Paul, Jen, and V

Customer Trends Lifestyles, Tastes, and Demands Customers seeking wider menu selection, non-burger fare Greater concern with nutritional issues by customers, regulatory agencies Value-pricing: “Dollar” Menu—reduced margins Combos/Meals—increased sale of high-margin items Customer lifestyles continue to become more hectic, demand more expedient service

SWOT Strengths Size: largest QSR chain worldwide, largest market share Brand awareness: logo recognized worldwide, an American Icon Brand-equity: Generally good reputation worldwide, in part due to local sourcing and responsiveness (ex: McRice in Indonesia); charitable endeavors Process: streamlined, standardized service process highly effective Customer Loyalty: 20% account for 60% Access to capital Weaknesses Greasy, unhealthy image Facility atmosphere detracting certain types of customers Non-burger fare is not as appealing as that of competition, needs development Level of service, customer experience not highly rated as competitors Opportunities Expand “healthy fare” menu Expand menu, offer more non-burger items Upselling Reposition brand, re-image to appeal to different (and higher spending) target Improve customer experience Threats Rising awareness of nutritional issues Changes may alienate loyal customers Rising competitive environment (from burger, non-burger, & more upscale SQRs) Variation may reduce efficiency, speed of service

Industry Trends Greater competition from “burger”-QSRs as they expand into more areas Market growing McDonald's maintains market share above competitors… ….But grows more slowly Growing competition from non-burger QSRs New competition from more upscale, “classy” QSRs as customers are willing to pay a few dollars more for a better dining experience. All QSRs begin to expand menus Costs are significant (R&D, advertising, capital/sunk, etc)—many failed items (Hot dog McNuggets?!?!) Customer-by-customer variations “have it your way,” MTO --reduced efficiency, speed Move away from “greasy” items More attention to customer experience, facility atmosphere

Recommendations Expand and publicize “healthy” options—especially for children, target ads towards working mothers, prey on conflict of role guilt Pursue menu variations, with an eye towards cost (process, ingredients, time, fit) Improve customer experience—atmosphere, speed, service Promote drive through, capitalize on venue growth Upsell, combos

Thank You Questions? Concerns? Comments?