McDonald’s Ansoff Matrix

McDonald’s Ansoff Matrix is a marketing planning model that helps the fast food giant to determine its product and market strategy. Ansoff Matrix illustrates four different strategy options available for businesses.  These are market penetration, product development, market development and diversification.

McDonald’s Ansoff Growth Matrix

Within the scope of Ansoff Matrix, McDonald’s uses three growth strategies in an integrated manner:

1. Market penetration. Market penetration refers to selling existing products to existing markets. The fast food chain engages in market penetration growth strategy through efficient implementation of integrated marketing strategy.

2. Product development. This involves developing new products to sell to existing markets. McDonald’s introduces new items on its menu in a regular manner on par with changes in customer tastes and preferences. For example, latest additions in the menu include The Hash Brown McMuffin, The Crunchy Double, The Land, Air & Sea and The Surf + Turf.

3. Market development. Market development strategy is associated with finding new markets for existing products. Market development through franchising has been one of the main growth strategies for McDonald’s since the purchase of the company by Ray Krock from the founder brothers Richard and Maurice McDonald. Thanks to successful application of this strategy, currently there are 40,031McDonald’s restaurants in119 countries.[1]

4. Diversification. Diversification involves developing new products to sell to new markets and this is considered to be the riskiest strategy. Up to date McDonald’s has not diversified outside of its core business of selling food through franchising and company-operating stores and generating revenues from real estate leased to franchisees.

McDonald’s Corporation Report contains the above analysis of McDonald’s Ansoff Matrix. The report illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces, Value Chain analysis and McKinsey 7S Model on McDonald’s. Moreover, the report contains analyses of McDonald’s leadership, business strategy, organizational structure and organizational culture. The report also comprises discussions of McDonald’s marketing strategy, ecosystem and addresses issues of corporate social responsibility.

[1] Annual Report (2021) McDonald’s Corporation