The McDonald’s Story McDonald’s started in 1954, when its founder
Raymond Kroc saw a hamburger stand in San Bernardino, California and envisioned a nationwide fast food chain.
Today: world’s largest fast food chain serving 47 million customers daily. one of the most valuable brands globally worth more than $25 billion though the company has roots in the US,
McDonald’s today has become an accepted citizen of the world.
Business ModelFranchise Model –
Only 15% of the total number of restaurants are owned by the company.
remaining 85% is operated by franchises.
The company follows a comprehensive framework of training and monitoring of its franchises to ensure that they adhere to the Quality, Service, Cleanliness and Value propositions offered by the company to its customers.
Product Consistency –
By developing a sophisticated supplier networked operation and distribution system, the company has been able to achieve consistent product taste and quality across geographies.
Act like a retailer and think like a brand
McDonald’s focuses not only on delivering sales for the immediate present, but also protecting its long term brand reputation.
McDonald’s in India McDonald’s entered India in 1996.
McDonald’s India has a 50-50 joint venture with Connaught Plaza Restaurants and Hard Castle Restaurants.
Connaught Plaza Restaurants manages operations in North India while Hard Castle Restaurants in Western India.
The company is now expanding to Tier2 cities like Pune and Jaipur.
Challenges in Entering Indian Markets
Re-engineering the Menu
The vegetarian customer
Re-engineering the menu McDonald’s has continually adapted to the customer’s
tastes, value systems, lifestyle, language and perception.
Globally known for its hamburgers, beef and pork burgers.
Most Indians are barred by religion not to consume beef or pork.
To survive, the company had to be responsive to the Indian sensitivities.
So it came up with chicken, lamb and fish burgers.
The Veg challenge India huge population of vegetarians.
To cater to this customer segment, the company came up with a completely new line of vegetarian items McVeggie burger McAlooTikki.
The separation of vegetarian and non-vegetarian sections is maintained throughout the various stages.
Segmentation, Targeting and Positioning McDonald’s uses demographic
segmentation strategy with age as the parameter.
The main target segments :ChildrenYouthYoung urban family.
To attract childrenHappy Meal (toys ranging from hot wheels
to various Walt Disney characters)
Play Place (children can play arcade games, air hockey, etc.)
Birthday Parties
Fun Days
To target the teenagers Aggressive pricing, Target AD’s, Facilities
like Wi-Fi, Ambience, etc.
Family restaurant When McDonald’s entered in India it was mainly
perceived as targeting the urban upper class people.
Always projected itself as the Family Restaurant
Today it positions itself as an affordable place to eat without compromising on the
quality of food service hygiene.
Family value meal
Marketing Mix: 7P’s Product Price Place Promotion People Physical evidence Process
Product Veg menus
Non-veg Menus
Beverages
Desserts
kept its product depth and product width
limited. totally different menu as compared to its
International offering
dropped ham, beef and mutton burgers from the menu.
India is the only country where McDonalds serve vegetarian menu.
Even the sauces and cheese used in India are 100% vegetarian
Continuously innovates its products according to the changing preferences and tastes
The recent example is the introduction of the Chatpata
McAlooTikki burger
A new product range to target the customers in the morningBreakfast Menu
Product strategy: Fast-serviced meal
○ Can be considered as the driving force Healthy food
○ Fat free food○ Nutritional value displayed
Quality Very efficient supply chain management products and suppliers are used on a “first-in, first-out” basis to
ensure freshness. On an average 20 different quality checks are carried out before
any product is served to our customers.
Respect for the Indian Customs and Culture Introduction of vegetarian line only vegetable oil is used as a cooking medium The cheese and cold sauces used are 100% vegetarian.
Price McDonald’s leverages economies of scale to
minimize costs while maximizing value to customers.
Targeted to Middle Class
Earlier perception Upper Middle Class
Now with aggressive Pricing it has targeted Whole Middle Class
value pricing and bundling strategies
happy meal, combo meal, family meal etc
Specifically priced product for every segment it targets
Place Strategic location
○ Nearly 50% of U.S.A is within a 3 minute drive from a McDonald’s outlet.
Offers Hygienic environment, Good ambience Great service. Internet facilityPlay Areas
McDelivery Started free home delivery to penetrate
further Making IT reach the customer rather
than customer coming to it
Promotion Uses every Medium
○ TV, Print, Hoardings○ Bus Stops○ Internet
Spends 30% of its budget on ads
Rs 400-500 mn in 2009
Focuses its ad campaigns on its overall experience and active life style.
Its ads show happiness.
And relates its product with happiness that it brings through low price, hygiene, quality, fast service.
Some of the most famous marketing campaigns of McDonald’s are:
You Deserve a break today, so get up and get away- To McDonald’s
Aap ke zamane mein ,baap ke zamane ke daam Food, Folks, and Fun I’m loving it
Nowadays its into Social Marketing
Twitter Strategy Establish online hub for ongoing and consistent
communication to customers, media & influencers
Demonstrate that McDonalds listens to its customers & is open to feedback
Use insight to share timely customer feedback on important marketing initiatives
McDonalds- Social Brand Ranks 32 out of a list of “100 Most
Social” brands
Promotional activities keep on
happening Tray mats ensure that no new scheme gets unnoticed 80:20 Menu Board
People McDonald continuously does Internal Marketing.
It includes hiring, training and motivating able employees. Gives stars as per their performance
It understands the fact that a happy employee can serve well and result in a happy customer
Gives employees larger role in decisions.
Fast & friendly service
The punch line “I’m loving it” is an attempt to show that the employees are loving their work at McDonalds and will love to serve the customers.
Physical Appearance Every care given for:
CleanlinessEfficient Menu displayAmbienceTransparencySpeedQuality Packaging
Process Food manufacturing transparent to customers.
Training to the licensees.
Invented the most efficient cooking equipment.
New methods of food packaging and distribution.
McDonald’s in India followed the same tradition.
Spent Rs. 50 crores on market research.
PLC in McDonalds To counter these changes McDonalds has
continuously introduced new products and has phased out the old ones which were at the decline stage of their PLC.
For eg. French Fries A perfect example of revitalizing a product
in decline phase
French Fries an important part of the McDonalds
menu worldwide
But it was in the stage of decline and was actually not generating proper return.
To revitalize it, a new variant was introduced namely Shake Shake Fries
Being served with chatpata spice mix resulted in increase in the sales of
French Fries elevated it from to the decline stage.
Swot Analysis
Swot Analysis
CSR Instituted a special fund to support green movements in Delhi.
In Mumbai, it sponsors various community-related activities—such as “keep your city clean”
Organizes McDonald’s Spotlight, which is an annual interschool performing arts competition
Celebrates World Children’s Week from November 14-20 & raise funds for children
CSR Blue Dot initiative that supports
educational programs for the girl-child
Sponsors Pulse Polio program
Sponsors & promotes various programs for children
Thank You