Strategy

Competitive Strategy

Executive Summary

This report is designed to offer understanding regarding competitive strategies in the context of contemporary market environment. For this purpose, this study has supported to offer detailed understanding regarding the research topic while taking the examples of the firms of food industry and airlines industry. This study has supported to give consideration towards two arenas, i.e. global strategy as business model change and target markets and modes of entry. For this purpose, researcher has considered two industries. Utilization of various concepts and theories remained supportive to increase the reliability in this study.

Introduction

This report is based on secondary data analysis and has supported to offer in-depth knowledge regarding the market strategies. In this context, researcher has considered two arenas, i.e. global strategy as business model change and target markets and modes of entry. For this purpose, researcher has considered two industries. To get detailed understanding regarding global strategy as business model change, researcher has utilized food industry. In like manner, for the purpose of getting understanding regarding target markets and modes of entry, researcher has taken airline industry. This study is based on secondary data analysis and has selected those firms which have successfully applied the chosen theory.

Global Strategy as Business Model Change

Under this concept, researcher has taken food industry and has included McDonald’s and Burger King as firms to analyze the components of the business model, global strategy as business model change, value disciplines and business models and choosing a value discipline and market leadership.

Components of the Business Model

There are four components of business model they are value proposition, market participation, value chain infrastructure and global management model.

Business Model of McDonald’s

Value proposition:

McDonald’s is highly famous organization which is dealing in food chain industry. Its quality products and quick service enables to create competitive advantage in the industry. Company has wide range of products and has great product lines (Mc. Donald’s, 2017). Company targets children and focus to provide quick breakfast to this target segment while giving concern to tasty meals.

Market participation:

Firm’s stores are mainly situated at the city market areas so that the students, employees, working professionals and middle class families can be easily addressed. Moreover, firm has shown huge presence on social media and digital marketing (Mc. Donald’s, 2017). McDonald’s also give concern towards various campaigns and offers which enables the firm to attract its target consumers, i.e. children and family.

Value chain infrastructure:

The value chain infrastructure of the McDonald’s includes the primary activities and support activities. Under primary activity, McDonald’s purchases the raw materials from pre-defined suppliers. In the secondary activities, its infrastructure is modern to attract the young generation. It changes the themes of the restaurant according to the changing market need (Khanagha, Volberda and Oshri, 2014). The infrastructure is also sophisticated due to advanced use of IT and focused towards maintaining the green activities. It provides the eco-friendly environment to the customer and employees.

Global management model:

McDonald’s has their marketing and sales in all over the world and currently it is operating in more than 100 countries and serves millions customers per day. For global management, firm utilizes the local market spices and major ingredients and designs the menu according to the preference of local market (Ghezzi, Cortimiglia and Frank, 2015). In like manner, firm also gives the focus towards the taste parameters of the local market.

Business Model of the Burger King

Value proposition:

To create value of its products, firm is highly focused towards offering quality products. In like manner, firm gives consideration towards great taste & affordability which enables the firm to increase the brand loyalty and supports to create long-term sustainability in the industry (Saebi and Foss, 2015). Consistency and quick delivery enables the firm to increase customer satisfaction.

Market Participation:

The target market of Burger King is young adult, specifically young males. However, firm is focused towards other demographic sector too. Firm has created its restaurants at the dense location which enables to increase the approachability of the firm (Lambert and Davidson, 2013). In like manner, firm is focused towards online presence which supports the firm to attract huge population.

Value chain infrastructure:

The value chain infrastructure of Burge king supports to present every step of the business activities to deliver a valuable product or service in the market. Firm is focused towards waste management, recycling process and CSR activities which enables the firm to create sustainable infrastructure. Under primary activity, firm focuses towards procuring the quality raw material. Firm is focused towards effective marketing and sales activities (Cummings and Worley, 2014). In like manner, firm infrastructure is designed with advanced technique. Human resources of the firm are highly experienced and trained and are focused towards customer satisfaction. Firm use advanced technology in production and overall operations and procure most of the ingredients from the local market.

Global management model:

Burger King is dealing in around 100 countries and has more than 15,243 outlets. Burger King product-lines vary from place to place (Greenspan, 2015). Firm gives concern towards utilizing different strategies to deal in different market. In like manner, internet advertising remains highly assistive to attract global consumers. Firm utilizes local language in advertisement which supports the firm to promote in the global market.

Global Strategy as Business Model Change

Mc. Donald’s

In the context of McDonald’s due to increase in the issue of obesity at a global platform, firm has increased concern towards developing healthy products. In the current scenario, firm has increased the concern towards digital marketing as at present most of the consumers spend their huge hours on internet so digital marketing enables the firm to influence the consumer buying behavior (Tongur and Engwall, 2014). In like manner, firm offers time to time discounts, offers, coupons, etc. to boost the consumers to buy more. At present, company has increased the focus towards value preposition. In this perspective, firm gives concern towards attract the consumers through offering various offers, quality products and services. On time delivery, use real ingredients, great taste, transparency in production, etc. strategies enable the firm to promote the firm products.

Burger King

At present due to increased concern of the consumers towards CSR practices, firm has given consideration towards scholarships and financial assistance for educational programs and for this purpose, Burger King donates huge amount of fund at McLamore Foundation (Hanlon, 2016). It enables the firm to create positive word of mouth in the industry. To create competitive advantage at a global market, Burger King deals in less product line which supports the firm to achieve economies of scale and enables the firm to achieve cost leadership in the industry. In like manner, Burger King uses market-oriented as well as bundle pricing strategy which enables the firm to increase the customer attraction.

Value Disciplines and Business Models

McDonald’s

McDonald’s uses various strategies to differentiate it from the competitors. For this purpose, while designing the advertisements firm gives concern to this segment. Moreover, firm uses attractive slogan “I am lovin it” supports to attract this segment. It enables the firm to increase customer intimacy (Sinkovics, Sinkovics and Yamin, 2014). Moreover, firm is highly active on social media and has given chance for kids to be a Player Escort UEFA Euro 2016 in France. Moreover, firm has also developed the campaign on Instagram such as “CelebrateBetter” campaign. Additionally, there are various other campaigns which are run by the firm time to time. Happy meals, happy hours, etc. strategies are used by the firm to increase the target market intimacy.

The target customers of McDonald’s are family and kids. Firm is focused towards providing low cost, family friendly products to increase the value in the target market which enables it to differentiate itself from its competitors. Moreover, it provides the facility of free Wi-Fi to attract adults (Grant, 2016). In like manner, firm runs different experiential and digital activity campaigns which enable to increase the interaction with the families which enables the firm to provide operational excellence. To achieve product leadership, firm uses local market spices and gives concern to offer the products according to the local market taste. Firm is focused towards research and bring new product according to the changing market need. Corporate vision and objectives of the firm is to offer the best quick service restaurant experience while focusing towards outstanding quality, service, cleanliness, and value which will remain supportive to increase customer satisfaction and to effectively target family and children (Cortimiglia, Ghezzi and Frank, 2016). It will enable the firm to increase the discipline and market leadership.

Burger King

Burger King is focused towards effective CSR practices to attract the consumers. The target customers of the firm are young adults. This is the segment which gives huge concern towards environment. Due to this reason, firm gives focus towards social activities. In like manner, firm utilizes the branding strategies of name of the firm on caps, t-shirts, etc. (Rodrigo, 2012). This organization gives huge concern towards R&D which supports the firm to create global presence and to increase customer intimacy (Cortimiglia, Ghezzi and Frank, 2016). Corporate vision and objectives of the firm is to achieve the leading position in the quick service while increasing the franchise system to grow, which will enable the firm to increase the market presence.

Choosing a Value Discipline and Market Leadership

Mc. Donald’s

McDonald’s is focused towards offering operational excellence to the customers while offering quality products at an affordable price while offering quick services and home delivery options. Firm uses advanced technology in its restaurant and offers time to time discount offers to the consumers which enable the firm to achieve the parameters of operational excellence which also enables the firm to meet the standards of customer intimacy and product leadership. To meet the consumer need, firm introduces new meals and also does changes in the existing range.

Burger King

In like manner, Burger King is the firm, which is highly focused towards achieving the economies of scale. For this purpose, firm focuses to deal with less product lines which enable the firm to create price leadership. It supports the firm to achieve the standards of customer intimacy and product leadership too.

Target Markets and Modes of Entry

Target Market Selection

British Airways (BA)

For targeting the market selection, British Airways uses single-segment concentration marketing strategy which enables the firm to offer four different service packages to different customer segments. In this context, BA uses different strategies to target different customer segments and offer its services on four levels, i.e. economy, premium economy, executive and first class (Kraus, et al., 2015).

Virgin Atlantic Flights

This airways industry targets the low price consumer and offers low price services (Virgin, n.a.). Its targets the audience who are price sensitive consumers who prefer to avail the airlines services at low cost with good quality.

Measuring Market Attractiveness

British Airways (BA)

To attract the global citizens, firm is focused towards offering quality services. For this purpose, firm gives concern towards offering effective dine facility and to offer quality services to the consumers. In like manner, to attract the global agnostics, firm offers its services at lower prices to its customers, which enables the firm to attract the price conscious consumers and the consumers who are not brand loyal and can shift to other brand easily (Brouthers, 2013). Majorly firm attracts the consumers who are highly quality seeker and willing to pay for premium quality.

Virgin Atlantic Flights

Its market attractiveness is high quality with low price which remains assistive to create competitive advantage in the industry and differentiate it from its competitors (Ang, Benischke and Doh, 2015).

Entry Strategies: Mode of Entry

British Airways (BA)

BA is the large firm and has huge amount to invest, due to this reason, this firm will utilize FDI (Foreign Direct Investment) strategy while entering in the new market (Musso and Francioni, 2014). Acquisition strategy will remain assistive for the firm to create competitive advantage in the new market.

Virgin Atlantic Flights

Virgin utilizes FDI (Foreign Direct Investment) strategy to entering in the new market (Musso and Francioni, 2014).

Entry Strategies: Timing

British Airways (BA)

BA deals in economy, premium economy, executive and first class segments, due to this reason firm create the entry barrier for the new entrants. BA was established in the year 1974 when there is a low competition due to which firm has gained the advantage of first mover (British Airways, n.a.).

Virgin Atlantic Flights

This firm has not get the advantage of first mover as this firm established in the year of 1984 (Virgin, n.a.). However, due to effective pricing and quality strategies firm become able to create recognition in the global market.

Conclusion

This study has supported to conclude that firms need to use different competitive strategies to sustain in the contemporary market environment. In like manner, it has enabled to understand that firms change their market strategy while dealing in the global market as it is essential to survive in the situation of fierce competition. Additionally, while targeting a market, it is essential to give focus towards market attractiveness and entry strategies in the context of modes of entry and timing parameters. Utilization of Mc.Donald’s, Burger King, British Airways and Virgin Atlantic Flights as these are well-known firms and are highly focused towards creating long-term sustainability in the industry. From the above study, it can be recommended that firms need to increase concern towards the changing market need while effectively analyzing the demand of local market as customers demand are highly unpredictable in nature. Moreover, firms should also focus towards cultural influence, language barrier and cultural diversity as these are the major challenges which are faced by the firm while dealing in the global market.

References

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