RUNNING HEAD: REGRESSION ANALYSIS 1
MacDonald’sis one of the most recognized fast food outlets in the world. Theorganization operates in more than one hundred countries, with morethan 30,000 outlets spread across six continents. The organizationexperienced fast growths from 1960s up to 2000s, when its fortunesstarted Dwindling due to fierce competition.
Itwould be impossible to talk about international brands withoutmentioning MacDonald’s. MacDonald`s, which is a market leader inthe food industry, was incorporated in 1955 as a quick-servicerestaurant. MacDonald`s is the leading organization in the foodindustry. This research paper delves into the background of thecompany to inform a better understanding of its history. The paperalso tackles qualitative research methods with an objective toapplying them to assess the perception of MacDonald’s as a brand inthe face of increasing competition in the fast food industry.
Backgroundinformation of MacDonald`s
Thecompany generates approximately $40 billion in sales which is a hugefigure by any standards. The organization operates over 30,000restaurants in more than one hundred countries around the world, andis therefore, a respected and a recognizable brand. The company hasglobal infrastructures and has a track record in the management ofrestaurants, real estates, retailing, franchising, and marketing. Theorganization is a leader in the sectors and actively shares itsknowledge in food safety and is committed to environmentalconservation(Cassell & Symon, 2004).
Inan ordinary day, the company serves an average of 46 millioncustomers in its combined outlets around the world. Of the more than30,000 stores, 9,000 are company owned and managed, while the restare either operated by franchisees or as joint ventures with localbusiness individuals. The nine major markets in which the companyoperates are the US, Australia, Canada, China, Brazil, Germany,Japan, France and the UK. The nine markets account for 80% of therestaurant sales and 75% of the total sales.
Thecompany provided its initial public offering in 1965, where thecommon shares went for $22.50, and the trading price had surged to$30 by the close of the first day. The high rate of growth of thecompany was attributed to its skillful marketing and flexibility inthe response to customer demands. In the late 1970s, the competitionfrom hamburger making companies such as the Wendy`s began tointensify as the companies engaged in a war to control the market.McDonalds` was able to conquer the market and has remained a majorplayer in the sector since then.
Themethod chosen for the research is qualitative approach .It employsface to face interviews, with focus groups in search of valuableinsights about MacDonald`s as perceived by the consumers. The methodwas chosen to get people talk about their opinions regarding theMacDonald`s, to understand their motivations and feelings(Cassell & Symon, 2004).More specifically the ethnography method was used whereby as manypeople as possible were observed and interviewed to capture theirperception of the MacDonald`s as an organization. Thephenomenological method was also employed to interview customers whohave experienced the changes at the MacDonald`s over several years.The narrative approach focused on the individual skills and wasapplied through the listening of the stories individuals had aboutMacDonald`s. Documents about the organization were reviewed too
TheEthnography research involves engaging the target participants withan objective to understand the goals, motivations, challenges,cultures and other aspects necessary for research. ObservationalResearch Methods require researcher’s attempt to observe aphenomenon without much interference(Cassell & Symon, 2004).The methods use nominal or ordinal scales of measurements as theyhave no clearly defined research problem. Questions emerge in theprocess of study, for example, a researcher could observe an unusualbehavior and gets interested to know what and why it is happening.The observation methods are heavily employed in social sciences wherebehavioral scientists and anthropologists study groups withoutinfluencing their behaviors. The experiments cannot be replicated orfalsified and provides unique insights in the advancement of thehuman knowledge(Cassell & Symon, 2004)
TheNarrative method joins a sequence of events from one or twoindividuals to create a strong story. It requires in-depthinterviews, reading of documents, looking for themes and looks at howthe different story is related to the topic of research. Interviewsare conducted over weeks, months or could even be carried out foryears. The final narrative needs not to be in any chronological orderas long it is coherent. The most valuable perspective of the story isthe themes that reconcile conflicting stories to depict contentiousareas and challenges which could be exploited as opportunities forinnovation.
Thephenomenological approach involves a combination of methods such asreading documents, conducting interviews, visiting places or evenwatching videos to understand the participant`s position in the areaof research(Cassell & Symon, 2004).The method relies on the perception, not on the member to giveinsights into their motivation. Five to twenty-five interviews arenecessary for acquisition of the common themes to construct enoughdataset to assess emerging topics and to use other participants toconfirm the findings.
Fromthe findings, the MacDonald`s falling fortunes coincide with the riseof the ‘fast-casual’ phenomenon in the fast food industry. Themajorities of the customers are changing their taste requirements andhence are embracing other brands in the fast food industry. Themajority of the people interviewed are not only going for healthyfood but quality too (Cassell& Symon, 2004).Although most people have been loyal customers for the MacDonald`sfor long, the supermarkets are offering sandwiches and prepared mealsthat have become options for many clients. The stores also offer hotdogs and doughnuts implying that the clients don`t have to go to therestaurants. From most of the respondents, there used to be a cleardifference between fast food and family dining but at the moment, thewhole market is blurred, and hence, restaurants such as MacDonald`sno longer stand out like they used. The findings also revealed thatthe consumers are not interested in the traditional food andtherefore are not particularly keen about fast food restaurants suchas MacDonald’s (Cassell& Symon, 2004).The results revealed that the company is losing ground due toinformation the youth, mainly 21-35-year-olds, acquired while inschool, that eating at the MacDonald`s is not healthy. The groupprimarily referred to as millennial generation grew up hearing thatfast food at MacDonald`s was fattening hence making eating at therestaurants as shameful. Several people said they cannot say thatthey eat at the MacDonald`s unless they are telling someone who does.Others said it is embarrassing to know that someone eats at theMacDonald`s. Quite a substantial figure of the respondents statedthat they only eat at the MacDonald`s if they are having a bad day(Cassell & Symon, 2004).Others were specific on the food items they crave for at therestaurants. For example, several mentioned Mcdouble and ice creamcone as some of the only items that would compel them to eat at theMacDonald`s. Most of the respondents aged 21-35 years who take fastfoods, said that MacDonald’s was not their preferred restaurants.Results showed that MacDonald`s is associated with an unhealthy imagethat the respondents were trying to shake off.
Severalrespondents expressed satisfaction that the restaurants had improvedthe food by removing preservatives, artificial flavors, and meatfillers. The respondents said that they were aware that theorganization was buying higher quality beef. They also said that therestaurants buy hormone-free and antibiotic free chicken. Asubstantial number of the respondents stated that MacDonald`s servehealthier fast food regarding calorie counts and quality, than mostof its competitors. However, those who expressed the sentiments saidthat most people are obsessed with the past about MacDonald`s. Othersstated that MacDonald`s had a negative perception and wondered howthe organization would change it while admitting that it may take along time to reverse it. In the US market, the majority of therespondents were unanimous that MacDonald`s needs to change itsoperations to shake off the negative image that has been acquired inthe recent past(Cassell & Symon, 2004).Some respondents felt that the restaurant was adopting other modelsof services, such as reducing its menu to return to the basics. Someof the interviewees insinuated that the organization was engaging inthe turnaround strategies and would soon reclaim its rightfulposition as a restaurant of choice for the majority. The respondentsfelt that the reorganization of corporate operations would bearfruits and lead to improved menu items. The respondents said that itwas good that the management of the organization is aware of itsnegative image and expressed optimism that something was being doneto reverse it. Many respondents were aware of the reorganizationaladjustments taking place in the organization and hoped they wouldbear fruits to turn it around.
MacDonald’sis one of oldest fast food restaurants, but has lately experienced aseries of mixed fortunes. In an effort to understand the perceptionof the company, qualitative methods were employed. The company iskeen to rebrand by introducing healthy food items on its menu in aneffort to restore its past glory. The organization is currentlyengaged in restructuring strategies aimed at shaking off the badimage acquired over the past years.
Cassell,C., & Symon, G. (Eds.). (2004). Essentialguide to qualitative methods in organizational research.Sage.