Mcdonald's and Burger King Are Term Paper
- Length: 10 pages
- Sources: 8
- Subject: Business
- Type: Term Paper
- Paper: #66519569
Excerpt from Term Paper :
Everyone wants to get chance to win the millions by eating at McDonald's, and the more they eat, the more they will have a chance to win. McDonald's promotion is popular because Monopoly itself is popular (Compbell 10.)
Amy Murray, a McDonald's spokeswoman, said, "McDonald's has held the Monopoly game many time since 1987. The restaurants do see higher sales around the country during Monopoly games for a long time because it has proved to be very effective in attracting customers. Monopoly is one of the reasons McDonald's is so popular in the fast food market" (Compbell 10).
Burger King features the Whopper and the BK Broiler sandwich as well as traditional fast-food fare such as fries, shakes, and soft drinks. Advertising is considered integral to the success of the company and has developed a number of memorable campaigns. The BK Broiler was a grilled chicken sandwich introduced in 1990 and has also been highly successful, though the Whopper remains the store favorite. One element in the success of the company has been the sale of franchises. Restaurant decor has also been considered important in the growth of the company, and Burger King was the fist fast-food chain to introduce dining rooms to give customers a chance to eat inside. Drive-thru service was introduced in 1975 and now accounts for 60% of the business ("Burger King" (www.burgerking.com).
Advertising has been important to both McDonald's and Burger King, each of which has developed specific advertising campaigns over the years. McDonald's developed campaigns around characters such as Ronald McDonald and the Hamburglar, family campaigns emphasizing quality of service and convenience, and others. Burger King has structured campaigns around slogans such as "Have It Your Way" and more recently a King character.
Burger King actively tries to overcome the lead McDonald's enjoys. There is a good deal of information on the marketing strategies of these two companies, and Burger King in particular has not been shy about its intent in trying to gain market share of in the fact that it has targeted McDonald's in its advertising. More than simply advertising is involved, and every aspect of marketing, from the development of new products to pricing, has been shaped to this end. Burger King has announced that its sales are not driven by price but by quality and value, and indeed one of the reasons for the problems faced by McDonald's has been the increase in sales for Burger King. The addition of the Arch Deluxe line at McDonald's benefited Burger King, where sales went up immediately as the Arch Deluxe line failed. McDonald's is still the nation's and the world's largest restaurant chain with more than 15,000 restaurants in more than 100 countries and with total sales last year at $31.8 billion. Burger King benefited not only from trouble at McDonald's but also from giveaways of figures from Walt Disney Co. films, though McDonald's has since wooed Disney back to its stores (Gibson, "Worried McDonald's Plans Dramatic Shfits and Big Price Cuts" A6).
McDonald's has been adding elements to its Quarter Pounder to make the latter more like the Whopper, but this is a strategy that can backfire, as a Northwestern University marketing professor notes with reference to what he calls the "attraction effect":
Creating a clone of a dominant brand can backfire by helping increase the dominant brand's allure -- and market share (Gibson, "Anatomy of a Burger" B1).
McDonald's and Burger King, though, see introducing a new line as even more dangerous for them.
The giant companies like McDonald's and Burger King have considerable power to maintain their leading positions in the industry. Speed is still an important element for the consumer, and drive-thru stores do very well (Kochak 69-70). The new McDonald's strategy includes a claim that food will be delivered in 55 seconds or the customer will receive a coupon for a free sandwich (Gibson, "Worried McDonald's Plans Dramatic Shfits and Big Price Cuts" A1). This sort of promise is preferred to the less specific image claims made by Burger King.
The most recent financials for McDonald's show that the company has assets of more than $29 billion. The financials for Burger King are not available because they are part of the overall picture for Pillsbury, but McDonald's has more assets than all of Pillsbury at this time.
The strategies and styles for the two companies differ and have from the beginning. Both companies used franchising as a way of growing, but McDonald's has always maintained control over franchisees and has nurtured a unified image for the company, including assuring consistent quality across all stores. Burger King franchised ore loosely and so did not keep control over the stores or the products to the same degree. In spite of the growth of Burger King, the chain suffered for this decision and never managed to reach the kind of saturation that McDonald's has been able to achieve. McDonald's manages ever aspect of the business of the stores, including teaching employees of all franchises the same procedures. The company runs a school for its manners in Chicago to assure quality and consistency in all stores. While Pilsbury has tried to institute a similar approach for Burger King now that it own's that company, the process is less pervasive and far less effective.
Franchising continues to be an important way for this type of business to grow, with differing degrees of control exerted by the main office for different companies. The trend toward healthier food is also expected to continue, and some cities and states are passing laws to enforce this to a degree, as with the recent decision in New York to eliminate the use of all trans-fats from food preparation. Stores will continue to offer healthier versions of their goods and will more and more compete with each other to produce the healthiest alternatives, with or without the motivation of a law.
Branch, S. And E.P. Gunn. "What's Eating McDonald's?" Fortune (13 Oct 1997), 122.
Burger King. www.burgerking.com.
Burger King Corporation." International Directory of Company Histories, Vol.56. St. James Press, 2004. December 6, 2006. http://galenet.galegroup.com/servlet/BCRC?vrsn=155&locID=longbeach&srchtp=glbc&cc=1&c=1&mode=c&ste=74&tbst=tsCM&tab=4&ccmp=Burger+King+Corp.&mst=burger+king&n=25&docNum=I2501308118&bConts=13223.
Compbell, Susan. "Odds in McDonald's Monopoly Contest Pretty High." The Hartford Courant (April 28, 1998), F10.
Cook, William. "Lean, Green and To Go." U.S. News & World Report (December 17, 1997), 9.
Gibson, Richard. "Anatomy of a Burger." Wall Street Journal (December 17, 1997), B1.
Gibson, Richard. "Worried McDonald's Plans Dramatic Shfits and Big Price Cuts." Wall Street Journal (February 26, 1997), A1, A6.
Kochak, Jacque. "In the Driver's Seat." Restaurant Business (December 10, 1996), 69-78.
McDonald's Corporation." International Directory of Company Histories, Vol.63. St. James Press, 2004. December 6, 2006. http://galenet.galegroup.com/servlet/BCRC?vrsn=155&locID=longbeach&srchtp=glbc&cc=2&c=2&mode=c&ste=74&tbst=tsCM&tab=4&ccmp=McDonald%27s+Corp.&mst=mcdonald%27s&n=25&docNum=I2501308903&bConts=13247.
Vampire Bites: Fast Food in America." The Economist (July 22, 1995), 62.