1. Using the information provided in the case study and your own observation as a consumer, explain in detail the 1) segmentation, 2) targeting, and 3) positioning strategies of Burger King (Please, do not simply and only say the company is targeting this type of customers, instead, explain the segmentation criteria/types the company uses (ex. demographic, psychographic, behavioral, etc.), the targeting strategy it is pursuing (undifferentiated? differentiated? niche?), and the position the brand tries to occupy in consumers mind relative to competition).
2. Explain in more detail the challenges associated with the type of targeting strategy Burger King is pursuing.
3. What strategic recommendations do you have for Burger King to strengthen its positioning in the fast-food market?

Burger King identity crisis: who is it now? When Burger King was established in the early 1950s, it wanted to attract the fam- ilies of baby boomers and serve them with affordable and quick broiled burgers. By providing the consumers with the best quality burgers, it was able to achieve great success in a short time and become the second largest fast food chain. Although it achieved great success, because of changing social factors Burger King got caught in an identity crisis. Who is it, what kind of food does it serve, and which market segment is it targeting Currently, Daniel Schwartz is Burger Kings 21st CEO since the company was founded in 1953. Burger King has suffered from "years of neglect and strategic incoherence" (Leonard, 2014). Burger King needs a strong brand and core values to stand out from all other competition. Fast food sales are declining as more customers are gravitating towards healthier food options. Schwartz is helping Burger King regain its former identity. He started his job as CEO discovering what life was like for the kit- chen employees (Leonard, 2014). He has simplified the menu, and also changed the cor- porate management team so they could work better together on a new tactical plan. Company background Burger King is the second largest food chain in the United States, with over 10,400 restaurants, Burger King was originally known as Insta-Burger King and founded in Florida in 1953 by Keith Kramer and Matthew Burns before they had financial difficul- ties and sold the company to its Miami-based franchisees.James McLamore and David Edgerton in 1954 (Burger King Worldwide, Inc., 2014). Burger King was founded with an idea that was not so unique. Around this time other restaurants, especially drive- ins, were popping up all over the United States. One that stands out in particular is the current number one fast food chain, McDonald's, which started its empire with a California drive-in (Burger King Worldwide, Inc., 2014). Despite all the competition around it Burger King started out very strong and successful. By 1967 the corporation was acquired by The Pillsbury Co.for $18 million, and it already had about 274 restaurants. Its secret to success was giving its restaurant a special edge. In 1957 the Whopper sandwich - the burger for large appetites - was introduced and from the beginning it was successful. It was also the first chain to offer its customers a sit-in dining room. Two years later, the company began to expand through franchising. That is when it started having inconsistency in product and service from franchise to franchise. This problem was caused because it used a small field staff for franchise support. Burger King franchisees had varying approaches to the way they implemented the organiza tional culture in Burger King restaurants (Gibbons, 2000) Burger King's main competitor McDonald's took a different strategy from the beginning, leasing stores to franchisees and demanding a high degree of uniformity in return (Gale, 2004). To fix this problem, Burger King hired a strong executive from McDonald's to restructure the company's franchise system. He began by introducing a more demanding franchise contract. This contract stipulated the franchises need to be awarded only to Individuals, not partnerships or companies. Another rule was that they may not own other restaurants and must live within an hour's drive of their fran. chise. These were set in place to stop franchisees from getting too big. Additionally, he also changed the corporate structure of the company, replacing eight of ten managers with McDonald's people. In order to attack Burger King's inconsistency problem, Smith assigned a yearly two-day check of each franchise and frequent unscheduled visits. All of these strategies worked as planned and by 1979 he had brought the company's share of outlet ownership up from 34 percent to 42 percent (Gale, 2004). Around this time Burger King also started to market its products to kids, making its commercials similar to McDonald's. Using similar tactics to McDonald's, Smith was able to bring up sales for Burger King, but once Smith left the corporation to join another, Burger King's sales started to decline again. Burger King's organizational culture is based on being friendly and supporting its people for high performance, which is accentuated through meritocracy and empowerment. The primary advantage of Burger King's organizational culture is that people feel comfortable doing what they know how to do. Another characteristic of Burger King's culture is accountability, this ensures that with autonomy and flexibility errors and related unnecessary costs are minimized. However, while Burger King's organizational culture is strongly manifested in its corporate offices, it has only limited implementation in the restaurants, The fast food industry The fast food industry is a huge industry in the U.S. With low price points and the emphasis on convenience, fast food restaurants have been a steadily popular option for breakfast, lunch, and dinner in the U.S. for many decades. Many consider White Castle as the first in the business although McDonald's might be the most known as they revolutionized the industry with their effective assembly-line system in the late 1940s. Since then, a huge number of fast food restaurant chains have entered the market and are now battling for market share. There are about 200.000 fast food restaurants in the United States and it is estimated that 50 million Americans eat at one every day (Franchise Help, 2017). In 1970 the fast food industry generated about $6 billion in revenues. It has been a rap- idly growing market with $227.5 billion in revenues and $11.8 billion in profits in 2016. One of the reasons why these restaurants are wildly popular is mostly because of the convenience, speed, and low prices they offer. The fast food chains have also put a bigger emphasis on the overall restaurant experience over the past few years. The fast food industry has become an industry with a wide variety of food options. Restaurants that sell burgers make up 42 percent of the products sold in the fast food market. This reflects its biggest player in the market, McDonald's. The menu items are consistent in almost every restaurant which makes it easier for the con- sumers to pick favorites Competitors The McDonald's way McDonald's is the largest fast food operation in the world. The first store opened in 1948 in San Bernardino, CA with its first franchise agreement in 1954. By the end of 2015 the company had over 36,000 stores in over 119 countries. By 2018 the company plans to have 90 percent of the stores operated by franchisees. "This is part of a restructuring plan that will give restaurants more opportunities to experiment and better integrate themselves within their core markets" (Alvarez, 2016). McDonald's restaurants have a marketing strategy in place that is very successful. There are three levels of advertising that McDonald's implements at every location. These are national, regional, and local advertising strategies. McDonald's requires every franchise to give 4 percent of their sales to pay for the national and regional advertisements (Gerhardt, Hazen, and Lewis, 2014). Local advertisements are up to the franchisee to decide on and are separate from the initial 4 percent. According to Business Insider, McDonald's is the most successful food chain in America, compared to Burger King which is in fourth place. Yum! Brands Yum! Brands Inc. is a Kentucky-based fast food conglomerate. PepsiCo was the owner until 1997 when it decided to publicly list the company to improve cash flow."PepsiCo purchased Pizza Hut in 1977, Taco Bell in 1978 and KFC in 1986" (Alvarez, 2016). In 2003 the company launched WingStreet to co-exist with Pizza Hut locations. Yum! Brands like many of its competitors, operates under franchises with 80 percent of its stores being franchised. A multibranding strategy is how Yum! Brands believes it is able to offer something for everyone helping break the family barrier when the kids want to eat different things than their parents. When the company puts two or more of its brands in the same restaurant it is able to increase sales by 30 percent (Enz, 2005). This strategy is believed to offer a chance to leverage its existing assets that have lower volumes. Wendy's Wendy's Co. is a fast food burger chain based out of Dublin, OH, operating more than 6,500 stores globally with 85 percent of its stores under franchise agreements. Wendy's also owns a stake of 18.5 percent of Arbys. Before 2011 Wendy's digital and social marketing was nonexistent. By building a relationship with Facebook and working with its global marketing service group Wendy's was finally using digital and social marketing to reach its target audiences. Wendy's declines to give exact numbers on its digital marketing expense, however, it did spend $290 million in 2013 on media expenses (Morrison, 2014). Changing factors The health conscious consumer Changes in culture and the study of the human body and eating habits have led to a change in the American people (Alvarez, 2016). A common denominator for all restaurant markets is the change of customer eating habits in the United States. Especially in the fast food industry it has been health concerns from customers that have resulted in decreasing sales. The American people have become more health conscious and are demanding alternatives to the traditional greasy food most fast food restaurants serve. The saturated food traditionally sold at fast food restaurants has helped keep prices low within the industry. Fast food chains have been forced to make drastic changes or additions to their menus to meet customer needs and wants. These changes mostly consist of healthier options that would appeal to the new trends in eating habits, but still at a very reasonable price. Although the new eating habits have caused changes in strategy and additions in product selection, they have also opened up for chains to market differently with new products or renewing interest in current products. Threat of fast casual restaurants As a result of new trends in eating habits, new concepts and hybrids in the restaurant industry have emerged. Fast casual restaurants are one of these new concepts. These restaurants are a hybrid or a mix of a fast food and casual dining place. Basically, they have all the elements of convenience that fast food has like speed and price, but with a more inviting atmosphere like one would find in a sit-down restaurant. These restaurants focus more on offering healthier, fresher, and higher quality ingredients to attract customers who are health conscious. Fast casual restaurants give off a better Impression than most fast food restaurants. Consumers feel they eat healthier and also feel better in a more sophisticated atmosphere (Alvarez, 2016). Fast casual restaurants are stealing market share away from fast food chains. As a counter, many chains are experimenting with their own fast casual concept. If the experiments are a success, this might be the direction fast food chains are going However, fast food chains are seeking to offer healthier options and will do so in the years to come. They will also diversify into new areas such as cafes or full-service restaurants but maybe under different names and at new locations (Alvarez, 2016). Fast food chains and fast casual chains will both be investing in further renovations and improving service through technology and the basic aesthetics. Targeting a market Since the 1980s, Burger King has been having a difficult time attracting a specific target market. In contrast, some of its competitors such as McDonald's and Wendy's effectively attracted a distinctive target market (Mitchman and Mazze, 1998). As a result of consumers' concerns about eating healthy food, Burger King decided to be the first fast food chain to include information about calories, fat, salt, and other contents in its menu items. This action was part of a strategic plan to attract new market segments. Likewise, in response to consumers' changes in preferences, McDonald's and other fast food chains deleted sodium from food items, and added healthy options such as salads and baked potatoes (Dugan, 2013). Daniel Schwartz current CEO, expressed his concern about the market the com- pany has been historically trying to target, which is males between the ages of 18 and 35, since this market is not representative of the overall fast food market. After real- izing this fact, Burger King decided not to target this market's subsets (Kelso, 2012). In order to make a shift in its demographic, Burger King decided to target not just males but also females in its advertisements. Results were satisfactory, after having the soccer star David Beckham in one of Burger King's commercials, surveys showed higher percentage of females consuming its products. Baby boomers This segment of the market, born between 1946 and 1964, is being considered as a powerful consumer of fast food. These members of the population have new habits, they are exercising, traveling, volunteering. Due to this active lifestyle, they need quick meals, and some of them demand healthy meals. Also, grandparents might be involved in their grandchildren's daily lives. By targeting grandparents, fast food chains also gain their family members In 1999, the chain released three different advertisements promoting the Whopper, one of them was intended only for baby boomers, the other two for blacks and Hispanics (Albert, 2012). Although it is targeting baby boomers it does not market the brand well to this segment. There are no advertisements that would help them feel connected to the brand, to keep them as returning customers. Millennials The population between the ages of 18 and 33 years old are currently the generation that tend to eat out more often. In fact 53 percent of millennials eat out once a week, compared with 43 percent for the general population in the U.S. However, millennials when being surveyed are embarrassed to say they eat fast food (Lutz, 2015). The majority of this market segment prefers eating at fast casual dining restaurants when eating out. However, they still consider fast food restaurants as a second option. Recently, the chain reported a decline in 5 percent in traffic of low-income millennials (Forbes, 2017). This decline might be a consequence of not promoting the brand among this market segment appropriately, which is mainly through social media. Generation X This generation is the group between baby boomers and millennials, comprising people born between 1965 and 1980. This population is commonly the busiest with work, family, and paying bills. The Generation X segment prefers coupons and special discounts when consuming products. Even though the fast food chain has been doing efforts to broaden its demographic, there is still much to achieve. The brand is constantly launching products for different segments of the market, and it is not adjusting its branding accordingly. Whether Burger King should focus on a specific market segment, or adjust its branding accordingly to each one, is a major concern that the company should analyze, in order to look at solutions for its identity crisis. Burger King's strategic positioning When referring to positioning in the fast food industry, McDonald's definitely has the lead. The majority of consumers tend to first think about McDonald's when looking for a fast food option. Burger King has a positioning statement that distinguishes it from the rest, but it has not been enough to achieve a better pos- ition in the market. Burger King for a long period, was relying on the positioning statement "Have it your way." but recently the senior vice-president of global management decided to sharpen the chain's positioning by first changing the statement to "Be your way" (Parpis, 2016) However, changing a positioning statement is not enough to gain competitive advantage in the market. In fact, many customers were confused as to why Burger King dropped a 40-year old slogan, and what it had to do with their food. A food critic summed it up by saying "While the original phrase reminded customers that customizing their food was always on the table, the new phrase seems like a cryptic philosophy a mentor would give a young boy from Jersey right before a karate tour- nament" (Pham, 2014). Although this critic might have been a little harsh, Burger King gave up part of who it is by changing its slogan The company has also decided to advertise without celebrities, and instead focus on the brand's core product, the Whopper. It is making efforts to build an ecosystem of agencies that are constantly aligned. It is also trying to be more unified to achieve brand positioning, by creating an effective advertising campaign and taking in consid- eration all relevant aspects of Burger King's new marketing strategies. Burger King is also supporting the LGBT community by launching a campaign called "Proud Whopper." Likewise, the company released a commercial spoken in sign language and used American Sign Language (ASL) for all the signs located at a store next to Gallaudet University for the deaf. These actions are meant to support the chain's new slogan "Be your way." The company is making efforts to gain a competi- tive advantage. The significant changes in its marketing strategy have been showing positive results, reporting 4.6 percent growth globally, and 5.4 percent growth in the U.S. in the first quarter of 2016, after implementing the changes. The way forward Burger King targets too many market segments, at the same time. However, it does not communicate the same message to all the segments. To do this it creates more than one advertisement for the same product. Burger King is also known to copy many of the methods of its competitors. In 2012, Burger King restructured many of its stores with a $750 million investment, to create a more open and inviting atmos- phere but McDonald's made the exact same move the year before. Burger King's menu has also been very inconsistent. A couple years ago it started offering healthier products like salads, smoothies, and new chicken menu items. Analysts said this was a page taken out of the Wendy's playbook. Although this was a move made to target more health conscious consumers, it hurt Burger King's brand identity Burger King has also brought in some new, wild menu items like the french fry burger. While some of these menu items have brought in more customers to the restaurant , others items have been pulled off the menu before most people even heard about them. Burger King is having a hard time retaining customers because of its issues with brand identity. It seems a very confused brand to the public. When it first started out it was known for its main product , the Whopper. It offered consumers a great burger at a low price. Burger King needs to restructure its brand image to represent itself and not every other fast food restaurant