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BABM DISSERTATION
CONSUMER BEHAVIOUR
Rok Zerjal
Tutor: Richard Mannix
1
ACKNOWLEDGEMENTS
Writing and putting together this dissertation has been both exiting and challenging. Indeed, I
have been able to work on really interesting topic- consumer behaviour.
In twelve weeks time that we have been given to write this dissertation have been very
intensive, to some extend exhaustive as well, and have taught me how to deal with a great
amount of information and work within limited period of time.
I have now completed my dissertation of Business and Management degree program at the
European Business School London, and I would like to take this opportunity to thank a few
persons in for their direct or indirect contribution to my work.
Firstly, I would like to thank my tutor Mr. Richard Mannix, Subject Leader Marketing EBSL,
who has been indeed extremely supportive and understanding whilst I was progressing
through my work. Without him I believe that I would not be able to write my dissertation in
the way it has been written.
Finally, I would like to thank my family, my dad who has provided me with some ideas, and
my mom, who has contributed with her thoughts while deciding upon my dissertation topic,
as well as I am thankful for her support and patience during the past weeks.
Rok Zerjal
London 4th of December 2006
2
TABLE OF CONTENTS
CHAPTER 1: INTRODUCTION 1
1.1 Consumer behaviour 1
1.2. Fast food VS Junk Food 1
1.3 Obesity in the UK 2
1.4 Fast food industry in the UK 2
1.5 McDonald's Corporation background 3
1.6 Research question 4
1.7. Plan of the dissertation 5
3
3.8.4 PEST Framework 20
3.8.5 Ansoff’s product/market matrix 21
CHAPTER 5: FINDINGS
5.1 External analysis 22
5.1.1 Fast food industry in the UK- overview 22
5.1.2 PEST Framework 24
5.1.2.1 Political / Legal conditions 24
5.1.2.2 Socio-cultural conditions 26
5.1.2.3 Key drivers of change: 27
5.2 Key factors influencing the consumer 29
decision-making process
5.2.1 Focus group (analysis of key points) 29
5.2.2 Questionnaire (analysis of findings) 29
CHAPTER 5: RECOMMENDATIONS 44
5.1 Option description and evaluation 45
5.1.1 Option 1: Increase awareness of the 45
quality of McDonalds’ products
5.1.2 Option 2: Introduction of new healthier 47
menus along with refurbishment of restaurants
5.2 Implementation plan 48
CHAPTER 6: CONCLUSION 50
BIBLIOGRAPHY 52
APPENDIX A 56
APPENDIX B 57
APPENDIX C 62
4
LIST OF FIGURES
5
FORWARD
Having studied in United States (San Francisco) gave me the opportunity to experience the
eating habits of the “fast food nation” and the passion of the fast food myself. In those four
months of studying in San Francisco, I have gained 7 kilograms. At that point I began
questioning my self the importance of healthy diet and how nutritious in fact fast food is?
In the UK today, there is virtually no week that passes by without hearing any news regarding
obesity, health concerns and dietary issues, be it in newspapers or on TV news. That was my
primary motivation, along with studying in the US, that pushed me towards understanding the
process which impacts on us consumers, whether we will go and eat burgers or not.
6
EXECUTIVE SUMMARY
The aim of this dissertation is to investigate the factors that are influencing consumer
decision-making process in relation to fast food restaurant industry in the UK. It further aims
This is important and at the same time interesting to observe such topic, because of the high-
profile political and public debate on obesity and other health issues that is UK currently
facing.
A better understanding of the background and problems related to the fast food issue and
context of decision-making process is first obtained via literature review, where various
academic journals were examined. Afterwards the qualitative focus group was conducted with
an aim to explore and gauge consumer attitudes towards fast food and McDonalds. Key
themes from focus group formed questions for the questionnaire. This quantitative survey was
then used to gauge whether the views of the respondents from focus group were
representative of a larger group.
In order to examine the context in which McDonalds is evolving, with addition to identify the
key drivers of change that might influence fast food industry in the future, PEST framework
was applied. Changing consumer lifestyle and Government interference were highlighted as
two potential drivers of change.
Key themes from focus group were quality of fast food, ethical aspects (animal welfare), trust
towards McDonalds and impact of media and Government on consumer behaviour. These
themes were then tested to a larger group using questionnaires. Respondents associated
McDonalds and its products with adjectives such as unhealthy, cheap, tasty and fatty. They
‘ranked’ their food (with exception of salads and fruit) as of the worst quality. 25% of
respondents claimed that ethical issue regarding chicken bothers them and that is the reason
they don’t eat chicken in McDonalds. Moreover 28% of those who were familiar with current
7
high public obesity debates in the UK issue it affected them in such way that they now eat less
fast food as they used to. 35% of respondents claimed that ever since they saw the
documentary “Super Size Me” they don’t eat in McDonalds anymore.
Most purchases of fast food occurred as a result of impulse decision-making.
Since consumer’s knowledge/information acquired regarding fast food are mostly negative, as
a result their attitudes are also negative. There are also external influences that have negative
impact on consumer decision-making process i.e. current high public obesity debates in the
introducing healthier menus. Consumers do not trust McDonalds, which also negatively
impact on their decision-making process. All factors above contribute towards risk perception
that consumers have with McDonalds food. Marketers at McDonalds try to reduce perceived
risk by providing consumers with information regarding their food. That is also author’s
hence reduce consumers perceived risk and increase their trust with McDonalds brand.
8
CHAPTER 1: INTRODUCTION
This chapter will give the reader a clear statement of the research question and the problem
statement that will be addressed in this research. Moreover, the background information on
definitions of key terms and the chosen organisation will be presented. Finally, the ‘route
map’ will be illustrated in order to guide the reader to the rest of the report.
9
Junk food is regarded as “food such as potato chips, sweets and doughnuts, which is mass-
produced and is of low nutritional value”. (dictionary.com, 2006)
Often the term junk food is used to describe fast food. Just recently, the debate has been going
on whether the term junk food (to describe fast food) is in fact justified. Author of article
argues that the "junk food" tag seem to be applied selectively, and often to food outlets in
urban and suburban areas but not to those in leafier parts. Hence, he points out that the term
"junk" has become a way of disapproving of certain foods. (O’Neill, 2006)
10
McDonald's Corporation was the leading fast food outlet in the UK in 2004, with an 18.3%
value share and a clear lead over its nearest rivals KFC (owned by Yum Brands) and Burger
King. (Euromonitor, 2006b)
McDonald's is a pioneer in the fast food industry and today world leader in the sector. The
company has over 31,000 fast food restaurants in over 120 countries. (MarketLine, 2006)
The company operates primarily in the US and the UK. It is headquartered in Oak Brook,
Illinois and employs 447,000 people all over the world. (Datamonitor, 2006)
McDonalds currently operates in more than 1,316 restaurants throughout the UK. Its profits
grew by 55% in 2004. (Euromonitor , 2006b)
In 2003 the company was loosing money for the fist time in its five-decade history, as it was
serving mainly greasy food and therefore fuelling obesity epidemic. Moreover the company
was loosing important consumers trust due to release of the documentary ‘Super size me’ and
critical book ‘Fast food nation’. However, McDonalds introduced healthier menus and just
recently (October 13th 2006) it has announced that its sales had rocketed, sending its shares
soaring to a six year high. British restaurants were singled out among the biggest improvers in
performance. (Clark, 2006)
11
1.6 Research question
What factors are currently influencing the consumer decision-making process in the fast
food restaurant industry in the UK, and how is McDonalds responding to changing
environment and consumer behaviour?
The research question can be further divided into three sub sections in order to clarify the
objectives of the research.
B. With the aim of identifying the factors that are influencing consumer purchasing
decisions in relation to fast food products:
o The Consumer Decision-Making Process will be examined, in particular the
psychological field- focusing specifically on consumers’ attitudes towards fast
food and McDonalds. In addition the socio-cultural environment, as external
factors that have impact on consumers’ decisions will be investigated.
12
1.7. Plan of the dissertation
INTRODUCTION
This chapter will give the reader a clear statement of the research question and the problem statement that will be addressed
in this research. Moreover, the background information on definitions of key terms and the chosen organisation will be
presented. Finally, the ‘route map’ will be illustrated in order to guide the reader to the rest of the report.
LITERATURE REVIEW
This chapter sets the study within its wider context and show the reader how this study supplements the work that has already
been done on chosen topic. Therefore it identifies, analyses, compares and contrasts views and theories of other writers in
relation to the research topic. It also provides the stepping-stone towards the methodology chapter of the dissertation.
METHODOLOGY
In this chapter the research design and the research methodology employed to answer the research question will be explained
and justified. In addition, it provides the reader with a clear description of models and concept used for the analysis.
FINDINGS
This chapter will provide a reader with detailed presentation of facts and data obtained using tools described in research
methodology, leaving out discussion for the final chapter. In order to communicate findings clearly, author decided to brake
down this chapter into to parts. Firstly, the external analysis will be applied, in order to provide a reader with the context in
which McDonalds is evolving. And secondly, the key factors influencing the consumer decision-making process will be
analysed/explored.
RECOMMENDATIONS
In this chapter a set of proposed recommendations as well as supporting analysis of the options for McDonalds will be
depicted. In addition the implementation plan to support the key recommendation, including description of resources
required will be illustrated.
CONCLUSION
In this chapter author will conclude his research with how the research question has been solved. In addition a brief re-cap
13
This chapter sets the study within its wider context and show the reader how this study
supplements the work that has already been done on chosen topic. Therefore it identifies,
analyses, compares and contrasts views and theories of other writers in relation to the
research topic. It also provides the stepping-stone towards the methodology chapter of the
dissertation.
The following literature review will critically analyse the theories associated with the research
topic. Firstly, it looks at the issues of consumer behaviour; hence it highlights the factors,
which influence the consumer decision-making process, predominantly the consumer
attitudes. The author has found a variety of academic articles, some of which focus on food
industry and public trust in food safety. Other articles examine more generally models of
consumer attitude formation, which might be useful applied to the research question in this
dissertation.
While the first section focuses on the aspects of consumer behaviour, the second part of the
review, as already outlined in the introduction section of dissertation, observes the marketing
issues, particularly the marketing communication strategy within the marketing mix.
Furthermore this review will contribute towards creation of possible marketing strategies as
well as recommendations that McDonalds might pursue in order to respond on changing
environment and consumer behaviour.
Therefore the following theories from consumer behaviour and marketing have been outlined:
Consumer decision-making process
Consumer attitude formation and change
The marketing mix
14
presented models of consumer behaviour towards food (Pilgrim, 1957, cited by Verbeke,
2005) and on a review of factors affecting food acceptance and behaviour (Shepherd, 1990,
Steenkamp, 1997, cited by Verbeke, 2005) proposed a classification with three types of
influencing factors: environmental factors, person-related factors and properties of the food.
Jobbers (1995) identifies the concept of influences on consumer purchasing behaviour among
which he points out the level of purchase involvement as one of the factors that influences the
consumer decision-making process. Referring to Kim (2005) who was investigating how
product involvement and values interact with consumers, more current research examines
consumer involvement under working assumptions that different types of product
involvement trigger different behaviour. In the research conducted by Schroeder and
McEachern (2005), who were analysing the impact of McDonald’s and KFC’s corporate
social responsibility (CSR) on consumers purchasing behaviour, authors propose that
purchases of fast food are mostly impulsive, hence suggesting relatively low-involvement in
each case.
Brown, McIlveen and Struggnel (2000) examined the nutritional awareness and food
preferences among young consumers. They suggest that young consumer decisions regarding
food preferences are influenced by nutritional awareness knowledge. This knowledge is
acquired within the home, school and social environments. They also put forward that
education plays important role regarding healthy eating.
Lye et al. (2005), in their study of consumer decision models, advocate that the complexity of
consumer decisions is increasing. “We have limited understanding of the decision process and
the models are inadequate at predicting decision outcomes”. Hence the current models, they
argue, are out of date and insufficient in providing the desired outcome.
Nevertheless, the decision-making process model will provide the author and the reader with
general overview and understanding of factors influencing on consumers purchasing
behaviour.
Author will attempt to identify and focus, along with the attitudes, on the socio-cultural part
of the consumer decision-making process, i.e. impact of communication and information from
mass media (bad publicity of fast food), as it appears that this is the most recent issue due to
health concerns in the UK.
15
For Nielsen, Jongen and Meulenberg (1998, cited by Verbeke 2005) understanding of the
factors that determine consumer perception/attitudes of a product’s value or cost is of crucial
importance to an industry’s product innovation, choice of marketing and communication
strategy and maintenance of competitive advantage.
According to Ajzen (1998) the attitudes are the first determinant of behaviour intention. In
consumer behaviour context attitude is a learned predisposition to behave in a consistently
favourable or unfavourable way with respect of a given object. Most researchers agree that
attitudes consist of three components: Affect (consumers’ emotions and feelings about the
attitude object), Behaviour (intention to do something with regard to an attitude object) and
Cognition (believes a consumer has with an attitude object). (Solomon et al., 2006, p.140)
For Verbeke (2005), who examined the influences on consumer decision-making process
towards fresh meat, the hierarchy of effects indicates the different mental stages that consumer
must go through when making buying decision and responding to marketing or non-
commercial messages. In our instance, where the attitude object is fast food, plus taking into
account that fast food is considered to be low involvement product, the low involvement
hierarchy of effects would occur. This will be explained in more details in the next chapter-
methodology.
As mentioned on previous page, knowledge and perceptions (cognitive component) of an
attitude that consumer has with an attitude object plays important/initial role by the attitude
itself. Baltas (2001, cited by Schroeder and McEachern 2005) acknowledge that the nature of
fast food production and processing is becoming more important to consumer. Furthermore
Harper and Makatouni (2002, cited by Schroeder and McEachern 2005) note that ethical
production in terms of animal and human welfare and environmental protection are of greatest
importance. Similarly Mohr et al. (2001, cited by cited by Schroeder and McEachern 2005)
recognize that information regarding firm’s ethical behaviour is thought to influence product
sales and consumers’ overall image of a company. Additionally Verbeke (2005) recognizes
that along with increasing importance of quality, organoleptic and sensory properties of the
food, issues relating to food safety and human health have gained considerable attention and
importance. All above links well to attitudes that consumers will have with fast food products
and companies.
Attitude can form in several different ways, depending on particular hierarchy of effects in
operation. (Solomon et al., 2006 p.145) Referring to Schiffman and Kanuk (2004 p.256), the
16
formation of consumer attitudes is strongly influenced by personal experience, the influence
of family and friends, direct marketing and mass media. Yet again author will attempt to link
the current health concerns/obesity issues to above factors that have direct impact on attitudes
formation. Goldsmith, Freiden and Henderson (1997) who investigated the impact of social
values on food related attitudes, recognize that marketers, consumer psychologists and public
policy makers have an interest in the personal and social values of consumers as these deeply
held feelings of what is important in life influence both consumer attitudes and behaviour.
Reflecting desired end states or ways of living, values might in part represent some of the
fundamental motives that drive and direct the consumer behaviour. Furthermore Homer and
Kahle 1988, cited by Goldsmith, Freiden and Henderson (1997) suggest that the influence of
values may not be limited just to high- involvement areas, but may also be relevant to less
involving product fields such as food.
Besides the values, which influence both consumer attitudes and behaviour, Schiffman and
Kanuk (2004 p.256) acknowledge that formation of consumer attitudes is strongly influenced
by personal experience, the influence of family and friends, direct marketing and mass media.
Author will try to connect the current health concerns/obesity issues to above factors that have
direct impact on attitudes formation.
Finally, the importance of risk perception needs to be explained. Verdume and Viaene (2003)
investigated consumers’ beliefs, attitudes and purchase intentions with regards to genetically
modified food. Attitudes towards GM food are determined by perception of risk and benefits.
(Grunet, 2001, cited by Verdume and Viaene, 2003). When perceived risk is high, that
influence negatively on consumer’s purchase intention. That might be linked to fast food as
well, as eating fatty food may be risky of suffering obese related diseases.
17
Vignali (2001) acknowledges that for many years 4Ps have been used as the principal
foundation on which a marketing plan is based. However, with particular attention being paid
to services marketing in recent years, theorists have identified additional variables, which
could be added to the 4Ps. Fifield and Gilligan (1996, cited by Vignali 2001) recognized the
following variables as an integral part of the marketing mix- process, physical and people.
Vignali (2001) applied 7Ps analysing the marketing mix of McDonald’s in the following way:
1. Product – features, quality, quantity.
2. Place – location, number of outlets.
3. Price – strategy, determinants, levels.
4. Promotion – advertising, sales promotion, public relations.
5. People – quantity, quality, training, promotion.
6. Process – blueprinting, automation, control procedures.
7. Physical – cleanliness, decor, ambience of the service.
In this dissertation, however, the author will not focus on all 7Ps; the emphasis will be on
product, promotion and physical as this links logically with the research question/objectives.
If we look further into the promotion part of the marketing mix, the promotional mix is a
direct way in which an organization attempts to communicate with various target audiences. It
consists of five main elements:
Advertising
Public relations
Sales promotion
Direct marketing
Personal selling
(Brassington, 2006 p.630)
As mentioned earlier fast food products are purchased mainly impulsively, hence they are
considered to be low involvement products. Laurent and Kapferer (1985 cited by Kim 2005)
recognize that the degree of consumer involvement in a product category has become a major
factor relevant to advertising and promoting strategies. Solomon et al. (2006) suggests that
this might be involvement paradox; the less important is the product to consumers, the more
important are many of the marketing stimuli (e.g. packages, jingles) that must be devised to
sell it.
18
Taking above statements into account, McDonald’s might want to employ advertising and
sales promotions, in order to attempt to change consumer attitudes. Having said that author
will focus therefore primarily on advertising and promotion of the promotional mix.
19
CHAPTER 3: RESEARCH METHODOLOGY
In this chapter the research design and the research methodology employed to answer the
research question will be explained and justified. In addition, it provides the reader with a
clear description of models and concept used for the analysis.
20
The emphasis by explanatory study is on studying a situation or a problem in order to explain
the relationships between variables.
In the first part of this dissertation, the research purpose will be exploratory and explanatory
because the aim of the research is to explore consumer attitudes and factors that influence the
consumer decision-making process in the fast food industry. The purpose of the second part of
dissertation, however, is to elucidate McDonalds potential responses on changing
environment and consumer behaviour. From the analysis of the market and consumer
behaviour author will seek to apply established business models such as marketing mix in
order to generate a set of practical recommendations for McDonalds business.
21
to attempt to gauge whether the views of the respondents in the focus group were
representative of a larger population.
Taking above facts into consideration author decided, firstly, to carry out the qualitative focus
group, and secondly use its outcome to formulate questions for the questionnaire.
The chosen sample for the focus group were undergraduate students form European Business
School London in the UK. Three out of seven participants were British citizens, remaining
four were international students, however, they have been living in the UK for 3-4 years.
Kraus (1995, cited by Schroeder and McEachern, 2005) support the use of students since they
are more homogeneous as a group than non-students, thus resulting in less “extraneous
variation”. As a key target market of the UK fast food sector is between 17-25 years, a
convenience sample of students is justified for this exploratory study. Author realizes that
socio-economic status of some EBS students for the focus group might not be the same as one
of typical fast food consumer. However, participants eat in such restaurants and are therefore
appropriate for this study.
Since there is nearly impossible to distribute over 100 questionnaires physically in such a
short time, author decided to distribute questionnaires to students via email. Author acquired
approximately 140 British email addresses that he got from a person who lives in London.
The questionnaires were sent then to people around the UK.
22
3.7 Data collection
In this study, both primary and secondary data sources were used. Firstly, for a better
understanding of the background and problems related to the context of the consumer
decision-making, the literature review was written based on secondary data collection. Then
the primary data was gathered using qualitative focus group, which were then quantitatively
validated through questionnaires.
Secondary data sources used in this dissertation include books, library databases, periodicals,
McDonalds web site and other Internet sources. For collecting primary data sources, author
used firstly focus group and secondly questionnaire.
When designing questions for focus group author focused primarily on two things; firstly on
exploring consumers’ attitudes towards fast food, and secondly identifying impacts from
external environment which might influence the consumer decision-making process regarding
fast food. Having said that knowledge and perception about fast food will be examined, and
what kind of experience and beliefs participants have with such restaurants and products.
Then their emotions and feelings towards fast food will be explored. Additionally the possible
23
impact of current anti-obesity campaigns and regulations on participant’s decision-making
process will be examined.
3.7.2 Questionnaire
Since the participants in focus group were not randomly selected from the population, the
author cannot freely generalize from the results. Hence qualitative data obtained by focus
group will inform the content of the questionnaire and will be tested to a larger group.
According to Saunders (2007, p.356) a questionnaire to discover consumers’ attitudes can be
complemented by focus groups to explore and understand these attitudes. Author decided to
use questionnaires that are completed by respondents, i.e. self-administrative questionnaires
(internet-mediated questionnaires). More specifically author selected special on-line surveys
(www.freeonlinesurveys.com) due to time restrictions and convenience reasons. In order to
ensure the high response rate, Saunders (2007 p.390) suggests use of covering email, which
explains the purpose of the study. The aim of my study was explained in the introduction part
of questionnaire, attached to actual questions.
The key issues/themes identified from focus group were used as a basis to construct closed-
end questions or forced-choice questions. These provide a number of alternative answers from
which respondent is instructed to choose. More specifically author used mainly category,
ranking and list type of closed questions. (Saunders, 2007 p.368) Moreover by designing
questions, for instance question number 4, the tricomponent attitude model was incorporated,
to gauge consumers’ attitudes toward fast food products. (Shiffman and Kanuk, 2004, p.258)
Answering categories given in the questionnaires were also based on the preliminary
qualitative research- focus group. Key themes from focus group (quality of fast food, ethical
aspects, trust towards McDonalds, impact of media and government on consumer behaviour),
formed questions for questionnaire and were further examined and tested to larger group.
Saunders (2007, p.386) encourages pilot test prior using the questionnaire to collect data.
Author sent questionnaire to few individuals before sending it to larger population, in order to
ensure that all questions are clear. For more information regarding actual questionnaire that
was sent to participant, please refer to appendix B.
24
3.8 Models employed in dissertation
25
Source: Schiffman and Kanuk (2004)
This model will provide author and reader with a starting point and general picture of what
kind of factors have impact on consumer decision-making process.
Despite some critiques, which imply that these models are out of date and inadequate at
predicting decision outcomes, author decided to use it merely to clarify and illustrate rather
complex process of the decision-making.
26
Conative component- is concerned with the likehood or tendency that consumer will
undertake a specific action or behave in a specific way with regard to the attitude
object
Schiffman and Kanuk (2004 p.256)
This model emphasizes the interrelationships between knowing, feeling and doing.
The tri-component attitude model will assist author to structure questions for focus group and
questionnaire, as it helps to explore and gauge consumers’ attitudes towards attitude object-
fast food. When such model applied to the questions, the outcome might give author greater
insight regarding knowledge and perceptions (about the fast food), emotions or feelings
(toward the fast food) and finally likelihood or tendency (of certain behaviour).
27
(behaviour). However, depending in the consumer’s level of involvement and the
circumstances, attitudes can result from other hierarchies of effects. (Solomon et al., 2006,
p.159)
Hence in our instance, where the attitude object is fast food, plus taking into account that fast
food is considered to be low involvement product, the low involvement hierarchy of effects
can be illustrated. (Figure 3.3)
In this sequence, the consumer does not initially have a strong preference for one brand over
another, but instead acts on a basis of limited knowledge and then forms an evaluation only
after the product has been purchased or used. Under these conditions consumers are
influenced by principles of behavioural learning. (Solomon et al., 2006 p.142) Referring to
that, author assumes that consumers of fast food products will form attitudes via the concept
of low involvement hierarchy of effects. In turn, this concept will be taken into consideration
later in the dissertation by the final recommendations, when suggesting McDonald’s
communication strategy.
28
environmental influences that might affect the organization. In addition it will provide an
overview of the environment in which McDonalds is evolving.
The use of this framework is useful only when you apply the potential impact of factors, now
and in future affecting the industry, rather than just a long list of influences itself. Having said
that, we mean factors that have potential impact on customers and stakeholders. It is of vital
importance that one identifies the key drivers of change, as they will provide a better
understanding of the main issues that are currently facing the industry and how these might
affect the future of the business within the particular industry. Nevertheless, not all factors
will have the potential impact, thus combined effect of some of the factors is likely to be the
most important. (Johnson et al, 2005, p.65).
Economic and technological factors appear not to have any significant impact on the fast food
industry, and are hence irrelevant for such research. For that reason author decided to exclude
them from the PEST Framework. It is important, however, to identify the political and socio-
cultural factors, as they appear to be of crucial importance by influencing the fast food
industry in the future.
29
3.8.5 Ansoff’s product/market matrix
In order to generate options for McDonalds, the author will use the Ansoff’s product/market
matrix, which is used for identifying directions for strategic development. (Ten Have et al., p.
9)
Figure 3.5: Ansoff’s product/market matrix
Once the options will have been generated the author will be able to evaluate them and choose
the one that could be the most beneficial.
30
CHAPTER 5: FINDINGS
This chapter will provide a reader with detailed presentation of facts and data obtained using
tools described in research methodology, leaving out discussion for the final chapter. In order
to communicate findings clearly, author decided to brake down this chapter into to parts.
Firstly, the external analysis will be applied, in order to provide a reader with the context in
which McDonalds is evolving. And secondly, the key factors influencing the consumer
decision-making process will be analysed/explored.
Figure 5.1: United Kingdom Fast Food Market Value: £ and $ billion, 2001-2005
Year £ Billion $ Billion % Growth
31
Figure 5.2: United Kingdom Fast Food Market Value: $ billion, 2001-2005
In spite of consumer concerns of fast food being linked with problems such as obesity,
diabetes, heart conditions, food poisoning and scares and unethical advertising, the UK fast
food industry has enjoyed remarkable growth in recent years.
In terms of per capita expenditure, between 2000 and 2005, the fast food outlets have been
growing at the fastest pace within the consumer food service sector. (Euromonitor, 2006b)
32
Name of the company Market share (%)
McDonald's Corp 18.3
Yum! Brands Inc 8.4
Burger King Corp 8.3
Pret a Manger Europe Ltd 1.4
Compass Group Plc 1.2
Nando's Group Holdings Ltd 0.8
Source: Euromonitor, 2006b
McDonald's operates fast food restaurants all over the world. The company has over 31,000
fast food restaurants in over 120 countries. (MarketLine, 2006)
The company operates primarily in the US and the UK. It is headquartered in Oak Brook,
Illinois and employs 447,000 people all over the world. (Datamonitor, 2006)
McDonalds currently operates in more than 1,316 restaurants throughout the UK. Its profits
grew by 55% in 2004. (Euromonitor , 2006b)
33
Obesity is a major risk factor linked to heart disease, cancer, and type 2 diabetes. It reduces
life expectancy by an average of nine years, and by more in smokers. Apart from the human
cost to the individual, there is a direct cost of obesity to the nation. The Government has
calculated that the overall cost of obesity to the National Health Service is around £1 billion
(2006), with a further £2.3 billion to £2.6 billion for the economy as a whole. It warns that if
obesity continues to increase, the cost to the economy alone could rise to £3.6 billion by 2010,
plus at least £1 billion on the NHS bill. (Euromonitor, 2006a)
Referring to the Department of Health, growing obese crisis is expected to cause thousands
more people to suffer obesity related diseases. (Oliver, 2006)
Fat tax
34
Another policy to tackle the rising incidence of heart disease and prevent obesity is to place so
called fat tax on junk food. The Prime Minister's Strategy Unit raised the prospect of extra
duty or VAT being imposed on some fatty foods after heart disease overtook cancer as
Britain's biggest killer, and more young people started developing diabetes. This would be a
warning sign to producers as well as consumers and serve more broadly as a signal to society
that nutritional content in food is important. (Telegraph, unattributed, 2006)
The British Medical Journal recently claimed a “fat tax” could help prevent 1,000 premature
deaths from heart disease every year in the UK. (News.bbc, unattributed, 2006a)
35
Despite the increasing tendency of consuming junk food and rising obesity level, the health
concern of UK consumers, according to the survey undertaken in 2004, are very much high.
(Euromonitor, 2006a)
Influence of TV chefs
Another factor that has influenced the UK consumers is chef Jamie Oliver. His television
shows, books and recent TV series designed to improve the quality of school food and
highlight the danger of junk food in the UK have significantly increased consumer as well as
government awareness and interest in healthy eating. (Euromonitor, 2006a)
According to a survey, Jamie Oliver is named the biggest single force behind an improvement
in school dinners. The celebrity chef is perceived as having a bigger impact than the
government, local education authorities and the schools themselves. (Guardian, unattributed,
2006a)
Negative publicity of fast food
Despite the increasing popularity of fast food restaurants in the UK, they have been hit by
negative publicity in recent years. The reason behind that is their association with unhealthy
food and their perceived contribution to childhood obesity. Thus the growth in traditional fast
food sub sector (burgers, chip, kebab etc.) has been offset by continuous product innovation in
the bakery- sandwich sub sector (Pret-a-Manger, Subway, etc.) (Euromonitor, 2006a)
36
The Government interference
The high- profile political and public debate on obesity and other health issues will most
probably continue and this is likely to negatively affect burger, chicken and pizza fast food
sales. (Euromonitor, 2006b)
To make the above statement even more plausible, the government has failed to stop the rise
of obesity during its nine years in power. (Oliver, 2006)
Perhaps the seriousness of the situation has finally brought the government to take more
interventionist approach and ignore the accusations of running the “nanny state”. (Marrin,
2006) Probably is just the matter of time when it will start to employ the issues form the
White paper in addition to other proposals in order to tackle obesity.
These drivers will affect the fast food industry, however, it is hard to predict what impact will
predominate- the strong consumer demand and changes in lifestyles, which appears to be in
favour of fast food industry, or escalating trend of healthy living underpinned by possible new
government legislations, which negatively impact the industry.
In order to determine how McDonalds might effectively cope with the changes in
environment, it is crucial to examine the attitudes that consumers have toward fast food. Data
of this kind may give McDonalds greater insight into customer needs and wants.
Understanding this may then enable McDonalds to develop more effective marketing and
communications strategy.
37
impacts coming from external environment that might have an impact on consumer decision
making process in relation to fast food products. For focus group questions and other detailed
information please refer to appendix A.
38
They only use cuts of forequarter and flank (parts of a cow), with nothing added. All beef they
use is audited by the European Food Safety Inspection Service. Chicken they use is in their
sandwiches comes form approved suppliers that have a fully integrated supply chain to ensure
full control over all aspects of chicken farming, including feed and animal welfare.
(mcdonalds.co.uk, 2006)
Despite what McDonalds claims they use in their products, participants clearly are either not
aware of or they don’t (want) to believe it. The truth is that their overall knowledge,
perception and beliefs regarding food quality and animal welfare are negative. However,
while nutritious value of fast food and ethical issue is important to them, it would not
determine them from going to eat in such restaurants.
During the debate author noticed several times that fast food has been referred as ‘junk food’-
i.e. food that is considered to be fatty and unhealthy. Referring to one article, the Food
Standards Agency ‘junk food’ is any food high in fat, salt or sugar. (O’Neill, 2006) O’Niell
argues, why are some fatty foods defined as ‘junk’, but others are not? Government ministers
and celebrity chefs discouraging people eating French fries (which in McDonald's contain
about 5g of fat), and at the same time say nothing of eating a dish like duck a l'orange (which
can contain 15 to 20g of fat in a single serving). Why does the ‘junk food’ tag seem to be
applied selectively? According to Peter Marsh of the Social Issues Research Centre in Oxford,
cited by O’Niell (2006), which studies food and obesity issues, the term ‘junk’ has become
“simply a matter of aesthetics”, a way of disapproving of certain foods. Koeslag, a professor
of medical physiology in South Africa, argues that French fries are seen as ‘junk food’, but
roast potatoes are not. Bread is a basic foodstuff, but biscuits are ‘junk’. The sugar in cake is
detrimental to health, but the sugar in honey and grapes is not. The adjective 'junk' is
unfortunate, if not outright misleading. (O’Neill, 2006) Above arguments indicates that
McDonalds food is not as fat and caloric comparing to other food (in some instances even less
caloric and fatty). However, participants still associated fast food with ‘junk food’ and
therefore simultaneously related it to fat, greasy and unhealthy food, which then have negative
impact on the perception of such food.
39
Group expressed mix feelings and emotions towards fast food (McDonalds). While some
participants absolutely loved it, others totally hated it. One participant put this reason for
going to McDonalds: “I’m dying of hunger and nothing else is available.”
Other participant said: “It comes once in a while, you know as it’s like something driving me
there, it’s when you have a crave, then I go and eat in McDonalds”.
This statement may suggest that eating such food comes as an eager desire. According to
Dictionary.com “to crave” means to want greatly, desire eagerly. This could imply that eating
fast food for some people is similar to eat sweets (as stated at Dictionary.com, to crave
sweets). Having said that author refers to some instances of females (or men) “addiction” to
chocolate. This perhaps could be linked to the infamous documentary about McDonalds and
fast food ‘Super size me’ which showed its maker Morgan Spurlock's gain 11 kilos, an
increase of 13% of his body mass and cholesterol levels soaring, as he ate only McDonald's
for a month. (Revill, 2004) In the documentary Morgan also suggests that such food is
addictive. To underpin that, according to research hamburgers and fries could be as addictive
as heroin, scientists have claimed. Researchers in the United States have found evidence to
suggest people can become overly dependent on the sugar and fat in fast food.
(news.bbc.co.uk, unattributed , 2003)
40
the customer has about the product and the product category, the more predictable the
probable consequences and, thus the lower the perceived risk. McDonalds tries to reduce
consumers’ perceived risk by providing information about their products. On their website
everyone can have a look what ingredients each product consists of. They strive to show
customers that their burgers are not as bad as majority might think. They also argue that
McDonald’s “highly quality food is made out of best raw ingredients”. (McDonalds.co.uk,
2006a) One can, for instance, calculate daily calories intakes and compare them to
McDonald's choices, using special tables. Basically their website is designed in such way to
inform consumers about the food and services they offer, providing information regarding
animal and environmental welfare. All that with attempt to reduce consumer perceived risk.
Moreover they have been promoting active lifestyle and importance of energy balance for
over a decade, via sponsoring various sport events- the most recent one, which are yet to
come- the Olympic Games!
One participant described his eating in fast food restaurants as: “You are tired, it’s late, you
are walking home and then you see McDonalds- at that point I decide to go and eat there…
sometimes I smell McDonalds”. Similarly one added: ”I often go there when I’m driving and
I see the golden arch…” These two statements (plus referring to other researchers, i.e.
Schroeder and McEachern) implicates that purchasing fast food is mostly impulsive- people in
general, when they decide to go in such restaurants, they do not plan that in advance,
suggesting that fast food is low involvement product. Under these conditions consumers are
influenced by principles of behavioural learning. (Solomon et al., 2006 p.142) Therefore
marketers at McDonalds pay more attention to the amount of information in their restaurants,
as well as to the way it is presented. Various points of purchase stimuli plays important role
when the consumer involvement is low and the purchase is impulsive. For instance,
McDonalds restaurants are currently advertising various attractive Sony prizes that can be
won. Also when one passes by the McDonalds restaurant the typical smell that is coming out
of the restaurant works as stimuli for going into the restaurant for a meal. Author assumes that
this could be done intentionally as one of the tactics McDonalds use to encourage more
customers to eat in their restaurants.
41
The Elaboration Likehood Model (ELM) suggests that a person’s level of involvement during
message processing is a critical factor in determining which route to persuasion is likely to be
effective. When involvement is low, consumers follow the peripheral route and rely more
heavily on other message elements (e.g. background music) to form attitudes or make product
choices. (Schiffman and Kanuk, 2004, p.238) That is one of the reasons why is McDonalds
using the famous jingle “I’m Lovin’ it” backed up by famous artist Justin Timberlake, as they
try to increase consumer involvement with the use of celebrity endorsement.
Part two: influences from external environment impacting (current obesity issues in the
UK, impact of media, etc.) on consumer decision making process with respect to fast
food
While all participants were familiar with the current obesity issue in UK, they claimed that
such issue is not affecting them in any way. “It is really the matter of ignorance, people don’t
really know how to eat. Its general change in lifestyle…people don’t exercise, they are lazy”.
Another one said: “Super size me movie make me not want to go to McDonalds ever
again…” It was interesting, however, to investigate the companies’ responses on that
infamous documentary. McDonalds surprisingly stated on their website that on the whole they
agree with the Super size me’s message- that is important to have a balanced diet and take
exercise. They argue that actor ate a one-dimensional diet with more than 5000 calories a day,
that’s twice the recommended intake for and adult male, while he goes from highly active
individual to purposely stopping all physical activities. That is not the reality, besides what the
actor ate in 30 days, an average British McDonalds customer eats in 6 years. It is hardly
surprising then that this had impact on his body. McDonalds also supports their customers by
providing them relevant nutritional facts so they can make informed decisions.
(McDonalds.co.uk, 2006b) In response to the documentary McDonalds launched a website
www.supersizeme-thedebate.co.uk which provides customers with information on a balanced
diet and their opinions on documentary. One can even take a test in order to separate the facts
form the fiction and at the same time learn the truth behind statements.
Debate carried on as one participant said: ”Its about changing lifestyles- couch potato
lifestyles and stuffing food in their mouth that taste good and they have no knowledge about
how this food does harm to them. Honestly I believe that is a question of education…people
aren’t aware of the consequences”. Referring to Alock (1995), cited by Brown, McIlveen and
42
Strugnell (2000), the power of education can be immensely helpful in the pursuit of better
understanding by consumers regarding healthy eating and may occur within home, school and
social environments. This implies that education might play crucial role by deciding what
people eat. Perhaps that is the reason why in general all participants, who are educated final
year university students, do not eat in McDonalds that often. Or perhaps this is the matter of
their social status/class. Furthermore one participant stated: ”If parents don’t encourage kids
to do something (sport) and if they don’t teach them how to eat properly, then they will end up
not doing so later in their life”. According to Warwick et al. 1997, cited by Brown, McIlveen
and Strugnell (2000), evidence has suggested that young consumers appear to be creatures of
habit, fuelled from birth by the guidance of parents, peers and from other societal factors and
once formed, such habits are difficult to change. This might indicate that the way children
were brought up; it is likely to affect its food behaviour. However, later research suggested
that the food preference habits of young consumers could change, depending upon the
environment within which they are present (home, school, social). (Brown, McIlveen and
Strugnell, 2000).
A lengthy debate took place whether should the government bring in laws to stop
companies promoting and producing unhealthy food or let the industry self-regulate and allow
customers make their own choices. Group supported the fact that the government intends to
interfere/has interfered by imposing regulation regarding advertising junk food to children.
However, they were sceptical by other regulations. Group advocated “personal liberty”- “I
believe strongly in the personal liberty and making your own choice. If you walked in the fast
food restaurant, you have made that decision…but then again we have came back to the
question of education- if that is really what you want to do (eat) as you have healthier
alternative option right next door. Everybody is given a choice to choose healthier alternative
over the fast food”.
Followed by another participant: “I agree- it’s a matter of education. If people know they
have alternatives, from that point on it’s their own choice. What the government should be
doing is promoting other lifestyles, and not stop companies from what they are doing”.
On the last question should fast food companies be held responsible for rising obesity levels
in the UK everyone said no, except one student who argue that: “They (fast food companies)
are aware of what they are serving, they know what kind of impacts such food has on people,
43
but they are in the business of making money. But somewhere you have to draw a line of
what’s right and what’s wrong…maybe that’s an ethical issue, I don’t know. So in a sense yes
they should be held responsible”.
There could be a possibility that fast food chains will be fought in a similar way tobacco
companies were fought. There were some cases in which individuals blamed McDonalds for
causing obesity, however, the lawsuits were dismissed. (Wazir, 2003)
To conclude, while ethical issue and nutritional value of fast food is important to them it will
not determine them from going to eat in such restaurants. The desire for fast food comes
impulsively. The convenience-healthfulness dichotomy, describing fast food as convenient but
unhealthy was underlined. High public anti-obesity debates in the UK appear to have no
significant negative impact on consumer attitudes towards fast food. Fast food companies are
not to be blamed for rising obesity levels in the UK, though people themselves.
Figure 5.5: How often do you eat fast food (i.e. McDonalds)?
44
QUALITY OF FAST FOOD & CONSUMER’S TRUST IN MCDONALDS
Author used ‘selected evaluative scale’ to gauge respondents’ attitudes towards quality of fast
food. The majority of respondents classified all types of food with exception of salads and
fruit, as the worst quality. For detailed information regarding that question please refer to
Appendix C. Answers given by that question justified a lengthy debate from focus group, that
nutritional value of such food is indeed regarded as extremely poor.
34% of respondents have seen a list of nutrition facts in McDonalds restaurants. Nevertheless,
those who had seen it they do not trust what is written on it. (Appendix C)
83% of respondents believe that McDonalds use chemicals in their products. (Figure 5.6)
When respondents were given the 5 point Likert-scale, 31 out of 71 (44%) considered what
McDonalds claims on their website, “…committed to providing high quality food, using the
best raw ingredients” as untrue. (Figure 5.7)
Figure 5.6: Do you believe McDonalds put chemicals in their food? (To improve the taste
45
Figure 5.7: McDonalds claims on their website that they use “the best raw ingredients in
their highly quality food”! Do you believe that? Please mark on a scale from 1 to 5 (1 as
least believable)!
When respondents were given the fact that if McDonalds would have used 100% beef along
with fresh vegetables, apples in their apples pies, etc., 34% said they would go eat there more
often.
46
30% of respondents have visited www.mcdonalds.co.uk and 50% of those who have visited
claimed that they haven’t found it really appealing or useful. (Figure 5.8) Furthermore, 61%
of those who haven’t visit the website they don’t intend to visit it in the future.
Reason for going to McDonalds as “dying of hunger and nothing else is available” was firstly
picked up during the focus group discussion. It was, however, claimed by larger population as
the strongest reason why eating there as well, where 27 out of 71 participants (38%) selected
that option over the convenient one (28%). (Figure 5.9)
47
Figure 5.9: What makes you go to McDonalds?
When participants were asked to write three adjectives they would link to McDonalds
products; unhealthy, cheap, tasty and fatty were the ones that were noted most frequently. For
adjectives given by all 71 participants please refer to Appendix C.
ETHICAL ISSUES
Merely 31% of respondents did not have any knowledge what ethical issue (animal welfare
concerning chicken) in relation to McDonalds is. While great majority of respondents were
familiar with the ethical aspects, 25% of those claimed that this is the reason they don’t eat
chicken in McDonalds. (Figure 5.10)
48
Figure 5.10: When you eat chicken sandwich at McDonalds, does the ethical issue
When respondents were given the fact that if McDonalds would have used 100% naturally
raised chicken meet, 39% said they would go eat there more often.
49
Figure 5.11: Do these high public obesity debates from the government and media have
any impact on you (in terms of what makes you change your attitudes towards fast food
products)?
The infamous documentary ‘Super size me’, which 84% of all participants claimed they were
familiar with, had a strong negative influence (on those who had seen the movie). 35%
claimed that ever since they saw the documentary, they don’t eat in McDonalds anymore.
(Figure 5.12)
50
Figure 5.12: Did Super size me documentary made you go less in McDonalds?
On the last question participants blamed ‘junk food’ as the strongest reason for UK being
selected as the fattest country in Europe. (Figure 5.13)
51
Figure 5.13: UK has been recently chosen as the fattest country in Europe. What do you
think is the reason for that? Please apply everything that you consider as a reason!
In conclusion, author found out that the key issues/themes from the focus group discussion
appeared to be of greatest importance with the larger group of UK’s fast food target market.
However, one topic from focus group did not match with answers given in questionnaires.
While participants in the focus group claim that current public anti-obesity debates in the UK
have no significant negative impact on their attitudes towards fast food, respondents by
questionnaires claimed opposite. Respondents associated McDonalds and its products with
adjectives such as unhealthy, cheap, tasty and fatty. They ‘ranked’ their food (with exception
of salads and fruit) as of the worst quality. Ethical issue concerning McDonalds, current high
public obesity debates in the UK along with the documentary Super Size Me, appears to
contribute towards negative attitudes that consumers have with McDonalds.
52
CHAPTER 5: RECOMMENDATIONS
In this chapter a set of proposed recommendations as well as supporting analysis of the
options for McDonalds will be depicted. In addition the implementation plan to support the
key recommendation, including description of resources required will be illustrated.
Now that factors that influence the consumer decision-making process regarding fast food
have been identified and analysed, the following recommendations that McDonalds might
pursue is proposed. From the introduction chapter it can be seen that the company is, despite
its traditionally unhealthy image, performing in fact really good.
There still are, however, few areas that McDonalds might improve in, to boost current rising
sales and secure escalating share prices. Options like Increase awareness of the quality of
McDonalds’ products, promotion of active lifestyle through celebrity football player, new
healthy menus along with redecorating its restaurants, and hiring celebrity chef to promote
McDonalds brand might help McDonalds improve its business of operation.
Due to word limit restrictions for this dissertation, author decided to further describe and
evaluate two options that could be beneficial for McDonalds. The proposed two options are
illustrated in Ansoff’s Matrix.
Figure 5.1 Options for McDonalds illustrated in Ansoff’s matrix
53
5.1 Option description and evaluation
It is important that options are presented with a concept of success criteria, by which these
strategic options can be judged. According to Johnson (2005, p.357), there are three main
success criteria:
54
nutritional content of the food, animal welfare, super size me documentary, etc. From the
analysis 34% (for beef burgers) and 39% (for chicken sandwiches) of respondents claimed
that if they had been given a fact that McDonalds uses 100% beef and chicken, they would eat
there more often. (Appendix C, questions 9 and 15) If McDonalds manages to inform these
people about the leanness of its meat and the truth behind its apple pies and chicken
McNuggets- that might reduce consumers risk perception, since they would feel more
confident of what they are eating, and where did that meat come from.
Besides that they could attract more people to visit their website and spend more time there by
introducing various games and healthy quizzes that could be launched form their website.
They could increase consumer’s knowledge regarding its product by giving away (after the
purchase with a receipt) each customer a special voucher booklet, in which the information of
the ingredients they use how they treat the animals and what parts of animals goes into their
burgers would be described. In addition, this booklet would contain the story of the
McDonalds brand in a ‘warm and engaging way’ and therefore try to create and increase the
consumers’ emotions with McDonalds brand. Such booklets/fliers would also be distributed in
front of each McDonalds restaurants. They would also put their nutritional facts list on every
back of the tray paper, give the chance to their customers to see how much fat, sugar, proteins,
calories etc. their meal consists of. That would be a good start of building trust with their
customers.
This option is suitable since it fits perfectly in the environment. People are concerned with
what goes into their bodies. Referring to findings, people would go more often to McDonalds
if they would be guarantied that what they are eating is 100% good quality food. People want
to know what they are eating. By providing all these information regarding nutrition quality,
McDonalds would increase sales as well as increase and improve their brand value.
What are the risks and returns? That is the question of acceptability. This option is
considered as not particularly risky. In case of failure, this would not be disastrous for
McDonalds (apart from for money invested in that promotional campaign). Regarding
possible returns associated with that option are incomparable with the risk of that option. In
55
addition, there is no critical issue attached to that option that would not be accepted or
approved by McDonalds stakeholders.
Is it feasible, will it work in practise? This option should work in practise, since author
presume that McDonalds is capable of such marketing investment. Improving their website,
purchasing of prizes, providing voucher booklets and other point of purchase promotional-
informational material to increase their awareness is relatively inexpensive for a giant like
McDonalds. Moreover author believes that McDonalds possesses all resources and
competences in order to make this option work in practise.
Nowadays customers demand quality and healthy food. Thus, McDonalds should consider
introducing new range of healthier sandwiches, salads, fruit salads and other more nutritious
food. For French fries, apple pies and other fried food, they could, for instance, instead of
frying it, prepare it in oven, which would be a lot healthier and it would eliminate the trans fat
it uses in cooking fried food. Instead of white bread they could use wholemeal bread. They
would start position themselves as healthier food chain. The interior design of their typical
restaurant would change from combination of red-yellow colour, to softer browns-
emphasizing the nature. Moreover they could start introducing computers equipped with
Internet in some of their restaurants as well as newspapers. This could attract new customers
going to their restaurants- they could broaden its customer base. They would be promoting
healthy living by new advertising campaigns in which advertising message would be designed
in such way to show explicitly how more nutritious and healthier their food is.
From suitability perspective, it fits completely with trends in domestic environment and
current health concerns. That option might result in changing peoples’ perception they
presently possesses with McDonalds brand, which is anything else than healthy.
56
quality fast food chain’. Furthermore not all McDonalds shareholders might agree with that
option, since it would require significant investments, which would most probably mean no
dividends for them in the short-medium term. Furthermore there could be a risk of
cannibalisation effect on traditional burgers, which would suffer on expense of new healthier
menus.
Is this feasible? From financial perspective it would be probably one of the most expensive
investments in the history of the company. Money required for financing refurbishment of all
restaurants and offering healthier, better quality products (which are obviously more
expensive than products they offers now), on the top of new advertising campaigns, would
definitely be a difficult task, even for a giant like McDonalds.
Both presented options are attractive for McDonalds and furthermore both fit in the
environment. However, according to authors’ findings, he believes that option 1 is more
appropriate than the second one. Moreover first option meets criteria (suitability,
acceptability, feasibility) better than the second option. It is very straightforward, it can be
employed immediately and it does not require heavy investments. Above all, it does not shy
away from McDonalds core (traditional) business, which is making burgers and French fires.
57
Redesigning the website (in order to make people read about the facts of their products
and spend more time in their website)
Promote their website (coupon with a number that has to be entered on their website in
order to win prizes)
Designing special voucher booklet, designing list of nutritional facts (which goes on
the top of the tray), and other point of purchase promotional material
*Once the new website is launched, it will be available in the future as well and not just in the first 6 months
as it is illustrated on the chart.
58
CHAPTER 6: CONCLUSION
In this chapter author will conclude his research with how the research question has been
solved. In addition a brief re-cap of the whole dissertation will be provided.
My research question:
What factors are currently influencing the consumer decision-making process in the fast
food restaurant industry in the UK, and how is McDonalds responding to changing
environment and consumer behaviour?
The need for fast food comes impulsively. People do not spend significant time thinking on
whether they will go eat in McDonalds or not. Attitudes that consumers have with McDonalds
are predominantly associated with their knowledge regarding fast food. Their
knowledge/information they have acquired regarding fast food is primarily negative. As a
result their attitudes are also negative. Research revealed that majority of people link
McDonalds food with adjectives unhealthy, cheap, tasty and fatty. Furthermore people ranked
McDonalds food as of worst quality. The reason for eating in their restaurants was described
as the ‘last resort’, underpinning the fact that McDonalds is still (traditionally) perceived as
typical junk food restaurant. There are also external influences that have impact on consumer
decision-making process. These have direct impact on consumer’s psychology, resulting in
changing their attitudes and perceptions they currently possess. These external influences are
current high public obesity debates in the UK, which according to research have negative
impact on consumers purchasing behaviour. All factors above contribute towards risk
perception that consumers have with McDonalds food. The research also revealed that
consumers do not trust McDonalds, which negatively impact on their decision-making
process of eating in such restaurants.
59
change that might have an impact on the industry in the future is high- profile political and
public debate on obesity and other health issues in the UK.
Nonetheless, McDonalds is used to that. Having said that, McDonalds has been battered by
books (Fast Food Nation), thousands of dietary experts stressing dangerous facts about
McDonalds food, criticized by celebrity chefs (Jamie Oliver) and they even made a
documentary (Super size me) to reveal the truth behind the fast food. On top of that it had
gone through several lawsuits (in the US), fortunately (for McDonalds) neither of them
succeeded. Indeed, these had negative impacts on the company as people became aware of the
consequences of fast food. As a response on that McDonalds introduced healthier menus, cut
the amount of trans fat it uses in cooking fried food and introduced the website that offers
their side of the story as a response on the ‘Super size me’ documentary. And it seems like its
effort has paid off. McDonalds sales are now increasing and as a consequence its shares price
ended at highest point in past six years. Perhaps McDonalds became immune on all those who
want to harm its reputation and it even got stronger with all these many years of accusations.
Perhaps in a ten years time they might be famous for their salads and organic food as they are
now for their burgers and fries.
To conclude, author has not found anything particularly new regarding consumer attitudes
towards such food. Consumers still (and probably will) have negative attitudes towards
McDonalds. They will perceive it as something greasy, fatty and bad for their body.
McDonalds cannot change people’s perception over night. What they can do, though, is they
can show people what their food is made of- it is then up to us consumers, whether we will
trust them or not. And that is what will make us go and eat their burgers.
60
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Viewed 25/10/2006
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Viewed 23/10/2006
WAZIR, B. (2003) Fight the good fight against fat
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Viewed 26/11/2006
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4366-9856-C5F4E7E7B0DB
Viewed 15/10/06
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Viewed 12/10/2006
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McDonalds Corporation, MarketLine Database, 2006
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Wednesday November 15 2006
APPENDIX A
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FOCUS GROUP
Focus group took place at Regents College campus (room 106) on the 16th of November 2006.
It consisted of seven students, four men and three women (the initial plan was to interview
nine people but two female students cancelled one hour before the session). All participants
were EBS students.
The moderator (author of the dissertation) was not trained for doing such research. Before the
actual session, the invitation with a proposed agenda, session time and list of questions the
group will discuss, was sent to all participants via email. Before the session began the ground
rules were also explained. Furthermore the PowerPoint slides with one question on a slide
were showing throughout the whole focus group in order to imply the participants to stay
focus on the question discussing at that time. The discussion was recorded with an audio-
video recorder. The content of which is available on DVD.
APPENDIX B
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QUESTIONNAIRE
Hi! I’m doing this for my dissertation and I would really appreciate if you could answer
following questions. The topic is FAST FOOD & MCDONALDS.
I’m looking for your attitudes and perceptions regarding fast food products and restaurants,
particularly McDonalds. Moreover I’m trying to find out the impact of current high pubic
anti-obesity debate in the UK, that it has (if it has) on your behaviour.
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4. On a scale from 1 to 7 (1 being the worst quality and 7 as the best quality) how nutritious
are McDonalds’ products?
o Beef Burgers 1 2 3 4 5 6 7
o Vegetables in burgers 1 2 3 4 5 6 7
o Salads 1 2 3 4 5 6 7
o Fruit 1 2 3 4 5 6 7
o Apple pies 1 2 3 4 5 6 7
o Chicken sandwiches 1 2 3 4 5 6 7
o McDonalds McNuggets 1 2 3 4 5 6 7
o French fries 1 2 3 4 5 6 7
5. Have you ever seen a list of nutrition facts at the McDonalds restaurants?
o Yes
o No
7. Do you believe McDonalds put chemicals in their food? (to improve the taste and/or
improve the texture of vegetables)
o Yes
o No
8. McDonalds claims on their website that they use “the best raw ingredients in their highly
quality food”! Do you believe that? Please mark on a scale from 1 to 5 (1 as least believable)!
1 2 3 4 5
9. If you were given the fact that McDonalds uses 100% lean beef along with fresh
vegetables, apples in their apples pies, etc. would that make you go eat there more often?
o Yes
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o No
12. If you haven’t visit it yet, do you intend to visit their website in the future?
o Yes
o No
14. How well are you aware of the ethical issues (animal welfare- for example feeding
chicken with steroids, etc.) regarding McDonalds chicken farming?
o Very familiar
o Quite familiar
o Don’t know what that is
15. When you eat chicken sandwich at McDonalds, does the ethical issue regarding chicken
bothers you?
o Yes it bothers me, and that’s the reason I don’t eat chicken in McDonalds
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o Yes it bothers me, but I eat it anyways
o It doesn’t bother me at all
o I don’t eat chicken
16. If you were given the fact that McDonalds uses 100% naturally raised chicken meat in
their sandwiches, would that make you go eat there more often?
o Yes
o No
17. Please write 3 adjectives you would link them to McDonalds products they offer!
________________________________________________________
18. Are you familiar with the current obesity issues (the government anti-obesity policies,
Jamie Oliver campaigns, etc.) in the UK?
o Yes
o No
19. Do these high public obesity debates from the government and media have any impact on
you (in terms of what makes you change your attitudes towards fast food products)?
o Yes, I now have different perception of fast food and I don’t eat it any more
o Yes, but I still go and it in fast food restaurants, just not as often as I used to
o No, it didn’t affect me in any way and I still eat in fast food restaurants
o I never eat in such restaurants
20. Are you familiar of the documentary about McDonalds “Super Size Me”?
o Yes
o No
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o Yes, I don’t eat there anymore
o Yes, at the beginning, but now I go as often as I used to
o No, I still eat there
22. UK has been recently chosen as the fattest country in Europe. What do you think is the
reason for that? Please apply everything that you consider as a reason!
o Busier lifestyle
o Sedentary lifestyle (lack of exercise)
o Lack of education
o Eating too much “junk food”
T H A N K Y O U F O R Y OU R PA RT I C I PATI O N ! ! !
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APPENDIX C
On a scale from 1 to 7 (1 being the worst quality and 7 as the best quality) how
nutritious are McDonalds’ products?
71
72
73
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