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McDonalds Pestle Analysis Marketing Case Study

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McDonalds is a food chain that generates a revenue of around $22.820 Billion. It is listed among the top food chains in the world. Writing a marketing case study on McDonalds is a common topic provided to marketing students by universities. McDonald’s environment is important in the political context because it can both provide opportunities and threats in its road to success. the brand value of McDonalds is strengthened by providing different channels of ordering to customers. Some of the widely used channels are in store self-service, manual collection or physical takeaways and online ordering. Organizations can gather data of customers undertaking personalized marketing through media promotions through online marketing.  It becomes highly convenient for customers and organizations continuously work towards meeting the high expectations of the customers. It is the corporate social responsibility to develop policies and prepare reports on these policies through the global reporting initiative framework. Issues such as requirements for brands and supply chains are made environment friendly also it has been observed that sustainable and ethical supply chain agreements are becoming a firm feature for global companies such as McDonalds. In this article we are going to discuss the political, economic, socio cultural, technological, environmental, and legal impact on McDonalds Pestle.

  • Political- Issues such as public health can be the major cause for the increased cost and have an impact on the organization’s operations and fall under the political factors affecting McDonalds .Further trade agreements have the capacity to simplify or complicate the process of undertaking business activities in certain areas. Another reason why business activities have turned out to be expensive is the health condition of the user.
  • Economic McDonalds pestle is greatly affected by economic factors. That includes, national, local conditions, and also international because McDonalds is a global brand.(McDonalds 2017a)

Further reports suggest that McDonalds have greatly suffered during the economic recession in the year 2008.  This is why students in USA and Europe have experienced fall in the disposable income along with wage stagnation and increased unemployment.  As per the analysis the cause of the sales to fall can also be a result for increased unemployment., changes in taste and increased completion. The exchange rate also impacts on McDonalds and a weaker US dollar enables a better exchange rate and thus financial reporting (McDonalds 2017a).SourceEssay offers instant assignment help to students who are finding difficulties in understanding the economic factors that have lead to the growth of Mc Donald’s.

  • Socio- Cultural-  The next factor that influences the sales of McDonalds is the socio cultural differences. The changing tastes of the customers have great impact on the annual sales of Mc Donald.  Researchers suggest that McDonalds is now greatly focused on the health of their customers. Moreover it has been observed that the coffee industry has been flourishing.  And it has lead to the intrusion of McCafe Menu that also acts as an alternative to expensive coffee houses like star bucks. Apart from this changes in the demographic mean suggest that it should meet the changing demands of the customers. Furthermore obesity in customers have forced McDonalds to shift to healthier choices especially when children are involved.
  • Technological- Technology has been constantly upgrading and there is a continuous need to improve the business process of McDonalds. Processes of reducing waste and re-orders have improved their versions and helps to create greater connection with their customers. Apart from this the brand value of McDonalds is strengthened by providing different channels of ordering to customers. When it comes to ordering customers are spoilt for choice. Some of the widely used channels are in store self-service, manual collection or physical takeaways and online ordering. (McDonalds 2017c) Organizations can gather data of customers undertaking personalized marketing through media promotions through online marketing.  It becomes highly convenient for customers and organizations continuously work towards meeting the high expectations of the customers. Otherwise customers have a free choice to shift to their competitors for satisfactory service. Technology helps organizations and markets undertake various social strategies and also help a brand reach a far better market. SourceEssay essay writing help has a team of experts who assist students in writing a case study on Mc. Donald’s highlighting the technological factors. 
  •  Environmental- The main reason why environmental issues are addressed is because it is vital to protect our resources. It has long term implications on the business therefore it is the corporate social responsibility to develop policies and prepare reports on these policies through the global reporting initiative framework. Issues such as requirements for brands and supply chains are made environment friendly also it has been observed that sustainable and ethical supply chain agreements are becoming a firm feature for global companies such as McDonalds. Some of the environmental issues being faced are in food production and this includes issues such as deforestation and food miles. One of the ways in which McDonalds addresses this is to buy beef and milk from UK farmers (McDonalds 2017b)
  • Legal- The regulatory context can have a major impact on how successful a business can be. Higher levels of regulation can stifle business growth, whilst lower levels may enable businesses to make more profit. Employment law regarding issues such as minimum wage, holiday and sick pay may increase the costs for a business, but may also reduce recruitment costs if staff feel that they are receiving the correct rate of pay and other benefits. However, in the UK, there has been an increased use of zero hour contracts which organizations have used to gain a more flexible working force, which is particularly useful for the food industry, which often operates 24 hours per day (Ruddick 2016). Whilst these are legal, there have been some criticisms of their use as they prevent workers from receiving holiday and sick pay (Ruddick 2016).

Conclusion

Therefore according to pestle analysis of McDonalds we can say that Trade agreements have the capacity to simplify or complicate the process of undertaking business activities in certain areas. McDonalds have greatly suffered during the economic recession in the year 2008 because of which people in USA and Europe have experienced fall in the disposable income along with wage stagnation and increased unemployment.  Socio-cultural differences leads to the changing tastes of the customers have great impact on the annual sales of Mc Donald.  Therefore it can be said that online essay writers from SourceEssay can assist students in writing case study on Mc Donald’s Pestle Analysis.  However to write a case study on Mc Donald’s Pestle analysis students should have in-depth knowledge on the political, economic, socio-cultural, technological, environmental, and legal factors that leads to the growth in sales of McDonalds.

References

Angwin, D, Cummings, S and Smith, C (2011) The Strategy Pathfinder: Core Concepts and Live Cases, (2nd ed), Chichester: John Wiley and Sons Ltd, Chichester

BBC News (2016) ‘First bid for McDonald’s China franchises confirmed’ BBC News, June 23

Forbes (2017) ‘The World’s Most Valuable Brands #9 McDonalds’ [online] Available from   IBIS World (2017) ‘Takeaway and fast food restaurant in the UK: market research report’   Johnson, G., Whittington, R., Scholes, K., Angwin, D. and Regnér, P. (2014) Exploring Strategy, Text and Cases (10th ed.) Harlow: Pearson Education Ltd

McDonalds Corporation (2017a) ‘Annual Report 2016’

McDonalds (2017b) ‘Our company’

McDonalds (2017c) ‘Click and Collect’

Ruddick, G. (2016) ‘McDonald’s offer staff the chance to get off zero-hours contracts’ Guardian, April 15

Perera, R. (2017). The PESTLE analysis. Nerdynaut.

Vrontis, D., & Pavlou, P. (2008). The external environment and its effect on strategic marketing planning: a case study for McDonald’s. Journal for International Business and Entrepreneurship Development, 3(3-4), 289-307

Abdelgawwad, M. A. A. (2012). Quality management: success and failure factors for new global product development in global quick service restaurants: a case study of McDonald’s Egypt (Doctoral dissertation, Cardiff Metropolitan University).

Kumar, A., & Marwah, N. Impact of Asian Culture on the Market Entry Strategies and new Product Acquisition of McDonalds and Starbucks in Indian and Chinese Market.

Ramadhan, T., Sumarjaya, I. W., Asih, N. I. M., & Kencana, I. P. E. N. (2018). Application of discriminant analysis in determining the purchase decision of McCafe products (case study: McDonald’s Jimbaran Bali). E-Jurnal Matematika, 7(1), 50-55.

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