Re: McDonald’s profit boosed in U.S., Europe

The original blog on the subject was basically adressing the strategies utilised by McDonald’s to hold such a strong position within its market, despite the existence of much rival corporations; such strategies included: cost-advantage; differentiation; and focus (however, I disagree with that they utilise “focus” simply because their consumer-base is so large; therefore, I will be addressing only the prior two points). I agree that McDonald’s takes advantage of both cost-advantage and differentiation to garner success- but I would like to address how, exactly, McDonald’s can do so when in the Porter’s article, it states that companies that are between two strategies within the same level of operation perform poorly. I believe McDonald’s overcomes this belief for a couple reasons: 1, they mastered cost-advantage to the point of becoming the biggest fast-food chain in the world; the strategy became indifferent of the company itself; 2, they waited until the strength of their name was such that missteps would cause minimal recoil to the company. Once stable, McDonald’s looked to broaden it’s marketing approach, not by ditching it’s cost advantage, but by adding it’s McCafe, consistent also with the chain’s cost-advantage approach. Because their consumer-base was already established, they did not have to worry about sending mixed messages of both “quality difference” with “cost-advantage” as much as a lesser-known company because the world already knows them for their cheap price, and mixing it up with differentiation gathers positive attention for the company, rather than confusing customers.

https://blogs.ubc.ca/bettyhuang/2012/10/07/mcdonalds-profit-boosted-by-u-s-europe/