutually beneficial, between a business entity and its publics. In that regard, therefore, public relations is strategic in nature (Shockley-Zelabak, 2011). A more concise definition of public relations would be “the management, through communication, of perceptions and strategic relationships between an organization and its internal and external stakeholders” (Barker and Angelopulo, 2005, p. 196).
In several instances, McDonald’s has been successful in the utilization of PR. However, in some other instances, the company has ended up shooting itself on the foot as far as good PR practices are concerned. In the recent past, there has been significant insistence on the need for companies in the restaurant – fast-foods sector to focus more on the enhancement of the nutritional content of their products. In an attempt to avoid antagonizing one of its key stakeholders — i.e. customers, McDonald’s has made its meals healthier. As the company points out, it has all along been aware that moms would be interested in knowing that the foods the company is providing to their families is not only of good quality but also nutritious. Towards this end, the company launched a well thought-out PR exercise it calls ‘Mom’s Quality Correspondents.’ In this project, “the Mom’s Quality Correspondents saw first-hand how McDonald’s successfully serves quality foods to millions of customers every day” (McDonald’s, 2014). One could, therefore, conclude that this was a noble attempt by the company to manage, via communication, perceptions of a critical stakeholder group, i.e. clients. It is, however, important to note that the company’s attempts to establish mutually beneficial relationships with its stakeholders have not been successful in some instances. In what has variously been referred to as a corporate PR lesson, McDonald’s set out to assist its employees budget and developed a website — an undertaking that could have also helped grab it some good PR. The website was fully accessible to the general public. This the company did in the full knowledge that it offered its workers minimal wages. According to Ben-Achour (2013), this turned out to be “a classic public relations nightmare: company information gets out, without the accompanying context.”
The Marketing Mix
In seeking to discuss McDonald’s marketing, this section will largely concern itself with the choices the company has to make in the course of taking the product to the market. The marketing mix, according to Barker and Angelopulo (2005, p. 138), is “a list of the important forces emanating from the market which bear upon the marketing operations of an organization.” One of the most effective ways of defining the marketing mix is via the 4Ps of marketing (Shockley-Zelabak, 2011). The four Ps as Barker and Angelopulo (2005, p. 138) point out include “product, price, place (distribution channel), promotion (marketing communication).”
Product: it is important to note that at any given time, customers have a variety of products to choose from. Given its unique and well-crafted menu, it is clear that McDonald’s goes to great lengths to give customers that which they want. This is particularly the case given that the company keeps phasing out old products and coming up with new and unique food items — in full realization that customer tastes and preferences keep changing from time to time.
Price: this has got to do with what value the product has to the buyer. On this front, therefore, McDonald’s has to determine the buyer’s perception of value prior to setting the price of its various food items. McDonald’s has a different price regime for each of the markets it serves in — which takes into consideration the discounts and the other relevant parameters. It the U.S. For instance, McDonald’s has to take into consideration the reactions of competitors such as Burger King.
Place: Place has largely got to do with getting products to clients. The key decisions to be made here, therefore, include, but they are not limited to, transportation, warehousing, distribution channels, etc. In the U.S. most of McDonald’s outlets happen to be a short distance (a few minutes away) from each other. In this case, McDonald’s appears to be keen on not only ensuring that its food items are accessible to clients, but also easily available in the right quantities.
Promotion: the relevance of promotion cannot be overstated when it comes to marketing promotion. From time to time, McDonald’s communicates information it deems relevant in the generation of positive customer responses. The decisions made here have got to do with sales promotions, promotional approach and strategy, etc.
Managing an Organization’s Image or Reputation
As I have already pointed out elsewhere in this text, McDonald’s has made a number of PR gaffes. It is, however, important to note that the company has always been keen to ensure that the image it portrays out there is consistent with good corporate citizenship and enhanced customer focus. This is particularly the case when it comes to the enhancement of the nutritional content of its various food items and immersing itself into various charitable undertakings.
Some of the charitable events the company has been actively involved in include the so called McDonald’s Monopoly donation to St. Jude and McHappy day. However, the company has in some instances had to engage in efforts to defend its reputation. This was the case in the McResource debacle recounted elsewhere in this text, where the company had to shut down the website as a result of massive criticism over its low wages.
Part Three: Assessment and Recommendations
Generally, McDonald’s has been somewhat effective in its utilization of strategic communication. The company should, however, make efforts to further enhance its strategic communication. This is particularly the case with regard to advertisement and management of its image and reputation. On the advertising front, the company could target various segments. The other demographic segments McDonald’s should make use of, in addition to age, are sex and social status. Currently, the company has some marketing campaigns specifically targeting children. The development of unique segments should, however, be based on sound market research. The only downside to this strategy would be that the company could end up loosing a more general audience — meaning that it would have to do more advertising and hence incur additional costs.
McDonald’s could also make use of other avenues such as mobile advertising and enhance its presence on the social media as it seeks to rope in more customers. This it could do by developing and running mobile ads to promote various categories of its products. With regard to social media, the company ought to invest more on marketing so as to enhance its organic reach on such social media platforms as Facebook. By adding these to TV spots and the print media, the company will most likely make a greater impact.
With regard to the management of its image and reputation, McDonald’s ought to be more proactive than reactive. This is particularly the case given that most of the negative publicity the company has had to deal with in the past was triggered by its inability to respond in time to situations that had real potential to hurt its interests.
Barker, R. & Angelopulo, G.C. (2005). Integrated Organizational Communication. Lansdowne, Cape Town: Juta and Company.
Ben-Achour, S. (2013). McDonalds Fast Food Advice Becomes Corporate PR Lesson. Retrieved from http://www.marketplace.org/topics/business/mcdonalds-fast-food-advice-becomes-corporate-pr-lesson
McDonalds. (2014). Home Page. Retrieved from http://www.mcdonalds.com/us/en/home.html
O’Guinn, T., Allen, C., Semenik, R. & Scheinbaum, A.C. (2014). Advertising and Integrated Brand Promotion (7th ed.). Stamford, CT: Cengage Learning.
Shockley-Zelabak, P.S. (2011). Fundamentals of Organizational Communication. Saddle River, NJ: Pearson Education.
Yahoo! Finance. (2014). McDonald’s Corp. (MCD) — NYSE. Retrieved from http://finance.yahoo.com/q/co?s=MCD+Competitors
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