Introduction To Macro And Micro Environment Marketing Essay

An important aspect of any business is its external environment. When we talk about an external environment we mean all those factors that can indirectly influence an organization, and for which that organization has no power over. Such factors can be political, social, economical, environmental, legal and technological. They are sensitive and also critical to any organization.

Macro analysis: We know that McDonald’s is worldwide business organization, for analysis of McDonald; ‘globalization’ is main factor for the contact between all parts of the world. Because to understand the customers living style and their different types of cultures and belief, fallacies. Another thing is ‘ethics’ the different culture has different types of their own moral values. It is not so easy to calculate the worldwide market for any corporations or multinational companies. Because there are more than 500 organizations are only in United States (Global Capitalism, 2005) that’s we found our research and in the year of 2004 the McDonald’s had join in those corporations with 119 countries.

This is marketing strategy of decision making for their success to consideration with internal and external factors. For this consideration there are so many risk for foreign market, McDonald’s done well to appeal for targeting the local markets and consumers and build relationship to them . (Bateman & Scott, 2004), It is effective planning of market strategy.

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For measuring of GDP we are clearly ensure to getting level of the country economic activities. And also, with the help of GDP we can ensure to the perfect demand of the products and services in business with their product prices reduce or increase the sales. It may an effecting the unemployment rates.

For example, In India, people mostly like vegetarian food as per demand of consumers they change their menu and including of this things for only customers choices. In Pakistan the people accept both things like to eat it is shows the McDonald’s menu has change their food product as per economical environment of the choice of different countries people.

Increase rates we will be an increase the prices of the products and services with specify time of the period, and it may also affect the wages of the employees. But my question is how .If we think that it will depends on inflation rates, and then McDonald’s should change their strategies as per particular nation’s market circumstances and demand also. We cannot say that inflation rates are always steady for all the time because every nation or country has changes as per economy. High interest rates are affecting directly to their business with appropriate higher interest expanse and have to repay the loan with higher costs.

Buying and selling activities giving the level of current economy status, this is not steady but can changeable any time; it may directly affect to our business.

“Through careful planning and working with the car Trust we ensure that we use the most energy efficient equipment for our restaurants according to the technology available”. By:-Saunders .K, Environmental Manager, McDonald’s UK.

In above words of the McDonald’s manager of environment UK .He think positive way according to the general environment of their restaurants with the help of used the technology on their restaurants and the helping to trying balance to the environment indirectly, because they have online purchasing facilities and choice to the home deliveries of food facilities to their customers . We know that our less energy and water consumption become great contribution to our environment impact. McDonald’s is multinational company and regarding to business environment of McDonald’s should maintain this thing very strong way for their business. [Hoovers (2008)]

McDonald’s: Company Profile

The company was started on year of 1940 by McDonald brothers’ .The Company growing very fast within two year at 1959 there were 100th McDonald’s already opened in Chicago.

Outside of the USA in Canada and Puerto Rica and then in 1971 in Tokyo, Japan they opened first restaurant because “the reason Japanese————————————————————————-our hair blonde”.

Japan, Holland, Australia, Germany, Panama, Guam, France is new countries and sales increased $1 billion, 2000th restaurants were opened. In UK McDonald’s Corporation and two businessmen one was British and another was American started in Sweden they introduced as Egg McMuffin. There are so many companies in the world which is so famous in different way of their products and good .McDonald’s one of the world’s largest companies in quick service restaurant, serving tens of millions of customer’s daily worldwide.

In UK property portfolio of successfulness is because of well located restaurant and very convenient networking of the area wise for their customers to use and enjoy with taste. And there are more then 32,000 local restaurants, 60 million people in117 countries leading as the part of McDonald’s with the global food service retailer. (A brief history of McDonald’s; Dated on 23 March, 2010.)

Strategic Analysis of McDonalds

Strategy formulation is an important aspect of any business. A thorough investigation of how to formulate strategies is essential. Various tools can be used to assist management create strategy. One of those tools could be SWOT Analysis.

If we take McDonalds as an example, we will find some reasons which are demand for the change in market and business environment, and how the macroeconomic factors are helps to determine the current market position of the business.

There are some following reasons.

Strengths: McDonald’s is the No.1 fast food company by 5.6%sales growth, 2007(11,409 million). The main target is focus on customer choice, reasonable value and great service. The company has to investment mostly for supporting to its franchise network. Communicate with staff and also getting feedback to the customers giving good response to cover demand. Open restaurants for 24 hours facilities to their customers. Loyal with our staff and very strong management team is the good strength.

Weaknesses: More and more healthy lifestyles for adult and children because of core product line to focused on hot food and burgers. Quality issues across worldwide franchise. It is very hard to understand the management because globalism way to manage their restaurants, customer’s choice with demand, services of each and every employees and market competitors all these things are very challenging for McDonald’s managers and their management team.

Opportunities: There are so many opportunities like, joint ventures with retailers with better location. In social changes like healthier lifestyle foods by innovation with new positioning in healthier snacks (fruit) etc. Focus on social responsibility, reducing of applies on the environment and worldwide linkages. Worldwide an emerging markets of china, Malaysia and India. They should also build their markets in social environment with worldwide. For example, the technology advance has improving way for services efficiency as their customer, staff and woman workers able to order or booking online through McDonald’s giving quacking meal at late night facilities.

Threats: Competitive markets of big product ranges and higher lifestyle products E.g. subway, supermarkets, M&S, also Burgers King and KFC. Recession and economical changes in between 2007 to 2009.Environmental group of pressure. McDonald’s of 54 billion customers are major factor because of they are always conscious about their choice, demand and liking. Here, we are not to say confident in future about the customers and their choice because any time it may change customer’s food likes in their taste, choices and demand. It is not stable for ever.

“The world has changed. Our customers have changed. We have to change too.” (James R. Cantaloupe, Chairman and CEO, McDonald’s, 2003)

Overview of Business Challenges

Introduction: In business environment the PESTLE analysis are most affected to the organizations. Globalizations and international levels of the companies must have to need the marketing strategies of pestle analysis and their factors. Any countries of some main factors and their issues like political, economical, social, technological, legal, and environmental are most important for business.

One single or wrong step of the organisation has highly paid by the other countries of the same organisation. The management team and the managers are always try to maintain and must have to follow the rule of these factors. As per countries there are different types of rules are made and changes in these factors of business.

Political: we found in sense of McDonald’s the company has control by individual policies and regulations. Related to health, worker protection, and environment are such things focus with particular market areas. In India, McDonald’s starting business and follow the infringement of rights and violation laws pertaining to the containing of their food, because the Hindu religious are not accept with meat food. And also found in studies that for targeting of market the employment laws, business venture as well as tax obligations are main issues for succeeds in the Indian markets and foreign markets.

Economics: Branches and franchises of food restaurant effected by hit in McDonald’s economy with inflation and exchange rates. The circumstances of the customers are also faced the problems with individual budgets and also foreign fast food (2004). These issues are directly effect to the business economic environment. McDonald’s stores have need to consideration with reference to their microenvironment. McDonald’s target the customers of weak state with smooth operation to understand the rates of the economic, Hence ,for existing the product with higher cost from the other market product. Those type of need to change and adjustment for maintaining the economic environment.

In case of Malaysia, Mostly the business activities as per economic way, the condition is very slow due to household incomes and current status of economic become very down, we also get in our research that Malaysia still not comes in recession as per some other country like Singapore or United States. And GDP growth is an increase from 5.0% to 5.2% in between 2008-09. (Case Study of McDonalds Malaysia)

Social environment: This factor is related to the consumer’s social behavior and purchasing power of the market place (1998).we can say that have major thing to understand the performance of any organisation on market. Every nation or country has their own social laws, so as per social demands are related to different factors in their attitudes, cultures, ages, wages, working hours, men and women jobs securities, pension schemes, royalties will main thing to face the challenges for an organisation.

Technological factors: McDonald’s campaign with “loving it” globally. New technology has to introduce with the changing environment on demand for management team. Connect with global to their franchise food restaurants for getting and giving information fast services and communicates to them for better output and improvement for market demand. McDonald’s with technological factor as much as better way to know the changes of their market products, prices, good and supplies from the beginning. McDonalds has ability on their business with advertising food products with call centre to “working on allowing customers to order and pay online”.

There are enough to know for the student of MBA in research, since 2006 in the business of McDonald’s need to create any type of new products launch for demand they using television advertise in marketing and also targets the younger peoples in particular area of market place. The other way of advertise the product with help of celebrities, i.e., “loving it” campaign. McDonald’s with new technology of using in inventory system and chain value of management for suppliers feedback of payments with respective market demand. Technology helps to the globalization of marketing deals with connecting people, suppliers, dealers, and the stores as well as customers very easier way.

Environment: Global environment of the organisation has needed to changeable as per countries circumstances. (1997) Hong Kong has made action in McDonald’s franchise with use of plastic material packing meal and glasses for drinking. It was directly affecting on change environment of business in Australia and also the United states. Change of income, economy of the future prospects, worldwide economic activities, some political activities, some social and natural effects like hurricanes, earthquakes, flood etc. For natural effects which will depend on the future prospects, we can’t forget these things. We must think and already make some planning for secure the future aspects. So, here we consider to taking some insurance policies for the companies and also related effecting factors.

Legal environment: Concern with legal and socio-cultural environment of the Muslim countries requirement with law in Halal restaurants, in other hand in some European countries conform to existing this laws are modified to banning the use of meat on their food products. There are legal taxes obligations, employment rules, quality concept are also important for smooth operations to achieve. In Malaysia, the most people are Islamic majority and related to the market circumstances; McDonald’s like to continue with target on local businesses with great confident on their customers and take authorities and suppliers by government. The “Syariat law” allowed easy way to served food in Halal restaurant. [McDonald’s website, 2009]

Change Management

We consideration that every organization management team must need to open their mind for much better way to continue their business .For competitive market condition, and customers flow or latest technologies development may be change very fast way. As the part of marketing strategy of McDonald the change is limited to the performance of Integrated Marketing Campaign (IMC).The IMC new theme well be focus on media and sales promotion for the part of marketing strategy of the company.

The manager role is very important for analysis to change environment of the businesses or company as per as different countries or nations because what to be change and how to introduce effectively their new products in market place, McDonald have implemented the change with the feedback of employees, staff, and customers their demands.

Global Marketing objectives

McDonald’s is not but any global companies must be clear their main objectives in market plan. Market share, sales, goals, audience feedback and what and how will be achieved by other competitors in markets. McDonald’s targets into short-term objectives, Feedback of customers and staff communicate types of objectives becoming more easier way to get the result for any kind of change in market plans for success to competitive markets.

McDonald’s serve the world some of its favourite, convergence foods – for example, World Famous Fries, Big Mac, Quarter Pounder, Chicken McNuggets and Egg McMuffin, Ice cream for children and youngster with different flavours . As per nation, countries and global way there are different types of choice and taste of the customers will need the demand with services in food business. And related to this now we consider to see four (P) in the business cycle.

McDonald’s Business Cycle

There are four (P) types in business cycle: Product, Price, Promotion, and Place.

Product: McDonald’s always concentrate to customer’s performances and their preferences. When they need to change in their products or new products they introduce new choice for control the sales stability in market .When they launch any new products it will in direct way to get the benefits with the help of advertisement of product on television. It will possibly to McDonald’s have many choices for growth stage in popularity with ‘big Mac’ to product ‘maturity’ stage. In Malaysia consumers have wide range on food choices to serve local taste as well in Halal, and as per demand of “propriety burgers” for Chinese New Year.

Price: At the same time price of the product is also important because customers always thing about the prospective of the product qualities and reasonable price with choices. Related to market circumstances of reducing price will direct effecting to profit margin but McDonald’s marketing tool of their customers feel about pure qualities of any product with compromised with McDonald’s price. In other sense we can say this is the one type of monopoly on quality products and reasonable price where the customers must has to compromise with them. McDonald’s reduce their price compared with Burger King and KFC.

Promotions: This factor are related to marketing communications, Advertising with the help of TV, radio, cinema, online booking with free devilries charge, posters sites, newspapers, magazines etc. The method Sales promotions, point of sales display, merchandising, telemarketing. Therefore, promotional concept by McDonald’s to their stores becoming encourages to the customers understanding the product knowledge of buying sensibility. It is indirect support to increasing sales of the restaurant. This is key of advertisement and skill of marketing communication to make customers awareness of new products .People are indirect support with the help of communicated massages each other and represents the brand or product become more consistency. Marketing with communicating massage must be approach to the right peoples, with perfect planning of media giving great benefits to the profit margin of the products. In Malaysia they advertise with billboard on main road like ‘Mc Value Meal’ and also to attract their customer by sending flyers to their houses and attaching discount coupon in newspapers.

Place: Perfect location of the stores is also part of the marketing but management processes and powerful skill of the managers giving the products to the end of consumer. [Jobber, 2006] McDonald’s have 185 restaurants in Malaysia in several local gas station for example, ‘PETRONAS’ Mesra, and for hunger they satisfied their consumers to served on express café with popular products. (Case Study of McDonalds Malaysia, Dated on 06 April, 2010)

Conclusion

We also consideration of McDonald’s business environment, which will gives very good example for us and the other organisation whom are concern with same or establish their business company on global way. There are lot’s of thing which are like to understand and learn form them. Here we mention some general information, as per my consideration the McDonald’s company is real way to connect all over the worldwide.

In Economical way we found how the company mixes with different countries of the cultures, nature of human ethics with different moral values, belief. They study very well and giving as per demand of the customer’s choices and change in their food menu with non-vegetarian and vegetarian to their customer’s taste of products demand. It is an effecting marketing strategy on economical environment of the business

In SWOT analysis we understand the management team of strength, weakness, Threat and their change environment, Economy environment. Its shows graph of the company’s sales growth rate of 2007. Focus on media and sales promotional with celebrities on new products are really remarkable thing by IMC, and demand of new technology need the change of business environment shows the good market strategy of the managers of the company to fulfill the demand of their products with choices with getting feedback from employees, staff and customers.

In business cycle shows the development, introduction, growth and maturity of McDonald’s products, prices, promotions, place. Quality in products show there is no compromise with the prices. Promotions are giving good example of advertising and marketing selling skill.

At the concern with global environment of the company we also saw the macro environment, microenvironment and the “PESTEL” analysis with their related factors like political, economical, social, technological, legal and environmental. McDonald’s is really very good way to studied in all the factors for company success and balance the circumstances as per as need to changes demand with their strategies on the business environment.