Competitor Analysis
The main competitors of McDonald’s are Wendy’s, Yum! Brands’ Taco Bell and Burger King. Currently, the company is almost twice as large as the three competitors combined, though it has slightly fewer stores. McDonald’s controls about 50% if the United States hamburger market. This is more than thrice the market share held by any of the three leading competitors. However, stocks of the competitors performed better in 2012, painting a grim picture of the future of McDonald’s. Wendy’s has a strategy that will see it take some part of McDonald’s market share by branding itself as having a “cut above” all other competitors and providing higher-quality food which is made fresh-to-order. The firm focuses on the long-term brand establishment by way of redesigning its stores and expanding its menu so as to include breakfast.
Burger King, which is the third most significant competitor of McDonald’s, has been attacking McDonald’s market share by adding new items on its menu and giving their stores a more modern look. On the other hand, Taco Bell, which a highly recognized quick-service restaurant has over 5800 restaurants in the United States, 80 per cent of which are franchises. Though the company faced several incidents of food contamination during the period between 2006-2011, they have embarked on a reformation agenda that saw them posting 13% increases in same store during the second quarter of 2012. This has been mainly attributed to the introduction of the healthier Catrina Bell product line and also the famous Doritos Locos Tacos. McDonald’s has other competitors such as Subway, Starbucks and Dunkin’ Donuts, all of which are trying to implement a variety of strategies that will enable them to gain a winning edge over their rivals.
Market Analysis
According to market research, the average American consumers about 2.5 lunches and around 2 dinners outside their homes. Approximately 11 to 12% of these meals are taken at McDonald’s. Within any given day, 1 out of every 16 people is likely to visit McDonald’s outlets in a day. Of the company’s sales, 30% comes from breakfast, 24 per cent comes from lunchtime sales while the rest comes from a late night or early morning sales. The company mainly targets mothers, children and young adults. To maintain its historical growth in revenues, McDonald’s will have to draw new customers. This calls for reaching out to new market segments as well as the strategic selection of new global markets to be entered.
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