Societal marketing: McDonald’s
Business executives are frequently perplexed by the constant growth of society’s expectations of corporations. For instance, in the corporate world, numerous laws and extensive government regulation affect practically every part of business activities. They touch “nearly every business decision which range from the production of goods and services for their packaging, supply, advertising, and service” (Carroll, 1979, p. 98). Thus, perhaps not only are organizations held responsible for maximizing profits for the owners and investors and for operating within the legal framework, they are also expected to support their workers’ quality of work life, to demonstrate their concern for the communities within which their organizations run, to minimize the impact of various risks on the international environment, and to participate in strictly social or philanthropic endeavors.
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Among researchers, this problem has provoked a particularly rich and diverse literature investigating the function of business in society. Major streams have been followed two by research in this area. Typically the most popular of the studies have focused on the connection between a company’s social responsibility and its own financial performance (McGuire, J., Sundgren, A., & Scheeweis, T., 1988, p. 858). Another stream of studies has analyzed the effect of board members’ demographic and non-demographic traits on the individual corporate social responsiveness orientation (Wood, 1991, p.
389). Because the societal marketing involves some sort of corporate response to social demands, the very first step would be to recognize and classify the various social needs. You will find three classes of such needs. First, survival needs consist of the different needs which are required for individual members of the social segment to endure, such as food, shelter, and the preservation or restoration of your respective health.
A second class can be involved with security needs. These are the demands that are required to safeguard the members of the social section from internal and external threats. Maybe not only do countries have defense institutions for protection from external threats, but they also enact and enforce laws to protect persons and groups from the others in society. Numerous areas are covered by such laws which range from environmental protection to safeguarding individual liberties.
The next class consists of various development needs which, in turn, could be broken down in to religious needs and material needs. The former are involved with the enrichment of the social section through economics (the allocation of limited resources) and technology (the use of tools and processes to create wealth). Spiritual needs are associated with the spiritual growth of the social section; they include instruction, metaphysics, science, arts, and amusement.
Social segments expect different agents to satisfy these needs. These agents could be a person (e.g., a parent who supports a family), a group (e.g., political parties and interest groups who represent their members), a company organization (e.g., a corporation which supports inner city revitalization), a not-for-profit organization (e.g., a hospital providing you with services to the community), and authorities (e.g., for protection from external threats). Both the kind and extent of the needs to be fulfilled and the broker who is likely to fulfill these needs will be based upon the social segment’s culture and ethics, the legal environment, and the degree to which the members of the social segment perceive that such needs are not fulfilled.
As a vital person in society, a corporation should take into account the needs which are likely to be met by company. A social demand is constituted by these needs. Hence, social demand incorporates not just demand for a company’s services and products, but also extends to the gratification of other societal demands. With this particular framework in your mind, it could be said that the range of a small business organization, i.e., what products and services it provides, is established both by the corporation itself and by society’s expectations. In other words, it may be stated that a given company operating in two different social sections has, in place, two different scopes. Failure on the section of a business to understand and fulfill the different demands of the social segments within which it runs will result in its rejection by society and its ultimate death. Consequently, a company’s mission and goals should perhaps not just address conventional organizational concerns such as for example profitability and markets served, but should also be focused on determining and meeting various social expectations.
Certainly one of the facets of the social marketing includes alliances which have arisen between environmentalist groups and companies within the last decade. The brand new relationships have already been referred to as path breaking and innovative (e.g., Long & Arnold, 1995; Wasik, 1996). An average of, they are distinguishable from the earlier non-profit (e.g., contributions to or sponsorships of environmental causes) and commercial relationships (e.g., calendars, T-shirts created for environmental groups) because they engage the expert knowledge of the environmental group and affect it, to varying degrees, in combined problem solving or tactical decision making with the corporate partner (Clair, Milliman, & Mitroff, 1995, p. 188). In this class are green product endorsements, audits by environmental groups of business programs or methods, and joint projects of the kind engaged in by green alliance between McDonald’s and Environmental Defense Fund, where in fact the corporate partner’s business methods are assessed and improved based on ecological criteria.
Environmentalist relationships are also functioned rhetorically in a more complex way than traditional business – by green alliances. Here I follow Levy who has pointed out that environmental management – that is, corporate methods to cut back the ecological damage of economic processes – serves symbolic and political objectives by helping to build business as green and so to legitimate its role as manager of the natural environment (1997, p. 127). Green alliances, a method within corporate environmental management, also provide political and symbolic value – for both partners. The corporation borrows maybe not only the environmental expertise, but in addition the credibility, of the ecology group, which by its allegiance implicitly or explicitly endorses business actions – e.g., creating earth-friendly services and products or running in pollution-free ways (Ottman, 1994, p. 86). Corporate actors are also brought by the partnership in to the group of those to be entrusted with the work of saving the world.
McDonald’s may be the leader of the fast-food business, with world-wide operations employing roughly 500,000 individuals in 11,000 restaurants and serving 22 million customers each day. At that time Environmental Defense Fund (EDF) approached McDonald’s, its entanglement in controversy over its packaging frustrated the business. From EDF’s viewpoint, McDonald’s leadership position, its problematic history of waste management, and the iconic value of waste management as an environmental problem made the business an attractive candidate for partnership. Significant opportunity was seen by edf for both environmental actions and a significant, high visibility, opportunity to analyze its revolutionary approach to environmental problem – solving through partnerships.
With environmentalism on the rise one of the general public in the 1980s, consumer-driven companies were especially susceptible to and sensitive about public pressure (Livesey, 1993, pp. 2-4). Plastic have been demonized by a few environmentalist companies such as the grassroots groups Greenpeace and CCHW. The use-and-dispose doctrine at the center of McDonald’s business and its particular distinctive plastic clamshell sandwich boxes, which helped to help make the firm one of the largest single users of polystyrene in the United States, had made McDonald’s an ongoing goal of ecology groups (Livesey, 1993, p.
4). Through the late 1980s, McDonald’s instituted and publicized a number of environmentally positive measures in its national operations. Consumption was reduced by it, for example, by making use of lighter weight paper in straws, paper bags and other things and recycled paper and cardboard packaging. In 1987, it changed from polystyrene (used for the clamshells) blown with CFCs, the group of substances which destroy the ozone layer, to plastic foam that used hydrocarbon blowing agents (Annual Report, 1989, pp. 10-15). In 1989, the firm instituted a pilot program in 450 New England shops to recycle its plastic clamshells (Livesey, 1993, pp. 12-14). In April, 1990, it committed $100 million, or one quarter of the business’s yearly building and remodeling budget, to purchase recycled materials for restaurant construction, remodeling, and operations under a plan called “McRecycle” (Livesey, 1993, pp.
13-14). In 1989 and 1990, McDonald’s bolstered its environmental management methods with a proactive public relations campaign. The centerpiece was the 1989 Annual Report, which highlighted the problem of the environment. McDonald’s also offered in-store flyers to teach clients in regards to the business’s environmental management methods, coverages, philosophies, and positions on specific problems such as for example rainforest beef and the ozone issue. Brochures on environmental subjects, including packaging, were available from its public relations section. Additionally, McDonald’s worked with a number of different environmental and non-profit groups (e.g., the Entire World Wildlife Fund and the Smithsonian Institution) to coproduce elementary school substances on the surroundings.
McDonald’s 1989 annual report represents an aggressive effort by the organization to handle the general public discussion across the business’s part as an environmentally responsible corporate citizen and build itself as green. The report is one of the type of epideictic advocacy, the discourse of praise and blame that is generally used to create or consolidate value premises, particularly in corporate issue management campaigns; such discourse frequently functions as a foundation for later persuasive efforts (Cheney & Vibbert, 1987, p. 183). Epideictic rhetoric works because they build on shared premises and borrowing from beliefs and values embedded in the most popular culture. In this instance, given the brand new ecological consciousness of the people, McDonald’s positions it self as having concerns ecological and practical, social as well as economic.
As described by the media, the 1989 Annual Report looks “more like an Audubon Society pamphlet than the usual financial statement” (Horovitz, 1991, p. D2). Nature images, poetry, and quotations from national and international figures prominent in the environmental movement (e.g., Gro Brundtland) are interspersed through the report, along with merchandise and financial advice. The cover includes a four-page foldout image of the Northwest American woods with a quote from Chief Seattle about man’s appropriate relationship to the planet earth. The report it self is “dedicated” to a “discussion of the [environmental] challenges which lie ahead” (McDonald’s Annual Report, 1989, p. 2). The discussion is included in a 10-page supplement.
The themes of dialogue, logical discussion, practical alternatives, the value of individual effort, and stewardship or common social responsibility for the world that are played out in the nutritional supplement are initially articulated in the shareholders’ letter. This letter is really as notable for what it omits as for what it says. It at the same time implicates the reader, inviting dialogue, and yet leaves the specific situation ambiguous, especially vis-a-vis the business’s duty and purposes.
The nutritional supplement includes a few distinct components: a solution to a letter from Dan Getty, an 11-year-old boy who calls for responsible action from McDonald’s (Annual Report, 1989, pp. 7-8); a broad outline of McDonald’s doctrine and historic obligation to “responsible [environmental] actions,” including company founder Ray Kroc’s mandate to teams to clean up trash near McDonald’s restaurants (p. 9); three sections addressing facts and expert opinions about solid waste management, resource conservation, and recycling (pp. 10-15); and a collective call “to Aid [sic]” in solving the challenge of the environment (p.
16). The letter of answer to 11-year-old Dan Getty illustrates a number of the rhetorical strategies McDonald’s uses to attain a symbolic identification with its clients and the overall public. First, McDonald’s constructs it self as a naive, non-specialist, and innocent individual performer. Like Dan Getty and “individuals of all ages,” McDonald’s is “asking questions about the environment” and learning that the responses to environmental problems are “complicated” (Annual Report, 1989, p. 7). It eschews inaction in the face of sophistication: “It is simple for all of us to claim we have been perhaps not responsible for these complicated forces. However we need to request, ‘Who is?’ “(p. 8). At exactly the same time, it sounds a cautionary note: It is significant “to do what exactly is environmentally sound, if the responsible plan of action becomes clear” (p. 7). Who or exactly what will provide clarity leading to activity is left ambiguous.
2nd, McDonald’s positions it self as one of a residential area of stewards of the world: “Each of us, understanding what we have at stake, must make a commitment to a training course of action which will sustain and improve the environment we hold in trust for future generations… You are able to count us in” (p. 8). Through appeal to the language of Gala theory originator James Lovelock – “It is private activity that counts” (quoted in McDonald’s, 1989, p. – and founder Ray Kroc’s dictum – “None of us is just like most of us” (quoted in Annual Report, 1989, p. – the boy’s call for aid from McDonald’s is transformed into a call for everybody to behave. Identification and those things that it invites are private. Identifying with its clients, McDonald’s requests that they identify with it. McDonald’s places it self on a level with the 11-year-old. Hence, through rhetorical sleight, of-hand – in Cheney’s (1992) words “the sheer juxtaposition of images… as a substitute for reasoned discussion, for argument” (p. 174) – McDonald’s equates natural persons with the corporate persona, and power differences – the differences between producer and consumer, corporate giant and small child – are created to vanish: The people at McDonald’s, no not the same as people every-where, must act to save lots of our planet. Needless to say, at one level, McDonald’s people are like people every-where and, like them, likely hold a variety of views about the issue of the environment. Nevertheless, at yet another level and at the same time frame, McDonald’s individuals represent a corporate body.
McDonald’s defends its environmental record by listing specific actions that it has had to control waste and conserve resources by reducing, reusing and recycling materials. It cites experts who support its position on plastic packaging and who point out the little contribution of the whole quick-service restaurant business to America’s waste. In addition, it criticizes “the ‘Not In My Own Backyard’ syndrome – or NIMBY” (for example, individuals in McDonald’s communities who opposed business incinerators in their neighborhoods) as posing barriers to responsible waste solutions (Annual Report, 1989, p.
11). Also, McDonald’s stresses individual private actions: Plant a tree, turn off a light, recycle a clamshell. Yet, in addition, it describes it self as a proactive corporate actor searching for chances to work with persons, public officials, and others, as well as with the communities we serve.
The more McDonald’s constituted itself as “green,” the more it had been necessary to support environmental problems influenced by its business methods. McDonald’s attempts at recycling, resource reduction, incineration, and stuff like that are not merely symbolic. The business was the subject and the thing of a unique eco-discussion. The emerging storyline it built had positive environmental effects at the material level, as well as starting the business to potential dialogue with EDF.
In April 1991, the McDonald’s-EDF joint task force released its final product, a corporate waste reduction policy and a comprehensive waste reduction action plan with 42 initiatives. Many real environmental improvements were created by the task force. For example, environmental criteria were incorporated in to corporate packaging choices which before had been driven by quality and cost criteria (see McDonald’s Final Report, 1991). The media mainly praised the effects of the coalition (Reinhardt, 1992, p. 14), and the narrative was recycled over many years (e.g. Gutfeld, 1992). Eventually, the venture entered the green business literature as a milestone marking a change in the relationships between business and environmental groups (Long, F. J., & Arnold, M. B., 1995, p.
80). Hence, McDonald’s measures in managing environmental problems would be the types of social marketing. People become increasingly conscious of the damage that may be caused to the surroundings by products, packaging, by-products and production processes. They might slowly learn how to embrace more environmentally friendly products and services and, in specific, reject throwaway products. Green issues are increasingly viewed as important by consumers which has been reflected in the kinds of products and services consumers want to make use of. Businesses need to alter the character of the products and services to satisfy these demands. Many organizations seem to have a social conscience or find the advantages of meeting the needs of green issues; this is the case with McDonald’s.
The belief that environmental responsibility has become a function is based on research suggesting that consumers need such changes and can theoretically reimburse business investments by accepting higher prices. In a survey by Dagnoli (1990), 82% of the respondents claimed to have changed their purchasing decisions as a result of environmental concerns. Seventy-seven per cent of those surveyed also reported that the business’s environmental reputation affected their selection of brands. Environmentalism is sufficient of a concern that 78% of the respondents said they might change to an environmental container if it were priced 5% greater than a less-environmentally friendly container. Yet another 47% said they might pay just as much as 15% more for environmental packaging.
Companies now associated with the environmental movement have discovered the growing number of markets affected by environmentally concerned consumers, and naturally are expecting this tendency can increase their organizations’ long term gains. Proactive businesses like McDonald’s are trying to simply take leadership roles in the region of green products and services to be able to gain a competitive advantage (Smyth, 1991, p.
70). For McDonald’s, environmental marketing is becoming one of the main social marketing instruments. Even though much confusion still exists in regards to the details of green marketing, a very important factor that has been learned is that consumers will not necessarily pay more for green products and services (Winski, 1991, p. 3). Despite consumer claims to the contrary, the first sales of green products and packaging have been slow (Reitman, 1992, B1). Recent trends suggest a lack of readiness to really pay premium prices for such products and services (Wasik, 1992, p.
17). Hence, today’s market for environmentally-friendly goods is more than ever. To capitalize on this movement, managers and marketers, as McDonald’s case shows, must promote the environmental advantages of the products and maintain prices in a range near that of the rivals that usually do not stress environmental concerns. Promoting the environmental friendliness of products and services will be most attractive to some clients, while characteristics aimed at convenience will be attractive to the others. Even though these areas of the product mix are very important, competitive pricing of environmentally-friendly goods will be the important thing to capturing a major market share. Once high market shares are reached, cost reduction programs should permit profit margins to be increased by producers from products and services.