We have come to a time where the competitions between firms is getting more aggressive than ever before therefore every company has to have a certain weapon to defend itself or to gain new markets.
This project is about the differentiation tools used by the McDonlads Company and how it uses it resources to gain a competitive advantage and to be the leader in the market
It is the act of designing a set of meaningful differences top distinguish the company’s offering from competitors offering.
The number of differentiation opportunities varies with the type of industry:
1.volume industry: one in which companies can gain on only a few but rather large, competitive advantage. In the construction-equipment industry, a company can strive for the low cost position or the highly differentiated position and win big on either basis. Profitability is correlated with company size and Market share.
2.stalemated industry: one in which the are a few potential competitive advantages and each is small. Profitability is unrelated to the market share
3.fragmented industry (applied on our case):one which companies face many opportunities for differentiation, but each opportunity for competitive advantage is small. Both small and large companies profitable or unprofitable.
4.specialized industry: one in which companies face many differentiation opportunities, and each differentiation can have a high payoff, some small companies can be profitable as some large companies.
Physical products vary in their potential for differentiation .at one extreme we find product that allow little variation ex:(chicken) .At the other extreme products there are products which are capable of high differentiation :(cars).
It is how many products the company produces and for how long does have to be in the market before we can introduce new ones.
It depends on how long the products are in the market. In a new market, we prefer not to have too much in order to be consistent with the public knowledge.
Few products at first is always a better strategy.
I.e.: Big, quarter, pounder, filet o fish.
Eventually you introduce more products (Mc royal, Mc feats, Double cheeseburger after a certain period when the people are familiar with the old product
It is the quality of the product and what are the steps taken by the firm to have the maximum quality using the available resources
When you start with few products this increase the quality
Purchasing a product has to be done in a very organized way and it has to pass all the health procedures.
We conduct a training program for all the crew in the kitchen (back area) so we can make sure that they have good sanity and the have the knowledge of the all the required measurements.
All this makes sure that quality is food
Is how the consumer perceive the product even he likes it or not and if he things that it needs improvement or not
We get the right ingredients and the right portions of ingredients either locally made or imported to make sure that we are serving the right product and the same taste expected worldwide
In some countries after a few years (never at the beginning) we try to offer special product with local taste (spicy chicken & burger in Egypt, Japan with Japanese sauce, China with sweat and sour.)
We try to adapt to the local taste in few items and to keep our international flavor as well
Either the company has a size standard and how does it respect it or It doesn’t have a standard and how does It act due to this situation
We have standard size internationally and we have to respect it, but we do have bigger size (Big Mac) we try to offer the force flavor (local taste) in a bigger sandwich to give more value to the consumer (Upsize your Combo).
Size is very important, The more the client pay in a Big size the more it is profitable as we save more on paper cost.
The more the size is bigger the more we save cost.
Price is he selling value of the product whether it is cheep or expensive. This is one of the most important aspects because due to it the customer my change his mind
We make a Price sensitivity study (PSS)
We conduct interviews and we try to know at which price the consumer is willing to pay. We come with an average price for every product and if it is profitable, we try to market it
When we put the price we look at our coast (food and paper) the more we sell the more we save cost. The purchasing dept. buys in volume to cut down the coast to enable us to:
Competition is a very important aspect in price. Since we are the Market leaders, we start the price and usually the market follows.
Advertising is an important factor to make others follow
The International average of food coat at Mcdonald is 33 %
In Egypt the coast reach’s 45%
When the physical product cannot easily be differentiated, the key to competitive success may lie in adding valued services and improving their quality.
This refers to how easy it is for the customer to place on order with the company.
We give the best at McDonalds for a customer to take a product in the right timing. The product must be ready, this needs a lot of experience .The employee behind the counter has to see (make an evaluation) what is the product the most wanted so he can tell the Back area (the Kitchen) to increase a certain product (if he made a wrong evaluations the product will be thrown away) .a harmony between the crew has to exist in order to satisfy the customer needs
When there is a lot of traffic (the restaurant is full) it is easier to produce the product in a better Quality. The difficult part is when it is a slow day part in this case the employees have to entertain the customer so that he will not feel board.
We have only one lane but it has to be very wide in order to have two cars or if one car wants to leave the line.
We have to provide good and quick service
The stand has to be equipped with a mic in order to make the order, when the client reaches the second window the meal should be ready to be delivered.
Drive through gets 35% more sales than any restaurant as it has accessibility and good service
The disadvantage of the drive through is the big size of the required building which will increase the capital needed.
Delivery refers to how well the product or service is delivered to the customer it includes speed accuracy and care attending the delivery process, buyer will often choose a supplier with a better reputation for on time delivery.
1. Home delivery
We try to make a good service so the consumer can receive a hot meal in a short time (unfortunately the food is better sold at the shop). To do so we make sure that all the outlets conduct delivery service to the decrease the radios of each restaurant (to offer more quality and standard to the product)
Usually we have two to three lines with waiting calls and around five to ten motorcycles. We have also more drivers than the number of motorcycles to make sure that if one did not show he will be immediately replaced
We make the deliver takes only one order per time so that the food we be hot and quick
To avoid any error in orders we make the employee repeats to the customer the product ordered.
We are now working on a one number for home delivery to make it easy to remember when you call McDonald’s (Dial 30 30 30 3 from anywhere in Egypt)
Companies can find other ways to differentiate customer services they can offer product warranty, establish awards…. ECT
We try to provide inside McDonald’s the best experience and some time we provide a local neighborhood entertainment to make it more pleasant to the guests (entertainment in Shoubra is different than Heliopolis). We also offer Music, Karaoke, competition, special hours, and happy hours
To make our guest enjoys his stay a Mcdonald to the maximum.
We also provide B.O.G. (be our guest) card.
Companies can gain a strong competitive advantage through having better trained people
In an age when competitors can knock off products or services in an instant, some savvy companies are marketing their employees.
We screen people before we enroll them and we give them the proper local and international training and on job training. All job skills are taken into consideration as competence and how to be accurate to customer requests. Courtesy and friendliness are very important aspects in the personnel, Credibility is expected from the crew to match customer expectation by providing good service and also reliability, responsiveness are also very important to serve the client immediately with his order. The greater the responsiveness in a fast food business the better image and the frequency of repeat visits by the same customer are achieved.
Communication is important between the crew and the mangers to provide better, fast service to customer. Communication between the staff and the customer
Byers respond differently to company and brand images. Identity and image needs to be distinguished. Identities compromise the ways that a company aims to identify or position itself or it’s products. Image is the way the public perceives the company or the product. Images is affected by many factors beyond the company’s control
An effective image does three things:
1.establish the product’s character and value position
2.it conveys this character in a distinctive was so as not to confuse with competitors
3.it divers emotional power beyond a mental image
Images can be amplified by strong symbols as al lion, apple…. ECT
A brand can be build around a famous person; companies may also choose a color identifier such as blue, yellow. Alternatively, a specific piece of sound, even reproduce logos of most admired companies.
Every brand portraits a special image in people mind that is why brand advertising is very important not only product advertising
We have to pay for the brand, this means special market and special media with the best quality artwork
The chosen image must be worked into ads and media that convey a story, a mood, and a claim. It should appear in annual reports, brochures, the company stationery, and business cards.
What we do is that we have a market calendar for the year shows all the activities and plans for the different targets (Value, kids…. Etc)
I.e. Ramadan is a very good time for advertising (the Bay).
We do the market plan and the media plan (we determinate the budget for the whole year:
I.e. 🙁 upsize with Combo) in January and the media will be TV (Channel 1 or Channe2) and press (Al Ahram, Noss El Donia)
The choice of media depends on how you want to approach the customer as every body has his way to cover the market.
The physical space occupied by the company is another powerful image generator.
We like to believe that we offer a very special experience to our customer with a fast friendly courteous and always with a smile. We provide as much as we can play land for the kids to assure a frequent visit of the kids with their parents. Kids are very important as they represent with their parents an important potential of customers.
We always ensure a non-smoking area to please the family atmosphere
The LSM with events (special birthday parties)
I.e. A television for an important football match