Introduction:

The story of 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. Kroc proved himself as a pioneer who revolutionized the American restaurant industry. Today McDonald’s is the world’s largest fast food chain serving approximately 47 million customers daily. McDonald’s is now one of the most valuable brands globally, worth more than $25 billion. The Golden Arches and its mascot Ronald McDonald have gained universal recognition. Now McDonald’s Corporation USA is the ninth most valuable brand in the world. In October 1996, McDonald’s opened its first Indian outlet in Vasant Vihar, an affluent residential colony in India’s capital, New Delhi. McDonald’s India has a joint venture with Connaught Plaza Restaurants and Hard Castle Restaurants. Connaught Plaza Restaurants manages operations in North India whereas Hard Castle Restaurants operates restaurants in Western India. Apart from opening outlets in the major metros, the company is now expanding to Tier 2 cities like Pune and Jaipur.The fundamental secret to McDonald’s success is the way it achieves uniformity and allegiance to an operating regimen with proper marketing strategy. McDonald’s India has to adhere to many rules and regulations laid down by the parent company, and it still has to cater to the Indian customer and his needs.Six years prior to the opening of the first McDonald's restaurant in India, McDonald's and its international supplier partners worked together with local Indian Companies to develop products that meet McDonald's rigorous quality standards. Part of this development involves the transfer of state-of-the-art food processing technology, which has enabled Indian businesses to grow by improving their ability to compete in today’s international markets. McDonald's constructs its restaurants using local architects, contractors, labor and - where possible – local materials. McDonald's hires local personnel for all positions within the restaurants and contributes a portion of its success to communities in the form of municipal taxes and reinvestment.

McDonald’s Vision Statement: Every company has a Vision or Mission Statement. A vision statement should be short, clear, vivid, inspiring and concise without using jargon, complicated words or concepts. It represents the corporation guiding principles. It subtly indicates the businesses the firm will pursue and the customer needs it will seek to satisfy. The vision statement also allows the employees to clearly adhere to the standards set up by the business unit and work in as per the guidelines framed by the company.

"McDonald's vision is to be the world's best quick service restaurant experience. Being the best means providing outstanding quality, service, cleanliness, and value,

so that we make every customer in every restaurant smile."

Business Model Franchise Model – Only 15% of the total number of restaurants are owned

by the Company. The remaining 85% is operated by franchisees. 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.

I. Pricing Food pricing was a sensitive issue in India. An ideal strategy was to focus on customer’s ability to pay and tap the rich and upper middleclass population in India. Although McDonald’s strategy was to increase sales volumes by making products available at affordable price, its products were perceived to be expensive. The company outlets in Delhi and Mumbai initially were opened due to the increased affordability of people with western exposure and brand recognition factors in metros. Additionally, people in the metros were open to experiment with variety of foods. Absorption of newer cultures was faster in the Metros than other areas. SWOT ANALYSIS:

SWOT stands for strengths, weaknesses, opportunities, and threats. To meet the needs of the key market it is important to analyze the internal marketing strengths of the organization. Strengths and weaknesses must be identified, so that a marketing strategy which is right for the business can be decided upon. Once the strengths and weaknesses are determined, they are combined with the opportunities and threats in the market place. SWOT analysis is the first stage of planning and helps businesses to focus on key issues. Once key issues have been identified, they feed into marketing objectives.

Strengths MacDonald has built up huge brand equity. It is the No. 1 fast-food

company by sales, with more than 31,000 restaurants serving burgers and fries in almost 120 countries.

Good innovation and product development. It continually innovates to retain customers in the business.

The McDonalds brand offers consumers choice, reasonable value and great service

Large amounts of investment have gone into supporting its franchise network, 75% of stores are franchises.

Loyal staff and strong management team.Advertisements and promotion to market the McDonalds’ as a brand carves a strong image on customer’s mind. Business Model

Franchise Model – Only 15% of the total number of restaurants are owned by the Company. The remaining 85% is operated by franchisees. 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.

Weaknesses

Locations of outlets are sometimes not to closer to storage centers resulting in loss of quality.

Quality issues across the franchise network.Opportunities

Joint ventures with retailers (e.g. supermarkets). Consolidation of retailers likely, so better locations for franchisees. Strengthen its value proposition and offering, to encourage customers

who visit coffee shops into McDonalds. Expansion into emerging markets of cities present in India. Focus on middle-class income group customers with low-priced quality

goods will enhance the profit margin.Threats

Social changes - Government, consumer groups encouraging balanced meals, 5 a day fruit and vegetables.

Focus by consumers on nutrition and healthier lifestyles. Recession in economy may affect the retailer sales. Pressure groups - environmental.

Since McDonald’s is a symbol of American cultural imperialism, it continues to face continue opposition from religious fundamentalists, protectionists, animal rights activists, and anti-globalization protestors MARKETING STRATEGY McDonald’s Road Map for India

Emphasis on Local ManagementMcDonald’s has given the adage of “think global, act local” a concrete shape in India. The company’s localization strategy is clearly manifest in the critical area of management. McDonald’s decided to set up two joint ventures on a 50:50 basis with two local entrepreneurs in Mumbai and Delhi. In Mumbai, Amit Jatia’s company Hardcastle Restaurants Private Limited, was selected to own and manage McDonald’s restaurants in the western region. In Delhi, Vikram Bakshi’s Connaught Plaza Restaurants Private Limited was chosen to own and manage McDonald’s restaurants in the northern region.

Politically Correct” StrategyMcDonald’s managers were well aware of the fact that political activists can create trouble for foreign-based fast food chains. The two local managing directors Bakshi and Jatia of McDonald’s took a series of politically correct strategies to deal with the initial challenges of the Indian market. McDonald’s in India is Indianized and specifically designed to woo Indian customers.

Employment OpportunityMcDonald’s typically employs local people, and the average McDonald’s restaurant in India employs more than 100 people in all kinds of positions- cashiers, cooks, managers, etc…Every expansion also brings additional income and employment opportunities to India’s agricultural work force, which is very pleasing to government officials.

Formulating the Marketing Strategy Selecting the Target Market

A target market consists of a set of buyers who share common needs that the company decides to serve. McDonald’s targeted young families who are able to eat out, but the main focus was on to attract small children so that the whole young family follows after it.

McDonald’s followed niche marketing, a market-coverage strategy in which a firm goes after a large share of one or a few phases. Different phases to move into target markets was scheduled on,

a. Focus on cities of relatively high incomes.b. Move to smaller satellite towns.c. Move on to crowd pulling centers like malls, multiplexes,

highways, railway stations and airports.d. Introduce new low-priced products with same quality and service

for middle class income groups of people. Segmentation

Each company identifies the parts of the market that it can serve best and most profitably, which is called the segment of the market it wants to serve. Market segmentation allows dividing a market into smaller groups of buyers with distinct needs, characteristics, or behaviors who might require separate product. McDonalds’ identified certain segment based on its geographical and demographic segments.

i. Geographic Segmentation Geographic segmentation calls for dividing the market into different geographical units such as nations, regions, states, countries, cities, or neighborhoods. McDonalds’ India divided the country into different zones based on directions and concentrated particularly on North and West zone as its first market segment to attract on.

ii. Demographic Segmentation Demographic segmentation divides the market into groups based on variables such as age, gender, family size, family life cycle, income, occupation, education, religion, race, generation, and nationality. McDonald’s targeted different age groups from children and teens to adults up to age less than 30 years. Like its other worldwide locations, McDonald’s targeted children as their main clientele in India.

Positioning the Offer“Mc Donald’s mein hai kuch baat” a place for entire family to enjoy.Positioning is about communicating the unique selling advantage to the target audience in everything the firm does i.e.

• Marketing• Sales• Customer service.

Assembling the Marketing Mix

Assembling the marketing mix means assembling the four P’s of marketing viz. product, price, place, and promotion, in the best possible combination. The marketing mix principles are used by business as tools to assist them in pursuing their objectives.

Future:In 2007, a report by McKinsey Global Institute revealed that India

would join the premier league of the world’s consumer markets by 2025. With the middleclass growing by 12 times from 50 million to 583 million, the market potential was huge. Companies with long term plans for the Indian markets needed to understand the hidden potential and prepare themselves to accept the challenge.

McDonald’s was very positive on the Indian market scenario. With the parent company making huge investments in supply chain and media communication, the company was 17 helping the back-end supplier through direct investments in the joint ventures with them.

McDonald’s India operated around 100 restaurants across the country which included 11 “drive thru” restaurants, a new concept to the Indian market. With 5000 employees working, the company intended to hire another 10,000 to 15,000 people in the next few years. On an average it employed 50 people per outlet, depending upon the seating capacity.McDonalds’ can use following promotional techniques which should be appropriate to be used for increasing the sales:

1. Increase its product line.2. To expand their Happy Meal choices to attract and retain

customers.3. To provide better and quick service.4. Lower the supply chain cost so that it helps in cost reducing.5. Focus on gifts for all generations i.e. youth, kids’ especially senior

citizen which is a completely new concept.6. Special promotions during festivals as Indians tend to spend more

at such events.7. Increasing the space for provision of birthday party areas.

8. Try to sponsor college festivals.9. Work for social welfare of the society.

Conclusion: McDonald's marketing mix is strategic because of the diverse

approaches that are used. First, in identifying the "four P's" of marketing addressed earlier (product, price, promotion, and placement), research shows that McDonald's is very careful in making decisions that effect each area and how each area effects the other. McDonald's is concerned about how the firm will fulfill the needs and wants of its customers and in the activities associated with maintaining the relationships with its stakeholders. McDonald's stakeholders include customers, franchisees, suppliers, employees, and the local communities. McDonald's has shown care for customers through the decisions to add more healthful foods to the menus, by changing how products are packaged or how foods are prepared. McDonald's faces some difficult challenges in moving away from the fast food king to a more health conscious provider for customers who care about what they eat. Though there are many opportunities for this fast food giant, McDonald's must keep the strategic nature of its marketing efforts to stay on top and provide what customers want.