CASE 1 MACCA’S mission More than half a century ago, Ray Kroc, a 52-year-old salesman of milkshake-mixing machines, set out on a mission to transform the way Americans eat and, in the process, influenced many people's eating habits around the world. In 1955, Kroc discovered a string of seven restaurants owned by Richard and Maurice McDonald. He saw the McDonald brothers' fast-food concept as a perfect fit for America's increasingly on-the-go, time• squeezed, family-oriented lifestyles. Kroc bought the small chain for US$2.7 million and the rest is history. From the start, Kroc preached a motto of QSCV - quality, service, cleanliness and value. These goals became mainstays in McDonald's' customer-focused mission statement. Applying these values, the company perfected the fast-food concept - delivering convenient, good-quality food at affordable prices. McDonald's grew quickly to become the world's largest 'fast-feeder' The fast-food giant's more than 32 000 restaurants worldwide now serve 64 million customers each day, racking up system-wide sales of more than US$77 billion annually. Arguably, the 'golden arches' are one of the world's most familiar symbols and, other than Santa Claus, no character in the world is more recognisable than Ronald McDonald. After many ups and downs that saw the company actually losing money, in 2003 McDonald's adopted a new strategic blueprint which it called its 'Plan to Win'. The new mission was 'to be our customers' favourite place to eat'. As part of the strategic plan, the restaurants were redecorated and, more importantly, the menu was reworked by a well• recognised chef, resulting in many innovations, including the introduction of 1ts 'Premium' salads. The company also launched a multifaceted education campaign that underscores the importance of eating right and staying active. 'Maccas', as the chain is colloquially known in and , consistently outperforms its competitors. Updates to its restaurants and the constant introduction of innovations, such as salads, snack wraps, Angus Burgers, McCafe coffees and smoothies, have customers and the company alike humming the chain's catchy jingle, 'I'm lovin' it'.

Q 1. Does McDonald's' marketing strategy of innovating via its menus differentiate it from (say) Hungry Jack's? Explain your answer Q 2. Research the positioning statements for three (for example Subway, Dominos, Hungry Jacks) of the major fast-food chains. In what way do their advertising lines, such as 'I'm lovin' it', position the brands differently?

CASE 2 Disintermediate or be disintermediated Less than a decade ago, if you wanted to watch a movie at home, your only choice was to visit your local Blockbuster or other neighbourhood video• rental store. At the time, Blockbuster dominated DVD rentals, certainly in the , if not in Australia. But all that changed for Blockbuster- abruptly and radically in the United States. Facing losses and store closures, the once-mighty movie-rental chain declared bankruptcy in the United States in late 2010. In early 2011, it was bought for a song by Dish Network, primarily for its fledgling video-streaming services to complement Dish's satellite-TV offerings. In Australia, Blockbuster - along with the and EzyDVD chains is owned by the Franchise Entertainment Group (FEG) and continues to operate. FEG is also the franchisor for 45 franchisees under the two main brands, which operate nearly 1000 DVD vending-machine kiosks with aspirations to open a further 3000. However, FEG faces huge digital and direct competition from the likes of BigPond, Apple TV and subscriber- TY, as well as from and . And these are only the legal sources. is moving from a movie 'post and play' system to a 'download and play' approach, based on the games console. It is also an app on internet-connected Samsung Smart Hub television sets, set to Australia as the default country and involving a subset of the 55 000 titles in its DVD catalogue. Given the global nature of the direct and digital market for legal movie downloads, perhaps the fiercest competitor Quickflix may face is the US• based Netflix. Netflix was rumoured to be entering market but instead entered the Nordic market. In the late 1990s, Netflix pioneered the movie 'post and play' market that QuickFlix later emulated in Australia. Netflix has over 100 000 DVD titles to choose from but has turned away from the physical delivery mode, for which it increased its charges by a startling 60 per cent. The company adopted an internet-based delivery model, partly explaining Blockbuster's demise in the United States. This distribution system includes delivery to every form of internet-connected device, from 'smart' TVs (e.g. Samsung's Smart Hub televisions) to game consoles (, PS3, Xbox), Android media players, tablets and smartphones. Globally, Netflix now has more than 60 million subscribers, a subscriber• base that outstrips Australia's total population! Perhaps, the soundest advice one could give Quickflix is to be afraid ... very afraid ... of the competition- even that which has now arrived. After all, .com, Apple and YouTube also offer streaming-video subscription services. Google is not far behind, and other firms must surely be preparing to offer cable-service streaming videos as soon as the National Broadband Network becomes widespread in Australia. As Blockbuster and other slower• moving competitors learned the hard way, it is a case of disintermediate or be disintermediated.

Q 1. Discuss the term disintermediation. Does it really apply in the situation Quickflix faces??? Justify your answer. Q 2. Compare and contrast competitors in the traditional and digital home movie rental in Australia.

CASE 3 Lighting up business Small to medium-size businesses (SMBs) account for about 95 per cent of all Australian and New Zealand businesses and many do not have resources to spare for promotion. Although newspaper, radio and the Yellow Pages have been the mainstay media for local businesses, they can be expensive. Carefully executed marketing can be a very effective tool. But research has shown that only 30 per cent of small businesses are turning to the internet. With marketing budgets as low as $2000 for small businesses and about $12 000 for medium-sized enterprises, it is crucial that every online dollar is well spent. You, as a marketing communications expert, have been approached for marketing advice from a local electrician providing home electrical work and repairs in your suburb. The business has a larger• than-usual online budget of $11 000 for the forthcoming year.

Q 1. Develop an integrated marketing communications plan for the business, which includes a website revamp and links to and Pinterest Q 2. What opportunities (if any) are there for PR for the business? How would you integrate PR with the online social media campaign?

CASE 4 Apple and Adobe Flash dash: Customer-driven? Apple's iDevices - iPods, iPhones and iPads - are globally popular. But where's the flash? Adobe Flash, that is.Adobe's Flash, the long-standing multimedia platform behind approximately 75 per cent of the animated and streaming audio and video on the internet, is not supported by Apple's devices. Many purchasers were disappointed after spending hundreds of dollars on iPads and iPad Minis only to realise they could not play their favourite online game or watch videos on their device. And they still cannot, even with the latest- generation devices. Why not? It seems Apple's late founder and CEO, Steve Jobs, did not like Flash and would not support it on Apple's devices. Instead, app developers must conform to Apple's operating system, and existing applications on the web must convert to HTML5 to play on an Apple product. Adobe's co-founders claim Apple is 'undermining the next chapter of the web', and bloggers exclaim this is not just an 'Adobe/ Apple problem ... but an Apple/World problem'.

Q 1. Does Apple appear to embrace the marketing concept? Q 2. Research the controversy surrounding this issue and debate whether Apple did the right thing for its customers by not including the ubiquitous Adobe Flash software on Apple's products.