McDonald's Case Analysis

1. How are customer tastes changing in the fast-food industry? Customers are choosing non-hamburger fast-food restaurants including Pizza Hut, KFC, and Taco Bell and fast-casual restaurants such as Boston Market, Panera Bread, and Subway.

What impact do these changes have on McDonald's? This is reducing sales at McDonald's and other hamburger fast-food restaurants.

2. How well are these changes in customer tastes and preferences being reflected in competitive strategies in the industry? It is being reflected well in that the hamburger fast-food restaurants are adding to their menus. New menu items focus on chicken, salads, and café items.

3. What are McDonald's strengths and weaknesses and what conclusions do you draw about its future? McDonald's strengths are that they are fast, easy, and convenient. McDonald's weaknesses are that their food is unhealthy; many of the menu items are "classics" in that they have been around forever, and people are tired of them.

4. Should McDonald's develop a separate strategy for the heavy user segment of the fast food industry? Yes. If heavy users are making up 60% of sales, then they should market at least 40% of their advertising to them. The other 60% of their advertising should be used to try to improve the rest of their market share through highlighting their items that would appeal to the non-hamburger fast-food, fast-casual, and café customers.

5. What should Jack Greenberg do to grow sales, profits, and market share at McDonald's? I think the café segment has really helped McDonald's. for one, they have created beverages that are of really good quality that I enjoy as much as Starbucks. Two, their prices are more reasonable than other cafés. Three, it is more convenient than other cafés because they have a drive-thru. I believe they should expand the offerings from their McCafés to their regular McDonald's restaurants.