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