Task 2 (M1)
Similarities -
The similarities between both Adidas and McDonald's is that both use the growth
strategy scheme to gain maximum profit at lower risks. And the 4 growth
strategy they all use are Market penetration, Market development, Diversification
and Market penetration.
Both businesses use product development to gain maximum profits. Both
businesses use product development methods to increase their development
range and profits, despite that both businesses have different aims to gain profit,
and to increase customer base due to the business selection. McDonald’s and
Adidas are both developing new interesting ideas and plans to create more new
products for their existing customers, because the demands from the customers
are high therefore both businesses will need to increase the production scale of
new products. McDonald’s developed a new product called “Bacon clubhouse”.
Before McDonald’s put the “Bacon clubhouse” on the menu, the product
development department tested out the product with a group of focus group, to
find out what’s good, and are there any improvements. The feedback was good,
therefore McDonald’s revealed the new “Bacon clubhouse” burger on the menu
in 2014. They’ve advertised the burger online, so more customers who regularly
dine there are aware of the new burger. Similarly Adidas also developed new
products in the past to give to their existing customers. The product that Adidas
has created was a new pair of football trainers called “AdiPure lll”. Before they
put the new football trainers on the market, they tested it out with a group of
focus group from different demographics, and shoe size. They tested it out to get
a review of the base of the trainers, and the feel inside wearing the trainers. The
feedback was good, therefore Adidas put the new trainers on the market, and
they advertised it on the website, so more customers are aware of the new
arrival of the football trainers.
Both businesses use market penetration to increase more sales of the existing
product either by increasing the promotion, or reducing the price of the product
through advertisement, volume discounts and other strategies. McDonald’s had
existing products which were beverages, and dessert. At the time of the offer, it
was a summer day where everyone were out in the sun doing different types of
physical activities, therefore McDonald’s offered the sale in the summer because
it was the ideal season for selling beverages and desserts at a low price.
Consequently McDonald’s had put up an offer which was selling any sizes of
beverages for $1, apart from that it also bring people to buy other products on
the menu, such as Big Mac, the $1 offer on the burgers and fries. The sales have
increased due to that offer. The offer reached to many people in USA by
advertisement. McDonald’s advertise this offer via handing out leaflets, attaching
posters on the wall, and the online advertisement on the website. Similarly
Adidas followed the same method of market penetration, and they decided to
sell their existing products(football trainers, sport clothing, sports equipment’s)
at a low affordable price, and they have decided to do this offer in the summer
