Vegetarian Big-Mac Anyone ?
As stated by Iacobucci (2013) different people’s preferences and perceptions call for the need for different products to be produced to satisfy different needs. Therefore, segmentation is when a large diverse market is divided into smaller similar markets or segments. This way the company can focus on meeting the needs of two or three groups of customers to get closer to what the customer wants. Companies resort to segmenting the market because it’s not possible to please everyone at the same time. The segmentation group variables include: demographic, geographic, psychological and behavioral.
After choosing the market segment variable groups, a target market must then be chosen. Targeting is the process where the company decides which one of its segments will be the most likely to succeed and be profitable after taking into consideration all internal and external factors (Iacobucci 2013).
Lastly, after the target market has been chosen the product needs to be positioned. A product’s position is determined by the marketing mix: the product itself being offered, the price it is being sold for, the place it can be found and how it is being promoted (Iacobucci 2013).
Figure 1: Segmentation Targeting and Positioning
The video below summarizes the definition of segmentation.
McDonald’s and Geographical Segmentation
McDonald’s geographically segments very well by creating menu items out of well-known national foods or preferences which is what makes it a brand leader in the fast-food market globally. Examples of menu items that are geographically produced in certain countries to suit specific local needs include: Poutine in Canada which is gravy cheese fries; the cheese Katsu burger in Japan; the McRice burger in Southeast Asia where the bun is made from rice as a healthier alternative to bread; Create Your Taste for the USA and Australian customers where they get to create their own burger or meal; Mashu warma in Israel (a Halal burger option); brie nuggets in Russia; Cordon blue Burger in Poland and the vegetarian McCurry pan in India (Watchmojo.com 2015 ). These are a few examples of how the company segments geographically and specifically targets, and then modifies their product depending on the place it is being sold.
The Top ten Exclusive McDonald’s International Menu Items.
Before geographically segmenting and targeting itself into a market, consideration was given to other influencing factors as well as taste. For example, in the Indian market, McDonald’s took into account external factors including religion, eating habits and cultural needs to determine the success of its product. Pork and beef are not too popular in India as cows are considered sacred by Hindus and Muslims consider pigs unclean. Hence, why in 2013 a few of the McDonald’s that opened in India in the vicinity of places of worship such as the Golden Temple in Amritsar were strictly vegetarian.
Table 1 below represents McDonald’s Segmentation, targeting and positioning
It is clear from Table 1 above that McDonald’s targets and positions its products for almost everyone.
MacDonald’s takes segmentation, targeting and positioning of their products to another level and they do it in line with Hassan and Craft (2005), who state that effective segmentation methods should mix buyer-based variables with country-based factors. McDonald’s 2015 annual report states that their restaurants offer noticeably uniform menus with geographic differences to suit local tastes and preferences (About McDonalds 2015). This means their menu is tailored to local tastes whilst also providing customers the opportunity to enjoy the Big Mac regardless of their location. Providing consistent and familiar items on their global menu allows them to not only capture local audiences, but global travelers. As a well-known global brand, one knows what to expect: good service and value for money.
McDonald’s ability to transform their products to cater for such a large range of people raises the question; are they really segmenting and targeting a specific market or are they flooding the market with products?
Just hold on while I get some fries…..
About McDonald’s, 2015, McDonald’s 2015 Annual Report, Retried 1 August 2016<http://www.aboutmcdonalds.com/content/dam/AboutMcDonalds/Investors%202/2015%20Annual%20Report.pdf>
B2B International Marketing Research ,2014,The importance of Segmentation to consumers ,Retried 1 August 2016 ,<https://www.youtube.com/watch?v=oEP0JGdAza8>
Dudovskiy J,2016 , McDonalds Segmentation, Targeting and Positioning ,Retried 1 August 2016<http://research-methodology.net/mcdonalds-segmentation-targeting-and-positioning/>
Hassan S & Craft H,2005, Linking global market segmentation decisions with strategic positioning options, The Journal of Consumer Marketing 22.2/3 p.81-89 ,Retried 3 August 2016,<http://search.proquest.com.ezproxyf.deakin.edu.au/docview/220119742/DEC1EF9DB019405DPQ/1?accountid=10445)>
Iacobucci, D 2013, Marketing Management (MM4), Student Edition, South-Western, Cengage Learning, Mason, Ohio.
Newcomb T ,2012 , McDonald’s goes vegetarian in India ,Time,Retried 3 August 2016<http://newsfeed.time.com/2012/09/04/mcdonalds-goes-vegetarian-in-india/>
To know consulting ,2011 ,Market Segmentation ,Retried 2 August 2016<http://toknow.com.cn/en/scyj.aspx >
Marketing Management -Segmentation, Targeting and positioning
Student number -216041785