McCafé Marketing Plan

By Mikail M Gasanov

Mikail Gasanov

7 February 2012

BBA Marketing Planning, Group A

McCafé marketing planExecutive summary…………………………………………………………………………………………………………………….2

Current marketing situation…………….…………………………………………………………………………………………..2

SWOT analysis……………………………………………………………………………………………………………………………..7

Segmentation, targeting, and positioning……………………..………………………………………………………………10

Objectives and issues……………….………………………………………………………………………………………………….12

Marketing strategy and programmes……………………………………………………………………………………………14

Financial plans (budgets)…………………..…………………………………………………………………………………………17

Metrics and implementation controls…….……………………………………………………………………………………...18

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Executive SummaryMission Statement:

McCafé aims to be the number one coffee selling cafe in Lausanne.

First introduced in 1993 in Melbourne, McCafé became one of the largest coffee shop

chains in Australia and New Zealand. The brand is owned by the worldwide known fast

food restaurant group McDonald’s. The McCafés are usually located inside the McDonald’s

restaurants. The McDonalds group calls this concept “Shop within a shop”. They have a

separate cash desk and offer a variation of different hot drinks like coffee and hot

chocolate, high-quality desserts and sandwiches. There are already 1,300 McCafés in the

world. The plan is to expand and open 1,000 new McCafés in Europe.

McCafé in Lausanne is located in front of one of the largest train stations in Switzerland –

Lausanne Gare. The café has a great potential due to its unique location; however, it faces

several important problems, which need to be solved. The aim is to create a large social

place for the students to spend their free time and relax after classes. The main problems of

the current McCafé are the small area, absence of the places to sit, and small product range

compered to the competitors. If all of these difficulties will be solved – McCafé near

Lausanne Gare will become the number one coffee selling cafe in Lausanne.

Current Marketing SituationExternal Audit:

Pestle Analysis: McCafé Lausanne Gare, Vaud, Switzerland.

Political:

The political situation is Switzerland is very stable; however, there are still some aspects

that McCafé should take into consideration. The regime in the country changes

insignificantly every few years. The democracy dominates in Switzerland. Each canton has

its special laws and obligations. The government is in a good relationship with and

supports McDonald’s industry because its business does a lot of good to the country. On the

first place, it brings a lot of foreign money into Switzerland. On the second place,

McDonald’s employs a lot of Swiss citizens and immigrants; it solves the country’s

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unemployment problem. Overall, the political environment in canton Vaud is very suitable

for McDonald’s industry.

Economic:

On one hand, the economic situation in Switzerland is in a difficult situation nowadays. Due

to the strong Swiss Frank and the fall of the Euro, there is less foreign investment in the

country’s economy than it used to be before. There are less tourists, so, the demand is

lower. On the other hand, the country is in the downturn, so, the concept of McCafé is very

useful. The products of the low costs and high quality are very popular in the country.

Europe’s crisis did not affect the Swiss McDonald’s industry a lot. In addition, the Swiss

McDonald’s is very independent and different from the other European McDonalds’s. Most

of the raw material, which McDonald’s and McCafé use in Switzerland, are produced in the

country, and they are not exported. This policy creates the balance in the Swiss economy.

Social:

There are several important cultural aspects that McCafé needs to consider on the Swiss

market. One of the most important ones is the fair trade policy. Switzerland is an

agricultural country with the great nature and climate, its people respect the work of the

farmers. So, if the coffee is sold in McCafé, it should be 100% fair trade. It is an ethical issue

in Switzerland to do a fair business and produce the finest products. The other important

aspect is the Swiss culture itself. People in Switzerland like the coffee with cream or milk -

it is the national tradition. The morning coffee is an important part of the Swiss lifestyle.

Technology:

As a company, McCafé does not depend much on the technological progress; however, they

still need to keep their coffee and baking machines modern, so, they are competitive on the

market. What McCafé needs is to improve itself in the management technology and keep up

with its competitors. For example, Starbucks offers an interesting concept, where the

customers have to wait on the separate desk for their hot drinks, after paying for. This

process keeps the line short and makes the management efficient. The other important

innovation that McCafé can create is the free high-speed Wi-Fi network for its customers. It

will attract a lot of new customers. For example, it would be a great idea to put a Wi-Fi pin

code and login, which can be used just once for one device for a period of time, on the bill

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that is greater than CHF 10. This move would bring many of the Starbucks costumers,

because, their café does not provide such an impressive services.

Legal:

The most important issue is the recycling laws in Switzerland. If a household or a company

does not separate their trash, they will get fined. The Swiss government cares a lot about its

citizens; so, McCafé should keep the quality of their products on a high level and match the

Swiss standards due to the regular inspections. They should also care about their

employees. By the cantonal law, McDonald’s must protect them with the insurance, offer

them good pension policy and match the minimum wage in Switzerland (around

CHF2500). The other important rule in the country is to use the products, which are

produced in Switzerland if possible; this improves the country’s food market. The tax

policy in canton Vaud is very strict, but most of the taxes are relatively low and reasonable.

For example the corporate tax in the canton is around 20%, when in London it is more than

30%.

Environmental:

The Swiss agriculture is a great source of raw materials for McCafé industry. It allows

having the best quality products for the low prices in the business. Providing the healthy

food that tastes really good differentiates Swiss McDonald’s industry from most of the

foreign alternatives. For example, McCafé’s hot chocolate is 100% natural and does not

have any chemical additional ingredients. The coffee in the cafe is bought from the abroad.

However, it is also has a very good quality. McCafé follows the ethical trend on the fair

trade products. Due to this situation, the overall costs on the foreign raw materials have

increased in the last few years. However, if McCafé would not follow these trends, it would

loose the competition with Starbucks.

Conclusion:

Overall, McCafé meets the needs of its prior costumers. They are the business people, who

uses take away, students, who want to hang out but do not want to spend a lot of money,

and people waiting for the train. It offers a quick, fine service and provides the high-quality

products for the low prices.

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Characteristics/Needs/Behaviour/Attitudes of the Customers.

The main McCafé customers consist of four types: students, who want to spend

their free time there, train passengers, the business people, who use the take away

service, and tourists, who have different behaviour.

Students normally come to McCafé after classes to spend time there with their

friends and socialize. They usually have several coffees and desserts. Some may eat first in

the McDonald’s restaurant as their meal, and then have a coffee with a cake in McCafé as

their dessert. Their main needs are to have place to sit and the prices to be low. They

consider McDonald’s to be a fashionable place as well as McCafé. It interests them mostly

because the prices are relatively low and the quality is good. Their general attitude about

McCafé is positive. However, there are still a lot of improvements to be done. The place

provided is usually very crowded and not very comfortable. Due to this, they prefer to eat

at McDonald’s restaurant. The variety of products also needs improvement. The competitor

Starbucks offers a lot more options. There is also a matter of fashion. Students go to

Starbucks because of its image and prestige. McCafé does not have these qualities. There is

a very small semi-group, which consists of the richer students, who prefer to eat at

Starbucks in Saint-Francois square, due to its prestige and image. They rarely come to

McCafé, usually on the way form McDonald’s restaurant.

People, who use the Swiss railway system, usually come to McCafé to wait for the

train to arrive. They are usually the transfer passengers, who have to wait for several

minutes somewhere. The travellers come to McCafé to have a coffee and hang out for

sometime time, if they have time, or grab a coffee and have drink on the train. McCafé is

especially popular for these people during the winter season, since it is cold outside, and

the train station does not offer heated areas to wait. There are no proper cafes in the train

station as well. Their main needs are to have the fast service, short lines, Wi-Fi access, and

place to sit. Fast service and short lines is extremely important for them, because some

passengers do not have much time before the arrival of the train. They need to buy

something fast, so, they will not miss the train, and will not be hungry. Place to sit and Wi-

Fi access are very important to those, who are not in a hurry. If a person has to wait for a

long time for the train to come, he needs a comfortable area to sit down and relax. He also

needs a Wi-Fi access, so, he can do his work and spend time with the use or entertain

himself while waiting. The general attitude about McCafé of the train passengers is neutral.

The lines are not always short, and there is not much place to sit down; however, the

service is fast and there is the Wi-Fi access.

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Business people come to McCafé during the lunch breaks. Mostly, they have low-

middle ranks (clerks, bank workers, real-estate agents, salesmen). They do not have much

time, so, they usually order coffee and some dessert and take it to the workplace for the

business lunch. The most important things for them are the fast service, good quality and

short lines. Their attitude is generally positive. The quality of McCafé products is good and

the service is fast. However, there is not a big variety of products, this part needs

improvement.

There is group of customers that consists of tourists. They come to McCafé and

McDonald’s because of the brand name. They usually come to McCafé to sit down and relax

after a walk in the city or when they have free time in their city tour program. The most

important aspect for them is a comfortable area to sit down. Their attitude about McCafé in

Lausanne is generally neutral.

Overall, the customers of McCafé expect before, during and after each purchase

(going to McCafé) to have a quick service, short lines, good quality of products, relatively

low prices, and place to sit down. These needs will not change significantly over time. The

additional components, which may appear/appearing, are the eco-products, fair-trade

products, and computerized ordering system.

Market Analysis.

The McCafé is the part of the cafe market (“Coffee House” market).

The coffee house market is very big and promising in Lausanne, due to the high

number of the potential customers and few competitors. The major worlds known

companies in this market segment are Starbucks and McCafé. The rest are the private

individual cafes.

The main competitor – Starbucks is world wide know coffee shop industry. In this

case, it is a popular Starbucks in Saint-Francois Square in Lausanne. Advantages of

Starbucks compared to McCafé: it is more prestigious and fashionable; it offers more places

to sit, the atmosphere is more comfortable; the product range is significantly wider.

Disadvantages of Starbucks compared to McCafé: the prices are much higher for the similar

products (by quality/size).

The demand for the McCafé products is all time high and there will always be the

customers in need for coffee and desserts. The café market is very similar to the other food

selling/ serving markets. Food is the resource that will always be in need. The buying

patterns are very stable and do not change significantly, due to the septicity of the market.

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The McCafé costumers generally buy products for their own use. McCafé is a

consumer market.

SWOT AnalysisInternal Audit.

Introduction:

The McCafé decided to enter the Swiss market because of its great success in Germany,

when they opened 400 cafes in 4 years. The first Swiss McCafé was opened in 2008 in

Vevey, canton Vaud. One of the most popular and largest McCafés in Switzerland is located

near the train station in Lausanne, Vaud.

SWOT Analysis: McCafé Lausanne Gare, Vaud, Switzerland.

Strengths:

1) McCafé is a part of the largest and one of the oldest fast food restaurant chains in the

world. The company has a good knowledge of the market. McDonald’s is a very rich

company, it can afford to hire and have the world’s best experts to make the best

marketing research. The company has a very strong marketing. McCafé already has

all the needed resources to run the business (human, informational, financial and

supply resources). The McDonald’s company has a great experience in business and

is ranked as number one in the industry.

2) In general, the people in Switzerland prefer to work for the big companies. A lot of

them want to work in McDonald’s industry. The company has an opportunity to

choose and hire only the best of them at the most favourable conditions for the

group. In addition, there are a lot of international students from UNIL (Université de

Lausanne) in the city, who are ready to work at the lowest salaries. There will

always be people in Lausanne, wishing to work in McCafé.

3) McCafé offers a lot of high-quality products for the low prices. The café has a variety

of different coffee, “home-made” hot chocolate, different cakes, pies, biscuits and

sandwiches. All the food presented at McCafé is fresh and matches all the standards.

The food and drinks in McCafé are served on the porcelain dishes. The prices for the

products in McCafé are much lower than the prices for the similar products in Swiss

Starbucks.

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4) The lines at the cash desks are usually short. The employees work very fast and

efficient. In comparison, it takes much less time to get a coffee in McCafé than in

Starbucks in Lausanne.

5) The location of McCafé in very good. It is located in the entrance of McDonald’s, right

next to the metro and in front of the Lausanne Gare – one of the biggest Swiss train

stations. It is the key train station in canton Vaud and Geneva, linking the trains

from many European destinations. Thousands of people pass by McDonalds every

day. Many people, who have to change trains and wait for several minutes, pass by

McCafé to have a coffee with a sandwich. They do not want to stand in a long line in

the regular McDonald’s, so; they do not miss their trains. Many costumers of

McDonald’s usually take a coffee and a dessert from McCafé after they have a meal.

6) A lot of students live in Lausanne due to the number of schools and universities in

the city. There are more than 15,000 students only in UNIL, which is one of the

largest public universities in Switzerland. Low prices attract many of them. They

usually spend time in McCafé instead of much more expensive Starbucks. The city

itself is considered to be large in Switzerland; it has around 128 thousand citizens.

Weaknesses:

1) McCafé has a very strong competitor in Lausanne – the world’s most famous coffee

chain Starbucks. The Starbucks entered Switzerland in 2001, much earlier than

McCafé (2008). It is a very fashionable place in the city; many people meet there for

a coffee and spend much time there. Starbucks* is much more popular and

prestigious in Lausanne than McCafé.

2) The variety of products in McCafé is small in comparison with Starbucks. The

Starbucks cafe offers a huge variety of different kinds of coffee from different

countries, while McCafé has only a few of them.

3) McCafé near the train station is mostly oriented on the take away. There is no

special room for its costumers in McDonald’s. They have to sit in the main dining

hall with the McDonald’s costumers on the first or the second floor. It is very

uncomfortable for many people who do not like the smell of fast food. Three is also a

lot of noise in the main dining hall. On the second floor it is usually quieter;

however, a customer has to walk up the stares. Meanwhile, Starbucks offers a large

dining hall with the variety of different tables with chairs or comfortable sofas.

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Starbucks also offers a large terrace for the costumers, who want to sit outside or

who want to smoke.

4) The image of Starbucks, with its well-known healthy fair-trade products, is much

better and more attractive for the Swiss, than the image of McDonald’s.

*The Starbucks from the comparison is the one on Saint-Francois Square.

Opportunities:

1) Creating a better variety of products in the menu of McCafé will make McDonalds

much more competitive. Adding more kinds of drinks and sandwiches (deli

sandwiches for example) will attract people, who want to have a proper business

lunch. McDonald’s has all the needed resources to do it.

2) Another important aspect that McCafé needs is the health food promotion. If McCafé

will show and prove that their sandwiches and other meals are very different from

the fast food McDonald’s products, people will be able to come to McDonald’s with

their friends and eat the sandwiches as a healthy alternative.

3) Improving the atmosphere by dividing the dining hall into two parts, like in many

other McCafés in the world, will improve the level of the place. The main part would

be for the McDonald’s customers, and the smaller one - for the McCafé customers.

McDonald’s in Lausanne is very large by area and it is extremely rare when all the

tables are taken. It would be a good idea to create a little area separated by the

soundproofing glass, with comfortable chairs and sofas for the McCafé visitors. This

would solve the bad smell and noise problems; so, people can relax and enjoy their

coffee. It would attract other groups of costumers, such as business people, who

want to stay for the business lunch and wealthy students (Starbucks costumers).

4) Creating the massive charity and fair trade campaign is a great thing to do,

especially in Switzerland (putting the fair-trade signs on the food bags, creating

“make a donation” advertisements, giving one franc from some meals to the charity

funds, etc.). This kind of promotion will significantly improve the image of the Swiss

McDonald’s industry.

5) Creating the intensive recycling campaign is another great move that McCafé can do

(McDonald’s in general). For example putting the signs of the ecologically clean or

recycled materials on the paper bags will also improve the public image of

McDonald’s. Such moves will attract more customers, who care about the

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environment to McCafé and McDonald’s in general. Switzerland is the number one

recycling country in the world (by percentage of the recycled trash), so, such a

campaign will impress the Swiss people. Even, if McDonald’s recycles its trash

already, it should promote it better, so, all the people know about it and respect the

McDonald’s industry for it.

6) There is a downturn in the Swiss economy. Many people will choose McCafé instead

of Starbucks due its prices. McCafé should keep their prices low; this will attract

more and more customers every day.

Threats:

1) Currently, the Swiss Frank is very strong in comparison to other currency, so, there

are not as many tourists as before. Switzerland lives and earns money mostly

because of the foreign investments in the economy and the foreigners spending

their money in the country. Tourism is the main factor in the Swiss economy.

McCafé and McDonald’s in general depend a lot on the foreigners, as students and

tourists. If Euro will not be stabilized, McCafé can loose a lot of customers.

2) There are many foreign very big coffee shop companies like Dunkin' Donuts, who

want to enter the Swiss market. If it happens, there will even more competition on

the market.

Segmentation, targeting, positioning

Segmentation.

The McCafé customers can be divided into four segments based on their

characteristics/needs/behaviour/attitudes: students segment, business people

segment, tourist segment and train passengers segment. Student segment consists of

more than 20 thousand Swiss/international students who study in Lausanne. The train

passenger segment consists of 27 million transit passengers passing the Lausanne railway

station every year. The registered population of Lausanne is 128 thousand people.

Students of Lausanne are the multicultural group. They have different religions,

different backgrounds and come from different families. Their age varies from 16 to 26

years old. Some of them are Swiss, but many of them come from different countries for

their studies and have different permits/visas. Due to their age and status, most of them

can be considered as the lower-middle class. McCafé attracts them because of its prices and

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fine products. The richer students is a semi-segment. They come from rich Swiss or non-

Swiss families, they mostly study at the private boarding schools or universities.

Business people come from middle-class families. They are normally men and

women from 20 to 40 years old. They have different religions and ethnicities. Normally

they are Swiss, but can also work here with the special permit. McCafé attracts them

because of its fine products, quick service and location.

Tourists are the most diverse segment. They have different nationalities, religions,

age and social status. Mostly they are middle-upper class people, since Switzerland is an

expensive tourist destination. McCafé attracts them because it is a part of McDonald’s

industry (the products are almost the same all over the world). They know what they pay

for, before ordering.

Train passenger is the second most diverse segment. They can be both teenagers

and adults. Senior citizens prefer not to enter McDonald’s (mostly because of the brand

reputation and self-service). They can be the transfer passengers or people working in

Lausanne, who come early to the train station. McCafé attracts them because of its location,

quick service, Internet access and fine products.

Targeting.

The main focus is on the two most popular and largest McCafé segments: students and train

passengers. For these groups there is a lot of improvements that should be done in McCafé

is Lausanne.

Business people and tourists segments are mostly satisfied with McCafé products.

They are not as attractive customers for McCafé as the students and the train passengers,

due to the septicity of the café location. In addition, the business class segment is relatively

small and consists of richer people. They usually eat at the cafes nearest to their offices,

which have better reputation. The tourists also is a smaller segment, which consists mostly

of the richer people; they prefer to eat at the typical Swiss cafes with the typical Swiss

cuisine. The richer students do not interest McCafé as the potential customers due to the

size of the segment.

Students need more place to sit down, a bigger variety of products and better image

of McCafé. These problems can be solved as described in SWOT opportunities section of the

market plan (points 1,3,4,5). Investing money in the advertisement campaign can create a

better image for the café and attract more young customers.

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The train passengers have to get their orders fast. Sometimes McCafé faces a

problem of the long lines. It can be solved by spreading the McDonald’s electronic ordering

system to McCafé. McCafé also can create more separate cash desks with different lines like

in McDonald’s restaurant. Train passengers also need a comfortable area to sit down. The

solution for this problem can be easily solved. The solution is described in the SWOT

opportunities section of the market plan (point 3).

Positioning.

The position that McCafé has to take, regarding the most popular groups of the chosen

segments, must be related to the quick service and relatively short lines. It should also

represent its strongest advantages – relatively low prices for the fine products.

For example the good advertisement campaign may be led with the slogans “Finest

products for the lowest prices”, “Pay less for better products”. This will attract more

students, since it emphasizes the advantage McCafé has on the similar Starbucks, which

products cost more.

The train passengers will be interested in seeing that they will get a quick service.

This can be led by the slogans “Shortest lines and fastest service” or “Quick and fine

service”.

Both groups are interested in having more places to sit down. If this problem will be

solved, McCafé will increase the number of its customers significantly. The slogan for the

future improvement may be “McCafé de la gare: private area with finest products for the

lowest prices”. The special area for McCafé visitors is the prior improvement that should be

done.

Objectives and issuesDirection.

1) Improving the area for McCafé customers can be classified as modifying existing

products for existing market, if the place provided by the restaurant can be

classified as a product.

2) Creating a better variety of products is marketing new products in existing market.

Objectives (all the deadlines are given regarding the beginning of the works will take place

on the 1st of March 2012).

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Financial Objectives.

Short-term:

1) Increase McCafé’s turnover by 10 % by the end of March (31st March 2012).

2) Achieve 50 % return of the investments in modifications of McCafé by the end of

March (31st March 2012).

Long-term:

1) Increase McCafé’s turnover by 50 % by the end of 2012 (31st December 2012).

2) Achieve 100 % return of the investments in modifications of McCafé by the end of

April (30th April 2012).

The financial objectives listed above are realistic and at the same time challenging. The

modifications of the café, in the way described in the SWOT section of the market plan

(opportunities, 3) will pay of quickly and does not require a lot of investments. This will

allow to gain net income relatively quickly and complete the objective.

Marketing Objectives.

Short-term:

1) Improve the variety of products. Add 5 new products (drinks/desserts/snacks) by

the end of March (31st March 2012).

2) Finish the construction works by dividing the McDonald’s restaurant into two

separate areas by the end of the March (31st March 2012).

Long-term:

1) Increase the amount of McCafé customers in the café by 100 % by the end of August

(31st August 2012).

2) Become the most popular café place among the students segment by the end of

December (31st December 2012).

3) Offer the higher range of products than Starbucks in Saint-François does by the end

of December (31st December 2012).

The objectives listed above are realistic and easily achievable. Improvement of the menu is

not a difficult aspect for such a large industry as McDonald’s. The fast-food restaurant has a

very good practice in creating new products every couple of weeks. McCafé can use this

experience. The dividing of the café should be done in the simplest way by using modern

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mobile technologies. This will allow finishing the works relatively quickly. McCafé has all

the needed resources to achieve the long-term objectives listed above. If it follows the right

strategy and keeps the correct positioning, it will complete the objectives in the simple and

quick way. These changes will increase the overall customers’ satisfaction dramatically.

Societal Objectives.

Short-term:

1) The 5 new products, which will appear by the end of March 2012, should be the fair-

trade products.

2) Donate 5 % from the sales, which will occur in the period of time from 1st of March

to 31st of April to charity organizations or the Greenpeace.

3) Start the major advertisement campaign by the end of March. (31st March 2012)

Long-term:

1) 50 % of the McCafé products, which will exist in December 2012, should be the fair-

trade products.

2) Donate 10 % from the sales, which will occur in the period of time from 1st of May to

31st of December 2012 to charity organizations or the Greenpeace.

These objectives may seem rather unprofitable; however, they will help to increase the

image of McCafé significantly. They will also make McCafé more fashionable and trendy

place regarding the Starbucks’s practice. These changes will attract new customers, who

care about the planet, taking into consideration that Lausanne is becoming a very eco-city.

Marketing strategy and programmesStrategy.

The changes of enlarging the area and creating a better variety of products will be

considered as the strategy of growth - product development. There is no need to change

the market, since McCafé already covers the most interesting and attractive segments of

the business people, students, and train passengers, who use it regularly. The only way to

expand the McCafé’s market in Lausanne will be modifying the existing products as the

variety of food and drinks, and creating more places to sit for the customers. These

innovations will attract more people of the covered segments to the café. All the

innovations will be proceeded by the end of 2012, in the period of 10 months (from the 1st

of March to 31st of December).

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Creating a private area for McCafé customers.

The special area for McCafé can be created in McDonald’s restaurant in two simple ways.

The first and simplest way would be dividing the first floor by the soundproofing glass wall.

The café will be located on the left side of the restaurant. The furniture should be replaced

by much more comfortable, but cheap sofas and armchairs. The glass will accomplish three

goals at once. It will create the private atmosphere, isolate the place from noise and smell

coming from McDonald’s restaurant. Separating the restaurant in this was does not require

a lot of investments and time. The construction can be done in one week. To make it even

cheaper, a whole floor may be given to the McCafé customers, and McDonald’s customers

will have to go up with their meals. However, doing it in this way, will decrease the

popularity of McDonald’s between people, who can not use stairs for x or y reason. It will

also create a lot of unused space, which could be used in a much more efficient way.

The second way is more complicated and will require more time and resources. The idea is

to create all new McCafé on one half of the second floor of the McDonald’s restaurant. The

second floor of McDonald’s has a great but unused potential. There are a lot of spaces up

there, but they are rarely occupied. McDonald’s customers are not always willing to go up,

while the McCafé customers prefer to relax with the view and in the comfortable

atmosphere. The area will be separated by the glass wall; it will be very comfortable and

private with the view on the train station. At the same time, McCafé on the first floor will be

demolished and will become a part of McDonald’s fast-food restaurant. This change will

require more resources. Creating a brand new café will be more expensive and will take a

minimum of two weeks to be construct. There is also a good and bad side about the

location of the new café. It will become much more attractive for the student segment;

however, it will lose its popularity between the train passengers segment. If a person has

just five minutes to get on the train, and wants to grab something from McDonald’s, he will

see the usual line to the fast-food cash desk, decide not to stand there, and he will not have

time to go up to McCafé, where lines are much shorter.

Expanding the product range of McCafé.

The expansion of the product range is another goal of McCafé. Creating a better variety of

products should be done in a classic way using the previous experience. If two to five new

products will be added to the menu each month, the variety of McCafé will continuously

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improve, and by the end of the year, it will be as wide as in Starbucks. The prices should not

be raised; the company should keep its brand-promise – high quality for low prices. This

will be the key factor of differentiating and selecting McCafé from its competitors. As was

said before, the products should be 100% fair-trade, since it is very fashionable and good

thing to do nowadays.

Charity programmes.

The charity has always been and will be the McDonald’s key to keep the better image and

bring the customers’ attention away from the reputation of unhealthy fast-food producer.

McDonald’s is already known for these programmes, but now, it should help its subsidiary

– McCafé. Charity will be the major advertisement campaign of McCafé. The products

should be served in the packages with fair-trade signs and pictures of countries and farms

they were produced in. Greenpeace (WWF) is another important charity fund where

McCafé should invest its earnings. It is the only major charity program in which no other

café donated money. These donations will create the unique reputation for McCafé.

All these programmes create better relations with the government, improve the company’s

image and make a world a better place. The key factor is that they make a unique

advertisement for McCafé in the best possible way. They create reputation, image and

attract new customers at the same time.

Advertising.

Creating a know-how brand promise, which will become the main slogan of McCafé in

Lausanne will increase the public interest in the café and will attract more customers. The

best option at the moment is “McCafé: meilleur qualité pour tous” (Fr. best quality for all).

It is short but very convincing. It describes McCafé’s main values: quality and price. “Best

quality for all” means the high-quality products are affordable for everyone.

The advertising of McCafé can be led in different ways. The simples, most efficient and

cheapest way will be handing out coupons to the prior segment – students. This can be

done near the biggest university in Lausanne – UNIL, where thousands of students have

their classes everyday.

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Financial plans (budgets)Budgets.

Separation of the café:

The first way of separating McCafé from McDonald’s does not require a lot of investments

and has a great potential. The construction work required will cost five thousand Swiss

Francs (building a glass wall, changing some interior details); the new furniture will cost

three thousand Francs.

The second way of creating the private area with the new cash desks is more complicated

and requires a lot more investments. The price for the needed work is 10 thousand Swiss

Francs. (creating a private sector on the second floor with all new cash desks; improving

the atmosphere/interiors; changing interiors/removing McCafé on the first floor). The

furniture will cost more due to the bigger area of McCafé in the second plan. The price will

be six thousand Swiss Francs.

The given prices may vary due to the brands/companies/other circumstances.

Adopting new products for the café:

Including a new product in the menu is not a complicated thing to do, especially for the

McDonald’s industry with their technology and experience. It is also not very expensive.

However, due to the new fair-trade policy, the price for each product will be slightly higher

than it would have cost without applying the policy. As was said before, these extra-charge

will not only be a good charity action, but a good advertisement for the café.

Charity donations:

McCafé’s plan for the charity organizations is to donate 5 to 10 % of the monthly earnings

to the different charity organizations and create a reputation of the most caring about the

planet café.

Advertising:

Advertising of McCafé in a coupon giving way does not require a lot of investments but very

profitable in the end. The costs are: employing the people, who will handle out the coupons

(if hiring five students will for the job – on average five thousand francs a month.); and

actual value of the coupons (on average one franc worth of products for McCafé – but seven

francs for the market price of the product in McCafé).

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Forecasts.

The changes, which will be made in McCafé, will improve the turnover and profitability of

the café.

Expansion of the café in the first way will increase the monthly turnover by 10 %. The

second way will increase the profit by 20 %.

The investments made for the first way of the expansion will return in one month, the

return of investments for the second way of expansion will return in two months. The

investments for the new products vary in price, and they are very-long term, especially

with the fair-trade policy.

The charity programmes of McCafé are very important long-term continuous investments.

The return of the monthly investments cannot be measured in money but public respect,

popularity and social connections. McCafé will develop connections with different

governments, gain public support and appreciation. In the future, these connections can

help the McDonald’s industry to develop and succeed.

Advertising by giving out coupons will increase the monthly turnover of McCafé by 15 %.

The investments are continuous, but incomparable with the profits they will gain.

Metrics and implementation controlsMetrics.

Marketing metrics for McCafé were created according to the available market research.

They are the best estimates and they can measure the progress on a regular basis. Each

measurements should be taken once a month according to the points listed bellow.

Financial metrics:

1. Monthly profit/amount of sales.

2. Number of clients per month.

3. Occupancy of the café.

4. Most active segment of the customers.

Marketing metrics:

1. Number of products McCafé offers/number of new products.

2. Percentage of new customers acquired.

3. Satisfaction of the customers (offering an optional questionnaire about the new

McCafé to the customers once a month).

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Societal metrics:

1. Number of new fair-trade products McCafé offers.

2. Percentage of café’s profit donated to the charity organizations.

The advertising campaign with the coupons cannot be measured precisely, but according to

the available research, every two of the ten students (20%), who were given the coupons,

will use them in the McCafé. One student on average will bring from one to three friends

with him.

Implementation.

The marketing plan created needs a very good control to succeed.

The first step of control is the time. The deadlines for the marketing plan are set in the way

corresponding with the objectives. Due to the difficulties, which may occur because of x/y

reason, the final deadline is two weeks away from the times given for realization of

objectives. That system allows one to fix the occurred mistake or get out of the certain

situation.

The budgets described in the finance section are as accurate, as they can be with the

market research that was applied. However, there is a possibility of the additional costs in

the construction process. It is very important to have an insurance if there will be any

divergence with the budget plan. McDonald’s can assure this insurance because the

resources in its disposal.

The major measurements should be taken according to the approved metrics of the

marketing plan each month. There will also be the additional daily measurements, which

will have the similar statistics as metrics but less information. However, they will be as

important as the monthly metrics, because they will be the key to determine the future

divergence. Each measurement should be carefully studied and examined by the managers.

If they show that there is a possibility of a future divergence with the plan, the mistake

must be fixed immediately. If impossible, the changes should be immediately made to the

plan, which will allow preventing the occurring situation and succeeding anyway.

If the McCafé’s advertising campaign will go wrong, and the results will not meet the

expectations, the company will change the campaign. However, the assumptions were

made based on the market research and were widely used in the other café industries. The

coupon method is considered reliable and was tested over time.

For the implementation of the marketing plan, the control should be applied at

different levels:

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1. Business unit (if café achieves results as expected);

2. Marketing mix activities (evaluation of the results of product, pricing, sales targets,

awareness of the advertising campaigns);

3. Programme (evaluation of the performance of the programmes).

The marketing control will be applied in four stages:

1. The annual control will be done once a year, and it will evaluate the overall annual

performance of McCafé by comparing the results with the metrics results and

objectives of the marketing plan. It will be the main control check of the overall

performance of McCafé.

2. Financial control is all related to the inner economy of McCafé. It will evaluate all the

mistakes in budget calculations and compare the actual metrics results to the

forecasts.

3. Strategic control is responsible for the managing of McCafé. It will evaluate the

professionalism and performance of the managers.

4. Productivity control is the most important control check, which will determine the

efficiency of the whole marketing process of McCafé. It will evaluate all the

marketing activities launched at McCafé and will determine their efficiency.

The correct and précised control is very important and will play a very significant role in

the realization of the marketing plan for McCafé. Overall, the plan is simple, but at the same

time very challenging. The expected results can be achieved only with the hard work. If

McCafé in Lausanne will go through the simple changes and accomplish its objectives, it

will have all the chances to become the number one coffee selling cafe of Lausanne.

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