STP Analysis for McDonald's

STP Analysis for McDonald's

McDonald's is a hugely successful fast-food chain with over 40,000 stores worldwide (Statista, 2022). The marketing strategy used by the company has played a major role in its success. The STP model for marketing helps companies deliver personalised messages to customers and audiences in order to engage them (Hanlon. A, 2022). In this blog I will analyse how the company uses segmentation, targeting and brand positioning to ensure global success for the business.

Segmentation

Segmentation involves identifying groups of target customers and the characteristics of each segment (Hanlon. A, 2022). The four types of market segmentation used by companies, such as McDonald's, are: demographic, psychographic, behavioural and geographic. Segmentation is important to understand the needs and wants of the clients, as well as their buying behaviours. Whilst many companies may try to target very specific demographics of customers, McDonald's maintains a largely broad and wide target audience. McDonald's mainly tries to target customers aged under 70 and those who are working or middles class (Dudovskiy. J, 2022). Therefore, McDonald's can target these specific customers by tailoring the product and experience towards them, such as producing affordable food that is quick to prepare.

Image 1: (1000Logos, 2022)

Targeting

Upon understanding the market and their target customers, companies can then focus on certain segments of the market and planning how to attract those customers. Whilst McDonald's even states themselves that they want to appeal to "everyone" (McDonald's, 2018), in reality they specifically try to attract customers with families, those who need affordable food quickly and those from middle and lower classes. McDonald's is therefore able to target the customers through a value-based strategy. This is achieved through providing a $1-3 menu and trying to keep prices as low as possible (CoSchedule, 2022). In addition, McDonald's attempts to target families by tailoring certain meals towards children by including bright packaging and toys inside.

Image 2: (Starkey. E, 2020)

Brand Positioning

Brand positioning is the space in which a company resides within the mind of the consumers. Brands attempt to change themselves to attract different segments of the market. Brands may change their mission, values, USP and price in order to position themselves away from other companies (Indeed Editorial Team, 2022). After poor financial performance after WW2, McDonald's differentiated itself from competitors. Instead of focusing on making their company and products better than competitors, they instead focused on bringing value to the customer. McDonald's decreased the size of its menu and focused on quicker service to make the company perform more efficiently (Mohammed. S, 2019). Since then, McDonalds has continued to keep itself different from its competitors, a decision that has been highly successful.

Reference List:

1000Logos (2022) McDonald's Logo. [Image 1] Available at: https://1000logos.net/mcdonalds-logo/ (Accessed: 22 January 2023)

CoSchedule (2022) McDonald's Marketing Strategy: The Rise of the Golden Arches (+4 key strategies). Available at: https://coschedule.com/marketing-strategy/marketing-strategy-examples/mcdonalds-marketing-strategy#4-marketing-strategies-that-made-mcdonald-s-massive-brand (Accessed: 24 January 2023)

Dudovskiy, J. (2022) McDonald's Segmentation, Targeting and Positioning. Available at: https://research-methodology.net/mcdonalds-segmentation-targeting-positioning/ (Accessed: 22 January 2023)

Hanlon, A. (2022) The segmentation, targeting, positioning (STP) marketing model. Available at: https://www.smartinsights.com/digital-marketing-strategy/customer-segmentation-targeting/segmentation-targeting-and-positioning/ (Accessed: 23 January 2023)

Indeed Editorial Team (2022) What is brand positioning and what are its benefits? Available at: What is brand positioning and what are its benefits? | Indeed.com UK (Accessed: 24 January 2023)

McDonald's (2018) Who is your target market / audience? Available at: https://www.mcdonalds.com/gb/en-gb/help/faq/who-is-your-target-market---audience.html (Accessed: 23 January 2023)

Mohammed, S. (2019) Brand Positioning Strategy -McDonald's, An Example. Available at: Brand Positioning Strategy -McDonald’s, An Example | by Shah Mohammed | Medium (Accessed: 24 January 2023)

Starkey, E. (2020) Move over KFC, Maccas has launched a new chicken menu including a Parmi burger and chicken salt fries. [Image 2] Available at: McDonald's launches new chicken menu including Parmi burger and chicken salt fries - Eat Out - delicious.com.au (Accessed: 24 January 2023)

Statista (2022) Number of McDonald's restaurants worldwide from 2005 to 2021. Available at: https://www.statista.com/statistics/219454/mcdonalds-restaurants-worldwide/ (Accessed: 18 January 2023)