Question

The strong relationship are evident Macdonald showing a coke product along with their hamburgers in their ads. Is this part of their Integration of brands?

Answer 1

Introduction:

McDonald’s partnered with Coca-Cola in 1955, when McDonald’s opened its first restaurants in Des Plaines and a beverage supplier was required.   Since they possessed the same American expansion ambition, their executives agreed with this alliance. Despite the lack of paper contract, there is considerable contact between the two companies at board level.

Their partnering seems destined for success from the beginning. Not only does a joint mission naturally exist between a chain restaurant and a beverage supplier, but also McDonald’s shared the very exact destination, expansion first across the US, then around the world with Coca-Cola. As the result, they managed to create and deliver excellent transformational value for both sides, mainly focusing on developing an integrated supply chain, and enabling rapid entry and large-scale expansion into new geographies. Moreover, the top management teams from both sides have been very careful about partnering relationship since the handshake between the two top executives in 1955 . Javier C. Goizueta, the Vice President of the Coca-Cola Company and President of the global McDonald’s Division, is in charge of a worldwide organization responsible for building the strategic alliance with McDonald’s in over 31,000 restaurants and over 100 countries,Goizueta is an experienced mature leader with over 20 years of leading businesses successfully and fully empowered. Although McDonald’s and Coca-Cola seem to be a natural fit, it is the compelling partnership ‘Value Propositions’ and ‘offers’ they jointly designed that make the partnering extraordinary rather than good.

A. Market expansion

Both of them are the leaders in their industries and possess numerous resources and operation experiences, thus adding more symmetry to the vision of global expansion For example, to help McDonald’s expand worldwide, Coca-Cola often provides existing offices in different regions as a base of operation for McDonald’s to get up .

B. Product development

The know-how and expertise from Coca-Cola benefits the product development of McDonald’s. In 1993, Coca-Cola offered business advice on the product offering of McDonald’s, creating the Extra Value Meal In 2002, both of them executed collaborative strategies for Latin America, designing and testing of new packaging for drinks Moreover, recently, Coca-Cola helped McDonald’s create a new product line of smoothies Meal .

C. Unique strategic values created by the supply chain integration

The unique supply chain co-operated by both Coca-Cola and McDonald’s creates added values. Evidence shows that the best taste of Coca-Cola is only available in McDonald’s as they established a unique system for the delivery and production of coke. Coke syrup is normally delivered in plastic bags; however, since McDonald’s sells a larger amount of coke, syrup can be delivered in stainless steel tanker truck Additionally, McDonald’s has a reverse osmosis filter offering the cleanest water. All these make coke taste fresher and better, enabling McDonald’s to possess competitive advantage of better-taste coke.

Hamburger and coke add slim down the customers in the queue. yes it is integration of their brands through that synergy benefits both the company increase their market and growth.