1. Company background
a. McDonald's Corp. was founded in 1940 and is headquartered at ONE MCDONALD'S PLZ DEPT 332, Oak Brook, IL 60523, United States (1)
b. The firm’s primary product is a hamburger (Big Mac), and it produces various types of sandwiches and other fast foods.
c. McDonald’s is in the American fast food industry, SIC code 5812(Retail-Eating Places), 2012 NAICS code 722513(Limited-Services Restaurant). (2)
2. Market definition
d. Product dimension.
The market for hamburgers and many types of fast foods is somewhat deep, because there are quite a few of substitutes for McDonald's. When it comes to product format, they are quite similar although there are some minor differences in shape. Some examples are as follows. (3)
* Burger King Holdings, Inc.- Double whopper bacon deluxe double
* Wendy's International, Inc.- Bacon deluxe double
* Sonic Corporation- Supersonic cheese burger
* Subway- BMT
* Jack-In-The-Box-Jumbo Jack
* In-N-Out- cheese burger(California)
e. Geographic dimension.
When it comes to the geographic dimension in the US, it is very deep for hamburgers since numerous fast food stores across the nation and restaurants sell some type of hamburgers.
f. Customers Segments
* Households with children or teenagers.
* low income family
* Adult seeking a comfort food easy meal.
3. Market structure
g. Market Structure:
McDonald’s operates in a monopolistic competition market for its hamburger product. There are bunch of competitors, products are not 100% identical, and there are limited barriers to entry. In addition, non-price competition is very important in the market of this product.
* Number of Competitors
There are many competitors such as Burger King Holdings, Inc....