Skip to main content

How McDonalds Use Market Penetration, Market Development and Product Development?

The 3 concentration strategies we will consider are as follows –
Market Penetration
Market Development
Product Development

Market Penetration – when firms try to grab a bigger market share with existing product or service, that concentration strategy is known as market penetration.
McDonald's introduced a dollar menu, and when customers order dollar menu items they tend to order more. In 2018, McDonald's witnessed great growth in sales with its $4 menu items and another low-cost offering (Duggan,2018).  With the introduction of these menu items McDonald's gained market share, so this was a great market penetration strategy.
Microsoft offers an office suite, which is great for all enterprise usage, this is a good market penetration strategy. Because these products are great for all types of users.
Market Development – when a firm takes the existing product or service and takes it to a new market, where they were not present before, that is called market development.
When McDonald's took their menu and expanded in India and China, it was a Market development move. 50% of Indian follow a strict vegetarian diet. And beef or pork is not popular in India. So, McDonald's had to localize their menu. Their menu in India focused on vegetarian burgers and they did not have any pork or beef items (Kannan, 2014). While expanding its business in India is a good example of market development. India has a growing middle class who are eating out more and more.
But I think localizing their menu for vegetarian majority population is an example of market penetration.
 When Facebook or Google went international, they did not have to change much, as anyone could access the sites over the internet. They took their service and made those available in different geographies. This is a good example of market development.
Product Development – When a firm develops a new product to introduce to the existing market, that is called product development.
In India to serve the vegetarian population, McDonald's introduced Aloo Tikki burger. The Aloo Tikki burger costs 20INR. Which was a good competition with other food choices available in India? Moreover, McDonald's had to remove pork and beef items from the menu (Kannan, 2014). This is a good example of product development since while entering a new market they developed a new product, it was product development.
Microsoft often localizes their windows and office suites in local languages. This could be an example of product development.

References –
Kannan, S. ( November, 2014). Hod McDonald’s conquered India. Retrieved from https://www.bbc.com/news/business-30115555
Duggan, W. ( May,2018). McDonald's Is Gobbling Up Market Share. Retrieved from https://money.usnews.com/investing/stock-market-news/articles/2018-05-02/mcdonalds-corporation-mcd-stock

Comments

Post a Comment

Popular posts from this blog

Question and Answer

      * These attacks consist of injecting malicious client-side scripts into a website and using the website as a propagation method is: These attacks consist of injecting malicious client-side scripts into a website and using the website as a propagation method is: XML External Entities Cross Site Scripting (XSS) Security Mis Configuration Injection * A security principle, that ensures that authority is not circumvented in subsequent requests of an object by a subject, by checking for authorization (rights and privileges) upon every request for the object is ____.   A security principle, that ensures that authority is not circumvented in subsequent requests of an object by a subject, by checking for authorization (rights a Complete Mediation Least Privileges Separation of Duties Weakest Link * ...
Post a Comment
Read more

What are the challenges Zara face to maintain it's growth?

Notably, Zara has a unique approach to handle changing demand, which has allowed the company to become widely successful and a leading business organization in the fashion retail industry, in which many corporations struggle to deal with fast-changing environments, operations, and inventory costs. The arrival of new trends forces retailers to adapt their collections, causing what James (2011) calls the Forrester or bullwhip effect. Zara relies heavily on outsourced manufacturing, even though most operations and inventory decisions and strategies are still held, taken, and based out on their headquarters in Spain. Every time an order is placed, all items are shipped to Spain for final design adjustments and inventory stocking. With the use of technology and collaboration with its store managers, the company can produce only what is currently trending, which results in a significant reduction of unsold items caused by the rapidly changing tastes of consumers in this fast-changing ind...
Post a Comment
Read more

How Toyota New Global Architecture (TNGA) revolutionize the automobile manufacturing industry?

Toyota New Global Architecture (TNGA) system was created to revolutionize the actual automobile manufacturing systems. TNGA aims to promote a massive transformation in Toyota's development processes by emphasizing in harmony between planning and design, which, when appropriately combined and managed, will increase the company’s efficiency (N.A., 2015). Toyota's TNGA system is revolutionary because it creates an even leaner way of designing and manufacturing its cars and establishes a new era of vehicle design and production. From a different perspective, TNGA is a revolutionary system not because it employs a modular approach; since companies like Nissan and Volkswagen already use modular systems in their production plants (Schmitt, 2015). It is revolutionary because it is disruptive and expands the traditional and legendary Toyota’s lean methodology to a different level (N.A., 2015). This new global architecture system is disruptive to the old Toyota Production System (T...
1 comment
Read more