The article describes McDonalds’ new strategy as companies’ sales fell. They offer a huge amount of new luxurious options to its customers including five types of cheese, while adding greeters and servers to bring the food to the table. According to Poter, this is a perfect example of Focus strategy (differentiation), as McDonalds try to implement some new features and possibilities, while price of the product slightly goes up since close substitute products do not exist. It is clear that McDonalds tries to rebuilt its name and brand loyalty after several scandals in the food industry.
Some risks of differentiation include adapting its product in order to compete directly. As McDonalds is known for its relatively affordable prices some people (working class) would be disappointed, as they do not appreciate such ingredients. Also Some problematic areas include the difficulty on part of the firm to estimate if the extra costs entailed in differentiation can actually be recovered from the customer through premium pricing. Moreover, successful differentiation strategy of a firm may attract competitors to enter the company’s market segment and copy the differentiated product. Finally this type of strategy requires flair, research capability and strong marketing.
-
http://www.simplyfrugal.ca/wp-content/uploads/2012/09/hero_world-famous-fries-300×277.png http://www.slideshare.net/dipalij07/porters-generic-strategies-with-examples
- https://sites.google.com/…/mcdonaldsfranchisestrategy/…/mcdonald-s-co..
- www.academia.edu/…/Strategic_Marketing_for_Competitive_Advantage…
- www.123helpme.com/mcdonalds-case-analysis-view.asp?id=166350
- www.coursework4you.co.uk/essays-and…/porter-generic-strategies.php
- https://books.google.ca/books?isbn=1483321509
