Burger Wars

Burger Wars

The 1980s were dominated by the “cola wars.” While Coca-Cola and Pepsi duked it out for market share in the 1980s, with many casualties on both sides of the corporate battle-front, it is time for the “cola wars” to step aside. The “title” corporate bout of the 1990s seems to have moved from colas to burgers. The “burger wars” of the 1990s have heated up recently, as McDonalds has stalled in domestic sales massive expansions and promotional campaigns, while Burger King has gained market share and increased overall corporate profitability during the same time, “McDonald’s stock fell 50 cents to $48.125 in composite trading after the Oak Brook, Ill.-based company said late on Tuesday it was scrapping the promotion for lunch and dinner. It is returning to Extra Value Meal pricing, offering meal combinations starting at $2.99. By comparison, Burger King, a unit of Grand Metropolitan Place has about a 19 percent market share and Wendy’s International Inc. about 11 to 12 percent, he said,” (Commins 1). This analysis and discussion will include a short history on each company, and a comparison and contrast of the following corporate aspects: management strategy; marketing; financial performance. A conclusion will address the likely long-term winner in the burger wars.

Since 1937 McDonalds has been the undisputed darling of the fast food industry. In fact with their creative advertising, quality food, finely-tooled operations and a level of franchise loyalty that approached religious devotion, McDonalds became the undisputed leader in market share and profitability. Part of the reason for this success was a corporate strategy that gave customers what they wanted in a fast and economical manner. The company has never been radical in its corporate strategy, a strategy that today has it mired in stagnant growth. Despite a massive expansion effort, and hundreds of millions of dollars on new advertising campaigns…

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